Chubb Ltd 10-Q

ITEM 1A. Risk Factors The following supplements the risk factors that could have a material impact on our results of operations or financial condition as described under "Risk Factors" under Item 1A of Part I of our 2022 Form 10-K. We may be subject to U.S. tax and Bermuda tax which may have an adverse effect on our results of operations and shareholder investment. Chubb Limited and our non-U.S. subsidiaries operate in a manner so that none of these companies should be subject to U.S. tax (other than U.S. excise tax on insurance and reinsurance premium income attributable to insuring or reinsuring U.S. risks and U.S. withholding tax on some types of U.S. source investment income), because none of these companies should be treated as engaged in a trade or business within the U.S. However, because there is considerable uncertainty as to the activities that constitute being engaged in a trade or business within the U.S., we cannot be certain that the Internal Revenue Service (IRS) will not contend successfully that Chubb Limited or its non-U.S. subsidiaries are engaged in a trade or business in the U.S. If Chubb Limited or any of its non-U.S. subsidiaries were considered to be engaged in a trade or business in the U.S., such entity could be subject to U.S. corporate income and branch profits taxes on the portion of its earnings effectively connected to such U.S. business, in which case our results of operations and our shareholders' investments could be adversely affected. The Bermuda Minister of Finance, under the Exempted Undertakings Tax Protection Act 1966 of Bermuda, as amended, has given Chubb Limited and its Bermuda insurance subsidiaries a written assurance that if any legislation is enacted in Bermuda that would impose tax computed on profits or income, or computed on any capital asset, gain, or appreciation, then the imposition of any such tax would not be applicable to those companies or any of their respective operations, shares, debentures, or other obligations until March 31, 2035, except insofar as such tax would apply to persons ordinarily resident in Bermuda or is payable by us in respect of real property owned or leased by us in Bermuda. However, as part of its evaluation of a new income tax regime, the Bermuda Minister of Finance is reviewing the applicability of such written tax assurance certificates. The Bermuda Minister’s process for evaluation of a new income tax regime has been announced to comprise three expected public consultation papers, of which two have been issued already. The first one was issued on August 8, 2023, which considered a proposed Bermuda corporate income tax of up to 15% effective for tax years beginning on or after January 1, 2025. The second public consultation paper issued October 5, 2023, indicates that the Bermuda Government believes it is reasonable and proportionate for any new Bermuda corporate income tax regime to supersede any existing tax assurance certificates held by entities within the scope of the new Bermuda corporate income tax. We currently anticipate that a new Bermuda income tax would be a covered tax under the OECD’s global minimum tax regime discussed in our Risk Factor titled “The Organization for Economic Cooperation and Development (OECD), European Union (EU), Swiss Federal Council, and other jurisdictions are considering or have passed measures that might change long standing tax principles that could increase our taxes.” Therefore, we would expect any implementation of the OECD global minimum tax regime to count any enacted Bermuda income tax toward such OECD minimum tax. Although we cannot predict when or if any new Bermuda corporate income tax will be enacted, the imposition of a Bermuda corporate income tax could, if applicable to our Bermuda based entities, have an adverse effect on our financial condition and results of operations. 106 Table of Contents