Chubb Ltd 10-Q

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following is a discussion of our results of operations, financial condition, and liquidity and capital resources as of and for the three months ended March 31, 2024. All comparisons in this discussion are to the corresponding prior year period unless otherwise indicated. All dollar amounts are rounded. However, percent changes and ratios are calculated using whole dollars. Accordingly, calculations using rounded dollars may differ. Our results of operations and cash flows for any interim period are not necessarily indicative of our results for the full year. This discussion should be read in conjunction with our consolidated financial statements and related notes and our Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2023 (2023 Form 10-K). Other Information We routinely post important information for investors on our website (investors.chubb.com). We use this website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Securities and Exchange Commission (SEC) Regulation FD (Fair Disclosure). Accordingly, investors should monitor the Investor Information portion of our website, in addition to following our press releases, SEC filings, public conference calls, and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this report. MD&A Index Page Forward-Looking Statements 48 Overview 49 Consolidated Operating Results 50 Segment Operating Results 55 Net Realized and Unrealized Gains (Losses) 64 Effective Income Tax Rate 65 Non-GAAP Reconciliation 65 Amortization of Purchased Intangibles and Other Amortization 67 Net Investment Income 69 Interest Expense 69 Investments 69 Critical Accounting Estimates 73 Unpaid Losses and Loss Expenses 73 Asbestos and Environmental (A&E) 73 Fair Value Measurements 73 Catastrophe Management 74 Global Property Catastrophe Reinsurance Program 75 Capital Resources 76 Liquidity 77 Information Provided In Connection With Outstanding Debt of Subsidiaries 78 47 Table of Contents Forward-Looking Statements The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Any written or oral statements made by us or on our behalf may include forward-looking statements that reflect our current views with respect to future events and financial performance. The words “believe,” “anticipate,” “estimate,” “project,” “should,” “plan,” “expect,” “intend,” “hope,” “feel,” “foresee,” “will likely result,” “will continue,” and variations thereof and similar expressions, identify forward-looking statements. These forward-looking statements are subject to certain risks, uncertainties, and other factors that could, should potential events occur, cause actual results to differ materially from such statements. These risks, uncertainties, and other factors, which are described in more detail elsewhere herein and in other documents we file with the U.S. Securities and Exchange Commission (SEC), include but are not limited to: • actual amount of new and renewal business, premium rates, underwriting margins, market acceptance of our products, and risks associated with the introduction of new products and services and entering new markets; the competitive environment in which we operate, including trends in pricing or in policy terms and conditions, which may differ from our projections, and changes in market conditions that could render our business strategies ineffective or obsolete; • losses arising out of natural or man-made catastrophes; actual loss experience from insured or reinsured events and the timing of claim payments; the uncertainties of the loss-reserving and claims-settlement processes, including the difficulties associated with assessing environmental damage and asbestos-related latent injuries, the impact of aggregate-policy-coverage limits, the impact of bankruptcy protection sought by various asbestos producers and other related businesses, and the timing of loss payments; • changes in the distribution or placement of risks due to increased consolidation of insurance and reinsurance brokers; material differences between actual and expected assessments for guaranty funds and mandatory pooling arrangements; the ability to collect reinsurance recoverable, credit developments of reinsurers, and any delays with respect thereto and changes in the cost, quality, or availability of reinsurance; • uncertainties relating to governmental, legislative and regulatory policies, developments, actions, investigations, and treaties; judicial decisions and rulings, new theories of liability, legal tactics, and settlement terms; the effects of data privacy or cyber laws or regulation; global political conditions and possible business disruption or economic contraction that may result from such events; • severity of pandemics and related risks, and their effects on our business operations and claims activity, and any adverse impact to our insureds, brokers, agents, and employees; actual claims may exceed our best estimate of ultimate insurance losses incurred which could change including as a result of, among other things, the impact of legislative or regulatory actions taken in response to a pandemic; • developments in global financial markets, including changes in interest rates, stock markets, and other financial markets; increased government involvement or intervention in the financial services industry; the cost and availability of financing, and foreign currency exchange rate fluctuations; changing rates of inflation; and other general economic and business conditions, including the depth and duration of potential recession; • the availability of borrowings and letters of credit under our credit facilities; the adequacy of collateral supporting funded high deductible programs; the amount of dividends received from subsidiaries; • changes to our assessment as to whether it is more likely than not that we will be required to sell, or have the intent to sell, available-for-sale fixed maturity investments before their anticipated recovery; • actions that rating agencies may take from time to time, such as financial strength or credit ratings downgrades or placing these ratings on credit watch negative or the equivalent; • the effects of public company bankruptcies and accounting restatements, as well as disclosures by and investigations of public companies relating to possible accounting irregularities, and other corporate governance issues; • acquisitions made performing differently than expected, our failure to realize anticipated expense-related efficiencies or growth from acquisitions, the impact of acquisitions on our pre-existing organization, and risks and uncertainties relating to our outstanding purchase of additional interests in Huatai Insurance Group Co., Ltd. (Huatai Group); • risks associated with being a Swiss corporation, including reduced flexibility with respect to certain aspects of capital management and the potential for additional regulatory burdens; share repurchase plans and share cancellations; • loss of the services of any of our executive officers without suitable replacements being recruited in a reasonable time frame; 48 Table of Contents • the ability of our technology resources, including information systems and security, to perform as anticipated such as with respect to preventing material information technology failures or third-party infiltrations or hacking resulting in consequences adverse to Chubb or its customers or partners; the ability of our company to increase use of data analytics and technology as part of our business strategy and adapt to new technologies; and • management’s response to these factors and actual events (including, but not limited to, those described above). You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. We undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future events or otherwise. Overview Chubb Limited is the Swiss-incorporated holding company of the Chubb Group of Companies. Chubb Limited, which is headquartered in Zurich, Switzerland, and its direct and indirect subsidiaries (collectively, the Chubb Group of Companies, Chubb, we, us, or our) are a global insurance and reinsurance organization, serving the needs of a diverse group of clients worldwide. At March 31, 2024, we had total assets of $235 billion and total Chubb shareholders’ equity, which excludes noncontrolling interests, of $60.5 billion. Chubb was incorporated in 1985 at which time it opened its first business office in Bermuda and continues to maintain operations in Bermuda. We operate through six business segments: North America Commercial P&C Insurance, North America Personal P&C Insurance, North America Agricultural Insurance, Overseas General Insurance, Global Reinsurance, and Life Insurance. For more information on our segments refer to “Segment Information” under Item 1 in our 2023 Form 10-K. On July 1, 2023, we completed the acquisition of a controlling majority interest of Huatai Group. For the three months ended March 31, 2024, the results of operations of Huatai Group are reported at 100 percent in our consolidated results starting from the acquisition date, with amounts attributable to shareholders other than Chubb reflected under Noncontrolling interests. Huatai Group's life and asset management businesses are included in the Life Insurance segment, and Huatai Group's P&C business is included in the Overseas General Insurance segment. Results for Huatai Group's non-insurance operations, comprising real estate and holding company activity, are included in Corporate. 49 Table of Contents Consolidated Operating Results – Three Months Ended March 31, 2024 and 2023 Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 12,221 $ 10,710 14.1 % Net premiums written - constant dollars (1) 14.2 % Net premiums earned 11,583 10,142 14.2 % Net investment income 1,391 1,107 25.7 % Net realized gains (losses) (101) (77) 30.9 % Market risk benefits gains (losses) 21 (115) NM Total revenues 12,894 11,057 16.6 % Losses and loss expenses 5,727 5,148 11.2 % Policy benefits 1,180 797 48.1 % Policy acquisition costs 2,207 1,948 13.3 % Administrative expenses 1,070 930 15.0 % Interest expense 178 160 11.3 % Other (income) expense (191) (296) (35.6) % Amortization of purchased intangibles 80 72 10.8 % Cigna integration expenses 7 22 (66.9) % Total expenses 10,258 8,781 16.8 % Income before income tax 2,636 2,276 15.9 % Income tax expense 342 384 (11.0) % Net income $ 2,294 $ 1,892 21.3 % Net income attributable to noncontrolling interests 151 — NM Net income attributable to Chubb $ 2,143 $ 1,892 13.3 % NM - not meaningful (1) On a constant-dollar basis. Amounts are calculated by translating prior period results using the same local currency exchange rates as the comparable current period. Financial Highlights for the Three Months Ended March 31, 2024 • Net income attributable to Chubb was $2.1 billion compared with $1.9 billion in the prior year period. Net income in the current quarter was driven by strong P&C underwriting results, including growth in net premiums earned and net investment income. Net income included two discrete items: a deferred tax benefit of $55 million related to the Bermuda tax law enacted in December 2023, partially offset by a contribution to the Chubb Charitable Foundation of $30 million ($24 million after-tax). • Consolidated net premiums written were $12.2 billion, up 14.1 percent. P&C net premiums written increased 12.4 percent, with commercial insurance up 10.0 percent and consumer insurance up 19.3 percent. Life Insurance segment net premiums written increased 26.3 percent due to the impact of the consolidation of Huatai Group on July 1, 2023. • Pre-tax net investment income was $1.4 billion compared with $1.1 billion in the prior year period, primarily due to strong operating cash flow, higher reinvestment rates on fixed maturities, and the consolidation of Huatai Group. • Consolidated net premiums earned were $11.6 billion, up 14.2 percent, or 14.5 percent in constant dollars. • Total pre-tax and after-tax catastrophe losses, net of reinsurance and including reinstatement premiums, were $435 million (4.4 percentage points of the P&C combined ratio) and $347 million, respectively, compared with $458 million (5.1 50 Table of Contents percentage points of the P&C combined ratio) and $382 million, respectively, in the prior year period. • Total pre-tax and after-tax favorable prior period development were $207 million and $168 million, respectively, compared with $196 million and $149 million, respectively, in the prior year period. • The P&C combined ratio was 86.0 percent compared with 86.3 percent in the prior year period. The current year ratio improved primarily due to lower catastrophe losses and higher favorable prior period development. The P&C current accident year (CAY) combined ratio excluding catastrophe losses was 83.7 percent compared with 83.4 percent in the prior year period. • Operating cash flow was $3.2 billion compared with $2.3 billion in the prior year period. • Chubb shareholders' equity increased $1.0 billion in the quarter, primarily from net income attributable to Chubb of $2.1 billion, partially offset by total capital returned to shareholders of $666 million and net unrealized losses on our investment portfolio of $648 million, principally due to the mark-to-market impact in the fixed-income portfolio. Total capital returned to shareholders comprises dividends of $350 million, and share repurchases of $316 million at an average purchase price of $258.75 per share. Net Premiums Written Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 C$ Q-24 vs. Q-23 Property and other short-tail lines $ 2,360 $ 2,025 16.5 % 16.4 % Commercial casualty 2,210 1,903 16.1 % 15.8 % Financial lines 1,108 1,156 (4.1) % (4.4) % Workers' compensation 629 618 1.8 % 1.8 % Commercial multiple peril (1) 368 340 8.0 % 8.0 % Surety 184 160 15.1 % 13.0 % Total Commercial P&C lines 6,859 6,202 10.6 % 10.3 % Agriculture 249 293 (15.0) % (15.0) % Personal homeowners 1,065 902 18.1 % 18.4 % Personal automobile 642 427 50.4 % 44.3 % Personal other 565 507 11.4 % 11.8 % Total Personal lines 2,272 1,836 23.8 % 22.8 % Global A&H - P&C 849 809 4.9 % 5.9 % Reinsurance lines 359 277 29.7 % 29.7 % Total Property and Casualty lines 10,588 9,417 12.4 % 12.2 % Life Insurance 1,633 1,293 26.3 % 29.7 % Total consolidated $ 12,221 $ 10,710 14.1 % 14.2 % (1) Commercial multiple peril represents retail package business (property and general liability). The increase in consolidated net premiums written for the three months ended March 31, 2024, reflects growth across most product lines driven by strong premium retention, including rate and exposure increases, and strong new business. The consolidation of Huatai Group's life and P&C businesses contributed $559 million, or 5.0 percentage points, for the three months ended March 31, 2024. 51 Table of Contents • Property and other short-tail lines grew globally due to strong new business and retention, including both rate and exposure increases. • Commercial casualty grew globally due to strong retention, including both rate and exposure increases, and strong new business which included a large structured transaction in North America for the current year. • Financial lines declined in the quarter due to lost business due to a competitive market environment and lower retention. • Workers' compensation grew slightly due to new business and retention, including exposure increases. • Commercial multiple peril grew due to strong new business and retention, including higher rates, in North America. • Surety grew due to strong new business. • Agriculture declined primarily due to a return of premium under the U.S. government risk-sharing formula related to the 2023 crop year and lower commodity prices in the current year. • Personal lines grew globally due to strong new business and retention, including both rate and exposure increases, and the consolidation of Huatai. • Global A&H – P&C grew in Europe and Asia, with Asia benefiting from the consolidation of Huatai. • Reinsurance lines reflected continued growth, mainly in property lines. • Life Insurance grew principally due to the consolidation of Huatai Group and underlying growth in existing business in Asia. The consolidation of Huatai Group contributed $265.8 million, or 20.6 percentage points, to growth. For additional information on net premiums written, refer to the segment results discussions. 52 Table of Contents Net Premiums Earned Net premiums earned for short-duration contracts, typically P&C contracts, generally reflect the portion of net premiums written that was recorded as revenues for the period as the exposure periods expire. Net premiums earned for long-duration contracts, typically traditional life contracts, generally are recognized as earned when due from policyholders. For the three months ended March 31, 2024, net premiums earned increased $1.4 billion, up 14.2 percent, or 14.5 percent in constant dollars. P&C net premiums earned increased 12.3 percent, or 12.2 percent in constant dollars, comprising growth in commercial and consumer lines of 11.5 percent and 14.2 percent, respectively. Catastrophe Losses and Prior Period Development We generally define catastrophe loss events consistent with the definition of the Property Claims Service (PCS) for events in the U.S. and Canada. PCS defines a catastrophe as an event that causes damage of $25 million or more in insured losses and affects a significant number of insureds. For events outside of the U.S. and Canada, we generally use a similar definition. Catastrophe losses are net of reinsurance and include reinstatement premiums, which are additional premiums paid on certain reinsurance agreements in order to reinstate coverage that had been exhausted by loss occurrences. The reinstatement premium amount is typically a pro rata portion of the original ceded premium paid based on how much of the reinsurance limit had been exhausted. Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years. PPD includes adjustments relating to either profit commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends. The expense adjustments correlate to the prior period loss development on these same policies. Refer to the Non-GAAP Reconciliation section for further information on reinstatement premiums on catastrophe losses and adjustments to prior period development. Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Net catastrophe losses $ 435 $ 458 Favorable prior period development $ 207 $ 196 Catastrophe losses through March 31, 2024 and 2023, were primarily from the following events: • 2024: Severe weather-related events in the U.S and internationally. • 2023: Severe weather-related events in the U.S. and internationally; and New Zealand storms. Pre-tax net favorable PPD for the three months ended March 31, 2024, was $207 million including adverse development of $104 million in long-tail lines, principally in large account commercial excess and umbrella lines. Net favorable development of $311 million in short-tail lines is primarily in property and credit-related lines. Pre-tax net favorable PPD for the three months ended March 31, 2023, was $196 million including adverse development of $19 million in long-tail lines, principally from accident years 2013 through 2017. The net favorable development of $215 million in short-tail lines is primarily in surety and A&H lines. Refer to the prior period development discussion in Note 7 to the Consolidated Financial Statements for additional information. 53 Table of Contents P&C Combined Ratio In evaluating our segments, excluding Life Insurance financial performance, we use the P&C combined ratio, the loss and loss expense ratio, the policy acquisition cost ratio, and the administrative expense ratio. We calculate these ratios by dividing the respective expense amounts by net premiums earned. We do not calculate these ratios for the Life Insurance segment as we do not use these measures to monitor or manage the business in that segment. The P&C combined ratio is determined by adding the loss and loss expense ratio, the policy acquisition cost ratio, and the administrative expense ratio. A P&C combined ratio under 100 percent indicates underwriting income, and a combined ratio exceeding 100 percent indicates underwriting loss. Three Months Ended March 31 2024 2023 Loss and loss expense ratio CAY loss ratio excluding catastrophe losses 56.1 % 55.9 % Catastrophe losses 4.4 % 5.2 % Favorable prior period development (2.4) % (2.2) % Loss and loss expense ratio 58.1 % 58.9 % Policy acquisition cost ratio 19.2 % 18.8 % Administrative expense ratio 8.7 % 8.6 % P&C Combined ratio 86.0 % 86.3 % The loss and loss expense ratio improved for the three months ended March 31, 2024, reflecting lower catastrophe losses, and higher favorable prior period development. The CAY loss ratio excluding catastrophe losses increased for the three months ended March 31, 2024, primarily from the unfavorable impact of a large structured transaction in North America and higher loss trends in certain casualty lines, partially offset by a higher percentage of net premiums earned from property lines, and the consolidation of Huatai Group's P&C business effective July 1, 2023, which has a lower loss ratio. The policy acquisition cost ratio increased for the three months ended March 31, 2024, primarily due to higher ceded commissions and the impact of the consolidation of Huatai, partially offset by the favorable impact of the large structured transaction written in the current year that generated minimal acquisition expenses. The administrative expense ratio was relatively flat for the three months ended March 31, 2024, as the impact of increased spending to support growth and the consolidation of Huatai were offset by the favorable impact of higher net premiums earned. Policy benefits Policy benefits represent losses on contracts classified as long-duration and generally include accident and supplemental health products, term and whole life products, endowment products, and annuities. Policy benefits for the three months ended March 31, 2024, include the results of Huatai Group. Refer to the Life Insurance segment operating results section for further discussion. For the three months ended March 31, 2024 and 2023, Policy benefits were $1,180 million and $797 million, respectively, which include (gains) losses from fair value changes in separate account liabilities that do not qualify for separate account reporting under U.S. GAAP of $10 million and $(25) million, respectively. The offsetting movements of these liabilities are recorded in Other (income) expense on the Consolidated statements of operations. Excluding the separate account gains and losses, Policy benefits were $1,170 million and $822 million for the three months ended March 31, 2024 and 2023, respectively. Refer to the respective sections that follow for a discussion of Net investment income, Other (income) expense, Net realized gains (losses), Interest expense, Amortization of purchased intangibles, and Income tax expense. The increase in Policy benefits for 2024 is primarily due to the consolidation of Huatai Group. 54 Table of Contents Segment Operating Results – Three Months Ended March 31, 2024 and 2023 We operate through six business segments: North America Commercial P&C Insurance, North America Personal P&C Insurance, North America Agricultural Insurance, Overseas General Insurance, Global Reinsurance, and Life Insurance. For more information on our segments refer to “Segment Information” under Item 1 in our 2023 Form 10-K. North America Commercial P&C Insurance The North America Commercial P&C Insurance segment comprises operations that provide P&C insurance and services to large, middle market, and small commercial businesses in the U.S., Canada, and Bermuda. This segment includes our North America Major Accounts and Specialty Insurance division (large corporate accounts and wholesale business), and the North America Commercial Insurance division (principally middle market, and small commercial accounts). Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 4,689 $ 4,288 9.4 % Net premiums earned 4,880 4,369 11.7 % Losses and loss expenses 3,175 2,729 16.3 % Policy acquisition costs 688 613 12.2 % Administrative expenses 328 295 11.2 % Underwriting income 689 732 (5.9) % Net investment income 826 698 18.3 % Other (income) expense 7 7 — Segment income $ 1,508 $ 1,423 5.9 % Loss and loss expense ratio: CAY loss ratio excluding catastrophe losses 61.4 % 60.5 % 0.9 pts Catastrophe losses 4.9 % 3.7 % 1.2 pts Prior period development (1.2) % (1.7) % 0.5 pts Loss and loss expense ratio 65.1 % 62.5 % 2.6 pts Policy acquisition cost ratio 14.1 % 14.0 % 0.1 pts Administrative expense ratio 6.7 % 6.7 % — pts Combined ratio 85.9 % 83.2 % 2.7 pts Net Catastrophe Losses and Prior Period Development Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Net catastrophe losses $ 236 $ 162 Favorable prior period development $ 48 $ 72 Catastrophe losses through both March 31, 2024 and 2023, were primarily from U.S. flooding, hail, tornadoes, wind events, and winter storm losses. Refer to Note 7 to the Consolidated Financial Statements for detail on prior period development. 55 Table of Contents Premiums Net premiums written increased $401 million, or 9.4 percent, for the three months ended March 31, 2024, reflecting strong new business and retention, including rate and exposure increases. The increase in premiums was across most lines of business, most notably in property lines and casualty lines, which included a large structured transaction in the current year. This growth was partially offset by declines in financial lines, reflecting a competitive market environment and lower retention, and planned corrective underwriting actions in Major Accounts primary and excess casualty. Net premiums earned increased $511 million, or 11.7 percent, for the three months ended March 31, 2024, reflecting the growth in net premiums written described above, including from the large structured transaction, which was fully earned when written. Combined Ratio The loss and loss expense ratio increased for the three months ended March 31, 2024, reflecting higher catastrophe losses and lower favorable prior period development. The CAY loss ratio excluding catastrophe losses increased for the three months ended March 31, 2024, driven by the unfavorable impact of the large structured transaction and higher loss trends in certain casualty lines, partially offset by a higher percentage of net premiums earned from property lines. The policy acquisition cost ratio and the administrative expense ratio were relatively flat for the three months ended March 31, 2024, reflecting the favorable impact of the large structured transaction in the current year that generated minimal expenses, partially offset by a lower ceded commission benefit in the current year. North America Personal P&C Insurance The North America Personal P&C Insurance segment comprises operations that provide high net worth personal lines products, including homeowners and complementary products such as valuable articles, excess liability, automobile, and recreational marine insurance and services in the U.S. and Canada. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 1,456 $ 1,296 12.3 % Net premiums earned 1,471 1,320 11.4 % Losses and loss expenses 899 888 1.3 % Policy acquisition costs 300 272 10.1 % Administrative expenses 86 79 9.3 % Underwriting income 186 81 129.8 % Net investment income 102 82 24.5 % Other (income) expense 1 1 — Amortization of purchased intangibles 2 2 — Segment income $ 285 $ 160 78.2 % Loss and loss expense ratio: CAY loss ratio excluding catastrophe losses 53.1 % 53.9 % (0.8) pts Catastrophe losses 11.6 % 12.1 % (0.5) pts Prior period development (3.6) % 1.3 % (4.9) pts Loss and loss expense ratio 61.1 % 67.3 % (6.2) pts Policy acquisition cost ratio 20.4 % 20.6 % (0.2) pts Administrative expense ratio 5.9 % 6.0 % (0.1) pts Combined ratio 87.4 % 93.9 % (6.5) pts NM - Not meaningful 56 Table of Contents Net Catastrophe Losses and Prior Period Development Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Net catastrophe losses $ 170 $ 159 Favorable (unfavorable) prior period development $ 52 $ (17) Catastrophe losses through both March 31, 2024 and 2023, were primarily from U.S. winter storm losses, flooding, hail, tornadoes, and wind events. Refer to Note 7 to the Consolidated Financial Statements for detail on prior period development. Premiums Net premiums written increased $160 million, or 12.3 percent, for the three months ended March 31, 2024, driven by strong new business and retention, including positive rate and exposure increases in all lines. Net premiums earned increased $151 million, or 11.4 percent, for the three months ended March 31, 2024, reflecting the growth in net premiums written described above. Combined Ratio The loss and loss expense ratio improved for the three months ended March 31, 2024, reflecting a lower impact from catastrophe losses and favorable prior period development, compared with unfavorable development in the prior year period. The CAY loss ratio excluding catastrophe losses improved for the three months ended March 31, 2024, primarily reflecting an improvement in homeowners from earned rate and exposure growth, partly offset by an increase in excess liability and auto loss trends. The policy acquisition cost ratio and the administrative expense ratio were relatively flat for the three months ended March 31, 2024. 57 Table of Contents North America Agricultural Insurance The North America Agricultural Insurance segment comprises our North American based businesses that provide a variety of coverages in the U.S. and Canada including crop insurance, primarily Multiple Peril Crop Insurance (MPCI) and crop-hail through Rain and Hail Insurance Service, Inc. (Rain and Hail), as well as farm and ranch and specialty P&C commercial insurance products and services through our Agriculture P&C business. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 249 $ 293 (15.0) % Net premiums earned 128 159 (19.4) % Losses and loss expenses 49 140 (64.9) % Policy acquisition costs 21 15 44.7 % Administrative expenses 2 3 (29.1) % Underwriting income 56 1 NM Net investment income 21 17 27.1 % Other (income) expense — 1 NM Amortization of purchased intangibles 6 6 — Segment income $ 71 $ 11 NM Loss and loss expense ratio: CAY loss ratio excluding catastrophe losses 69.5 % 73.1 % (3.6) pts Catastrophe losses 2.1 % 15.4 % (13.3) pts Prior period development (33.0) % — (33.0) pts Loss and loss expense ratio 38.6 % 88.5 % (49.9) pts Policy acquisition cost ratio 16.8 % 9.3 % 7.5 pts Administrative expense ratio 1.2 % 1.4 % (0.2) pts Combined ratio 56.6 % 99.2 % (42.6) pts NM - Not meaningful Net Catastrophe Losses and Prior Period Development Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Net catastrophe losses $ 3 $ 24 Favorable prior period development $ 28 $ — Catastrophe losses through both March 31, 2024 and 2023, were primarily from U.S. flooding, hail, tornadoes, wind events, and winter storm losses. Refer to Note 7 to the Consolidated Financial Statements for detail on prior period development. Premiums Net premiums written decreased $44 million, or 15.0 percent, for the three months ended March 31, 2024, primarily due to a return of premium of $41 million under the U.S. government risk-sharing formula related to the 2023 crop year and lower commodity prices in the current year. Under the profit-sharing agreement, we ceded more premium due to lower losses experienced in certain states. The decrease was partially offset by strong new business and rate increases in our Agriculture P&C business. 58 Table of Contents Net premiums earned decreased $31 million, or 19.4 percent, for the three months ended March 31, 2024, reflecting the factors described above. Combined Ratio The loss and loss expense ratio improved for the three months ended March 31, 2024, reflecting higher favorable prior period development and lower catastrophe losses. The CAY loss ratio excluding catastrophe losses improved for the three months ended March 31, 2024, due to higher net premiums earned from our Agriculture P&C business that has a lower loss ratio, and earned rate exceeding loss trend in that business. The policy acquisition cost ratio increased for the three months ended March 31, 2024, reflecting the impact of the government profit share adjustment and agent commission adjustments relating to the 2023 crop year, and higher net premiums earned from our Agriculture P&C business that has a higher policy acquisition cost ratio. Overseas General Insurance Overseas General Insurance segment comprises Chubb International and Chubb Global Markets (CGM). Chubb International comprises our international commercial P&C traditional and specialty lines serving large corporations, middle market and small customers; A&H and traditional and specialty personal lines business serving local territories outside the U.S., Bermuda, and Canada. CGM, our London-based international commercial P&C excess and surplus lines business, includes Lloyd's of London (Lloyd's) Syndicate 2488. Chubb provides funds at Lloyd's to support underwriting by Syndicate 2488 which is managed by Chubb Underwriting Agencies Limited. Effective July 1, 2023, the Overseas General Insurance segment includes 100 percent of the results of Huatai Group's P&C business as required under consolidation accounting. We previously included our share of Huatai results based on our equity method investment within Other (income) expense. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 3,835 $ 3,263 17.5 % Net premiums written - constant dollars 16.7 % Net premiums earned 3,198 2,786 14.8 % Loss and loss expenses 1,426 1,237 15.3 % Policy benefits 100 110 (9.1) % Policy acquisition costs 823 713 15.4 % Administrative expenses 331 280 18.4 % Underwriting income 518 446 16.1 % Net investment income 267 188 42.5 % Other (income) expense 5 (9) NM Amortization of purchased intangibles 20 18 17.1 % Segment income $ 760 $ 625 21.6 % Loss and loss expense ratio: CAY loss ratio excluding catastrophe losses 49.7 % 49.4 % 0.3 pts Catastrophe losses 0.8 % 4.1 % (3.3) pts Prior period development (2.8) % (5.1) % 2.3 pts Loss and loss expense ratio 47.7 % 48.4 % (0.7) pts Policy acquisition cost ratio 25.7 % 25.6 % 0.1 pts Administrative expense ratio 10.4 % 10.0 % 0.4 pts Combined ratio 83.8 % 84.0 % (0.2) pts NM - not meaningful 59 Table of Contents Net Catastrophe Losses and Prior Period Development Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Catastrophe losses $ 26 $ 113 Favorable prior period development $ 89 $ 143 Catastrophe losses through March 31, 2024 and 2023, were primarily from the following events: • 2024: International weather-related events. • 2023: Storms in New Zealand and international weather-related events. Refer to Note 7 to the Consolidated Financial Statements for detail on prior period development. Net Premiums Written by Region Three months ended March 31 (in millions of U.S. dollars, except for percentages) 2024 2024 % of Total 2023 2023 % of Total C$ 2023 Q-24 vs. Q-23 C$ Q-24 vs. Q-23 Region Europe, Middle East, and Africa $ 1,869 49 % $ 1,721 53 % $ 1,749 8.6 % 6.8 % Asia (1) 1,161 30 % 861 26 % 829 34.7 % 40.1 % Latin America 777 20 % 661 20 % 688 17.5 % 12.9 % Other (2) 28 1 % 20 1 % 20 42.5 % 42.9 % Net premiums written $ 3,835 100 % $ 3,263 100 % $ 3,286 17.5 % 16.7 % (1) 2024 includes the consolidated results of Huatai P&C effective July 1, 2023. (2) Includes the international supplemental A&H business of Combined Insurance and other international operations. Premiums Overall, net premiums written increased $572 million, or $549 million on a constant dollar basis, for the three months ended March 31, 2024 reflecting growth in commercial lines of 12.2 percent, or 11.4 percent on a constant-dollar basis, and growth in consumer lines of 27.1 percent, or 26.2 percent on a constant-dollar basis. Europe increased for the three months ended March 31, 2024, supported by both our wholesale and retail divisions. The growth in commercial lines was driven by higher new business, and positive rate increases, primarily in commercial property and casualty lines. Consumer lines increased primarily due to new business from growth in our digital channels, including travel, and high net worth. Asia increased for the three months ended March 31, 2024, reflecting the consolidation of Huatai Group's P&C business effective July 1, 2023, as well as higher new business, higher retention and positive rate increases in commercial lines. Consumer lines had strong growth in Southeast Asian countries with growth in new business for both A&H and personal lines, fueled in part by new digital distribution. Latin America increased for the three months ended March 31, 2024, reflecting growth in commercial lines driven by growth in new business and positive rate increases across property and casualty lines. Our personal lines business, primarily automobile in Mexico, also continues to have strong growth. Net premiums earned increased $412 million, or $402 million on a constant-dollar basis, for the three months ended March 31, 2024, reflecting the increase in net premiums written described above. Combined Ratio The combined ratio improved for the three months ended March 31, 2024, primarily reflecting lower catastrophe losses. The CAY combined ratio excluding catastrophe losses increased, principally related to the consolidation of Huatai. 60 Table of Contents Global Reinsurance The Global Reinsurance segment represents our reinsurance operations comprising Chubb Tempest Re Bermuda, Chubb Tempest Re USA, Chubb Tempest Re International, and Chubb Tempest Re Canada. Global Reinsurance markets its reinsurance products worldwide primarily through reinsurance brokers under the Chubb Tempest Re brand name and provides a broad range of traditional and non-traditional reinsurance coverage to a diverse array of primary P&C companies. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-23 vs. Q-22 Net premiums written $ 359 $ 277 29.7 % Net premiums written - constant dollars 29.7 % Net premiums earned 295 244 20.8 % Losses and loss expenses 137 112 22.4 % Policy acquisition costs 81 62 29.9 % Administrative expenses 9 9 — Underwriting income 68 61 12.3 % Net investment income 57 49 15.1 % Other (income) expense — (1) 100 % Segment income $ 125 $ 111 12.3 % Loss and loss expense ratio: CAY loss ratio excluding catastrophe losses 46.0 % 49.0 % (3.0) pts Catastrophe losses — — — pts Prior period development 0.3 % (3.3) % 3.6 pts Loss and loss expense ratio 46.3 % 45.7 % 0.6 pts Policy acquisition cost ratio 27.5 % 25.6 % 1.9 pts Administrative expense ratio 3.1 % 3.8 % (0.7) pts Combined ratio 76.9 % 75.1 % 1.8 pts Net Catastrophe Losses and Prior Period Development Three Months Ended March 31 (in millions of U.S dollars) 2024 2023 Catastrophe losses $ — $ — Favorable (unfavorable) prior period development $ (1) $ 8 Refer to Note 7 in the Consolidated Financial Statements for detail on prior period development. Premiums Net premiums written increased $82 million for the three months ended March 31, 2024, primarily reflecting continued growth, mainly in catastrophe exposed property lines. Net premiums earned increased $51 million for the three months ended March 31, 2024, primarily reflecting the increase in net premiums written described above. Combined Ratio The loss and loss expense ratio increased for the three months ended March 31, 2024, mainly reflecting unfavorable prior period development compared with favorable development in the prior year. The CAY loss ratio excluding catastrophe losses 61 Table of Contents improved for the three months ended March 31, 2024, primarily from a shift in the mix of business towards property lines, which generally has lower loss ratios excluding catastrophe losses. The policy acquisition cost ratio increased for the three months ended March 31, 2024, primarily due to a shift in the mix of business and the impact of a treaty written in the prior year with a lower acquisition cost ratio. The administrative expense ratio improved for the three months ended March 31, 2024, reflecting the favorable impact of higher net premiums earned, as described above. Life Insurance The Life Insurance segment comprises our international life operations. Effective July 1, 2023, the Life Insurance segment includes 100 percent of the results of Huatai Group's life and asset management business as required under consolidation accounting. We previously included our share of Huatai results based on our equity method investment within Other (income) expense. The Life Insurance segment also includes Chubb Tempest Life Re (Chubb Life Re), and the North American supplemental A&H and life business of Combined Insurance. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Net premiums written $ 1,633 $ 1,293 26.3 % Net premiums written - constant dollars 29.7 % Net premiums earned 1,611 1,264 27.5 % Losses and loss expenses 32 32 — Policy benefits 1,070 712 50.3 % Policy acquisition costs 294 273 7.7 % Administrative expenses 207 167 23.8 % Net investment income 230 153 50.8 % Other (income) expense (40) (15) 155.0 % Amortization of purchased intangibles 10 4 192.8 % Segment income $ 268 $ 244 9.8 % Premiums Net premiums written increased $340 million, or $374 million on a constant-dollar basis, for the three months ended March 31, 2024. For our international life operations, net premiums written increased 31.5 percent for the three months ended March 31, 2024, substantially due to the consolidation of Huatai Group's life business which contributed $265.8 million or 25.4 percentage points. The remaining increase in net premiums written is primarily driven by the underlying growth of existing business in Asia, specifically in Hong Kong, Taiwan, and Southeast Asia, as well as by higher new business in Latin America. Net premiums written in our North American Combined Insurance business increased 5.5 percent for the three months ended March 31, 2024, due to growth in its worksite benefits business of 20.2 percent, partially offset by the non-renewal of a large program. 62 Table of Contents Deposits The following table presents deposits collected on universal life and investment contracts: Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 C$ 2023 Q-24 vs. Q-23 C$ Q-24 vs. Q-23 Deposits collected on universal life and investment contracts $ 600 $ 309 $ 301 93.9 % 99.4 % Deposits collected on universal life and investment contracts (life deposits) are not reflected as revenues in our Consolidated statements of operations in accordance with U.S. GAAP. New life deposits are an important component of production, and although they do not significantly affect current period income from operations, they are key to our efforts to grow our business. Life deposits collected increased $291 million for the three months ended March 31, 2024, primarily from the consolidation of Huatai Life business. Life Insurance segment income Life Insurance segment income increased $24 million for the three months ended March 31, 2024 reflecting the growth in premiums described above and includes higher-than-expected other income totaling $8 million. Corporate Corporate results primarily include the results of our non-insurance companies, income and expenses not attributable to reportable segments, and loss and loss expenses of asbestos and environmental (A&E) liabilities and certain other non-A&E run-off exposures, including molestation. Effective July 1, 2023, 100 percent of Huatai Group’s non-insurance operations results, comprising real estate and holding company activity, are included in Corporate. Three Months Ended March 31 % Change (in millions of U.S. dollars, except for percentages) 2024 2023 Q-24 vs. Q-23 Losses and loss expenses $ 10 $ 11 (2.9) % Administrative expenses 107 97 9.4 % Underwriting loss 117 108 8.1 % Net investment income (loss) (26) 11 NM Other (income) expense (68) (214) (68.1) % Amortization of purchased intangibles 42 42 — Net realized gains (losses) (100) (76) 31.4 % Market risk benefits gains (losses) 21 (115) NM Interest expense 178 160 11.3 % Cigna integration expenses 7 22 (66.9) % Income tax expense 342 384 (11.0) % Net loss (723) (682) 5.7 % Net income attributable to noncontrolling interests 151 — NM Net loss attributable to Chubb $ (874) $ (682) 27.9 % NM - not meaningful Administrative expenses increased $10 million for the three months ended March 31, 2024, respectively, primarily due to increased spending to support digital growth initiatives. Cigna integration expenses principally comprised legal and professional fees and all other costs directly related to the integration activities of the Cigna acquisition. These expenses are one-time in nature and are not related to the on-going business activities 63 Table of Contents of the segments. The Chief Executive Officer does not manage segment results or allocate resources to segments when considering these costs and they are therefore excluded from our definition of segment income. Refer to the respective sections that follow for a discussion of Net realized gains (losses), Net investment income (loss), Amortization of purchased intangibles, and Income tax expense (benefit). Refer to Notes 10 and 16 to the Consolidated Financial Statements for additional information on Market risk benefits gains (losses) and Other (income) expense, respectively. Net Realized and Unrealized Gains (Losses) We take a long-term view with our investment strategy, and our investment managers manage our investment portfolio to maximize total return within specific guidelines designed to minimize risk. The majority of our investment portfolio is available-for-sale and reported at fair value. The effect of market movements on our fixed maturities available-for-sale portfolio impacts Net income (through Net realized gains (losses)) when securities are sold, when we write down an asset, or when we record a change to the valuation allowance for expected credit losses. For a further discussion related to how we assess the valuation allowance for expected credit losses and the related impact on Net income, refer to Note 1 f) to the Consolidated Financial Statements in our 2023 Form 10-K. The effect of market movements on fixed maturities related to consolidated investment products (CIP) in the Huatai portfolio (Fixed maturities - CIP) impact Net realized gains (losses). Additionally, Net income is impacted through the reporting of changes in the fair value of public and private equity securities and derivatives, including financial futures, options, and swaps. Changes in unrealized appreciation and depreciation on available-for-sale securities, resulting from the revaluation of securities held, changes in cumulative foreign currency translation adjustment, changes in current discount rate on future policy benefits, changes in instrument-specific credit risk on market risk benefits, unrealized postretirement benefit obligations liability adjustment, and cross-currency swaps designated as hedges for accounting purposes are reported as separate components of Accumulated other comprehensive income (loss) in Shareholders’ equity in the Consolidated balance sheets. The following tables present our net realized and unrealized gains (losses): Three Months Ended March 31 2024 2023 (in millions of U.S. dollars) Net Realized Gains (Losses) Net Unrealized Gains (Losses) Net Impact Net Realized Gains (Losses) Net Unrealized Gains (Losses) Net Impact Fixed maturities $ 49 $ (677) $ (628) $ (180) $ 1,786 $ 1,606 Investment and embedded derivative instruments (43) — (43) (46) — (46) Public equity Sales (3) — (3) (5) — (5) Mark-to-market 6 — 6 16 — 16 Private equity (less than 3 percent ownership) Mark-to-market 31 — 31 15 — 15 Total investment portfolio 40 (677) (637) (200) 1,786 1,586 Other derivative instruments (2) — (2) (1) — (1) Foreign exchange (131) 80 (51) 131 (177) (46) Current discount rate on future policy benefits — (53) (53) — (151) (151) Instrument-specific credit risk on market risk benefits — 5 5 — (3) (3) Other (8) 31 23 (7) (33) (40) Net gains (losses), pre-tax $ (101) $ (614) $ (715) $ (77) $ 1,422 $ 1,345 Pre-tax net unrealized losses of $677 million in our investment portfolio for the three months ended March 31, 2024, were primarily driven by higher interest rates. 64 Table of Contents Pre-tax net realized losses of $101 million for the three months ended March 31, 2024 mainly comprised foreign exchange losses. Effective Income Tax Rate Our effective tax rate (ETR) reflects a mix of income or losses in jurisdictions with a wide range of tax rates, permanent differences between U.S. GAAP and local tax laws, and the impact of discrete items. A change in the geographic mix of earnings could impact our ETR. For the three months ended March 31, 2024, our ETR was 13.0 percent compared to 16.9 percent in the prior year period. The ETR for each period was impacted by our mix of earnings among various jurisdictions and by discrete tax items, including an incremental deferred tax benefit of $55 million related to the Bermuda tax law enacted in December 2023. Non-GAAP Reconciliation In presenting our results, we included and discussed certain non-GAAP measures. These non-GAAP measures, which may be defined differently by other companies, are important for an understanding of our overall results of operations and financial condition. However, they should not be viewed as a substitute for measures determined in accordance with GAAP. We provide financial measures, including net premiums written, net premiums earned, and underwriting income on a constant-dollar basis. We believe it is useful to evaluate the trends in our results exclusive of the effect of fluctuations in exchange rates between the U.S. dollar and the currencies in which our international business is transacted, as these exchange rates could fluctuate significantly between periods and distort the analysis of trends. The impact is determined by assuming constant foreign exchange rates between periods by translating prior period results using the same local currency exchange rates as the comparable current period. P&C performance metrics comprise consolidated operating results (including Corporate) and exclude the operating results of the Life Insurance segment. We believe that these measures are useful and meaningful to investors as they are used by management to assess the company’s P&C operations which are the most economically similar. We exclude the Life Insurance segment because the results of this business do not always correlate with the results of our P&C operations. P&C combined ratio is the sum of the loss and loss expense ratio, policy acquisition cost ratio and the administrative expense ratio excluding the life business and including the realized gains and losses on the crop derivatives. These derivatives were purchased to provide economic benefit, in a manner similar to reinsurance protection, in the event that a significant decline in commodity pricing impacts underwriting results. We view gains and losses on these derivatives as part of the results of our underwriting operations. CAY P&C combined ratio excluding catastrophe losses (CATs) excludes CATs and prior period development (PPD) from the P&C combined ratio. We exclude CATs as they are not predictable as to timing and amount and PPD as these unexpected loss developments on historical reserves are not indicative of our current underwriting performance. The combined ratio numerator is adjusted to exclude CATs, net premiums earned adjustments on PPD, prior period expense adjustments and reinstatement premiums on PPD, and the denomi nator is adjusted to exclude net premiums earned adjustments on PPD and reinstatement premiums on CATs and PPD. In periods where there are adjustments on loss sensitive policies, these adjustments are excluded from PPD and net premiums earned when calculating the ratios. We believe this measure provides a better evaluation of our underwriting performance and enhances the understanding of the trends in our P&C business that may be obscured by these items. This measure is commonly reported among our peer companies and allows for a better comparison. Reinstatement premiums are additional premiums paid on certain reinsurance agreements in order to reinstate coverage that had been exhausted by loss occurrences. The reinstatement premium amount is typically a pro rata portion of the original ceded premium paid based on how much of the reinsurance limit had been exhausted. Net premiums earned adjustments within PPD are adjustments to the initial premium earned on retrospectively rated policies based on actual claim experience that develops after the policy period ends. The premium adjustments correlate to the prior period loss development on these same policies and are fully earned in the period the adjustments are recorded. Prior period expense adjustments typically relate to adjustable commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends. The expense adjustments correlate to the prior period loss development on these same policies. 65 Table of Contents The following tables present the calculation of combined ratio, as reported for each segment to P&C combined ratio, adjusted for CATs and PPD: North America Commercial P&C Insurance North America Personal P&C Insurance North America Agricultural Insurance Overseas General Insurance Global Reinsurance Corporate Total P&C Three Months Ended March 31, 2024 (in millions of U.S. dollars except for ratios) Numerator Losses and loss expenses/policy benefits A $ 3,175 $ 899 $ 49 $ 1,526 $ 137 $ 10 $ 5,796 Catastrophe losses and related adjustments Catastrophe losses, net of related adjustments (236) (170) (3) (26) — — (435) Reinstatement premiums collected (expensed) on catastrophe losses — — — — — — — Catastrophe losses, gross of related adjustments (236) (170) (3) (26) — — (435) PPD and related adjustments PPD, net of related adjustments - favorable (unfavorable) 48 52 28 89 (1) (9) 207 Net premiums earned adjustments on PPD - unfavorable (favorable) — — 39 — — — 39 Expense adjustments - unfavorable (favorable) 8 — 3 — — — 11 PPD, gross of related adjustments - favorable (unfavorable) 56 52 70 89 (1) (9) 257 CAY loss and loss expense ex CATs B $ 2,995 $ 781 $ 116 $ 1,589 $ 136 $ 1 $ 5,618 Policy acquisition costs and administrative expenses Policy acquisition costs and administrative expenses C $ 1,016 $ 386 $ 23 $ 1,154 $ 90 $ 107 $ 2,776 Expense adjustments - favorable (unfavorable) (8) — (3) — — — (11) Policy acquisition costs and administrative expenses, adjusted D $ 1,008 $ 386 $ 20 $ 1,154 $ 90 $ 107 $ 2,765 Denominator Net premiums earned E $ 4,880 $ 1,471 $ 128 $ 3,198 $ 295 $ 9,972 Net premiums earned adjustments on PPD - unfavorable (favorable) — — 39 — — 39 Net premiums earned excluding adjustments F $ 4,880 $ 1,471 $ 167 $ 3,198 $ 295 $ 10,011 P&C Combined ratio Loss and loss expense ratio A/E 65.1 % 61.1 % 38.6 % 47.7 % 46.3 % 58.1 % Policy acquisition cost and administrative expense ratio C/E 20.8 % 26.3 % 18.0 % 36.1 % 30.6 % 27.9 % P&C Combined ratio 85.9 % 87.4 % 56.6 % 83.8 % 76.9 % 86.0 % CAY P&C Combined ratio ex CATs Loss and loss expense ratio, adjusted B/F 61.4 % 53.1 % 69.5 % 49.7 % 46.0 % 56.1 % Policy acquisition cost and administrative expense ratio, adjusted D/F 20.6 % 26.2 % 12.1 % 36.1 % 30.5 % 27.6 % CAY P&C Combined ratio ex CATs 82.0 % 79.3 % 81.6 % 85.8 % 76.5 % 83.7 % Combined ratio Combined ratio 86.0 % Add: impact of gains and losses on crop derivatives — P&C Combined ratio 86.0 % Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above. 66 Table of Contents North America Commercial P&C Insurance North America Personal P&C Insurance North America Agricultural Insurance Overseas General Insurance Global Reinsurance Corporate Total P&C Three Months Ended March 31, 2023 (in millions of U.S. dollars except for ratios) Numerator Losses and loss expenses/policy benefits A $ 2,729 $ 888 $ 140 $ 1,347 $ 112 $ 11 $ 5,227 Catastrophe losses and related adjustments Catastrophe losses, net of related adjustments (162) (159) (24) (113) — — (458) Reinstatement premiums collected (expensed) on catastrophe losses — — — — — — — Catastrophe losses, gross of related adjustments (162) (159) (24) (113) — — (458) PPD and related adjustments PPD, net of related adjustments - favorable (unfavorable) 72 (17) — 143 8 (10) 196 Expense adjustments - unfavorable (favorable) 3 — — — — — 3 PPD reinstatement premiums - unfavorable (favorable) — (1) — — — — (1) PPD, gross of related adjustments - favorable (unfavorable) 75 (18) — 143 8 (10) 198 CAY loss and loss expense ex CATs B $ 2,642 $ 711 $ 116 $ 1,377 $ 120 $ 1 $ 4,967 Policy acquisition costs and administrative expenses Policy acquisition costs and administrative expenses C $ 908 $ 351 $ 18 $ 993 $ 71 $ 97 $ 2,438 Expense adjustments - favorable (unfavorable) (3) — — — — — (3) Policy acquisition costs and administrative expenses, adjusted D $ 905 $ 351 $ 18 $ 993 $ 71 $ 97 $ 2,435 Denominator Net premiums earned E $ 4,369 $ 1,320 $ 159 $ 2,786 $ 244 $ 8,878 PPD reinstatement premiums - unfavorable (favorable) — (1) — — — (1) Net premiums earned excluding adjustments F $ 4,369 $ 1,319 $ 159 $ 2,786 $ 244 $ 8,877 P&C Combined ratio Loss and loss expense ratio A/E 62.5 % 67.3 % 88.5 % 48.4 % 45.7 % 58.9 % Policy acquisition cost and administrative expense ratio C/E 20.7 % 26.6 % 10.7 % 35.6 % 29.4 % 27.4 % P&C Combined ratio 83.2 % 93.9 % 99.2 % 84.0 % 75.1 % 86.3 % CAY P&C Combined ratio ex CATs Loss and loss expense ratio, adjusted B/F 60.5 % 53.9 % 73.1 % 49.4 % 49.0 % 55.9 % Policy acquisition cost and administrative expense ratio, adjusted D/F 20.7 % 26.7 % 10.8 % 35.7 % 29.4 % 27.5 % CAY P&C Combined ratio ex CATs 81.2 % 80.6 % 83.9 % 85.1 % 78.4 % 83.4 % Combined ratio Combined ratio 86.3 % Add: impact of gains and losses on crop derivatives — P&C Combined ratio 86.3 % Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above. Amortization of Purchased Intangibles and Other Amortization Amortization of purchased intangibles Amortization expense related to purchased intangibles was $80 million and $72 million for the three months ended March 31, 2024 and 2023, respectively. 67 Table of Contents At March 31, 2024, the deferred tax liability associated with the Other intangible assets (excluding the fair value adjustment on Unpaid losses and loss expenses) was $1,547 million. The following table presents, as of March 31, 2024, the expected reduction to the deferred tax liability associated with the amortization of Other intangible assets, at current foreign currency exchange rates, for the second through fourth quarters of 2024 and for the next five years: For the Years Ending December 31 (in millions of U.S. dollars) Reduction to deferred tax liability associated with intangible assets Second quarter of 2024 $ 21 Third quarter of 2024 20 Fourth quarter of 2024 20 2025 75 2026 69 2027 64 2028 61 2029 54 Total $ 384 Amortization of the fair value adjustment on assumed long-term debt The following table presents, as of March 31, 2024, the expected amortization benefit from the fair value adjustment on assumed long-term debt related to the Chubb Corp acquisition for the second through fourth quarters of 2024 and for the next five years: For the Years Ending December 31 (in millions of U.S. dollars) Amortization benefit of the fair value adjustment on assumed long-term debt (1) Second quarter of 2024 $ 5 Third quarter of 2024 5 Fourth quarter of 2024 6 2025 21 2026 21 2027 21 2028 21 2029 21 Total $ 121 (1) Recorded as a reduction to Interest expense in the Consolidated statements of operations. 68 Table of Contents Net Investment Income Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Fixed maturities (1) $ 1,311 $ 1,062 Short-term investments 49 38 Other interest income 15 17 Equity securities 24 9 Private equities 16 9 Other investments 23 17 Gross investment income (1) 1,438 1,152 Investment expenses (47) (45) Net investment income (1) $ 1,391 $ 1,107 (1) Includes amortization expense related to fair value adjustment of acquired invested assets $ (5) $ (2) Net investment income is influenced by a number of factors including the amounts and timing of inward and outward cash flows, the level of interest rates, and changes in overall asset allocation. Net investment income increased 25.7 percent for the three months ended March 31, 2024, primarily due to higher reinvestment rates on fixed maturities and the consolidation of Huatai Group. For private equities where we own less than three percent, investment income is included within Net investment income in the table above. For private equities where we own more than three percent, investment income is included within Other (income) expense in the Consolidated statements of operations. Excluded from Net investment income is the mark-to-market movement for private equities, which is recorded within either Other (income) expense or Net realized gains (losses) based on our percentage of ownership. The total mark-to-market movement for private equities excluded from Net investment income was as follows: Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Total mark-to-market gain on private equity, pre-tax $ 134 $ 257 Interest Expense Interest expense for the three months ended March 31, 2024, was $178 million comprising $183 million related to fixed expenses on existing debt obligations and variable expenses, and a $5 million benefit related to the amortization of the fair value of debt assumed in the Chubb Corp acquisition. The variable expenses relate to fees from the usage of certain facilities, including letters of credit, and interest on held collateral and repurchase agreements. Based on our existing debt obligations, including the new $1 billion of 5 percent senior notes issued on March 7, 2024, and projected variable expenses, we expect pre-tax interest expense to be approximately $561 million for the remainder of 2024, or $744 million for the full year. We also expect a $16 million benefit related to the amortization of the fair value of debt assumed in the Chubb Corp acquisition for the remainder of 2024. For more information on our debt obligations, refer to Note 11 to the Consolidated Financial Statements herein, and Note 13 to the Consolidated Financial Statements, under Item 8 in our 2023 Form 10-K. Investments Our investment portfolio is invested primarily in publicly traded, investment grade, fixed income securities with an average credit quality of A/A as rated by the independent investment rating services Standard and Poor’s (S&P)/Moody’s Investors Service (Moody’s) at March 31, 2024. Excluding Huatai, the portfolio is primarily managed externally by independent, professional investment managers and is broadly diversified across geographies, sectors, and issuers. We hold no collateralized debt obligations in our investment portfolio, and we provide no credit default protection. We have long-standing global credit limits for our entire portfolio across the organization. Exposures are aggregated, monitored, and actively managed by our Global Credit 69 Table of Contents Committee, comprising senior executives, including our Chief Financial Officer, our Chief Risk Officer, our Chief Investment Officer, and our Treasurer. We also have well-established, strict contractual investment rules requiring managers to maintain highly diversified exposures to individual issuers and clos ely monitor investment manager compliance with portfolio guidelines. The following table shows the fair value and cost/amortized cost, net of valuation allowance, of our invested assets: March 31, 2024 December 31, 2023 (in millions of U.S. dollars) Fair Value Cost/ Amortized Cost, Net Fair Value Cost/ Amortized Cost, Net Short-term investments $ 5,107 $ 5,108 $ 4,551 $ 4,551 Fixed maturities - Consolidated investment products 4,408 4,408 3,773 3,773 Fixed maturities available-for-sale 108,289 113,364 106,571 110,972 Fixed income securities 117,804 122,880 114,895 119,296 Equity securities 3,769 3,769 3,455 3,455 Private debt held-for-investment 2,733 2,708 2,560 2,553 Private equities and other 16,089 16,089 15,832 15,832 Total investments $ 140,395 $ 145,446 $ 136,742 $ 141,136 The fair value of our total investments increased $3.7 billion during the three months ended March 31, 2024, due to the investing of operating cash flow, partially offset by unrealized losses. The valuation of our fixed income portfolio is impacted by changes in interest rates. We estimate that a 100 basis point (bps) increase in rates would reduce the valuation of our portfolio by approximately $5.9 billion at March 31, 2024. The following tables present the fair value of our fixed income securities at March 31, 2024, and December 31, 2023. The first table lists investments according to type and second according to S&P credit rating: March 31, 2024 December 31, 2023 (in millions of U.S. dollars, except for percentages) Fair Value % of Total Fair Value % of Total U.S. Treasury / Agency $ 2,899 2 % $ 3,590 3 % Corporate and asset-backed securities 43,447 38 % 42,830 37 % Mortgage-backed securities 23,755 20 % 22,058 19 % Municipal 2,043 2 % 2,929 3 % Non-U.S. 40,553 34 % 38,937 34 % Short-term investments 5,107 4 % 4,551 4 % Total (1) $ 117,804 100 % $ 114,895 100 % AAA $ 14,289 12 % $ 12,669 11 % AA 34,371 29 % 34,312 30 % A 28,134 24 % 27,674 24 % BBB 21,283 18 % 20,810 18 % BB 10,529 9 % 10,270 9 % B 8,539 7 % 8,580 7 % Other 659 1 % 580 1 % Total (1) $ 117,804 100 % $ 114,895 100 % (1) Includes fixed maturities related to consolidated investment products recorded in Other investments in the Consolidated balance sheets of $4.4 billion and $3.8 billion at March 31, 2024, and December 31, 2023, respectively. 70 Table of Contents Corporate and asset-backed securities The following table presents our 10 largest global exposures to corporate bonds by fair value at March 31, 2024: (in millions of U.S. dollars) Fair Value Bank of America Corp $ 818 Morgan Stanley 724 JPMorgan Chase & Co 664 Wells Fargo & Co 597 Citigroup Inc 556 Goldman Sachs Group Inc 550 UBS Group AG 410 HSBC Holdings Plc 399 Verizon Communications Inc 396 AT&T Inc 394 Mortgage-backed securities The following table shows the fair value and amortized cost, net of valuation allowance, of our mortgage-backed securities: S&P Credit Rating Fair Value Amortized Cost, Net March 31, 2024 (in millions of U.S. dollars) AAA AA A BBB BB and below Total Total Agency residential mortgage-backed securities (RMBS) $ 9 $ 20,413 $ — $ — $ — $ 20,422 $ 22,146 Non-agency RMBS 1,086 101 61 62 6 1,316 1,382 Commercial mortgage-backed securities 1,716 173 113 14 1 2,017 2,167 Total mortgage-backed securities $ 2,811 $ 20,687 $ 174 $ 76 $ 7 $ 23,755 $ 25,695 Municipal As part of our overall investment strategy, we may invest in states, municipalities, and other political subdivisions fixed maturity securities (Municipal). We apply the same investment selection process described previously to our Municipal investments. The portfolio is highly diversified primarily in state general obligation bonds and essential service revenue bonds including education and utilities (water, power, and sewers). Non-U.S. Chubb’s local currency investment portfolios have strict contractual investment guidelines requiring managers to maintain a high quality and diversified portfolio to both sector and individual issuers. Investment portfolios are monitored daily to ensure investment manager compliance with portfolio guidelines. Our non-U.S. investment grade fixed income portfolios are currency-matched with the insurance liabilities of our non-U.S. operations. The average credit quality of our non-U.S. fixed income securities is A and 38 percent of our holdings are rated AAA or guaranteed by governments or quasi-government agencies. Within the context of these investment portfolios, our government and corporate bond holdings are highly diversified across industries and geographies. Issuer limits are based on credit rating (AA—two percent, A—one percent, BBB—0.5 percent of the total portfolio) and are monitored daily via an internal compliance system. We manage our indirect exposure using the same credit rating-based investment approach. Accordingly, we do not believe our indirect exposure is material. 71 Table of Contents The following table summarizes the fair value and amortized cost, net of valuation allowance, of our non-U.S. fixed income portfolio by country/sovereign for non-U.S. government securities at March 31, 2024: (in millions of U.S. dollars) Fair Value Amortized Cost, Net Republic of Korea $ 1,770 $ 1,746 People's Republic of China 1,586 1,458 Taiwan 985 969 Canada 907 953 Federative Republic of Brazil 631 634 United Mexican States 611 635 Kingdom of Thailand 587 563 Commonwealth of Australia 553 616 Province of Ontario 510 538 Socialist Republic of Vietnam 474 358 Other Non-U.S. Government Securities 6,224 6,493 Total $ 14,838 $ 14,963 The following table summarizes the fair value and amortized cost, net of valuation allowance, of our non-U.S. fixed income portfolio by country/sovereign for non-U.S. corporate securities at March 31, 2024: (in millions of U.S. dollars) Fair Value Amortized Cost, Net China $ 6,524 $ 6,523 United Kingdom 2,629 2,748 Canada 2,249 2,298 United States (1) 1,614 1,652 South Korea 1,572 1,562 France 1,567 1,609 Australia 1,137 1,192 Japan 816 849 Germany 631 663 Netherlands 586 612 Other Non-U.S. Corporate Securities 6,390 6,658 Total $ 25,715 $ 26,366 (1) The countries that are listed in the non-U.S. corporate fixed income portfolio above represent the ultimate parent company's country of risk. Non-U.S. corporate securities could be issued by foreign subsidiaries of U.S. corporations. Below-investment grade corporate fixed income portfolio Below-investment grade securities have different characteristics than investment grade corporate debt securities. Risk of loss from default by the borrower is greater with below-investment grade securities. Below-investment grade securities are generally unsecured and are often subordinated to other creditors of the issuer. Also, issuers of below-investment grade securities usually have higher levels of debt and are more sensitive to adverse economic conditions, such as recession or increasing interest rates, than investment grade issuers. At March 31, 2024, our corporate fixed income investment portfolio included below-investment grade and non-rated securities which, in total, comprised approximately 15 percent of our fixed income portfolio. Our below-investment grade and non-rated portfolio includes over 1,600 issuers, with the greatest single exposure being $164 million. We manage high-yield bonds as a distinct and separate asset class from investment grade bonds. The allocation to high-yield bonds is explicitly set by internal management and is targeted to securities in the upper tier of credit quality (BB/B). Our minimum rating for initial purchase is BB/B. Sixteen external investment managers are responsible for high-yield security selection and portfolio construction. Our high-yield managers have a conservative approach to credit selection and very low historical default experience. Holdings are highly diversified across industries and generally subject to a 1.5 percent issuer limit 72 Table of Contents as a percentage of high-yield allocation. We monitor position limits daily through an internal compliance system. Derivative and structured securities (e.g., credit default swaps and collateralized debt obligations) are not permitted in the high-yield portfolio. Critical Accounting Estimates Unpaid losses and loss expenses As an insurance and reinsurance company, we are required by applicable laws and regulations and U.S. GAAP to establish loss and loss expense reserves for the estimated unpaid portion of the ultimate liability for losses and loss expenses under the terms of our policies and agreements with our insured and reinsured customers. With the exception of certain structured settlements, for which the timing and amount of future claim payments are reliably determinable, and certain reserves for unsettled claims, our loss reserves are not discounted for the time value of money. The following table presents a roll-forward of our unpaid losses and loss expenses: (in millions of U.S. dollars) Gross Losses Reinsurance Recoverable (1) Net Losses Balance at December 31, 2023 $ 80,122 $ 17,884 $ 62,238 Losses and loss expenses incurred 6,603 876 5,727 Losses and loss expenses paid (6,423) (1,601) (4,822) Other (including foreign exchange translation) 39 4 35 Balance at March 31, 2024 $ 80,341 $ 17,163 $ 63,178 (1) Net of valuation allowance for uncollectible reinsurance. The estimate of the liabilities includes provisions for claims that have been reported but are unpaid at the balance sheet date (case reserves) and for obligations on claims that have been incurred but not reported (IBNR) at the balance sheet date. IBNR may also include provisions to account for the possibility that reported claims may settle for amounts that differ from the established case reserves. Loss reserves also include an estimate of expenses associated with processing and settling unpaid claims (loss expenses). Refer to Note 7 to the Consolidated Financial Statements for a discussion on the changes in the loss reserves. Asbestos and Environmental (A&E) There was no significant A&E reserve activity during the three months ended March 31, 2024. A&E reserves are included in Corporate. Refer to our 2023 Form 10-K for further information on our A&E exposures. Fair value measurements Accounting guidance defines fair value as the price to sell an asset or transfer a liability (an exit price) in an orderly transaction between market participants and establishes a three-level valuation hierarchy based on the reliability of the inputs. The fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1 inputs) and the lowest priority to unobservable data (Level 3 inputs). Level 2 includes inputs, other than quoted prices within Level 1, that are observable for assets or liabilities either directly or indirectly. Refer to Note 4 to the Consolidated Financial Statements for information on our fair value measurements. 73 Table of Contents Catastrophe Management We actively monitor and manage our catastrophe risk accumulation around the world from natural perils, which includes setting risk limits based on probable maximum loss (PML) and purchasing catastrophe reinsurance to ensure sufficient liquidity and capital to meet the expectations of regulators, rating agencies, and policyholders, and to provide shareholders with an appropriate risk-adjusted return. Chubb uses internal and external data together with sophisticated, analytical catastrophe loss and risk modeling techniques to ensure an appropriate understanding of risk, including diversification and correlation effects, across different product lines and territories. The table below presents our modeled pre-tax estimates of natural catastrophe PML, net of reinsurance, at March 31, 2024, and does not represent our expected catastrophe losses for any one year. Modeled Net Probable Maximum Loss (PML) Pre-tax Worldwide (1) U.S. Hurricane (2) California Earthquake (3) Annual Aggregate Annual Aggregate Single Occurrence (in millions of U.S. dollars, except for percentages) Chubb % of Total Chubb Shareholders’ Equity Chubb % of Total Chubb Shareholders’ Equity Chubb % of Total Chubb Shareholders’ Equity 1-in-10 $ 2,726 4.5 % $ 1,492 2.5 % $ 164 0.3 % 1-in-100 $ 5,179 8.6 % $ 3,501 5.8 % $ 1,843 3.0 % 1-in-250 $ 8,052 13.3 % $ 5,567 9.2 % $ 2,098 3.5 % (1) Worldwide aggregate comprises losses arising from tropical cyclones, convective storms, earthquakes, U.S. wildfires, and floods in the U.S., Canada, and Europe, and excludes "non-modeled" perils such as man-made and other catastrophe risks including pandemic. (2) U.S. hurricane losses include losses from wind, storm-surge, and related precipitation-induced flooding. (3) California earthquakes include the fire-following sub-peril. The PML for worldwide and key U.S. peril regions are based on our in-force portfolio at January 1, 2024, and reflect the April 1, 2024, reinsurance program, as well as inuring reinsurance protection coverage. As of April 1, 2024, we increased retention in North America by $500 million and increased limits by $1.7 billion. Refer to the Global Property Catastrophe Reinsurance section for more information. These estimates assume that reinsurance recoverable is fully collectible. According to the model, for the 1-in-100 return period scenario, there is a one percent chance that our pre-tax annual aggregate losses incurred in any year from U.S. hurricane events could be in excess of $3,501 million (or 5.8 percent of total Chubb shareholders’ equity at March 31, 2024). Effective March 31, 2024, our worldwide and U.S. Hurricane PMLs reflect the latest North Atlantic hurricane vulnerability model. The above estimates of Chubb’s loss profile are inherently uncertain for many reasons, including the following: • While the use of third-party modeling packages to simulate potential catastrophe losses is prevalent within the insurance industry, the models are reliant upon significant meteorology, seismology, and engineering assumptions to estimate catastrophe losses. In particular, modeled catastrophe events are not always a representation of actual events and ensuing additional loss potential; • There is no universal standard in the preparation of insured data for use in the models, the running of the modeling software, and interpretation of loss output. These loss estimates do not represent our potential maximum exposures and it is highly likely that our actual incurred losses would vary materially from the modeled estimates; • The potential effects of climate change add to modeling complexity; and • Changing climate conditions could impact our exposure to natural catastrophe risks. Published studies by leading government, academic, and professional organizations combined with extensive research by Chubb climate scientists reveal the potential for increases in the frequency and severity of key natural perils such as tropical cyclones, inland flood, and wildfire. To understand the potential impacts on the Chubb portfolio, we have conducted stress tests on our peak exposure zone, namely in the U.S., using parameters outlined by the Intergovernmental Panel on Climate Change (IPCC) Climate Change 2021 report. These parameters consider the impacts of climate change and the resulting climate peril impacts over a timescale relevant to our business. The tests are conducted by adjusting our baseline view of risk for the perils of hurricane, inland flood, and wildfire in the U.S. to reflect increases in frequency and severity across the modeled domains for each of these perils. Based on these tests against the Chubb portfolio we do not expect material impacts to our baseline PMLs from climate change through December 31, 2024. These tests reflect current exposures only and exclude potentially mitigating factors such as changes to building codes, public or private risk mitigation, regulation, and public policy. Refer to Item 7 in our 2023 Form 10-K for more information on man-made and other catastrophes. 74 Table of Contents Global Property Catastrophe Reinsurance Program Chubb’s core property catastrophe reinsurance program provides protection against natural catastrophes impacting its primary property operations (i.e., excluding our Global Reinsurance and Life Insurance segments). We regularly review our reinsurance protection and corresponding property catastrophe exposures. This may or may not lead to the purchase of additional reinsurance prior to a program’s renewal date. In addition, prior to each renewal date, we consider how much, if any, coverage we intend to buy and we may make material changes to the current structure in light of various factors, including modeled PML assessment at various return periods, reinsurance pricing, our risk tolerance and exposures, and various other structuring considerations. Chubb renewed its Global Property Catastrophe Reinsurance Program for our North American and International operations effective April 1, 2024, through March 31, 2025. The program consists of three layers in excess of losses retained by Chubb on a per occurrence basis. Chubb renewed its terrorism coverage (excluding nuclear, biological, chemical and radiation coverage, with an inclusion of coverage for biological and chemical coverage for personal lines) for the United States from April 1, 2024, through March 31, 2025, with the same limits and retention and percentage placed except that the majority of terrorism coverage is on an aggregate basis above our retentions without a reinstatement. Effective September 1, 2023, Chubb purchased an additional layer of per occurrence coverage for named windstorms and earthquakes within Northeast states. Coverage is provided for losses for North American and international operations within the territory through August 31, 2024. Loss Location Layer of Loss Comments Notes United States (excluding Alaska and Hawaii) $0 million – $1.75 billion Losses retained by Chubb (a) United States (excluding Alaska and Hawaii) $1.75 billion – $2.85 billion All natural perils and terrorism (b) United States (excluding Alaska and Hawaii) $2.85 billion – $4.0 billion All natural perils and terrorism (c) United States (excluding Alaska and Hawaii) $4.0 billion – $5.7 billion Named windstorm and earthquake United States (Northeast States Only) $3.5 billion – $4.0 billion Named windstorm and earthquake (d) International (including Alaska and Hawaii) $0 million – $225 million Losses retained by Chubb (a) International (including Alaska and Hawaii) $225 million – $1.325 billion All natural perils and terrorism (b) Alaska, Hawaii, and Canada $1.325 billion – $2.475 billion All natural perils and terrorism (c) (a) Ultimate retention will depend upon the nature of the loss and the interplay between the underlying per risk programs and certain other catastrophe programs purchased by individual business units. These other catastrophe programs have the potential to reduce our effective retention below the stated levels. (b) These coverages are both part of the same First layer within the Global Property Catastrophe Reinsurance Program and are fully placed with Reinsurers. (c) These coverages are both part of the same Second layer within the Global Property C atastrophe Reinsurance Program and are fully placed with Reinsurers. (d) Northeast states are defined as Virginia to Maine. This coverage is fully placed with Reinsurers and inures to the benefit of the United States (excluding Alaska and Hawaii) layer. 75 Table of Contents Capital Resources Capital resources consist of funds deployed or available to be deployed to support our business operations. March 31 December 31 (in millions of U.S. dollars, except for ratios) 2024 2023 Short-term debt $ 2,265 $ 1,460 Long-term debt 13,248 13,035 Total financial debt 15,513 14,495 Trust preferred securities 309 308 Total Chubb shareholders’ equity 60,535 59,507 Total capitalization $ 76,357 $ 74,310 Ratio of financial debt to total capitalization 20.3 % 19.5 % Ratio of financial debt plus trust preferred securities to total capitalization 20.7 % 19.9 % Repurchase agreements are excluded from the table above and are disclosed separately from short-term debt in the Consolidated balance sheets. The repurchase agreements are collateralized borrowings where we maintain the right and ability to redeem the collateral on short notice, unlike short-term debt which comprises the current maturities of our long-term debt instruments. On March 7, 2024, Chubb INA Holdings LLC (Chubb INA) issued $1.0 billion of 5.0 percent senior notes due March 2034. Refer to Note 11 to the Consolidated Financial Statements for additional details about the debt issued. For the three months ended March 31, 2024, we repurchased $316 million of Common Shares in a series of open market transactions under the Board of Directors (Board) share repurchase authorization. At March 31, 2024, there were 25,418,520 Common Shares in treasury with a weighted-average cost of $175.50 per share, and $3.4 billion in share repurchase authorization remained. For the period April 1, 2024, through April 25, 2024, we repurchased 250,000 Common Shares for a total of $62 million in a series of open market transactions under the share repurchase authorization. At April 25, 2024, $3.3 billion in share repurchase authorization remained. We generally maintain the ability to issue certain classes of debt and equity securities via a Securities and Exchange Commission (SEC) shelf registration statement which is renewed every three years. This allows us capital market access for refinancing as well as for unforeseen or opportunistic capital needs. Dividends We have paid dividends each quarter since we became a public company in 1993. Under Swiss law, dividends must be stated in Swiss francs though dividend payments are made by Chubb in U.S. dollars. Refer to Note 13 to the Consolidated Financial Statements for a discussion of our dividend methodology. At our May 2023 annual general meeting, our shareholders approved an annual dividend for the following year of up to $3.44 per share, or CHF 3.09 per share, calculated using the USD/CHF exchange rate as published in the Wall Street Journal on May 17, 2023, expected to be paid in four quarterly installments of $0.86 per share after the general meeting by way of a distribution from capital contribution reserves, transferred to free reserves for payment. The Board determines the record and payment dates at which the annual dividend may be paid until the date of the 2024 annual general meeting, and is authorized to abstain from distributing a dividend at its discretion. The four quarterly installments each of $0.86 per share were distributed by the Board as expected. The annual dividend approved in May 2023 represented a $0.12 per share increase ($0.03 per quarter) over the prior year dividend. The following table represents dividends paid per Common Share to shareholders of record on each of the following dates: Shareholders of record as of: Dividends paid as of: December 15, 2023 January 5, 2024 $0.86 (CHF 0.76) March 15, 2024 April 5, 2024 $0.86 (CHF 0.75) 76 Table of Contents Liquidity We anticipate that positive cash flows from operations (underwriting activities and investment income) should be sufficient to cover cash outflows under most loss scenarios for the near term. In addition to cash from operations, routine sales of investments, and financing arrangements, we have agreements with a third-party bank provider which implemented two international multi-currency notional cash pooling programs to enhance cash management efficiency during periods of short-term timing mismatches between expected inflows and outflows of cash by currency. The programs allow us to optimize investment income by avoiding portfolio disruption. Should the need arise, we generally have access to capital markets and to credit facilities with letter of credit capacity of $4.0 billion, $3.0 billion of which can be used for revolving credit. At March 31, 2024, our usage under these facilities was $958 million in letters of credit. Our access to credit under these facilities is dependent on the ability of the banks that are a party to the facilities to meet their funding commitments. The facilities require that we maintain certain financial covenants, all of which we met at March 31, 2024. Should the existing credit providers on these facilities experience financial difficulty, we may be required to replace credit sources, possibly in a difficult market. If we cannot obtain adequate capital or sources of credit on favorable terms, on a timely basis, or at all, our business, operating results, and financial condition could be adversely affected. To date, we have not experienced difficulty accessing our credit facility or establishing additional facilities when needed. The payment of dividends or other statutorily permissible distributions from our operating companies are subject to the laws and regulations applicable to each jurisdiction, as well as the need to maintain capital levels adequate to support the insurance and reinsurance operations, including financial strength ratings issued by independent rating agencies. During the three months ended March 31, 2024, we were able to meet all our obligations, including the payments of dividends on our Common Shares, with our net cash flows. We assess which subsidiaries to draw dividends from based on a number of factors. Considerations such as regulatory and legal restrictions as well as the subsidiary’s financial condition are paramount to the dividend decision. Chubb Limited received dividends of nil and $225 million from its Bermuda subsidiaries during the three months ended March 31, 2024 and 2023, respectively. Chubb Limited also received dividends of $91 million from its other international subsidiary during the three months ended March 31, 2024. The U.S. insurance subsidiaries of Chubb INA may pay dividends, without prior regulatory approval, subject to restrictions set out in state law of the subsidiary’s domicile (or, if applicable, commercial domicile). Chubb INA’s international subsidiaries are also subject to insurance laws and regulations particular to the countries in which the subsidiaries operate. These laws and regulations sometimes include restrictions that limit the amount of dividends payable without prior approval of regulatory insurance authorities. Chubb Limited received no dividends from Chubb INA during the three months ended March 31, 2024 and 2023. Debt issued by Chubb INA is serviced by statutorily permissible distributions by Chubb INA’s insurance subsidiaries to Chubb INA as well as other group resources. Chubb INA received no dividends from its subsidiaries during the three months ended March 31, 2024 and 2023. Cash Flows Our sources of liquidity include cash from operations, routine sales of investments, and financing arrangements. The following is a discussion of our cash flows for the three months ended March 31, 2024 and 2023. Operating cash flows were $3.2 billion in the three months ended March 31, 2024, compared to $2.3 billion in the prior year period, primarily due to higher net premiums collected and net investment income, and the impact of the Huatai consolidation. This was partially offset by net purchases of consolidated investment products from Huatai's asset management companies of $404 million. Cash used for investing was $3.7 billion in the three months ended March 31, 2024, compared to $570 million in the prior year period, an increase of $3.2 billion, which primarily included higher net purchases of fixed maturities and equity securities of $2.8 billion. Cash from (used) for financing was $562 million in the three months ended March 31, 2024, compared to $(1.4) billion in the prior year period, an increase in cash from financing of $2.0 billion. This was primarily due to net proceeds from the issuance of long-term debt of $1.0 billion compared with repayments of $0.5 billion in the prior year. We use repurchase agreements as a low-cost funding alternative. At March 31, 2024, there were $3.0 billion in repurchase agreements outstanding with various maturities over the next two months. 77 Table of Contents Both internal and external forces influence our financial condition, results of operations, and cash flows. Claim settlements, premium levels, and investment returns may be impacted by changing rates of inflation and other economic conditions. In many cases, significant periods of time, ranging up to several years or more, may lapse between the occurrence of an insured loss, the reporting of the loss to us, and the settlement of the liability for that loss. Information provided in connection with outstanding debt of subsidiaries Chubb INA Holdings LLC (Subsidiary Issuer) is an indirect 100 percent-owned and consolidated subsidiary of Chubb Limited (Parent Guarantor). The Parent Guarantor fully and unconditionally guarantees certain of the debt of the Subsidiary Issuer. The following table presents the condensed balance sheets of Chubb Limited and Chubb INA Holdings LLC, after e limination of investment in any non-guarantor subsidiary: Chubb Limited (Parent Guarantor) Chubb INA Holdings LLC (Subsidiary Issuer) March 31 December 31 March 31 December 31 (in millions of U.S. dollars) 2024 2023 2024 2023 Assets Investments $ — $ — $ 596 $ 103 Cash 108 77 3 3 Due from parent guarantor/subsidiary issuer 3 441 49 — Due from subsidiaries that are not issuers or guarantors 525 539 449 571 Other assets 3 12 3,004 2,785 Total assets $ 639 $ 1,069 $ 4,101 $ 3,462 Liabilities Due to parent guarantor/subsidiary issuer $ 49 $ — $ 3 $ 441 Due to subsidiaries that are not issuers or guarantors 383 263 240 593 Affiliated notional cash pooling programs 197 594 1,412 455 Short-term debt — — 2,265 1,460 Long-term debt — — 13,248 13,035 Trust preferred securities — — 309 308 Other liabilities 510 657 1,661 1,496 Total liabilities 1,139 1,514 19,138 17,788 Total equity (500) (445) (15,037) (14,326) Total liabilities and equity $ 639 $ 1,069 $ 4,101 $ 3,462 78 Table of Contents The following table presents the condensed statements of operations and comprehensive income of Chubb Limited and Chubb INA Holdings LLC, excluding equity in earnings from non-guarantor subsidiaries: Three Months Ended March 31, 2024 Chubb Limited (Parent Guarantor) Chubb INA Holdings LLC (Subsidiary Issuer) (in millions of U.S. dollars) Net investment income (loss) $ (9) $ (17) Net realized gains (losses) (18) (73) Administrative expenses 31 (2) Interest (income) expense (4) 116 Other (income) expense (12) 41 Income tax expense (benefit) 1 (33) Net loss $ (43) $ (212) Comprehensive loss $ (43) $ (218)