Chubb Limited (CB) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call highlights strong financial performance and optimistic guidance, including attractive growth opportunities and double-digit EPS growth. The Q&A session reveals confidence in digital transformation and margin management. Despite some unclear management responses, the overall sentiment is positive with significant opportunities in Asia and a focus on capital allocation through share buybacks. The emphasis on AI and digital transformation further supports a positive outlook. These factors suggest a likely stock price increase in the short term.
Key Financial Performance
Core Operating Income (Quarter) Nearly $3 billion or $7.52 per share, up about 22% and 25%, respectively. Reasons: Strong double-digit increases in underwriting and life income along with record investment income.
Total Company Net Premiums (Quarter) Grew almost 9% with P&C up 7.7% and life up about 17%. Reasons: Faster growth compared to the average for the full year.
P&C Underwriting Income (Quarter) $2.2 billion, up 40%. Reasons: Record low combined ratio of 81.2%, low cats, prior period reserve development, and strong current accident year performance.
Adjusted Net Investment Income (Quarter) $1.8 billion, up 7.3%. Reasons: Fixed income portfolio yield of 5.1% and strong growth in invested assets.
Core Operating Income (Full Year) Just shy of $10 billion or $24.79 per share, up about 9% and 11%, respectively. Reasons: Record results from all 3 major sources of income (P&C underwriting, investment income, and life insurance income).
P&C Underwriting Income (Full Year) $6.5 billion, up 11.6%. Reasons: Record low combined ratio of 85.7% despite higher cat losses driven by California wildfires.
Adjusted Net Investment Income (Full Year) Almost $7 billion, up 9%. Reasons: Growth in public fixed income portfolio and private investments.
Life Insurance Income (Full Year) $1.2 billion, up over 13%. Reasons: Strong performance in life insurance business.
Total Company Premiums (Full Year) Grew over 6.5% with P&C up about 5.5% and life up over 15%. Reasons: Broad-based growth across geographies and product lines.
Per Share Tangible Book Value (Full Year) Grew 25.7%. Reasons: Strong operating performance and wealth creation.
Cash and Invested Assets (Full Year) Exceeding $171 billion, up from $151 billion a year ago. Reasons: Strong operating cash flow and positive marks to market.
Capital Returned to Shareholders (Full Year) $4.9 billion, including $3.4 billion in share repurchases and $1.5 billion in dividends. Reasons: Strong financial performance and shareholder-focused capital allocation.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Record earnings: Achieved record earnings for both the quarter and the year, with core operating income of nearly $3 billion for the quarter and $10 billion for the year.
Investment income: Generated record adjusted net investment income of $1.8 billion for the quarter and $7 billion for the year.
Life insurance income: Life insurance income increased by over 13% for the year, reaching $1.2 billion.
P&C premium growth: Total company net premiums grew almost 9% for the quarter, with P&C up 7.7% and life up about 17%.
International P&C growth: Premiums in overseas general were up 10.8%, with strong growth in Latin America (14.7%), Asia (13%), and Europe (7%).
U.S. agriculture business: Premiums grew over 45% in the quarter, driven by profit-sharing formulas with the government.
Underwriting performance: P&C underwriting income was $2.2 billion for the quarter, up 40%, with a record low combined ratio of 81.2%.
Expense management: Achieved a paid-to-incurred ratio of 94% for the quarter, excluding cats, PPD, and agriculture.
Geographic diversification: Strong performance across global markets, including Latin America, Asia, and Europe, showcasing the company's diversified nature.
Investment in competitive profile: Continued investments to improve competitive positioning for future growth.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Catastrophe Losses: The company faced $2.9 billion in catastrophe losses for the year, up from $2.4 billion in the prior year, driven by events such as California wildfires and other weather-related incidents. This highlights the ongoing risk of volatile and severe natural disasters.
Competitive Market Conditions: The global P&C market is becoming increasingly competitive, particularly in large account property, admitted E&S, and upper middle market segments. This could pressure pricing and profitability.
Declining Property Pricing: Property pricing in North America declined by 1.5%, with rates down 4.6% in large account business and E&S. This trend could impact revenue and margins in these segments.
Regulatory and Asbestos-Related Risks: The corporate runoff portfolio experienced adverse development of $162 million, primarily related to asbestos liabilities. This underscores ongoing regulatory and legacy liability risks.
London Market Challenges: Premiums in the London wholesale business declined by about 1% due to more competitive conditions across property, marine, aviation, and professional lines. This could affect growth in this market.
Foreign Exchange (FX) Risks: Favorable FX contributed to the increase in the A-rated portfolio, but FX volatility remains a potential risk to financial performance.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Future Growth in Operating Earnings: The company is confident in its ability to generate strong growth in operating earnings for 2026, with expectations of double-digit growth in EPS and tangible book value.
Investment Income Projections: Adjusted net investment income for the first quarter of 2026 is expected to be between $1.81 billion to $1.84 billion.
Tax Rate Guidance: The annual core operating effective tax rate for 2026 is expected to be in the range of 19.5% to 20%.
Market Conditions and Pricing Trends: The global P&C market is transitioning and becoming incrementally more competitive, particularly in large account property admitted in E&S and upper middle market. Casualty pricing continues to firm in areas requiring rate increases, while financial lines remain soft with some signs of firming in discrete classes.
International Growth Expectations: Premiums in the international P&C business are expected to grow, with strong performance anticipated in Latin America, Asia, and Europe. Consumer premiums are expected to grow significantly, particularly in A&H and personal lines.
North America Growth Projections: Premiums in North America are expected to grow, with high net worth personal lines projected to increase over 6% and homeowners pricing expected to rise over 8.5%. Commercial pricing for property and casualty is expected to grow, with specific growth in middle market and small commercial segments.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Dividends paid in 2025: $1.5 billion in dividends were paid to shareholders in 2025.
Share repurchases in 2025: $3.4 billion worth of shares were repurchased at an average price of $282.57 per share.
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:Do you think you can sustain the excellent underlying margins in the U.S. commercial lines business in 2026?
A:Evan G. Greenberg stated that he does not provide forward guidance. He acknowledged that some lines of business have pricing not keeping pace with loss costs, but the broad mix of business helps mitigate this. He expressed confidence in the company's combined ratios and underwriting income growth contributing to EPS growth.
Q:What are your thoughts on excess profit laws and their potential implications for Chubb's personal lines business?
A:Evan G. Greenberg explained that the U.S. personal lines business typically runs combined ratios in the high 80s to low 90s over extended periods. He emphasized that affordability issues should not be politicized, as rising loss costs are driven by litigation and catastrophes, not insurance companies. He warned that politicizing affordability could lead to availability problems.
Q:Can you provide insights into growth opportunities in Latin America outside of Mexico?
A:Evan G. Greenberg highlighted strong consumer business growth in Latin America, with partnerships like Banco de Chile in Chile, Nubank in Brazil, and Banco Guayaquil in Ecuador. He noted growth in both consumer and commercial businesses in Argentina and emphasized the broad-based opportunities across the region.
Q:What are the competitive dynamics in the Asia business, and how should we think about the opportunities there?
A:Evan G. Greenberg stated that Asia offers significant opportunities, dwarfing Latin America in size and scale. Growth is driven by consumer lines and small/mid-market commercial businesses. He emphasized the challenges of competing in Asia due to its diverse markets and cultures, requiring years of effort to build local franchises and leverage technology and data.
Q:How does the robust consumer lines growth in the overseas general insurance business impact margins?
A:Evan G. Greenberg explained that margins vary by business type and distribution channel. He noted that A&H is a steady business with decent underwriting margins, while auto is less steady. He expressed confidence in the overall mix of business and its margins but did not provide specific margin breakdowns.
Q:What are the key drivers and execution priorities for delivering the 150 basis points of combined ratio improvement from digital transformation?
A:Evan G. Greenberg stated that most of the improvement will come from expense reductions in OpEx and claims costs. The company is focused on 9-10 discrete projects across geographies, involving technology, data, AI, analytics, and operations, with business leaders and technical teams working together.
Q:How does Chubb manage foreign exchange volatility in its global operations?
A:Evan G. Greenberg explained that Chubb does not hedge revenue or income but matches assets and liabilities in the same currency. He noted that a weaker U.S. dollar is a tailwind for growth and income, while a stronger dollar is a headwind. He emphasized that FX volatility does not reflect the intrinsic strength of the business.
Q:What is Chubb's approach to the emerging trend of data center infrastructure build-out?
A:Evan G. Greenberg stated that Chubb is actively involved in insuring data centers globally, offering comprehensive coverage across property, liability, marine, and professional lines. He noted potential headwinds like energy availability, labor, and supply chain issues. On the investment side, Chubb is cautious and sees potential future opportunities.
Q:How does Chubb view economic growth driven by AI infrastructure versus traditional means?
A:Evan G. Greenberg stated that broader-based economic growth is more stable and creates more opportunities. However, Chubb is agnostic about the source of growth as long as it can earn an adequate risk-adjusted return. The company pursues opportunities in multiple directions.
Q:Is the uptick in the acquisition and expense ratio in North America commercial a trend or steady state?
A:Evan G. Greenberg attributed the uptick to a mix shift towards middle and small market businesses and less one-off transactions like loss portfolio transfers. He noted that the trend is clear but varies quarter-to-quarter.
Q:What did you mean by more favorable January 1 conditions relative to expectations?
A:Evan G. Greenberg clarified that January 1 is an important date for large account business, particularly in Europe and the U.K. He noted that the business performed better than expected, providing a good start to the year.
Q:How constrained is Chubb's digital transformation by external stakeholders?
A:Evan G. Greenberg stated that the main constraint is the pace at which digital partners prioritize connectivity, data, and analytics. He emphasized that the transformation is a long-term effort focused on intrinsic value creation.
Q:What is the cultural reception within Chubb to the digital transformation?
A:Evan G. Greenberg highlighted Chubb's culture of adaptability, accountability, and respect. He expressed confidence in employees' willingness to embrace change and learn new skills, which supports the transformation.
Q:What explains the growth in financial lines and workers' comp despite challenging pricing trends?
A:John Keogh explained that financial lines growth reflects the diversity of products and markets, with some areas growing and others shrinking. He noted green shoots in public D&O and transaction liability pricing. Evan G. Greenberg attributed workers' comp growth to strong performance in middle and small commercial markets, though he viewed it as opportunistic rather than a trend.
Q:What drove the favorable prior period development in reserves?
A:Evan G. Greenberg stated that the favorable development came from long-tail lines reviewed in the quarter. He did not provide specific details on accident years or lines of business.
Q:Review of Unclear Management Responses
A:Management avoided providing specific margin breakdowns for the overseas general insurance business and did not elaborate on accident years or lines of business for the favorable prior period development in reserves. Additionally, they did not provide detailed guidance on the digital transformation's impact on combined ratio improvement or the acquisition and expense ratio trends in North America commercial.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AH line
Agriculture result
Agriculture sharing
America Agriculture
California hurricane
Chubb worksite
ES account
ES market
FX question
Fire flood
Frequency severity
Instructions conference
LPT transaction
Loss London
PC life
PC underwriting
Westchester
accident ratio
account ES
agriculture premium
average
balance sheet
core income
distribution
end
income core
income life
income share
industry cat
line market
market ES
market commercial
point record
premium PC
premium line
pricing account
ratio investment
record investment
record ratio
source income
tail line
underwriting result
CB Transcript
Chubb Limited (CB) Q4 2025 Earnings Call Transcript
Positive2-4
The earnings call highlights strong financial performance and optimistic guidance, including attractive growth opportunities and double-digit EPS growth. The Q&A session reveals confidence in digital transformation and margin management. Despite some unclear management responses, the overall sentiment is positive with significant opportunities in Asia and a focus on capital allocation through share buybacks. The emphasis on AI and digital transformation further supports a positive outlook. These factors suggest a likely stock price increase in the short term.
Chubb Limited (CB) Q3 2025 Earnings Call Transcript
Positive10-22
The earnings call summary indicates strong revenue and earnings growth expectations, supported by global diversification and disciplined operations. The Q&A session reveals no significant macroeconomic impacts, strong digital capabilities, and a focus on organic growth. Despite some negative casualty development, the overall sentiment remains positive due to strong financial metrics, optimistic guidance, and strategic focus on growth areas, such as Asia and Latin America. Additionally, the company's disciplined culture and management's confidence in achieving a 14%+ ROE contribute to a positive outlook.
Chubb Limited (CB) Q2 2025 Earnings Call Transcript
Unknown7-23
The earnings call provides a mixed sentiment. Strong financial performance and diversification are positive, but there are concerns about social inflation and pricing pressures in North America. The lack of clear guidance on property insurance pricing and the impact of social inflation adds uncertainty. The reauthorization of a share repurchase program is a positive, but the lack of specific guidance tempers the overall outlook. This results in a neutral sentiment, suggesting limited stock price movement in the near term.
Earnings call transcript: Chubb's Q4 2024 sees robust income growth
Unknown1-29
Despite strong financial metrics, including record underwriting income and significant shareholder returns, concerns about regulatory pressures, catastrophe losses, and competitive pressures in financial lines balance the outlook. The Q&A revealed management's reluctance to provide forward guidance and address certain risks clearly, adding uncertainty. While the results are solid, the mixed signals and lack of clear guidance suggest a neutral stock price movement over the next two weeks.
CB Slides
CB Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
