By Tess Stynes
Chubb Ltd. (>> Chubb Corp) said its second-quarter operating earnings surged on growth in premiums and net investment income, despite elevated losses for such natural disasters as the Fort McMurray wildfires in Canada.
Operating earnings are a widely watched benchmark for the insurance industry because they exclude realized capital gains and losses from companies' investment portfolios, among other items that aren't considered recurring on a quarterly basis.
Chubb, formed earlier this year when ACE Ltd. closed on a nearly $30 billion acquisition of Chubb, said its pretax catastrophe losses reached $390 million in the latest quarter, compared with $124 million a year earlier.
Higher catastrophe claims costs are expected to hurt earnings across the industry.
Other insurers with exposure to the Fort McMurray wildfires include global insurance conglomerate American International Group Inc., which reports Aug. 2, and Allstate Corp., which reports on Aug. 4, according to analysts.
Zurich-based Chubb reported operating earnings of $1.06 billion, or $2.25 a share, up from $788 million, or $2.40 a share, a year earlier.
Net premiums written increased 60% to $7.64 billion and net investment income rose 26% to $708 million.
Analysts polled by Thomson Reuters expected per-share operating profit of $2.22 and net premiums written of $7.37 billion.
Over all, Chubb reported a profit of $726 million, or $1.54 a share, down from $942 million, or $2.86 a share, a year earlier.
Also Tuesday, Axis Capital Holdings Ltd. (>> Axis Capital Holdings Limited) said its second-quarter operating earnings fell 50% on catastrophe losses related to natural disasters and weather events including the Fort Murray wildfires. Travelers Cos. on Thursday had reported that its second-quarter operating earnings fell 19%, also depressed by claims from catastrophes including the wildfires in Canada.
Write to Tess Stynes at email@example.com