Annual Report 2005 - Chubb Group of Insurance Companies

Earnings were at their
highest level since Chubb
was incorporated in
1967. Total shareholder
return for 2005, including
stock price appreciation
and dividends, was 30%,
compared to 5% for the
S&P 500 and 16% for
the S&P Property and
Casualty Insurance Index.
Earnings were at their highest level since Chubb was incorporated in
1967. In addition, the market price of our common stock closed at $98.13
on November 14, 2005, an all-time high closing price for Chubb shares.
Total shareholder return for 2005, including stock price appreciation and
dividends, was 30%, compared to 5% for the S&P 500 and 16% for the
S&P Property and Casualty Insurance Index.
Net written premiums grew 2% to $12.3 billion. The combined loss
and expense ratio was 92.3%, including 5.6 percentage points of
catastrophe losses. The expense ratio was 28.0%, 1.2 percentage points
better than in 2004 and an all-time best for the corporation. Net loss
reserves increased by $1.9 billion or 11%, bringing 2005 year-end net loss
reserves to $18.7 billion.
Property and casualty investment income after taxes for the year
116%
112%
108%
104%
100%
96%
92%
Combined Loss &
Expense Ratio
Percentage of premium dollars
spent on claims and expenses
113.4%
106.7%
98.0%
92.3%
2001 2002 2003 2004 2005
92.3%
increased 11% to $1.1 billion, bolstered by strong cash flow from
operations. The combination of strong income from both investments and
underwriting resulted in a 13% increase in book value per common share.
It was a year that demonstrated what Chubb is capable of achieving.
Chubb Personal Insurance (CPI) net written premiums grew 6% to
$3.3 billion. CPI’s combined ratio improved 5.9 percentage points to
86.6%, making it one of the most profitable years in the history of our
personal lines business. Excluding catastrophe losses, the combined ratio
improved 4.2 points to 80.1%.
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