Annual Report 2005 - Chubb Group of Insurance Companies

that transactions between companies within the holding company system must be fair and equitable.
Transfers of assets among aÇliated companies, certain dividend payments from insurance subsidiaries
and certain material transactions between companies within the system may be subject to prior notice
to, or prior approval by, state regulatory authorities. The ability of our insurance subsidiaries to pay
dividends is also restricted by regulations that set standards of solvency that must be met and
maintained, the nature of and limitations on investments and the nature of and limitations on dividends
to shareholders. These regulations may aÅect Chubb's insurance subsidiaries' ability to provide Chubb
with dividends.
Item 1B. Unresolved StaÅ Comments
None.
Item 2. Properties
The executive oÇces of the Corporation are in Warren, New Jersey. The administrative oÇces of
the P&C Group are in Warren and Whitehouse Station, New Jersey. The P&C Group maintains zone
administrative and branch oÇces in major cities throughout the United States and also has oÇces in
Canada, Europe, Australia, Latin America and Asia. OÇce facilities are leased with the exception of
buildings in Whitehouse Station and Branchburg, New Jersey and Simsbury, Connecticut. Management
considers its oÇce facilities suitable and adequate for the current level of operations.
Item 3. Legal Proceedings
As previously disclosed, beginning in December 2002, Chubb Indemnity was named in a series of
actions commenced by various plaintiÅs against Chubb Indemnity and other non-aÇliated insurers in
the District Courts in Nueces, Travis and Bexar Counties in Texas. The plaintiÅs generally allege that
Chubb Indemnity and the other defendants breached duties to asbestos product end-users and
conspired to conceal risks associated with asbestos exposure. The plaintiÅs seek to impose liability on
insurers directly. The plaintiÅs seek unspeciÑed monetary damages and punitive damages. Pursuant to
the asbestos reform bill passed by the Texas legislature in May 2005, these actions were transferred to
the Texas state asbestos Multidistrict Litigation on December 1, 2005. Chubb Indemnity is vigorously
defending all of these actions and has been successful in getting a number of them dismissed through
summary judgment, special exceptions, or voluntary withdrawal by the plaintiÅ.
Beginning in June 2003, Chubb Indemnity was also named in a number of similar cases in
Cuyahoga, Mahoning, and Trumbull Counties in Ohio. The allegations and the damages sought in the
Ohio actions are substantially similar to those in the Texas actions. In May 2005, the Ohio Court of
Appeals sustained the trial court's dismissal of a group of nine cases for failure to state a claim.
Following the appellate court's decision, Chubb Indemnity and other non-aÇliated insurers were
dismissed from the remaining cases Ñled in Ohio, except for a single case which had been removed to
federal court and transferred to the federal asbestos Multidistrict Litigation. There has been no activity
in that case since its removal.
As previously disclosed, as part of ongoing investigations of market practices in the insurance
industry, in particular contingent commissions and loss mitigation and Ñnite reinsurance arrangements,
Chubb and certain of its subsidiaries have received subpoenas and other information requests from the
Attorneys General and insurance regulators of several states, as well as from several foreign regulatory
authorities, the U.S. Securities and Exchange Commission and the U.S. Attorney for the Southern
District of New York. OÇcials from other jurisdictions may initiate investigations into similar matters
and, because the Corporation operates throughout the United States and in many jurisdictions outside
the United States, the Corporation may receive additional subpoenas and requests for information in
connection with such inquiries. The Corporation is cooperating, and intends to continue to cooperate,
fully in such investigations.
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