Annual Report 2001 - Chubb Group of Insurance Companies

The change in unrealized appreciation or depreciation (6) Deferred Policy Acquisition Costs
of investments carried at market value was as follows:
Years Ended December 31 Policy acquisition costs deferred and the related amor-
2001 2000 1999 tization charged against income were as follows:
(in millions)
Years Ended December 31
Change in unrealized appreciation or
depreciation of equity securities ÏÏÏÏ $(38.3) $ (63.4) $ (35.4)
2001 2000 1999
Change in unrealized appreciation or
(in millions)
depreciation of Ñxed maturitiesÏÏÏÏÏ 88.3 514.7 (715.2) Balance, beginning of year ÏÏÏÏÏÏÏ $ 842.0 $ 779.7 $ 728.7
50.0 451.3 (750.6) Increase related to acquisition of
Deferred income tax (credit) ÏÏÏÏÏÏÏÏ 17.5 158.0 (262.7) Executive Risk ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì Ì 55.2
Increase (decrease) in valuation
Costs deferred during year
allowance ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì (39.4) 39.4 Commissions and brokerage ÏÏÏ 950.9 869.0 784.4
$ 32.5 $ 332.7 $(527.3) Premium taxes and assessments ÏÏ
Salaries and operating costs ÏÏÏÏÏ
163.8
743.5
138.3
700.4
132.8
608.3
1,858.2 1,707.7 1,525.5
The unrealized appreciation of Ñxed maturities carried Amortization during year ÏÏÏÏÏÏÏÏ (1,771.4) (1,645.4) (1,529.7)
at amortized cost is not reÖected in the Ñnancial state- Balance, end of year ÏÏÏÏÏÏÏÏÏÏÏÏ $ 928.8 $ 842.0 $ 779.7
ments. The change in unrealized appreciation of Ñxed
maturities carried at amortized cost was a decrease of
$4.6 million, an increase of $9.5 million and a decrease of
$78.9 million for the years ended December 31, 2001,
(7) Real Estate
2000 and 1999, respectively. The components of real estate assets were as follows:
(c) The sources of net investment income were as
December 31
follows: 2001 2000
Years Ended December 31
(in millions)
2001 2000 1999
Mortgages and notes receivable (net of allowance for
(in millions)
uncollectible amounts of $.7 and $2.1)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 97.7 $ 89.7
Fixed maturitiesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $921.8 $895.4 $816.9 Income producing properties ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 186.9 192.8
Equity securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 25.6 23.5 31.2 Construction in progressÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 51.8 69.0
Short term investments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 34.8 38.5 43.8 Land under development and unimproved land ÏÏÏÏÏÏÏÏÏÏÏ 310.2 325.6
Other ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ .6 (.2) 1.5 $646.6 $677.1
Gross investment income ÏÏÏÏÏÏÏÏÏÏÏ 982.8 957.2 893.4
Investment expensesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 14.1 13.7 13.7
Substantially all mortgages and notes receivable are
$968.7 $943.5 $879.7
secured by buildings and land. Mortgages and notes
(d) Realized investment gains and losses were as follows:
receivable had an estimated aggregate fair value of
$89.0 million and $81.9 million at December 31, 2001
Years Ended December 31 and 2000, respectively. The fair value amounts represent
2001 2000 1999 point-in-time estimates that are not relevant in predicting
(in millions)
Gross realized investment gains
future earnings or cash Öows related to such receivables.
Fixed maturitiesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 56.9 $ 48.2 $ 38.2
Equity securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 81.6 94.0 172.9 Depreciation expense related to income producing
Sale of AAU ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 44.9 Ì properties was $4.2 million, $4.0 million and $3.5 million
138.5 187.1 211.1 for 2001, 2000 and 1999, respectively.
Gross realized investment losses
Fixed maturitiesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 57.7 40.5 14.3
Equity securities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 80.0 95.1 109.4
(8) Property and Equipment
137.7 135.6 123.7 Property and equipment included in other assets were
Realized investment gains ÏÏÏÏÏÏÏÏÏÏÏÏÏ .8 51.5 87.4 as follows:
Income taxÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ .3 18.0 31.6
December 31
$ .5 $ 33.5 $ 55.8
2001 2000
(in millions)
Cost ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $727.0 $599.8
Accumulated depreciationÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 279.8 235.9
$447.2 $363.9
Depreciation expense related to property and equipment
was $90.9 million, $80.4 million and $64.9 million
for 2001, 2000 and 1999, respectively.
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