Chubb Limited

your question, press star 1 again. I would now like to turn the call over to Karen Byer, Senior Vice President, Investor Relations. Please go ahead.

Thank you, and welcome to our March 31, 2025 first quarter earnings conference call. Our report today will contain forward-looking statements, including statements relating to company performance, pricing, and business mix, growth opportunities, and economic and market conditions, which are subject to risk and uncertainties, and actual results may differ materially. Please see our recent SEC Files, Earnings Release and Financial Supplement, which are available on our website at investors.job.com for more information on factors that could affect these matters. We will also refer today to non-GAAP financial measures, reconciliations of which to the most direct comparable GAAP measures and related details are provided in our Earnings Press Release and Financial Supplement. Now I'd like to introduce our speakers. First, we have Evan Greenberg, Chairman and Chief Executive Officer, followed by Peter Enns, our Chief Financial Officer. And then we'll take your questions. Also with us to assist with your questions this morning are several members of our management team. And now it's my pleasure to turn the call over to Evan.

Good morning. Let me begin with a few words. around the external environment. There is currently a great deal of uncertainty and confusion surrounding our government's approach to trade. It's impacting business and consumer confidence, as well as our image abroad. The odds of recession have risen substantially, and higher inflation is all but certain. To what degree? is an open question. We have competing priorities between our stated trade, economic and fiscal objectives, and coherence of policy has yet to emerge. I hope we can reach agreements on trade, reduce or eliminate tariffs, and reconcile our priorities quickly. Certainty and predictability are jacks to open for confidence. growth in the image of our country as a leader, a reliable partner, and a place to do business. As you saw from the numbers, we had a good first quarter, considering the significant catastrophe losses we incurred from the California wildfires. In terms of revenue growth, the headline number was impacted by foreign exchange due to the strong dollar, which has since weakened substantially. and one-time premium-related items in our North America business. We produced a billion and a half in core operating income, and it was down 31%. It was supported by excellent underwriting results, double-digit growth in investment income, and strong life insurance income. Total company premiums grew 5.7% in constant dollars. Our published combined ratio was 95.7 with underwriting income of $441 million, a notable result given 1.6 billion of CAT losses. Calendar year underwriting income was supported by a current accident year combined ratio of 82.3, a nearly one and a half point improvement from prior year, excluding CATs. Current accident year underwriting income was up 12%. Additionally, we had favorable prior year reserve development, $255 million. On the asset side for the quarter, adjusted net investment income was $1.7 billion, and it was up 12.7%. Our fixed income portfolio yield is 5%, and our current new money rate averaging five and a half. Tariffs and the federal budget deficit impact interest rates, the yield curve, spreads, asset values, and the dollar in ways that are not good for our country. As a company, we are predominantly buy and hold fixed income investors and benefit from higher yields. And as a multinational, our revenue and income benefit from a weaker dollar. In the quarter, our alternative investments produced modestly lower than usual private equity distribution related income. It's a combination of simply normal volatility and financial market conditions. Our annualized core operating return on tangible equity in the quarter is 13%. Peter's going to have more to say about the financial items. As you saw in the first quarter, we announced an agreement to acquire Liberty Mutual's business in Thailand and Vietnam. The two companies offer a range of consumer and commercial BNC products with distribution through 56 branches and 2,600 brokers and agents. Both fit well with our own business. The combined operations produced about $275 million in premiums in 2024, over 90% of which is in Thailand. For perspective, Thailand is now over a billion dollars in premium revenue for Chubb, non-life and life, and we're among the leading PMC companies in the country once the entities are merged. In fact, we'll be number four. We closed Thailand April 1st and expect to close Vietnam by early 26th. Now turning to growth, pricing and the rate environment. PNC revenue grew 3.2% per quarter, 5 in constant dollars, with commercial up 4.6, consumer up 6. Adjusting for the one-time items in North America, PNC premium revenue grew over 6.5 in constant dollars. All regions of the world contributed favorably. Premiums in our life insurance division grew over 10%. In terms of the commercial PNC underwriting environment, large account-related short-tail business, both admitted and ENFs, is growing quite competitive. A lot more capital is chasing the business. Prices are softening. We are, of course, disciplined, and we're not going to rate business below a technically adequate price. On the other hand, middle market and small commercial property, both admitted retail and non-admitted wholesale, or ENFs, remain much more disciplined and orderly. Rates, in fact, continue to rise, and we are growing in this area. Casualty continues to firm in all areas that require rate, retail and ENFs, with large account and middle market, and again, We're growing. Financial lines remain soft. The status backdrop, I want to give you some more color by division. And we'll start with North America, where premiums were up 3.4%. Growth, again, was impacted by the two one-time items I mentioned. Reinstatement premiums related to the California wildfires in personal insurance. And larger than usual, one-off structured transactions, think loss portfolio transfers, written last year in our major accounts commercial division. Adjusting for both, North America was up 6.4%, including growth of 10.1% in personal insurance, 5.3% in commercial. Commercial PNC lines were up 6.4%. and financial lines were down 1.3. Looking through those one-time items is a more representative view of our run rate growth for North America commercial PNC. Premiums in our very large middle market division increased almost 8%, an excellent result. PNC up over 10%, and financial lines down about 2%. Premiums in our major account and specialty division declined 1.7, and adjusting for the one-time transactions, they were up 3.1, 3.6 in PNC, and financial lines down 1. Major and specialty is comprised of E&S business, which was up 10.7, and our major account retail business, which was down 1.3. overall commercial pricing for property and casualty excluding thin lines and comp was up 8.3 percent with rates up 6.4 an exposure change of 1.8 going a step further property pricing was up 3-1 with rates down 0.7 offset by exposure change of 3.8 percent for property Pricing was down 9.6 in large account business, both admitted in E&S, and up 10.2 in middle and small, again, both admitted in E&S. Casualty pricing in North America was up 13.4%, with rates up 12.6 and exposure up 0.7. Financial lines pricing was down 3.2, that's all rate in comp primary comp pricing was flat while large account risk management was up seven and a half percent in north america commercial our selected loss cost trend was declined modestly from 6.8 and 24 to six and a half casualty running 8.9 and property four and a half percent we are mindful potential impact tariffs could have on short tail lines of business and are watching closely. On the consumer side of North America, our high net worth personal lines business had another very strong quarter with premium growth of 10.1 adjusted to the reinstatement premiums. New business growth was almost 20%. Premiums in our upper high net worth segments grew over 16%. Homeowner's pricing was up 12.5 in the quarter and ahead of loss costs, which are running 8.7. Turning to our international general insurance operations, premiums were up 1.8%, or 6.5 in constant dollar. The dollar was considerably stronger in the first quarter versus a year ago, but has substantially declined in value versus major currencies in recent weeks. In the quarter, international commercial lines grew about 7.5%. Consumer was up 5%. From a region of the world perspective, Asia and Latin America both grew 6.1%, while Europe grew 5.5%, including growth of 6% on the continent, while premiums in our London wholesale business were up nearly 8%. In our international retail commercial business, P&C pricing was up 2.6% and financial lines pricing was down 5.5%. Loss cost trends in international retail were in fact down 80 basis points from 24%, 5.8% to 5%. Our global reinsurance business had a strong quarter with premium growth of 14%. In our international life insurance business, which is fundamentally Asia, premiums and deposits were up 15.5% in constant dollar. And in combined insurance company, our U.S. worksite business grew 18.6%. Our life division produced over $290 million of pre-tax income in the quarter, up 15.7% in constant dollar. In summary, we are in the risk business. Volatility is a feature. While we are impacted by the wildfires, our underlying fundamentals are excellent. We had a good quarter. And as I observed at the beginning of the year, about 80% of our global PNC business, commercial and consumer, and our life business, very good growth prospects. In fact, When you listen as I read to you and describe going across divisions, the growth rate of the various businesses, FX aside, I think that speaks to the broad nature and the 80% I'm talking about. There is a lot of opportunity and I'm mindful that the external environment has become more uncertain. I have confidence in what we can control In that regard, in our ability to continue growing operating and earnings and EPFs at a double-digit rate, that's an FX notwithstanding. I'm going to turn the call over to Peter, and then we're going to come back and take questions. Good morning. Our strong first quarter results were supported by exceptional balance sheet strength and liquidity. Book value, nasty. to $2.3 billion. The quarter produced adjusted operating cash flow of $2 billion, including approximately $600 million of net loss payments for California wildfires. In the quarter, we returned $751 million of capital to shareholders, including $385 million in share repurchases and $366 million in dividends. The average share price on our repurchases for the quarter was $286.18. Book value for the quarter was favorably impacted by unrealized mark-to-market gains on our high-quality fixed income portfolio due to declining interest rates. Book and tangible book value per share excluding AOCI grew 0.9% and 1.6% respectively for the quarter. As you know, rates have since backed up. Our core operating return on tangible equity for the quarter is 13%, while our core operating ROE for the quarter was 8.6%. The quarter included pre-tax catastrophe losses of $1.64 billion, excluding the California wildfires. The approximately $170 million balance was principally weather-related, split 74% U.S. and 26% internationally. Prior period development in the quarter in our active companies was a favorable $268 million pre-tax, with favorable development of $313 million in short-tail lines, a mix of commercial and consumer. an unfavorable development of $45 million in long-tail commercial lines. Turning to investments, our A-rated portfolio produced adjusted net investment income of $1.67 billion, which was at the lower end of our six-month guidance and was negatively impacted by approximately $25 million of lower-than-usual private equity distributions and realizations and $10 million of unfavorable FX movements. The income generated from our public fixed income, private credit, and strategic holdings portfolio is performed in line with expectations. While the direction of financial markets remain uncertain and volatile, we expect second quarter adjusted net investment income to be at the midpoint of our previously guided six-month guidance. Our pay to incurred ratio for the quarter was 87% or 86% excluding tax, PPD, and agriculture. Our core effective tax rate was We continue to expect our annual core operating effective tax rate to be in the range of 19 to 19.5%. I'll now turn the call back over to Karen.