Chubb Ltd - FORM 8-K - EX-99.2

Attached files

file	filename
EX-99.1 - EX-99.1 - Chubb Ltd	d947899dex991.htm
8-K - 8-K - Chubb Ltd	d947899d8k.htm

Exhibit 99.2

LOGO

Chubb Limited

Financial Supplement

for the Quarter Ended June 30, 2020

Investor Contact

Karen Beyer: (212) 827-4445

email: investorrelations@chubb.com

This report is for informational purposes only. It should be read in conjunction with documents filed by Chubb Limited with the Securities and Exchange Commission, including the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

Cautionary Statement Regarding Forward-Looking Statements

Any forward-looking statements made in this financial supplement reflect Chubb Limited’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties which may cause actual results to differ materially from as indicated by such statements. For example, forward-looking statements related to financial performance, including exposures, reserves and recoverables, could be affected by the frequency and severity of unpredictable catastrophic events, actual loss experience, uncertainties in the reserving or settlement process, currency exchange fluctuations, new theories of liability, judicial, legislative, regulatory and other governmental developments, litigation tactics and developments, investigation developments and actual settlement terms, the amount and timing of reinsurance receivable and credit developments among reinsurers.

Our forward-looking statements could also be affected by, among other things, competition, pricing and policy term trends, market acceptance, changes in demand, actual market developments, rating agency action, possible terrorism or the outbreak and effects of war, and such other factors identified in our filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Chubb Limited

Financial Supplement Table of Contents


		Page

I.	Financial Highlights
	- Consolidated Financial Highlights		1

II.	Consolidated Results
	- Consolidated Statement of Operations		2
	- P&C Results—Consecutive Quarters		3
	- Global P&C Results—Consecutive Quarters		4
	- Catastrophe Losses		5
	- Summary Consolidated Balance Sheets		6
	- Line of Business		7
	- Consolidated Results by Segment		8 - 11

III.	Segment Results
	- North America Commercial P&C Insurance		12
	- North America Personal P&C Insurance		13
	- North America Agricultural Insurance		14
	- Overseas General Insurance		15
	- Global Reinsurance		16
	- Life Insurance		17
	- Corporate		18

IV.	Balance Sheet Details
	- Loss Reserve Rollforward		19
	- Reinsurance Recoverable Analysis		20
	- Investment Portfolio		21 - 24
	- Net Realized and Unrealized Gains (Losses)		25 - 26
	- Debt and Capital		27
	- Computation of Basic and Diluted Earnings Per Share		28
	- Book Value and Book Value per Common Share		29

V.	Other Disclosures
	- Non-GAAP Financial Measures		30 - 36
	- Glossary		37

Chubb Limited

Consolidated Financial Highlights

(in millions of U.S. dollars, except share, per share data, and ratios)

(Unaudited)

Note: All dollar amounts in the Financial Supplement are rounded. However, percent changes and ratios are calculated using whole dollars. Accordingly, calculations using rounded dollars may differ.


	Three months ended June 30									Constant $		Constant $			Six months ended June 30									Constant $		Constant $
	2020			2019			% Change			2019		% Change			2020			2019			% Change			2019		% Change
Gross premiums written	$	10,040		$	10,355			-3.0	%	$	10,192		-1.5	%	$	19,792		$	19,466			1.7	%	$	19,274		2.7	%
Net premiums written	$	8,355		$	8,343			0.1	%	$	8,200		1.9	%	$	16,332		$	15,656			4.3	%	$	15,488		5.5	%
P&C net premiums written	$	7,736		$	7,764			-0.4	%	$	7,629		1.4	%	$	15,068		$	14,498			3.9	%	$	14,337		5.1	%
P&C net premiums written adjusted for COVID-19 exposures ⁽¹⁾								2.1	%				3.9	%								5.3	%				6.4	%
Net premiums earned	$	8,128		$	7,891			3.0	%	$	7,754		4.8	%	$	15,922		$	15,028			5.9	%	$	14,868		7.1	%
Net investment income	$	827		$	859			-3.8	%	$	851		-2.9	%	$	1,688		$	1,695			-0.4	%	$	1,686		0.1	%
Adjusted net investment income	$	857		$	902			-5.0	%	$	894		-4.2	%	$	1,750		$	1,784			-1.9	%	$	1,775		-1.4	%
P&C underwriting income (loss)	$	(929	)	$	727			NM		$	714		NM		$	(151	)	$	1,439			NM		$	1,424		NM
Agriculture underwriting income	$	31		$	38			-17.9	%	$	38		-17.9	%	$	45		$	111			-59.2	%	$	111		-59.2	%
Global P&C (excludes Agriculture) underwriting income (loss)	$	(960	)	$	689			NM		$	676		NM		$	(196	)	$	1,328			NM		$	1,313		NM
Core operating income (loss)	$	(254	)	$	1,195			NM		$	1,179		NM		$	966		$	2,365			-59.2	%	$	2,347		-58.8	%
Net income (loss)	$	(331	)	$	1,150			NM							$	(79	)	$	2,190			NM
Operating cash flow	$	1,985		$	1,386										$	3,697		$	2,708
P&C combined ratio
Loss and loss expense ratio		85.2	%		61.7	%										72.8	%		60.6	%
Policy acquisition cost and administrative expense ratio		27.1	%		28.4	%										28.2	%		29.0	%

Combined ratio		112.3	%		90.1	%										101.0	%		89.6	%
P&C Current Accident Year (CAY) combined ratio ex Catastrophe losses (Cats)
CAY loss and loss expense ratio ex Cats		60.4	%		60.5	%										59.3	%		59.6	%
CAY policy acquisition cost and administrative expense ratio ex Cats		27.0	%		28.4	%										28.2	%		29.1	%

CAY combined ratio ex Cats		87.4	%		88.9	%										87.5	%		88.7	%
Global P&C CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		59.3	%		59.4	%										58.6	%		58.9	%
CAY policy acquisition cost and administrative expense ratio ex Cats		28.0	%		29.4	%										28.8	%		29.8	%

CAY combined ratio ex Cats		87.3	%		88.8	%										87.4	%		88.7	%
ROE		-2.5	%		8.7	%										-0.3	%		8.4	%
Core operating return on equity (ROE)		-2.0	%		9.3	%										3.7	%		9.2	%
Core operating return on tangible equity (ROTE)		-3.2	%		15.2	%										6.0	%		15.2	%
Effective tax rate ⁽²⁾		15.8	%		15.3	%										206.8	%		15.3	%
Core operating effective tax rate ⁽²⁾		15.3	%		15.3	%										16.5	%		15.0	%
Earnings per share ⁽³⁾
Net income (loss)	$	(0.73	)	$	2.50			NM							$	(0.17	)	$	4.75			NM
Core operating income (loss)	$	(0.56	)	$	2.60			NM							$	2.13		$	5.13			-58.5	%
Weighted average basic common shares outstanding		451.4			457.2											451.6			458.0
Weighted average diluted common shares outstanding		452.8			460.2											453.7			460.9

	June 30 2020			March 31 2020			% Change 2Q-20 vs. 1Q-20			December 31 2019		% Change 2Q-20 vs. 4Q-19
Book value per common share	$	121.32		$	115.62			4.9	%	$	122.42		-0.9	%
Tangible book value per common share	$	77.49		$	72.27			7.2	%	$	78.14		-0.8	%

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by COVID-19 including $184 million of exposure adjustments on in-force policies and $7 million of return premiums in North America Personal P&C Insurance.

(2)	Q2 2020 effective tax rate reflects an income tax benefit.

(3)

In periods where core operating loss and net loss are recognized, inclusion of incremental dilution is anti-dilutive and therefore basic shares are used in the calculation of per share earnings. For the three and six months ended June 30, 2020, the effect of dilutive securities was 1,395,951 shares and 2,044,144 shares, respectively. Weighted-average shares outstanding used to calculate core operating income per share for the six months ended June 30, 2020 and earnings per share for the 2019 periods include the effect of dilutive securities.


Financial Highlights		Page 1

Chubb Limited

Statement of Operations—Consecutive Quarters

(in millions of U.S. dollars)

(Unaudited)

Consolidated Statements of Operations


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	10,040		$	9,752		$	9,934		$	10,724		$	10,355		$	19,792		$	19,466		$	40,124
Net premiums written		8,355			7,977			7,997			8,622			8,343			16,332			15,656			32,275
Net premiums earned		8,128			7,794			7,935			8,327			7,891			15,922			15,028			31,290
Adjusted losses and loss expenses ⁽¹⁾		6,578			4,487			4,865			5,066			4,708			11,065			8,807			18,738
Realized (gains) losses on crop derivatives		1			2			—			14			(7	)		3			(6	)		8

Losses and loss expenses		6,577			4,485			4,865			5,052			4,715			11,062			8,813			18,730
Adjusted policy benefits ⁽²⁾		183			185			201			165			164			368			330			696
Gains (losses) from fair value changes in separate account liabilities		(40	)		56			(24	)		7			3			16			(27	)		(44	)

Policy benefits		223			129			225			158			161			352			357			740
Policy acquisition costs		1,593			1,615			1,542			1,603			1,544			3,208			3,008			6,153
Administrative expenses		727			741			810			752			758			1,468			1,468			3,030
Adjusted net investment income ⁽³⁾		857			893			893			910			902			1,750			1,784			3,587
Amortization expense of fair value adjustment on acquired invested assets		(30	)		(32	)		(35	)		(37	)		(43	)		(62	)		(89	)		(161	)

Net investment income		827			861			858			873			859			1,688			1,695			3,426
Adjusted realized gains (losses) ⁽⁴⁾		31			(956	)		(55	)		(141	)		(230	)		(925	)		(326	)		(522	)
Realized gains (losses) on crop derivatives		(1	)		(2	)		—			(14	)		7			(3	)		6			(8	)

Net realized gains (losses)		30			(958	)		(55	)		(155	)		(223	)		(928	)		(320	)		(530	)
Adjusted interest expense ⁽⁵⁾		134			137			140			143			145			271			290			573
Amortization benefit of fair value adjustment on acquired long term debt		(6	)		(5	)		(6	)		(5	)		(5	)		(11	)		(10	)		(21	)

Interest expense		128			132			134			138			140			260			280			552
Gains (losses) from fair value changes in separate account assets		40			(56	)		24			(7	)		(3	)		(16	)		27			44
Net realized gains (losses) related to unconsolidated entities		(100	)		(7	)		227			41			219			(107	)		215			483
Other income (expense) - operating		2			8			19			23			14			10			27			69

Other income (expense)		(58	)		(55	)		270			57			230			(113	)		269			596
Amortization expense of purchased intangibles		72			73			76			76			77			145			153			305
Chubb integration expenses		—			—			14			2			4			—			7			23
Income tax expense (benefit)		(62	)		215			169			230			208			153			396			795

Net income (loss)	$	(331	)	$	252		$	1,173		$	1,091		$	1,150		$	(79	)	$	2,190		$	4,454

(1)	Adjusted losses and loss expenses used throughout this report includes realized gains and losses on crop derivatives.

(2)	Adjusted policy benefits used throughout this report excludes gains and losses from fair value changes in separate account liabilities.

(3)	Adjusted net investment income used throughout this report excludes Amortization expense of fair value adjustment on acquired invested assets.

(4)	Adjusted realized gains (losses) used throughout this report excludes realized gains and losses on crop derivatives.

(5)	Adjusted interest expense used throughout this report excludes Amortization benefit of fair value adjustment on acquired long term debt.


Statement of Operations		Page 2

Chubb Limited

P&C Underwriting Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

Chubb Limited P&C Underwriting Results


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
P&C underwriting income (loss) (Including Corporate and excluding Life Insurance)
Gross premiums written	$	9,387		$	9,069		$	9,282		$	10,082		$	9,743		$	18,456		$	18,243		$	37,607
Net premiums written		7,736			7,332			7,375			8,010			7,764			15,068			14,498			29,883
Net premiums earned		7,520			7,163			7,322			7,729			7,320			14,683			13,896			28,947
Adjusted losses and loss expenses		6,407			4,285			4,689			4,876			4,519			10,692			8,416			17,981
Policy acquisition costs		1,397			1,435			1,376			1,427			1,394			2,832			2,730			5,533
Administrative expenses		645			665			724			672			680			1,310			1,311			2,707

P&C underwriting income (loss)	$	(929	)	$	778		$	533		$	754		$	727		$	(151	)	$	1,439		$	2,726

P&C CAY underwriting income ex Cats	$	947		$	897		$	730		$	819		$	814		$	1,844		$	1,572		$	3,121
% Change versus prior year period
Net premiums written		-0.4	%		8.9	%		9.0	%		6.2	%		4.2	%		3.9	%		3.6	%		5.6	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		2.1	%														5.3	%
Net premiums earned		2.7	%		8.9	%		6.3	%		5.0	%		2.9	%		5.7	%		2.2	%		4.0	%
Net premiums written constant $		1.4	%		9.3	%		9.8	%		7.2	%		6.0	%		5.1	%		5.6	%		7.0	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		3.9	%														6.4	%
Net premiums earned constant $		4.6	%		9.3	%		7.1	%		6.1	%		4.9	%		6.8	%		4.2	%		5.4	%
P&C combined ratio
Loss and loss expense ratio		85.2	%		59.8	%		64.0	%		63.1	%		61.7	%		72.8	%		60.6	%		62.1	%
Policy acquisition cost ratio		18.5	%		20.0	%		18.8	%		18.4	%		19.1	%		19.3	%		19.6	%		19.1	%
Administrative expense ratio		8.6	%		9.3	%		9.9	%		8.7	%		9.3	%		8.9	%		9.4	%		9.4	%

Combined ratio		112.3	%		89.1	%		92.7	%		90.2	%		90.1	%		101.0	%		89.6	%		90.6	%

CAY P&C combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		60.4	%		58.2	%		61.3	%		62.4	%		60.5	%		59.3	%		59.6	%		60.8	%
CAY policy acquisition cost and administrative expense ratio ex Cats		27.0	%		29.3	%		28.7	%		27.1	%		28.4	%		28.2	%		29.1	%		28.4	%

CAY combined ratio ex Cats		87.4	%		87.5	%		90.0	%		89.5	%		88.9	%		87.5	%		88.7	%		89.2	%

Other ratios
Net premiums written/gross premiums written		82	%		81	%		79	%		79	%		80	%		82	%		79	%		79	%
Expense ratio		27.1	%		29.3	%		28.7	%		27.1	%		28.4	%		28.2	%		29.0	%		28.5	%
Expense ratio excluding A&H		25.2	%		27.5	%		26.6	%		25.1	%		26.3	%		26.3	%		27.1	%		26.4	%
Catastrophe reinstatement premiums (expensed) collected—pre-tax	$	(20	)	$	—		$	(14	)	$	2		$	—		$	(20	)	$	—		$	(12	)
Catastrophe losses—pre-tax ⁽²⁾	$	1,781		$	237		$	416		$	234		$	275		$	2,018		$	525		$	1,175
Unfavorable (favorable) prior period development (PPD)—pre-tax	$	75		$	(118	)	$	(233	)	$	(167	)	$	(188	)	$	(43	)	$	(392	)	$	(792	)
Impact of catastrophe losses on P&C combined ratio—Unfavorable		23.9	%		3.3	%		5.9	%		3.0	%		3.8	%		13.8	%		3.8	%		4.1	%
Impact of PPD on P&C combined ratio—Unfavorable (favorable)		1.0	%		-1.7	%		-3.2	%		-2.3	%		-2.6	%		-0.3	%		-2.9	%		-2.7	%
Impact of Cats and PPD on P&C combined ratio—Unfavorable		24.9	%		1.6	%		2.7	%		0.7	%		1.2	%		13.5	%		0.9	%		1.4	%

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by COVID-19 including $184 million of exposure adjustments on in-force policies and $7 million of return premiums in North America Personal P&C Insurance.

(2)	Q2 and YTD 2020 represents P&C catastrophe losses only and excludes $6 million related to the COVID-19 losses included in the Life Insurance segment. Refer to page 5 for additional information on our catastrophe losses.


P&C Results		Page 3

Chubb Limited

Global P&C Underwriting Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

Global P&C includes the company’s North America Commercial P&C Insurance segment (refer to page 12), North America Personal P&C Insurance segment (refer to page 13), Overseas General Insurance segment (refer to page 15), Global Reinsurance segment (refer to page 16), and Corporate (refer to page 18). Global P&C excludes the North America Agricultural Insurance and Life Insurance segments.

Global P&C (Including Corporate and excluding Agriculture)


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Global P&C underwriting income (loss)
Gross premiums written	$	8,735		$	8,849		$	9,000		$	8,810		$	9,101		$	17,584		$	17,382		$	35,192
Net premiums written		7,275			7,175			7,099			7,072			7,298			14,450			13,902			28,073
Net premiums earned		7,144			7,069			6,901			6,788			6,942			14,213			13,463			27,152
Adjusted losses and loss expenses		6,094			4,220			4,236			3,996			4,210			10,314			8,133			16,365
Policy acquisition costs		1,368			1,424			1,382			1,371			1,367			2,792			2,696			5,449
Administrative expenses		642			661			727			668			676			1,303			1,306			2,701

Global P&C underwriting income (loss)	$	(960	)	$	764		$	556		$	753		$	689		$	(196	)	$	1,328		$	2,637

Global P&C CAY underwriting income ex Cats	$	910		$	889		$	789		$	797		$	774		$	1,799		$	1,518		$	3,104
% Change versus prior year period
Net premiums written		-0.3	%		8.6	%		8.0	%		6.2	%		3.3	%		3.9	%		3.0	%		5.0	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		2.3	%														5.3	%
Net premiums earned		2.9	%		8.4	%		5.0	%		4.4	%		2.7	%		5.6	%		2.0	%		3.3	%
Net premiums written constant $		1.6	%		9.1	%		8.9	%		7.3	%		5.3	%		5.2	%		5.0	%		6.6	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		4.2	%														6.6	%
Net premiums earned constant $		4.9	%		8.8	%		5.8	%		5.6	%		4.7	%		6.8	%		4.0	%		4.9	%
Combined ratio
Loss and loss expense ratio		85.3	%		59.7	%		61.4	%		58.9	%		60.6	%		72.6	%		60.4	%		60.3	%
Policy acquisition cost ratio		19.1	%		20.2	%		20.0	%		20.2	%		19.7	%		19.6	%		20.0	%		20.1	%
Administrative expense ratio		9.0	%		9.3	%		10.5	%		9.8	%		9.8	%		9.2	%		9.7	%		9.9	%

Combined ratio		113.4	%		89.2	%		91.9	%		88.9	%		90.1	%		101.4	%		90.1	%		90.3	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		59.3	%		57.9	%		58.1	%		58.5	%		59.4	%		58.6	%		58.9	%		58.6	%
CAY policy acquisition cost and administrative expense ratio ex Cats		28.0	%		29.5	%		30.5	%		29.8	%		29.4	%		28.8	%		29.8	%		30.0	%

CAY combined ratio ex Cats		87.3	%		87.4	%		88.6	%		88.3	%		88.8	%		87.4	%		88.7	%		88.6	%

Other ratios
Net premiums written/gross premiums written		83	%		81	%		79	%		80	%		80	%		82	%		80	%		80	%
Expense ratio		28.1	%		29.5	%		30.5	%		30.0	%		29.5	%		28.8	%		29.7	%		30.0	%
Expense ratio excluding A&H		26.2	%		27.7	%		28.6	%		28.0	%		27.4	%		26.9	%		27.8	%		28.0	%
Catastrophe reinstatement premiums (expensed) collected—pre-tax	$	(20	)	$	—		$	(14	)	$	2		$	—		$	(20	)	$	—		$	(12	)
Catastrophe losses—pre-tax	$	1,775		$	229		$	415		$	231		$	273		$	2,004		$	521		$	1,167
Unfavorable (favorable) prior period development (PPD)—pre-tax	$	75		$	(104	)	$	(196	)	$	(185	)	$	(188	)	$	(29	)	$	(331	)	$	(712	)

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by COVID-19 including $184 million of exposure adjustments on in-force policies and $7 million of return premiums in North America Personal P&C Insurance.


Global P&C		Page 4

Chubb Limited

Segments Results—Catastrophe Loss Charges

(in millions of U.S. dollars)

(Unaudited)

Chubb Limited Catastrophe Loss Charges—Q2 2020


	North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance		Overseas General Insurance			Global Reinsurance		Life Insurance		Total Consolidated excluding Reinstatement premiums		Reinstatement premiums expensed			Total Consolidated including Reinstatement premiums
Catastrophe Loss Charges by Event—Net
COVID-19	$	973		$	—		$	—	$	360		$	10	$	6	$	1,349	$	(16	)	$	1,365
U.S. Flooding, Hail, Tornadoes, and Wind Events		179			109			6		2			3		—		299		(4	)		303
Civil unrest		118			—			—		12			—		—		130		—			130
Other		—			—			—		9			—		—		9		—			9

Total	$	1,270		$	109		$	6	$	383		$	13	$	6	$	1,787

Reinstatement premiums expensed		(3	)		(1	)		—		(16	)		—		—			$	(20	)

Total before income tax	$	1,273		$	110		$	6	$	399		$	13	$	6						$	1,807

Income tax benefit																						297

Total after income tax																					$	1,510

Note: The above table represents catastrophe loss estimates for events that occurred in the current calendar year only (i.e., loss events occurring during the second quarter of 2020 and changes to catastrophe loss estimates that occurred in Q1 2020). Changes in catastrophe loss estimates in the current calendar year that relate to loss events that occurred in previous calendar years are considered prior period development and are excluded from the table above.


Catastrophe Losses		Page 5

Chubb Limited

Summary Consolidated Balance Sheets

(in millions of U.S. dollars, except per share data)

(Unaudited)


	June 30 2020			March 31 2020			December 31 2019
Assets
Fixed maturities available for sale, at fair value	$	86,712		$	81,523		$	85,488
Fixed maturities held to maturity, at amortized cost		11,845			12,022			12,581
Equity securities, at fair value		2,394			2,068			812
Short-term investments, at fair value		4,003			3,586			4,291
Other investments		5,923			6,075			6,062

		110,877			105,274			109,234
Cash		1,557			1,512			1,537
Securities lending collateral		1,832			1,342			994
Insurance and reinsurance balances receivable		10,853			10,058			10,357
Reinsurance recoverable on losses and loss expenses		15,207			14,898			15,181
Deferred policy acquisition costs		5,243			5,162			5,242
Value of business acquired		290			289			306
Prepaid reinsurance premiums		2,725			2,570			2,647
Goodwill and other intangible assets		21,093			20,873			21,359
Investments in partially-owned insurance companies		1,364			1,346			1,332
Other assets		10,433			9,793			8,754

Total assets	$	181,474		$	173,117		$	176,943

Liabilities
Unpaid losses and loss expenses	$	65,699		$	62,214		$	62,690
Unearned premiums		17,081			16,459			16,771
Future policy benefits		5,895			5,776			5,814
Insurance and reinsurance balances payable		6,249			6,084			6,184
Securities lending payable		1,832			1,342			994
Accounts payable, accrued expenses, and other liabilities		13,998			13,463			13,189
Deferred tax liabilities		696			473			804
Short-term and long-term debt		14,956			14,810			14,858
Trust preferred securities		308			308			308

Total liabilities		126,714			120,929			121,612
Shareholders’ equity
Total shareholders’ equity, excl. AOCI		53,662			54,281			54,712
Accumulated other comprehensive income (loss) (AOCI)		1,098			(2,093	)		619

Total shareholders’ equity		54,760			52,188			55,331

Total liabilities and shareholders’ equity	$	181,474		$	173,117		$	176,943

Book value per common share	$	121.32		$	115.62		$	122.42
% change over prior quarter		4.9	%		-5.6	%		1.7	%
Tangible book value per common share	$	77.49		$	72.27		$	78.14
% change over prior quarter		7.2	%		-7.5	%		2.5	%


Consol Bal Sheet		Page 6

Chubb Limited

Consolidated Net Premiums Written by Line of Business

(in millions of U.S. dollars)

(Unaudited)


	2Q-20		2Q-19		% Change			Constant $ % Change			C$ adjusted for COVID-19 exposures % Change ⁽¹⁾			YTD 2020		YTD 2019		% Change			Constant $ % Change			C$ adjusted for COVID-19 exposures % Change ⁽¹⁾
Net premiums written
Commercial multiple peril⁽²⁾	$	267	$	254		5.3	%		5.3	%		7.3	%	$	508	$	473		7.5	%		7.5	%		8.6	%
Commercial casualty		1,478		1,472		0.4	%		1.2	%		5.2	%		2,819		2,672		5.5	%		6.0	%		8.2	%
Workers’ compensation ⁽³⁾		467		482		-3.1	%		-3.1	%		22.0	%		1,053		1,075		-2.1	%		-2.1	%		9.2	%
Professional liability		997		909		9.7	%		11.4	%		11.4	%		1,909		1,695		12.6	%		13.7	%		13.7	%
Surety		117		156		-25.2	%		-21.5	%		-21.5	%		267		308		-13.5	%		-11.0	%		-11.0	%
Property and other short-tail lines		1,344		1,186		13.4	%		16.0	%		16.0	%		2,678		2,343		14.3	%		16.3	%		16.3	%

Total Commercial P&C		4,670		4,459		4.7	%		6.2	%		10.3	%		9,234		8,566		7.8	%		8.8	%		10.9	%
Agriculture		461		466		-1.1	%		-1.1	%		-1.1	%		618		596		3.8	%		3.8	%		3.8	%
Personal automobile		353		473		-25.3	%		-19.7	%		-18.0	%		794		894		-11.2	%		-8.5	%		-7.6	%
Personal homeowners		980		968		1.3	%		1.7	%		1.7	%		1,753		1,711		2.5	%		2.7	%		2.7	%
Personal other		402		383		4.8	%		7.6	%		7.6	%		820		751		9.2	%		11.3	%		11.3	%

Total Personal lines		1,735		1,824		-4.9	%		-2.3	%		-1.9	%		3,367		3,356		0.4	%		1.7	%		1.9	%
Total Property and Casualty lines		6,866		6,749		1.7	%		3.4	%		6.3	%		13,219		12,518		5.6	%		6.6	%		8.2	%
Global A&H lines ⁽⁴⁾		951		1,130		-15.9	%		-13.5	%		-13.5	%		2,018		2,203		-8.4	%		-6.7	%		-6.7	%
Reinsurance lines		207		197		4.6	%		4.9	%		4.9	%		425		399		6.5	%		6.4	%		6.4	%
Life		331		267		24.2	%		27.0	%		27.0	%		670		536		25.1	%		26.5	%		26.5	%

Total consolidated	$	8,355	$	8,343		0.1	%		1.9	%		4.2	%	$	16,332	$	15,656		4.3	%		5.5	%		6.7	%

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by COVID-19 including $184 million of exposure adjustments on in-force policies and $7 million of return premiums in North America Personal P&C Insurance.

(2)	Commercial multiple peril represents retail package business (property and general liability).

(3)	Q2 and YTD 2020 net premiums written includes $116 million related to a structured transaction written in the quarter, that covers previously incurred losses, which contributed 23.9% to the Q2 2020 growth.

(4)

For purposes of this schedule only, A&H results from our Combined North America and International businesses, normally included in the Life Insurance and Overseas General Insurance segments, respectively, as well as the A&H results of our North America Commercial P&C segment, are included in Global A&H lines above.


Line of Business		Page 7

Chubb Limited

Consolidated Results—Three months ended June 30, 2020

(in millions of U.S. dollars, except ratios)

(Unaudited)


Q2 2020	North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C			Life Insurance			Total Consolidated
Net premiums written	$	3,720		$	1,327		$	461		$	2,021		$	207		$	—		$	7,736		$	619		$	8,355
Net premiums earned		3,595			1,192			376			2,194			163			—			7,520			608			8,128
Adjusted losses and loss expenses		3,498			762			313			1,485			73			276			6,407			171			6,578
Adjusted policy benefits		—			—			—			—			—			—			—			183			183
Policy acquisition costs		471			231			29			624			42			—			1,397			196			1,593
Administrative expenses		249			66			3			241			9			77			645			82			727

Underwriting income (loss)		(623	)		133			31			(156	)		39			(353	)		(929	)		(24	)		(953	)
Adjusted net investment income		507			65			7			124			51			8			762			95			857
Other income (expense)—operating		(4	)		(1	)		(1	)		(8	)		8			(9	)		(15	)		17			2
Amortization expense of purchased intangibles		—			(3	)		(6	)		(11	)		—			(51	)		(71	)		(1	)		(72	)

Segment income (loss)	$	(120	)	$	194		$	31		$	(51	)	$	98		$	(405	)	$	(253	)	$	87		$	(166	)

Adjusted interest expense																	(134	)								(134	)
Income tax benefit																	46									46

Core operating loss																	(493	)								(254	)
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $5 million tax benefit																	(19	)								(19	)
Adjusted net realized gains (losses), net of $11 million tax benefit⁽¹⁾																	(58	)								(58	)

Net loss																$	(570	)							$	(331	)

Combined ratio		117.3	%		88.8	%		91.8	%		107.1	%		76.6	%					112.3	%
CAY combined ratio ex Cats		86.0	%		79.6	%		90.2	%		90.7	%		78.2	%					87.4	%

(1)	Includes Net realized gains (losses) related to unconsolidated entities.


Consol Results—QTD 2020		Page 8

Chubb Limited

Consolidated Results—Six months ended June 30, 2020

(in millions of U.S. dollars, except ratios)

(Unaudited)


YTD 2020	North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C			Life Insurance			Total Consolidated
Net premiums written	$	6,972		$	2,434		$	618		$	4,619		$	425		$	—		$	15,068		$	1,264		$	16,332
Net premiums earned		6,971			2,392			470			4,501			349			—			14,683			1,239			15,922
Adjusted losses and loss expenses		5,679			1,445			378			2,743			160			287			10,692			373			11,065
Adjusted policy benefits		—			—			—			—			—			—			—			368			368
Policy acquisition costs		963			476			40			1,266			87			—			2,832			376			3,208
Administrative expenses		508			134			7			499			19			143			1,310			158			1,468

Underwriting income (loss)		(179	)		337			45			(7	)		83			(430	)		(151	)		(36	)		(187	)
Adjusted net investment income		1,023			131			16			269			105			16			1,560			190			1,750
Other income (expense)—operating		(1	)		(3	)		(1	)		(12	)		23			(25	)		(19	)		29			10
Amortization expense of purchased intangibles		—			(6	)		(13	)		(23	)		—			(101	)		(143	)		(2	)		(145	)

Segment income (loss)	$	843		$	459		$	47		$	227		$	211		$	(540	)	$	1,247		$	181		$	1,428

Adjusted interest expense																	(271	)								(271	)
Income tax expense																	(191	)								(191	)

Core operating income (loss)																	(1,002	)								966
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $10 million tax benefit																	(41	)								(41	)
Adjusted net realized gains (losses), net of $28 million tax benefit⁽¹⁾																	(1,004	)								(1,004	)

Net loss																$	(2,047	)							$	(79	)

Combined ratio		102.6	%		85.9	%		90.4	%		100.2	%		76.3	%					101.0	%
CAY combined ratio ex Cats		86.2	%		80.4	%		90.4	%		90.2	%		79.2	%					87.5	%

(1)	Includes Net realized gains (losses) related to unconsolidated entities.


Consol Results—YTD 2020		Page 9

Chubb Limited

Consolidated Results—Three months ended June 30, 2019

(in millions of U.S. dollars, except ratios)

(Unaudited)


Q2 2019	North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C			Life Insurance			Total Consolidated
Net premiums written	$	3,534		$	1,309		$	466		$	2,258		$	197		$	—		$	7,764		$	579		$	8,343
Net premiums earned		3,390			1,168			378			2,225			159			—			7,320			571			7,891
Adjusted losses and loss expenses		2,214			747			309			1,125			90			34			4,519			189			4,708
Adjusted policy benefits		—			—			—			—			—			—			—			164			164
Policy acquisition costs		459			237			27			629			42			—			1,394			150			1,544
Administrative expenses		259			71			4			265			7			74			680			78			758

Underwriting income (loss)		458			113			38			206			20			(108	)		727			(10	)		717
Adjusted net investment income		521			64			4			151			55			10			805			97			902
Other income (expense)—operating		(2	)		(1	)		(1	)		(3	)		15			(4	)		4			10			14
Amortization expense of purchased intangibles		—			(3	)		(7	)		(12	)		—			(54	)		(76	)		(1	)		(77	)

Segment income (loss)	$	977		$	173		$	34		$	342		$	90		$	(156	)	$	1,460		$	96		$	1,556

Adjusted interest expense																	(145	)								(145	)
Income tax expense																	(216	)								(216	)

Core operating income (loss)																	(517	)								1,195
Chubb integration expenses, net of $1 million tax benefit																	(3	)								(3	)
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $6 million tax benefit																	(32	)								(32	)
Adjusted net realized gains (losses), net of $1 million tax benefit ⁽¹⁾																	(10	)								(10	)

Net income (loss)																$	(562	)							$	1,150

Combined ratio		86.5	%		90.3	%		90.1	%		90.8	%		87.7	%					90.1	%
CAY combined ratio ex Cats		87.9	%		81.7	%		89.6	%		91.2	%		81.7	%					88.9	%

(1)	Includes Net realized gains (losses) related to unconsolidated entities.


Consol Results—QTD 2019		Page 10

Chubb Limited

Consolidated Results—Six months ended June 30, 2019

(in millions of U.S. dollars, except ratios)

(Unaudited)


YTD 2019	North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C			Life Insurance			Total Consolidated
Net premiums written	$	6,485		$	2,365		$	596		$	4,653		$	399		$	—		$	14,498		$	1,158		$	15,656
Net premiums earned		6,475			2,322			433			4,339			327			—			13,896			1,132			15,028
Adjusted losses and loss expenses		4,187			1,504			283			2,231			166			45			8,416			391			8,807
Adjusted policy benefits		—			—			—			—			—			—			—			330			330
Policy acquisition costs		918			468			34			1,225			85			—			2,730			278			3,008
Administrative expenses		499			139			5			514			17			137			1,311			157			1,468

Underwriting income (loss)		871			211			111			369			59			(182	)		1,439			(24	)		1,415
Adjusted net investment income		1,031			128			14			295			111			19			1,598			186			1,784
Other income (expense)—operating		3			(1	)		(1	)		(7	)		24			(11	)		7			20			27
Amortization expense of purchased intangibles		—			(6	)		(14	)		(23	)		—			(109	)		(152	)		(1	)		(153	)

Segment income (loss)	$	1,905		$	332		$	110		$	634		$	194		$	(283	)	$	2,892		$	181		$	3,073

Adjusted interest expense																	(290	)								(290	)
Income tax expense																	(418	)								(418	)

Core operating income (loss)																	(991	)								2,365
Chubb integration expenses, net of $2 million tax benefit																	(5	)								(5	)
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of $14 million tax benefit																	(65	)								(65	)
Adjusted net realized gains (losses), net of $6 million tax benefit ⁽¹⁾																	(105	)								(105	)

Net income (loss)																$	(1,166	)							$	2,190

Combined ratio		86.5	%		90.9	%		74.5	%		91.5	%		82.1	%					89.6	%
CAY combined ratio ex Cats		87.8	%		81.4	%		88.5	%		91.3	%		81.6	%					88.7	%

(1)	Includes Net realized gains (losses) related to unconsolidated entities.


Consol Results—YTD 2019		Page 11

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

North America Commercial P&C Insurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	4,401		$	4,211		$	4,576		$	4,533		$	4,518		$	8,612		$	8,495		$	17,604
Net premiums written		3,720			3,252			3,438			3,452			3,534			6,972			6,485			13,375
Net premiums earned		3,595			3,376			3,262			3,185			3,390			6,971			6,475			12,922
Losses and loss expenses		3,498			2,181			1,968			2,051			2,214			5,679			4,187			8,206
Policy acquisition costs		471			492			454			459			459			963			918			1,831
Administrative expenses		249			259			273			256			259			508			499			1,028

Underwriting income (loss)		(623	)		444			567			419			458			(179	)		871			1,857
Net investment income		507			516			519			532			521			1,023			1,031			2,082
Other income (expense)—operating		(4	)		3			(1	)		1			(2	)		(1	)		3			3

Segment income (loss)	$	(120	)	$	963		$	1,085		$	952		$	977		$	843		$	1,905		$	3,942

CAY underwriting income ex Cats	$	504		$	457		$	445		$	398		$	410		$	961		$	786		$	1,629
Combined ratio
Loss and loss expense ratio		97.3	%		64.6	%		60.3	%		64.4	%		65.3	%		81.5	%		64.7	%		63.5	%
Policy acquisition cost ratio		13.1	%		14.6	%		13.9	%		14.4	%		13.6	%		13.8	%		14.1	%		14.2	%
Administrative expense ratio		6.9	%		7.6	%		8.4	%		8.1	%		7.6	%		7.3	%		7.7	%		7.9	%

Combined ratio		117.3	%		86.8	%		82.6	%		86.9	%		86.5	%		102.6	%		86.5	%		85.6	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		66.1	%		64.2	%		64.0	%		65.5	%		66.7	%		65.2	%		65.9	%		65.3	%
CAY policy acquisition cost and administrative expense ratio ex Cats		19.9	%		22.3	%		22.4	%		22.1	%		21.2	%		21.0	%		21.9	%		22.1	%

CAY combined ratio ex Cats		86.0	%		86.5	%		86.4	%		87.6	%		87.9	%		86.2	%		87.8	%		87.4	%

Catastrophe reinstatement premiums expensed—pre-tax	$	(3	)	$	—		$	—		$	—		$	—		$	(3	)	$	—		$	—
Catastrophe losses—pre-tax	$	1,270		$	118		$	102		$	88		$	137		$	1,388		$	231		$	421
Favorable prior period development (PPD)—pre-tax	$	(146	)	$	(105	)	$	(224	)	$	(109	)	$	(185	)	$	(251	)	$	(316	)	$	(649	)
% Change versus prior year period
Net premiums written		5.3	%		10.2	%		9.4	%		7.9	%		6.0	%		7.5	%		5.6	%		7.1	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		9.8	%														10.0	%
Net premiums earned		6.1	%		9.4	%		6.0	%		5.5	%		3.4	%		7.7	%		2.7	%		4.2	%
Other ratios
Net premiums written/gross premiums written		85	%		77	%		75	%		76	%		78	%		81	%		76	%		76	%
Production by Size—Net premiums written ⁽²⁾
Major Accounts & Specialty	$	2,350		$	1,874		$	2,049		$	2,043		$	2,187		$	4,224		$	3,899		$	7,991
Commercial		1,370			1,378			1,389			1,409			1,347			2,748			2,586			5,384

Total	$	3,720		$	3,252		$	3,438		$	3,452		$	3,534		$	6,972		$	6,485		$	13,375

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by $160 million of COVID-19 exposure adjustments on in-force policies.

(2)

Major Accounts & Specialty: large corporate accounts and wholesale business. Commercial: principally middle market and small commercial accounts. Certain 2019 businesses, previously reported within Commercial, are now reported within Major Accounts & Specialty to align with 2020 reporting. The reclassifications are immaterial and have no impact to total reported North America Commercial P&C Insurance segment net premiums written.


NA Commercial		Page 12

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

North America Personal P&C Insurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	1,511		$	1,265		$	1,349		$	1,422		$	1,483		$	2,776		$	2,690		$	5,461
Net premiums written		1,327			1,107			1,171			1,251			1,309			2,434			2,365			4,787
Net premiums earned		1,192			1,200			1,185			1,187			1,168			2,392			2,322			4,694
Losses and loss expenses		762			683			865			674			747			1,445			1,504			3,043
Policy acquisition costs		231			245			240			240			237			476			468			948
Administrative expenses		66			68			75			72			71			134			139			286

Underwriting income		133			204			5			201			113			337			211			417
Net investment income		65			66			64			66			64			131			128			258
Other income (expense)—operating		(1	)		(2	)		(1	)		(1	)		(1	)		(3	)		(1	)		(3	)
Amortization expense of purchased intangibles		(3	)		(3	)		(3	)		(3	)		(3	)		(6	)		(6	)		(12	)

Segment income	$	194		$	265		$	65		$	263		$	173		$	459		$	332		$	660

CAY underwriting income ex Cats	$	242		$	226		$	223		$	222		$	214		$	468		$	431		$	876
Combined ratio
Loss and loss expense ratio		63.8	%		57.0	%		73.0	%		56.9	%		64.0	%		60.4	%		64.7	%		64.8	%
Policy acquisition cost ratio		19.4	%		20.4	%		20.3	%		20.2	%		20.2	%		19.9	%		20.2	%		20.2	%
Administrative expense ratio		5.6	%		5.6	%		6.3	%		6.0	%		6.1	%		5.6	%		6.0	%		6.1	%

Combined ratio		88.8	%		83.0	%		99.6	%		83.1	%		90.3	%		85.9	%		90.9	%		91.1	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		54.7	%		55.1	%		55.1	%		55.1	%		55.3	%		54.9	%		55.2	%		55.1	%
CAY policy acquisition cost and administrative expense ratio ex Cats		24.9	%		26.1	%		26.3	%		26.2	%		26.4	%		25.5	%		26.2	%		26.3	%

CAY combined ratio ex Cats		79.6	%		81.2	%		81.4	%		81.3	%		81.7	%		80.4	%		81.4	%		81.4	%

Catastrophe reinstatement premiums expensed—pre-tax	$	(1	)	$	—		$	(11	)	$	—		$	—		$	(1	)	$	—		$	(11	)
Catastrophe losses—pre-tax	$	109		$	21		$	214		$	83		$	117		$	130		$	246		$	543
Unfavorable (favorable) prior period development (PPD)—pre-tax	$	(1	)	$	1		$	(7	)	$	(62	)	$	(16	)	$	—		$	(26	)	$	(95	)
% Change versus prior year period
Net premiums written		1.4	%		4.8	%		9.2	%		2.7	%		-2.0	%		2.9	%		-0.7	%		2.4	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		2.0	%		5.1	%		4.6	%		3.9	%		2.4	%		3.4	%		2.4	%		3.3	%
Net premiums earned		2.1	%		3.9	%		4.8	%		1.7	%		1.1	%		3.0	%		1.2	%		2.2	%
Other ratios
Net premiums written/gross premiums written		88	%		88	%		87	%		88	%		88	%		88	%		88	%		88	%

(1)

Q2 and YTD 2020 net premiums written were adversely impacted by $7 million of return premiums related to COVID-19. For Q1 2020, YTD 2020 and the 2019 periods, net premiums written were also adjusted for certain items, including additional reinsurance, as applicable. Refer to the Non-GAAP financial measures section for additional details.


NA Personal		Page 13

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

North America Agricultural Insurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	652		$	220		$	282		$	1,272		$	642		$	872		$	861		$	2,415
Net premiums written		461			157			276			938			466			618			596			1,810
Net premiums earned		376			94			421			941			378			470			433			1,795
Adjusted losses and loss expenses ⁽¹⁾		313			65			453			880			309			378			283			1,616
Policy acquisition costs		29			11			(6	)		56			27			40			34			84
Administrative expenses		3			4			(3	)		4			4			7			5			6

Underwriting income (loss)		31			14			(23	)		1			38			45			111			89
Net investment income		7			9			8			8			4			16			14			30
Other income (expense)—operating		(1	)		—			—			—			(1	)		(1	)		(1	)		(1	)
Amortization expense of purchased intangibles		(6	)		(7	)		(7	)		(7	)		(7	)		(13	)		(14	)		(28	)

Segment income (loss)	$	31		$	16		$	(22	)	$	2		$	34		$	47		$	110		$	90

CAY underwriting income (loss) ex Cats	$	37		$	8		$	(59	)	$	22		$	40		$	45		$	54		$	17
Combined ratio
Loss and loss expense ratio		83.1	%		69.6	%		107.6	%		93.5	%		81.9	%		80.4	%		65.5	%		90.1	%
Policy acquisition cost ratio		7.8	%		11.1	%		-1.5	%		6.0	%		7.3	%		8.5	%		7.9	%		4.7	%
Administrative expense ratio		0.9	%		4.1	%		-0.7	%		0.4	%		0.9	%		1.5	%		1.1	%		0.3	%

Combined ratio		91.8	%		84.8	%		105.4	%		99.9	%		90.1	%		90.4	%		74.5	%		95.1	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		81.5	%		76.2	%		113.6	%		91.3	%		81.4	%		80.4	%		79.5	%		93.5	%
CAY policy acquisition cost and administrative expense ratio ex Cats		8.7	%		14.7	%		0.3	%		6.4	%		8.2	%		10.0	%		9.0	%		5.6	%

CAY combined ratio ex Cats		90.2	%		90.9	%		113.9	%		97.7	%		89.6	%		90.4	%		88.5	%		99.1	%

Catastrophe losses—pre-tax	$	6		$	8		$	1		$	3		$	2		$	14		$	4		$	8
Unfavorable (favorable) prior period development (PPD)—pre-tax	$	—		$	(14	)	$	(37	)	$	18		$	—		$	(14	)	$	(61	)	$	(80	)
% Change versus prior year period
Net premiums written		-1.1	%		21.2	%		40.4	%		6.2	%		20.1	%		3.8	%		20.1	%		14.8	%
Net premiums earned		-0.5	%		71.8	%		32.4	%		9.8	%		7.7	%		8.6	%		9.8	%		14.4	%
Other ratios
Net premiums written/gross premiums written		71	%		71	%		98	%		74	%		73	%		71	%		69	%		75	%

(1)	Includes Realized gains (losses) on crop derivatives.


NA Agriculture		Page 14

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

Overseas General Insurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	2,561		$	3,131		$	2,964		$	2,705		$	2,863		$	5,692		$	5,739		$	11,408
Net premiums written		2,021			2,598			2,381			2,228			2,258			4,619			4,653			9,262
Net premiums earned		2,194			2,307			2,287			2,256			2,225			4,501			4,339			8,882
Losses and loss expenses		1,485			1,258			1,221			1,154			1,125			2,743			2,231			4,606
Policy acquisition costs		624			642			646			630			629			1,266			1,225			2,501
Administrative expenses		241			258			262			257			265			499			514			1,033

Underwriting income (loss)		(156	)		149			158			215			206			(7	)		369			742
Net investment income		124			145			145			148			151			269			295			588
Other income (expense)—operating		(8	)		(4	)		(2	)		(3	)		(3	)		(12	)		(7	)		(12	)
Amortization expense of purchased intangibles		(11	)		(12	)		(11	)		(11	)		(12	)		(23	)		(23	)		(45	)

Segment income (loss)	$	(51	)	$	278		$	290		$	349		$	342		$	227		$	634		$	1,273

CAY underwriting income ex Cats	$	207		$	235		$	202		$	225		$	195		$	442		$	379		$	806
Combined ratio
Loss and loss expense ratio		67.7	%		54.5	%		53.3	%		51.1	%		50.6	%		61.0	%		51.4	%		51.9	%
Policy acquisition cost ratio		28.4	%		27.8	%		28.3	%		28.0	%		28.3	%		28.1	%		28.2	%		28.1	%
Administrative expense ratio		11.0	%		11.2	%		11.5	%		11.4	%		11.9	%		11.1	%		11.9	%		11.6	%

Combined ratio		107.1	%		93.5	%		93.1	%		90.5	%		90.8	%		100.2	%		91.5	%		91.6	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		51.6	%		50.8	%		51.5	%		50.7	%		51.1	%		51.2	%		51.2	%		51.2	%
CAY policy acquisition cost and administrative expense ratio ex Cats		39.1	%		39.0	%		39.7	%		39.3	%		40.1	%		39.0	%		40.1	%		39.7	%

CAY combined ratio ex Cats		90.7	%		89.8	%		91.2	%		90.0	%		91.2	%		90.2	%		91.3	%		90.9	%

Catastrophe reinstatement premiums expensed—pre-tax	$	(16	)	$	—		$	(4	)	$	—		$	—		$	(16	)	$	—		$	(4	)
Catastrophe losses—pre-tax	$	383		$	90		$	83		$	35		$	9		$	473		$	34		$	152
Favorable prior period development (PPD)—pre-tax	$	(36	)	$	(4	)	$	(43	)	$	(25	)	$	(20	)	$	(40	)	$	(24	)	$	(92	)
% Change versus prior year period
Net premiums written		-10.5	%		8.5	%		6.3	%		7.1	%		2.7	%		-0.7	%		1.5	%		4.0	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		-9.4	%														-0.2	%
Net premiums earned		-1.5	%		9.2	%		4.6	%		4.6	%		3.0	%		3.7	%		1.7	%		3.1	%
Net premiums written constant $		-5.1	%		9.7	%		8.8	%		10.7	%		8.5	%		2.7	%		7.2	%		8.4	%
Net premiums written adjusted for COVID-19 exposures ⁽¹⁾		-4.0	%														3.2	%
Net premiums earned constant $		4.2	%		10.5	%		6.9	%		8.0	%		9.2	%		7.4	%		7.8	%		7.6	%
Other ratios
Net premiums written/gross premiums written		79	%		83	%		80	%		82	%		79	%		81	%		81	%		81	%

Production by Region—Net premiums written	2Q-20			2Q-19			% Change			Constant $ % Change			YTD 2020			YTD 2019			% Change			Constant $ % Change
Europe	$	851		$	810			5.0	%		7.7	%	$	2,079		$	1,916			8.5	%		10.3	%
Latin America		389			573			-32.2	%		-20.8	%		972			1,106			-12.1	%		-4.0	%
Asia		721			792			-9.0	%		-6.3	%		1,409			1,461			-3.6	%		-1.7	%
Other⁽²⁾		60			83			-27.1	%		-24.6	%		159			170			-6.6	%		-4.8	%

Total	$	2,021		$	2,258			-10.5	%		-5.1	%	$	4,619		$	4,653			-0.7	%		2.7	%

(1)	Q2 and YTD 2020 net premiums written were adversely impacted by $24 million of COVID-19 exposure adjustments on in-force policies.

(2)	Primarily includes Eurasia and Africa, and the company’s international supplemental A&H business of Combined Insurance.


Overseas General Insurance		Page 15

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars, except ratios)

(Unaudited)

Global Reinsurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	262		$	242		$	111		$	150		$	237		$	504		$	458		$	719
Net premiums written		207			218			109			141			197			425			399			649
Net premiums earned		163			186			167			160			159			349			327			654
Losses and loss expenses		73			87			107			79			90			160			166			352
Policy acquisition costs		42			45			42			42			42			87			85			169
Administrative expenses		9			10			9			9			7			19			17			35

Underwriting income		39			44			9			30			20			83			59			98
Net investment income		51			54			54			55			55			105			111			220
Other income (expense)—operating		8			15			18			16			15			23			24			58

Segment income	$	98		$	113		$	81		$	101		$	90		$	211		$	194		$	376

CAY underwriting income ex Cats	$	36		$	37		$	28		$	28		$	30		$	73		$	61		$	117
Combined ratio
Loss and loss expense ratio		45.5	%		46.5	%		64.2	%		49.6	%		55.9	%		46.0	%		50.6	%		53.9	%
Policy acquisition cost ratio		25.5	%		24.5	%		24.7	%		26.2	%		26.9	%		25.0	%		26.1	%		25.7	%
Administrative expense ratio		5.6	%		5.1	%		5.7	%		5.3	%		4.9	%		5.3	%		5.4	%		5.4	%

Combined ratio		76.6	%		76.1	%		94.6	%		81.1	%		87.7	%		76.3	%		82.1	%		85.0	%

CAY combined ratio ex Cats
CAY loss and loss expense ratio ex Cats		46.8	%		50.4	%		52.5	%		49.9	%		49.7	%		48.7	%		50.1	%		50.6	%
CAY policy acquisition cost and administrative expense ratio ex Cats		31.4	%		29.6	%		30.8	%		32.2	%		32.0	%		30.5	%		31.5	%		31.5	%

CAY combined ratio ex Cats		78.2	%		80.0	%		83.3	%		82.1	%		81.7	%		79.2	%		81.6	%		82.1	%

Catastrophe reinstatement premiums collected—pre-tax	$	—		$	—		$	1		$	2		$	—		$	—		$	—		$	3
Catastrophe losses—pre-tax	$	13		$	—		$	16		$	25		$	10		$	13		$	10		$	51
Unfavorable (favorable) prior period development (PPD)—pre-tax	$	(16	)	$	(7	)	$	4		$	(25	)	$	—		$	(23	)	$	(8	)	$	(29	)
% Change versus prior year period
Net premiums written as reported		4.6	%		8.4	%		-6.0	%		-14.0	%		0.2	%		6.5	%		2.3	%		-3.2	%
Net premiums earned as reported		2.9	%		10.4	%		-5.8	%		1.9	%		-5.0	%		6.8	%		-2.5	%		-2.3	%
Net premiums written constant $		4.9	%		7.9	%		-4.8	%		-12.8	%		1.3	%		6.4	%		3.8	%		-1.7	%
Net premiums earned constant $		4.0	%		10.2	%		-5.0	%		3.1	%		-3.5	%		7.2	%		-0.5	%		-0.8	%
Other ratios
Net premiums written/gross premiums written		79	%		90	%		99	%		94	%		83	%		84	%		87	%		90	%


Global Reinsurance		Page 16

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars)

(Unaudited)

Life Insurance


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	653		$	683		$	652		$	642		$	612		$	1,336		$	1,223		$	2,517
Net premiums written		619			645			622			612			579			1,264			1,158			2,392
Net premiums earned		608			631			613			598			571			1,239			1,132			2,343
Losses and loss expenses ⁽¹⁾		171			202			176			190			189			373			391			757
Adjusted policy benefits ⁽¹⁾		183			185			201			165			164			368			330			696
Policy acquisition costs		196			180			166			176			150			376			278			620
Administrative expenses		82			76			86			80			78			158			157			323
Net investment income		95			95			95			92			97			190			186			373

Life Insurance underwriting income⁽²⁾		71			83			79			79			87			154			162			320
Other income (expense)—operating		17			12			11			17			10			29			20			48
Amortization expense of purchased intangibles		(1	)		(1	)		—			(1	)		(1	)		(2	)		(1	)		(2	)

Segment income	$	87		$	94		$	90		$	95		$	96		$	181		$	181		$	366

% Change versus prior year period
Net premiums written		7.0	%		11.4	%		6.9	%		8.5	%		2.5	%		9.2	%		3.0	%		5.3	%
Net premiums earned		6.5	%		12.6	%		6.6	%		8.7	%		3.4	%		9.5	%		3.6	%		5.6	%
Net premiums written constant $		8.5	%		11.3	%		6.8	%		9.1	%		4.3	%		9.9	%		4.7	%		6.4	%
Net premiums earned constant $		8.0	%		12.5	%		6.5	%		9.3	%		5.2	%		10.2	%		5.4	%		6.6	%

(1)	Q2 and YTD 2020 includes pre-tax catastrophe losses of $6 million related to COVID-19.

(2)	We assess the performance of our Life Insurance business based on Life Insurance underwriting income which includes Net investment income and (Gains) losses from fair value changes in separate account assets.

International life insurance net premiums written and deposits breakdown (excludes Combined North America and Life reinsurance businesses):


	2Q-20		2Q-19		% Change			Constant $ % Change			YTD 2020		YTD 2019		% Change			Constant $ % Change
International life insurance net premiums written	$	290	$	229		26.6	%		29.9	%	$	585	$	456		28.2	%		29.8	%
International life insurance deposits ⁽³⁾		309		369		-16.1	%		-16.9	%		752		690		9.1	%		8.0	%

Total international life insurance net premiums written and deposits	$	599	$	598		0.3	%		0.6	%	$	1,337	$	1,146		16.7	%		16.6	%

International life insurance segment income	$	37	$	42		-8.9	%		-7.5	%	$	82	$	76		9.0	%		10.0	%

(3)	Includes deposits collected on universal life and investment contracts. Consistent with GAAP, premiums collected on universal life and investment contracts are considered deposits and excluded from revenues.


Life Insurance		Page 17

Chubb Limited

Segment Results—Consecutive Quarters

(in millions of U.S. dollars)

(Unaudited)

Corporate


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Gross premiums written	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—
Net premiums written		—			—			—			—			—			—			—			—
Net premiums earned		—			—			—			—			—			—			—			—
Losses and loss expenses ⁽¹⁾		276			11			75			38			34			287			45			158
Policy acquisition costs		—			—			—			—			—			—			—			—
Administrative expenses		77			66			108			74			74			143			137			319

Underwriting loss		(353	)		(77	)		(183	)		(112	)		(108	)		(430	)		(182	)		(477	)
Adjusted net investment income		8			8			8			9			10			16			19			36
Other income (expense)—operating		(9	)		(16	)		(6	)		(7	)		(4	)		(25	)		(11	)		(24	)
Adjusted interest expense		(134	)		(137	)		(140	)		(143	)		(145	)		(271	)		(290	)		(573	)
Amortization expense of purchased intangibles		(51	)		(50	)		(55	)		(54	)		(54	)		(101	)		(109	)		(218	)
Income tax (expense) benefit		46			(237	)		(173	)		(219	)		(216	)		(191	)		(418	)		(810	)

Core operating loss		(493	)		(509	)		(549	)		(526	)		(517	)		(1,002	)		(991	)		(2,066	)
Chubb integration expenses, net of tax		—			—			(12	)		(2	)		(3	)		—			(5	)		(19	)
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax		(19	)		(22	)		(25	)		(24	)		(32	)		(41	)		(65	)		(114	)
Adjusted net realized gains (losses), net of tax⁽²⁾		(58	)		(946	)		170			(119	)		(10	)		(1,004	)		(105	)		(54	)

Net loss	$	(570	)	$	(1,477	)	$	(416	)	$	(671	)	$	(562	)	$	(2,047	)	$	(1,166	)	$	(2,253	)

Unfavorable prior period development (PPD)—pre-tax ⁽¹⁾	$	274		$	11		$	74		$	36		$	33		$	285		$	43		$	153

(1)	Q2 and YTD 2020 includes $254 million of unfavorable PPD for legacy exposures for U.S. child molestation claims, predominantly reviver statute-related. Excluded from this amount is $5 million recorded in the North America Commercial P&C Insurance segment.

(2)	Includes Net realized gains (losses) related to unconsolidated entities.


Corporate		Page 18

Chubb Limited

Loss Reserve Rollforward

(in millions of U.S. dollars, except ratios)

(Unaudited)


	Unpaid Losses									Net Paid to
	Gross			Ceded			Net			Incurred Ratio
Balance at December 31, 2018	$	62,960		$	14,689		$	48,271
Losses and loss expenses incurred		5,261			1,163			4,098
Losses and loss expenses paid		(5,197	)		(1,178	)		(4,019	)		98	%
Other (incl. foreign exch. revaluation)		119			33			86

Balance at March 31, 2019	$	63,143		$	14,707		$	48,436
Losses and loss expenses incurred		5,758			1,043			4,715
Losses and loss expenses paid		(5,581	)		(1,489	)		(4,092	)		87	%
Other (incl. foreign exch. revaluation)		(115	)		(28	)		(87	)

Balance at June 30, 2019	$	63,205		$	14,233		$	48,972
Losses and loss expenses incurred		6,783			1,731			5,052
Losses and loss expenses paid		(6,751	)		(1,568	)		(5,183	)		103	%
Other (incl. foreign exch. revaluation)		(225	)		(64	)		(161	)

Balance at September 30, 2019	$	63,012		$	14,332		$	48,680
Losses and loss expenses incurred		5,855			990			4,865
Losses and loss expenses paid		(6,382	)		(1,203	)		(5,179	)		106	%
Other (incl. foreign exch. revaluation)		205			62			143

Balance at December 31, 2019	$	62,690		$	14,181		$	48,509
Losses and loss expenses incurred		5,569			1,084			4,485
Losses and loss expenses paid		(5,345	)		(1,090	)		(4,255	)		95	%
Other (incl. foreign exch. revaluation)		(700	)		(135	)		(565	)

Balance at March 31, 2020	$	62,214		$	14,040		$	48,174
Losses and loss expenses incurred		7,825			1,248			6,577
Losses and loss expenses paid		(4,874	)		(1,024	)		(3,850	)		59	%⁽¹⁾
Other (incl. foreign exch. revaluation)		534			97			437

Balance at June 30, 2020	$	65,699		$	14,361		$	51,338
Add net recoverable on paid losses		—			846			(846	)

Balance including net recoverable on paid losses	$	65,699		$	15,207		$	50,492

(1)	The losses and loss expenses incurred increased $2.1 billion in the quarter, principally reflecting the significant catastrophe events in the period, principally COVID-19, and resulting in the 59% net paid to incurred ratio for Q2 2020.


Loss Reserve Rollforward		Page 19

Chubb Limited

Reinsurance Recoverable Analysis

(in millions of U.S. dollars)

(Unaudited)

Net Reinsurance Recoverable by Division


	June 30 2020			March 31 2020			December 31 2019
Reinsurance recoverable on paid losses and loss expenses
Active operations	$	736		$	748		$	887
Brandywine and Other Run-off		173			177			189

Total	$	909		$	925		$	1,076

Reinsurance recoverable on unpaid losses and loss expenses
Active operations	$	13,315		$	13,088		$	13,223
Brandywine and Other Run-off		1,286			1,190			1,198

Total	$	14,601		$	14,278		$	14,421

Gross reinsurance recoverable
Active operations	$	14,051		$	13,836		$	14,110
Brandywine and Other Run-off		1,459			1,367			1,387

Total	$	15,510		$	15,203		$	15,497

Provision for uncollectible reinsurance ⁽¹⁾
Active operations	$	(177	)	$	(176	)	$	(180	)
Brandywine and Other Run-off		(126	)		(129	)		(136	)

Total	$	(303	)	$	(305	)	$	(316	)

Net reinsurance recoverable
Active operations	$	13,874		$	13,660		$	13,930
Brandywine and Other Run-off		1,333			1,238			1,251

Total	$	15,207		$	14,898		$	15,181

(1)	The provision for uncollectible reinsurance is based on a default analysis applied to gross reinsurance, net of usable collateral of approximately $3.9 billion.


Reinsurance Recoverable		Page 20

Chubb Limited

Investment Portfolio

(in millions of U.S. dollars)

(Unaudited)


	June 30 2020					March 31 2020					December 31 2019
Market Value
Fixed maturities available for sale	$	86,712				$	81,523				$	85,488
Fixed maturities held to maturity		12,620					12,468					13,005
Short-term investments		4,003					3,586					4,291

Total fixed maturities	$	103,335				$	97,577				$	102,784

Asset Allocation by Market Value
U.S. Treasury / Agency	$	4,190		4	%	$	4,296		4	%	$	4,630		5	%
Corporate and asset-backed securities		36,345		35	%		32,990		33	%		34,259		33	%
Mortgage-backed securities		20,529		20	%		20,252		21	%		21,588		21	%
Municipal		12,291		12	%		12,266		13	%		12,824		12	%
Non-U.S.		25,977		25	%		24,187		25	%		25,192		25	%
Short-term investments		4,003		4	%		3,586		4	%		4,291		4	%

Total fixed maturities	$	103,335		100	%	$	97,577		100	%	$	102,784		100	%

Credit Quality by Market Value
AAA	$	15,411		15	%	$	14,577		15	%	$	15,714		15	%
AA		35,600		35	%		35,437		36	%		37,504		37	%
A		19,703		19	%		18,375		19	%		19,236		19	%
BBB		15,690		15	%		13,617		14	%		13,650		13	%
BB		9,302		9	%		8,661		9	%		9,474		9	%
B		7,124		7	%		6,487		7	%		6,897		7	%
Other		505		0	%		423		0	%		309		0	%

Total fixed maturities	$	103,335		100	%	$	97,577		100	%	$	102,784		100	%

Cost/Amortized Cost, net
Fixed maturities available for sale ⁽¹⁾	$	82,671				$	80,776				$	82,580
Fixed maturities held to maturity ⁽¹⁾		11,845					12,022					12,581
Short-term investments⁽¹⁾		4,002					3,582					4,291

Subtotal fixed maturities		98,518					96,380					99,452
Equity securities		2,394					2,068					812
Other investments		5,923					6,075					6,062

Total investment portfolio	$	106,835				$	104,523				$	106,326

Avg. duration of fixed maturities		4.0 years					3.9 years					3.8 years
Avg. market yield of fixed maturities		2.2	%				3.0	%				2.7	%
Avg. credit quality		A/Aa					A/Aa					A/Aa
Avg. yield on invested assets⁽²⁾		3.3	%				3.4	%				3.4	%

(1)	Net of valuation allowance for expected credit losses.

(2)	Calculated using adjusted net investment income.


Investments		Page 21

Chubb Limited

Investment Portfolio—2

(in millions of U.S. dollars)

(Unaudited)

Mortgage-backed Fixed Income Portfolio


Mortgage-backed securities	S&P Credit Rating
	AAA		AA		A		BBB		BB and below		Total

Market Value at June 30, 2020
Agency residential mortgage-backed securities (RMBS)	$	127	$	16,748	$	—	$	—	$	—	$	16,875
Non-agency RMBS		155		34		73		13		9		284
Commercial mortgage-backed securities		2,935		287		135		11		2		3,370

Total mortgage-backed securities at market value	$	3,217	$	17,069	$	208	$	24	$	11	$	20,529


U.S. Corporate and Asset-backed Fixed Income Portfolios

Market Value at June 30, 2020			S&P Credit Rating
			Investment Grade
			AAA		AA		A		BBB		Total

Asset-backed			$	3,142	$	438	$	48	$	71	$	3,699
Banks				—		21		2,567		1,497		4,085
Basic Materials				—		—		90		269		359
Communications				—		150		517		1,204		1,871
Consumer, Cyclical				—		272		540		707		1,519
Consumer, Non-Cyclical				64		673		1,513		1,692		3,942
Diversified Financial Services				7		205		417		398		1,027
Energy				—		72		203		711		986
Industrial				—		14		826		902		1,742
Utilities				—		3		1,023		561		1,587
All Others				213		339		1,686		1,158		3,396

Total			$	3,426	$	2,187	$	9,430	$	9,170	$	24,213


Market Value at June 30, 2020					S&P Credit Rating
					Below Investment Grade
					BB		B		CCC		Total

Asset-backed					$	1	$	17	$	5	$	23
Banks						—		—		—		—
Basic Materials						377		239		4		620
Communications						853		769		54		1,676
Consumer, Cyclical						1,090		992		61		2,143
Consumer, Non-Cyclical						1,214		1,472		103		2,789
Diversified Financial Services						194		86		7		287
Energy						703		325		12		1,040
Industrial						739		718		22		1,479
Utilities						352		27		7		386
All Others						905		726		58		1,689

Total					$	6,428	$	5,371	$	333	$	12,132


Investments 2		Page 22

Chubb Limited

Investment Portfolio—3

(in millions of U.S. dollars)

(Unaudited)

Non-U.S. Fixed Income Portfolio

June 30, 2020


Non-U.S. Government Securities	Market Value by S&P Credit Rating
	AAA		AA		A		BBB		BB and below		Total

Republic of Korea	$	—	$	1,082	$	—	$	—	$	—	$	1,082
Canada		876		—		—		—		—		876
United Kingdom		—		872		—		—		—		872
Province of Ontario		—		—		659		—		—		659
Kingdom of Thailand		—		—		616		—		—		616
Federative Republic of Brazil		—		—		—		—		569		569
Province of Quebec		—		525		—		—		—		525
United Mexican States		—		—		—		431		—		431
Commonwealth of Australia		399		—		3		—		—		402
Socialist Republic of Vietnam		—		—		—		—		373		373
Other Non-U.S. Government Securities		887		1,588		1,084		893		883		5,335

Total	$	2,162	$	4,067	$	2,362	$	1,324	$	1,825	$	11,740


Non-U.S. Corporate Securities	Market Value by S&P Credit Rating
	AAA		AA		A		BBB		BB and below		Total

United Kingdom	$	73	$	73	$	784	$	918	$	417	$	2,265
Canada		116		265		445		585		396		1,807
France		8		46		673		368		54		1,149
United States⁽¹⁾		—		—		204		255		588		1,047
Australia		103		203		328		220		21		875
Netherlands		50		80		240		150		105		625
Japan		—		10		513		83		—		606
Germany		67		37		107		283		44		538
Switzerland		55		4		253		196		28		536
China		—		—		269		91		70		430
Other Non-U.S. Corporate Securities		365		419		1,008		1,604		963		4,359

Total	$	837	$	1,137	$	4,824	$	4,753	$	2,686	$	14,237

(1)	Countries represent the ultimate parent company’s country of risk. Non-U.S. corporate securities could be issued by foreign subsidiaries of U.S. corporations.


Investments 3		Page 23

Chubb Limited

Investment Portfolio—4

(in millions of U.S. dollars)

(Unaudited)

Fixed Maturity Investment Portfolio

Top 10 Global Corporate Exposures


	June 30, 2020	Market Value		Rating
1	Wells Fargo & Co	$	765	A-
2	Bank of America Corp		656	A-
3	JP Morgan Chase & Co		639	A-
4	Comcast Corp		485	A-
5	Morgan Stanley		451	BBB+
6	Citigroup Inc		440	BBB+
7	HSBC Holdings Plc		406	A-
8	Verizon Communications Inc		393	BBB+
9	AT&T Inc		378	BBB
10	Goldman Sachs Group Inc		351	BBB+


Investments 4		Page 24

Chubb Limited

Net Realized and Unrealized Gains (Losses)

(in millions of U.S. dollars)

(Unaudited)


	Three months ended June 30, 2020
	Realized Gains (Losses)									Unrealized Gains (Losses)									Realized and Unrealized Gains (Losses)
	Gains			Tax			Gains			Gains			Tax			Gains			Gains			Tax			Gains
	Gains			Tax			Gains			Gains			Tax			Gains			Gains			Tax			Gains
	(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)
	Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax

Fixed income investments ⁽¹⁾	$	(19	)	$	—		$	(19	)	$	3,281		$	(524	)	$	2,757		$	3,262		$	(524	)	$	2,738
Public equity:
Realized gains (losses) on sales		187			(39	)		148			—			—			—			187			(39	)		148
Mark-to-market		(39	)		11			(28	)		—			—			—			(39	)		11			(28	)
Private equity:
Realized gains (losses) on sales		—			—			—			—			—			—			—			—			—
Mark-to-market		(200	)		11			(189	)		—			—			—			(200	)		11			(189	)

Total investment portfolio		(71	)		(17	)		(88	)		3,281			(524	)		2,757			3,210			(541	)		2,669
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges ⁽²⁾		110			—			110			—			—			—			110			—			110
Foreign exchange		(61	)		20			(41	)		445			6			451			384			26			410
Partially-owned entities ⁽³⁾		(7	)		—			(7	)		—			—			—			(7	)		—			(7	)
Other		(40	)		8			(32	)		(22	)		5			(17	)		(62	)		13			(49	)

Net gains (losses)	$	(69	)	$	11		$	(58	)	$	3,704		$	(513	)	$	3,191		$	3,635		$	(502	)	$	3,133

(1)

The quarter includes realized gains on fixed income derivatives of $14 million, realized gains related to the adoption of new accounting guidance that required the acceleration of certain mark-to-market losses on fixed maturities, previously classified as unrealized gains, as realized gains of $104 million, and impairment of $31 million for fixed maturities written to market entering default and our intent to sell certain securities during the quarter.

(2)	The quarter includes $103 million of losses on applicable hedges. These losses are both pre-tax and after-tax.

(3)	Partially-owned entities are investments where we hold more than an insignificant percentage of the investee’s shares. Refer to the Non-GAAP financial measures section for additional details.


	Three months ended June 30, 2019
	Realized Gains (Losses)									Unrealized Gains (Losses)									Realized and Unrealized Gains (Losses)
	Gains			Tax			Gains			Gains			Tax			Gains			Gains			Tax			Gains
	(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)
	Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax

Fixed income investments ⁽⁴⁾	$	(160	)	$	—		$	(160	)	$	1,240		$	(221	)	$	1,019		$	1,080		$	(221	)	$	859
Public equity ⁽⁴⁾:
Realized gains (losses) on sales		23			(5	)		18			—			—			—			23			(5	)		18
Mark-to-market		(27	)		6			(21	)		—			—			—			(27	)		6			(21	)
Private equity:
Realized gains (losses) on sales		—			—			—			—			—			—			—			—			—
Mark-to-market		240			(3	)		237			—			—			—			240			(3	)		237

Total investment portfolio		76			(2	)		74			1,240			(221	)		1,019			1,316			(223	)		1,093
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges ⁽⁵⁾		(85	)		—			(85	)		—			—			—			(85	)		—			(85	)
Foreign exchange		(11	)		4			(7	)		(97	)		2			(95	)		(108	)		6			(102	)
Partially-owned entities ⁽⁶⁾		9			(1	)		8			—			—			—			9			(1	)		8
Other		—			—			—			(18	)		3			(15	)		(18	)		3			(15	)

Net gains (losses)	$	(11	)	$	1		$	(10	)	$	1,125		$	(216	)	$	909		$	1,114		$	(215	)	$	899

(4)	The quarter includes pre-tax realized losses on derivatives of: $172 million in fixed income and $9 million in public equity. Other-than-temporary impairments for the quarter in realized losses were $13 million pre-tax for fixed maturities.

(5)	The quarter includes $20 million of losses on applicable hedges. These losses are both pre-tax and after-tax.

(6)	Partially-owned entities are investments where we hold more than an insignificant percentage of the investee’s shares. Refer to the Non-GAAP financial measures section for additional details.


Net Gains (Losses)		Page 25

Chubb Limited

Net Realized and Unrealized Gains (Losses)

(in millions of U.S. dollars)

(Unaudited)


	Six months ended June 30, 2020
	Realized Gains (Losses)									Unrealized Gains (Losses)									Realized and Unrealized Gains (Losses)
	Gains			Tax			Gains			Gains			Tax			Gains			Gains			Tax			Gains
	(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)
	Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax

Fixed income investments ⁽¹⁾	$	(365	)	$	40		$	(325	)	$	1,121		$	(240	)	$	881		$	756		$	(200	)	$	556
Public equity ⁽¹⁾:
Realized gains (losses) on sales		205			(42	)		163			—			—			—			205			(42	)		163
Mark-to-market		(44	)		3			(41	)		—			—			—			(44	)		3			(41	)
Private equity:
Realized gains (losses) on sales		—			—			—			—			—			—			—			—			—
Mark-to-market		(207	)		2			(205	)		—			—			—			(207	)		2			(205	)

Total investment portfolio		(411	)		3			(408	)		1,121			(240	)		881			710			(237	)		473
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges ⁽²⁾		(450	)		—			(450	)		—			—			—			(450	)		—			(450	)
Foreign exchange		(129	)		17			(112	)		(414	)		40			(374	)		(543	)		57			(486	)
Partially-owned entities ⁽³⁾		(2	)		—			(2	)		—			—			—			(2	)		—			(2	)
Other		(40	)		8			(32	)		(36	)		8			(28	)		(76	)		16			(60	)

Net gains (losses)	$	(1,032	)	$	28		$	(1,004	)	$	671		$	(192	)	$	479		$	(361	)	$	(164	)	$	(525	)

(1)

Year to date includes pre-tax realized gains on equity derivatives of $42 million, realized losses on fixed income derivatives of $13 million, realized losses related to the adoption of new accounting guidance that required the acceleration of certain mark-to-market losses on fixed maturities, previously classified as unrealized losses, as realized losses of $46 million, and impairments of $152 million related to certain securities the company intended to sell and securities written to market entering default.

(2)	Year to date includes $22 million of gains on applicable hedges. These gains are both pre-tax and after-tax.

(3)	Partially-owned entities are investments where we hold more than an insignificant percentage of the investee’s shares. Refer to the Non-GAAP financial measures section for additional details.


	Six months ended June 30, 2019
	Realized Gains (Losses)									Unrealized Gains (Losses)									Realized and Unrealized Gains (Losses)
	Gains			Tax			Gains			Gains			Tax			Gains			Gains			Tax			Gains
	(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)			(Losses)			(Expense)			(Losses)
	Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax			Pre-Tax			Benefit			After-Tax

Fixed income investments ⁽⁴⁾	$	(311	)	$	8		$	(303	)	$	3,129		$	(551	)	$	2,578		$	2,818		$	(543	)	$	2,275
Public equity ⁽⁴⁾:
Realized gains (losses) on sales		1			—			1			—			—			—			1			—			1
Mark-to-market		30			(4	)		26			—			—			—			30			(4	)		26
Private equity:
Realized gains (losses) on sales		(2	)		—			(2	)		—			—			—			(2	)		—			(2	)
Mark-to-market		193			2			195			—			—			—			193			2			195

Total investment portfolio		(89	)		6			(83	)		3,129			(551	)		2,578			3,040			(545	)		2,495
Mark-to-market from variable annuity reinsurance derivative transactions, net of applicable hedges ⁽⁵⁾		(34	)		—			(34	)		—			—			—			(34	)		—			(34	)
Foreign exchange		2			1			3			50			(5	)		45			52			(4	)		48
Partially-owned entities ⁽⁶⁾		10			(1	)		9			—			—			—			10			(1	)		9
Other		—			—			—			(45	)		9			(36	)		(45	)		9			(36	)

Net gains (losses)	$	(111	)	$	6		$	(105	)	$	3,134		$	(547	)	$	2,587		$	3,023		$	(541	)	$	2,482

(4)	Year to date includes pre-tax realized losses on derivatives of: $279 million in fixed income and $32 million in public equity. Year to date other-than-temporary impairments in realized losses were $26 million pre-tax for fixed maturities.

(5)	Year to date includes $83 million of losses on applicable hedges. These losses are both pre-tax and after-tax.

(6)	Partially-owned entities are investments where we hold more than an insignificant percentage of the investee’s shares. Refer to the Non-GAAP financial measures section for additional details.


Net Gains (Losses) 2		Page 26

Chubb Limited

Debt and Capital

(in millions of U.S. dollars, except ratios)

(Unaudited)


	June 30 2020			March 31 2020			December 31 2019			December 31 2018
Financial Debt:
Total short-term debt	$	1,300		$	1,300		$	1,299		$	509
Total long-term debt		13,656			13,510			13,559			12,087

Total financial debt	$	14,956		$	14,810		$	14,858		$	12,596
Hybrid debt:
Total trust preferred securities		308			308			308			308

Total	$	15,264		$	15,118		$	15,166		$	12,904

Capitalization:
Shareholders’ equity	$	54,760		$	52,197		$	55,331		$	50,312
Hybrid debt		308			308			308			308
Financial debt		14,956			14,810			14,858			12,596

Total capitalization	$	70,024		$	67,315		$	70,497		$	63,216

Leverage ratios (based on total capital):
Hybrid debt		0.4	%		0.5	%		0.4	%		0.5	%
Financial debt		21.4	%		22.0	%		21.1	%		19.9	%

Total hybrid & financial debt		21.8	%		22.5	%		21.5	%		20.4	%

Note: As of June 30, 2020, there was $2.0 billion usage of credit facilities on total capacity of $4.0 billion.


Debt and Capital		Page 27

Chubb Limited

Computation of Basic and Diluted Earnings Per Share

(in millions of U.S. dollars, except share and per share data)

(Unaudited)


	Three months ended June 30						Six months ended June 30
	2020			2019			2020			2019
Numerator
Core operating income (loss) to common shares	$	(254	)	$	1,195		$	966		$	2,365
Amortization of fair value adjustment of acquired invested assets and long-term debt, pre-tax		(24	)		(38	)		(51	)		(79	)
Tax benefit on amortization adjustment		5			6			10			14
Chubb integration expenses, pre-tax		—			(4	)		—			(7	)
Tax benefit on Chubb integration expenses		—			1			—			2
Adjusted net realized gains (losses), pre-tax		(69	)		(11	)		(1,032	)		(111	)
Tax (expense) benefit on adjusted net realized gains (losses)		11			1			28			6

Net income (loss)	$	(331	)	$	1,150		$	(79	)	$	2,190

Rollforward of Common Shares Outstanding
Shares—beginning of period		451,367,782			458,179,205			451,971,567			459,203,378
Repurchase of shares		—			(2,584,466	)		(2,266,150	)		(5,338,220	)
Shares issued, excluding option exercises		(64,658	)		55,208			1,027,562			1,223,084
Issued for option exercises		56,899			427,872			627,044			989,577

Shares—end of period		451,360,023			456,077,819			451,360,023			456,077,819

Denominator
Weighted average shares outstanding ⁽¹⁾		451,402,807			457,224,455			451,635,733			458,010,447
Effect of other dilutive securities⁽²⁾		—			2,945,237			—			2,863,109

Adj. wtd. avg. shares outstanding and assumed conversions		451,402,807			460,169,692			451,635,733			460,873,556

Basic earnings per share
Core operating income (loss)	$	(0.56	)	$	2.61		$	2.14		$	5.16
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax		(0.04	)		(0.07	)		(0.09	)		(0.14	)
Chubb integration expenses, net of tax		—			(0.01	)		—			(0.01	)
Adjusted net realized gains (losses), net of tax		(0.13	)		(0.01	)		(2.22	)		(0.23	)

Net income (loss)	$	(0.73	)	$	2.52		$	(0.17	)	$	4.78

Diluted earnings per share
Core operating income (loss) ⁽²⁾	$	(0.56	)	$	2.60		$	2.13		$	5.13
Amortization of fair value adjustment of acquired invested assets and long-term debt, net of tax		(0.04	)		(0.07	)		(0.09	)		(0.14	)
Chubb integration expenses, net of tax		—			(0.01	)		—			(0.01	)
Adjusted net realized gains (losses), net of tax		(0.13	)		(0.02	)		(2.22	)		(0.23	)
Use of weighted-average dilutive shares		—			—			0.01			—

Net income (loss) ⁽²⁾	$	(0.73	)	$	2.50		$	(0.17	)	$	4.75

(1)	Includes unvested restricted stock units that are not included in common shares outstanding as the shares are not issued until time of vesting, but are eligible to receive dividends (participating securities).

(2)


Earnings Per Share		Page 28

Chubb Limited

Book Value and Book Value per Common Share

(in millions of U.S. dollars, except share and per share data)

(Unaudited)

Reconciliation of Book Value per Common Share


	June 30 2020			March 31 2020			December 31 2019			June 30 2019
Shareholders’ equity	$	54,760		$	52,188		$	55,331		$	53,802
Less: goodwill and other intangible assets, net of tax		19,783			19,569			20,012			20,170

Numerator for tangible book value per share	$	34,977		$	32,619		$	35,319		$	33,632

Book value—% change over prior quarter		4.9	%		-5.7	%		1.4	%		2.8	%
Tangible book value—% change over prior quarter		7.2	%		-7.6	%		2.2	%		4.2	%
Denominator		451,360,023			451,367,782			451,971,567			456,077,819

Book value per common share	$	121.32		$	115.62		$	122.42		$	117.97
Tangible book value per common share	$	77.49		$	72.27		$	78.14		$	73.74
Reconciliation of Book Value
Shareholders’ equity, beginning of quarter ⁽¹⁾	$	52,188		$	55,259		$	54,572		$	52,355
Core operating income (loss)		(254	)		1,220			1,040			1,195
Amortization of fair value adjustment of acquired invested assets and long-term debt		(19	)		(22	)		(25	)		(32	)
Chubb integration expenses		—			—			(12	)		(3	)
Adjusted net realized gains (losses) ⁽²⁾		(58	)		(946	)		170			(10	)
Net unrealized gains (losses) on investments		2,757			(1,876	)		(70	)		1,019
Repurchase of shares		—			(326	)		(310	)		(376	)
Dividend declared on common shares		(353	)		(340	)		(340	)		(344	)
Cumulative translation gains (losses)		451			(825	)		177			(95	)
Postretirement benefit liability		(17	)		(11	)		(9	)		(15	)
Other⁽³⁾		65			55			138			108

	$	54,760		$	52,188		$	55,331		$	53,802

(1)	January 1, 2020 included a $72 million after-tax reduction to beginning equity principally related to the adoption of the current expected credit loss accounting guidance.

(2)	Includes net realized gains (losses) related to unconsolidated entities.

(3)	Other primarily includes proceeds from exercise of stock options and stock compensation, offset by the value of any share cancellations for restricted stock vesting taxes.


Reconciliation Book Value		Page 29

Chubb Limited

Non-GAAP Financial Measures

(Unaudited)

Regulation G—Non-GAAP Financial Measures

In presenting our results, we included and discussed certain non-GAAP measures. These non-GAAP measures, which may be defined differently by other companies, are important for an understanding of our overall results of operations and financial condition. However, they should not be viewed as a substitute for measures determined in accordance with generally accepted accounting principles (GAAP).

Throughout this document there are various measures presented on a constant-dollar basis (i.e., excludes the impact of foreign exchange). We believe it is useful to evaluate the trends in our results exclusive of the effect of fluctuations in exchange rates between the U.S. dollar and the currencies in which our international business is transacted, as these exchange rates could fluctuate significantly between periods and distort the analysis of trends. The impact is determined by assuming constant foreign exchange rates between periods by translating prior period results using the same local currency exchange rates as the comparable current period.

Underwriting income (loss) is calculated by subtracting adjusted losses and loss expenses, adjusted policy benefits, policy acquisition costs and administrative expenses from net premiums earned. We use underwriting income (loss) and operating ratios to monitor the results of our operations without the impact of certain factors, including net investment income, other income (expense), interest expense, amortization expense of purchased intangibles, Chubb integration expense, income tax expense and adjusted net realized gains (losses).

CAY underwriting income excluding catastrophe losses (Cats) is underwriting income (loss) adjusted to exclude Cats and prior period development (PPD). We believe it is useful to exclude Cats, as they are not predictable as to timing and amount, and PPD as these unexpected loss developments on historical reserves are not indicative of our current underwriting performance. We believe the use of these measures enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business.

Segment income (loss) includes underwriting income, adjusted net investment income, other income (expense) – operating, and amortization expense of purchased intangibles.

Adjusted losses and loss expenses include realized gains and losses on crop derivatives. These derivatives were purchased to provide economic benefit, in a manner similar to reinsurance protection, in the event that a significant decline in commodity pricing impacts underwriting results. We view gains and losses on these derivatives as part of the results of our underwriting operations, and therefore realized gains (losses) from these derivatives are reclassified to adjusted losses and loss expenses.

Adjusted policy benefits includes gains and losses from fair value changes in separate account assets, as well as the offsetting movement in separate account liabilities, for purposes of reporting Life Insurance underwriting income. The gains and losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP have been reclassified from Other (income) expense. We view gains and losses from fair value changes in both separate account assets and liabilities as part of the results of our underwriting operations, and therefore these gains and losses are reclassified to adjusted policy benefits.

Adjusted net investment income is net investment income excluding the amortization of the fair value adjustment on acquired invested assets from the acquisition of The Chubb Corporation (Chubb Corp). We believe this measure is meaningful as it highlights the underlying performance of our invested assets and portfolio management in support of our lines of business.

Adjusted interest expense is interest expense excluding the amortization of the fair value adjustment on acquired long-term debt, related to the Chubb Corp acquisition due to the size and complexity of this acquisition.

Other income (expense) – operating excludes from consolidated Other income (expense) the portion of net realized gains and losses related to unconsolidated entities and gains and losses from fair value changes in separate account assets that do not qualify for separate account reporting under GAAP. Net realized gains (losses) related to unconsolidated entities is excluded from core operating income (loss) in order to enhance the understanding of our results of underwriting operations as they are heavily influenced by, and fluctuate in part according to, market conditions. Other income (expense) – operating and net realized gains and losses related to unconsolidated entities are recorded to Other income (expense) in our income statement on a GAAP basis.

P&C underwriting income and P&C combined ratio exclude the Life Insurance segment. P&C loss and loss expense ratio and P&C combined ratio include adjusted losses and loss expenses in the ratio numerator. P&C expense ratio and P&C combined ratio include policy acquisition costs and administrative expenses in the ratio numerator. A reconciliation of combined ratio to P&C combined ratio is provided on pages 33-36.

CAY P&C combined ratio excluding catastrophe losses excludes Cats and PPD from the P&C combined ratio. We exclude Cats as they are not predictable as to timing and amount and PPD as these unexpected loss developments on historical reserves are not indicative of our current underwriting performance. The combined ratio numerator is adjusted to exclude Cats, net premiums earned adjustments on PPD, prior period expense adjustments and reinstatement premiums on PPD, and the denominator is adjusted to exclude net premiums earned adjustments on PPD and reinstatement premiums on Cats and PPD. In periods where there are adjustments on loss sensitive policies, these adjustments are excluded from PPD and net premiums earned when calculating the ratios. We believe this measure provides a better evaluation of our underwriting performance and enhances the understanding of the trends in our P&C business that may be obscured by these items. This measure is commonly reported among our peer companies and allows for a better comparison.

Expense ratio excluding accident and health (A&H) excludes the impact of our A&H business from our expense ratio. The expense ratio for the A&H business is typically higher than our traditional P&C business, and we believe that this measure provides better comparison to our peer companies that may not have a significant A&H block of business.

Global P&C performance metrics comprise consolidated operating results (including corporate) and exclude the operating results of the company’s Life Insurance and North America Agricultural Insurance segments. The agriculture insurance business is a different business in that it is a public sector and private sector partnership in which insurance rates, premium growth, and risk-sharing is not market-driven like the remainder of the company’s P&C insurance business. We believe that these measures are useful and meaningful to investors as they are used by management to assess the company’s global P&C operations which are the most economically similar. We exclude the North America Agricultural Insurance and Life Insurance segments because the results of these businesses do not always correlate with the results of our global P&C operations.

Core operating income (loss), net of tax, excludes from net income, the after-tax impact of adjusted net realized gains (losses), Chubb integration expenses, and the amortization of fair value adjustment of acquired invested assets and long-term debt related to the Chubb Corp acquisition. We believe this presentation enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business. We exclude adjusted net realized gains (losses) because the amount of these gains (losses) are heavily influenced by, and fluctuate in part according to the availability of market opportunities. We exclude the amortization of the fair value adjustments related to purchased invested assets and long-term debt and Chubb integration expenses due to the size and complexity of this acquisition. These integration expenses are distortive to our results and are not indicative of our underlying profitability. We believe that excluding these integration expenses facilitates the comparison of our financial results to our historical operating results. References to core operating income measures mean net of tax, whether or not noted.

Core operating effective tax rate is income tax expense (benefit) excluding tax expense (benefit) on adjusted net realized gains (losses), tax benefit on amortization of fair value of acquired invested assets and debt, and tax benefit on Chubb integration expenses, divided by income excluding adjusted net realized gains (losses) before tax, amortization of fair value of acquired invested assets and debt before tax, and Chubb integration expenses before tax. We believe the use of this measure is meaningful to show the tax on the underlying performance of our insurance business, by excluding the tax on adjusted net realized gains (losses), the tax on amortization of the fair value adjustments related to purchased invested assets and long-term debt and the tax on Chubb integration expenses. Refer to the definition of core operating income (loss), net of tax above for more information on these adjustments.

Book value per common share, is shareholders’ equity divided by the shares outstanding. Tangible book value per common share, is shareholders’ equity less goodwill and other intangible assets, net of tax, divided by the shares outstanding. We believe that goodwill and other intangible assets are not indicative of our underlying insurance results or trends and make book value comparisons to less acquisitive peer companies less meaningful. Book value per common share excluding mark-to-market, excludes unrealized investment gains (losses). Tangible book value per common share excluding mark-to-market, excludes goodwill and other intangible assets, net of tax, as well as unrealized investment gains (losses), net of tax. We exclude unrealized investment gains (losses) because the amount of these gains (losses) is heavily influenced by changes in market conditions, including interest rate changes, and we believe that excluding these gains and losses would highlight the underlying growth in book value and tangible book value.

International life insurance net premiums written and deposits collected includes deposits collected on universal life and investment contracts (life deposits). Life deposits are not reflected as revenues in our consolidated statements of operations in accordance with GAAP. However, we include life deposits in presenting growth in our life insurance business because new life deposits are an important component of production and key to our efforts to grow our business.

Net premiums written metrics adjusted for COVID-19 exposures are net premiums written in Q2 2020 and YTD 2020 adjusted to exclude exposure adjustments on in-force policies in the North America Commercial P&C Insurance and Overseas General Insurance segments of $184 million and, for the North America Personal P&C insurance segment, return premiums of $7 million. For the North America Personal P&C insurance segment for all periods presented, net premiums written adjusted for COVID-19 exposures also excludes reinstatement premiums, additional reinsurance, accounting actions in 2019 and unearned premium reserve (UPR) transfer. We believe these measures are meaningful to evaluate trends in the underlying business on a comparable basis.


Reconciliation Non-GAAP		Page 30

Chubb Limited

Non-GAAP Financial Measures —2

(in millions of U.S. dollars, except per share data and ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

Core operating effective tax rate

The following table presents the reconciliation of effective tax rate to the Core operating effective tax rate:


																YTD			YTD			Full Year
	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			2020			2019			2019
Tax expense (benefit), as reported	$	(62	)	$	215		$	169		$	230		$	208		$	153		$	396		$	795
Less: tax benefit on amortization of fair value of acquired invested assets and debt		(5	)		(5	)		(4	)		(8	)		(6	)		(10	)		(14	)		(26	)
Less: tax benefit on Chubb integration expenses		—			—			(2	)		—			(1	)		—			(2	)		(4	)
Less: tax expense (benefit) on adjusted net realized gains (losses)		(11	)		(17	)		2			19			(1	)		(28	)		(6	)		15

Tax expense (benefit), adjusted	$	(46	)	$	237		$	173		$	219		$	216		$	191		$	418		$	810

Income (loss) before tax, as reported	$	(393	)	$	467		$	1,342		$	1,321		$	1,358		$	74		$	2,586		$	5,249
Less: amortization of fair value of acquired invested assets and debt		(24	)		(27	)		(29	)		(32	)		(38	)		(51	)		(79	)		(140	)
Less: Chubb integration expenses		—			—			(14	)		(2	)		(4	)		—			(7	)		(23	)
Less: adjusted realized gains (losses)		31			(956	)		(55	)		(141	)		(230	)		(925	)		(326	)		(522	)
Less: realized gains (losses) related to unconsolidated entities		(100	)		(7	)		227			41			219			(107	)		215			483

Core operating income (loss) before tax	$	(300	)	$	1,457		$	1,213		$	1,455		$	1,411		$	1,157		$	2,783		$	5,451

Effective tax rate		15.8	%		46.0	%		12.6	%		17.4	%		15.3	%		206.8	%		15.3	%		15.1	%
Adjustment for tax impact of amortization of fair value of acquired invested assets and debt		-0.4	%		0.0	%		0.0	%		0.2	%		0.1	%		0.1	%		0.1	%		0.1	%
Adjustment for tax impact of Chubb integration expenses		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
Adjustment for tax impact of adjusted net realized gains (losses)		-0.1	%		-29.7	%		1.6	%		-2.5	%		-0.1	%		-190.4	%		-0.4	%		-0.3	%

Core operating effective tax rate		15.3	%		16.3	%		14.2	%		15.1	%		15.3	%		16.5	%		15.0	%		14.9	%

Core operating income

The following table presents the reconciliation of Net income (loss) to Core operating income (loss):


	2Q-20			1Q-20			4Q-19			3Q-19			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Net income (loss), as reported	$	(331	)	$	252		$	1,173		$	1,091		$	1,150		$	(79	)	$	2,190		$	4,454
Amortization of fair value adjustment of acquired invested assets and long-term debt, pre-tax		(24	)		(27	)		(29	)		(32	)		(38	)		(51	)		(79	)		(140	)
Tax benefit on amortization adjustment		5			5			4			8			6			10			14			26
Chubb integration expenses, pre-tax		—			—			(14	)		(2	)		(4	)		—			(7	)		(23	)
Tax benefit on Chubb integration expenses		—			—			2			—			1			—			2			4
Adjusted realized gains (losses), pre-tax		31			(956	)		(55	)		(141	)		(230	)		(925	)		(326	)		(522	)
Net realized gains (losses) related to unconsolidated entities, pre-tax ⁽¹⁾		(100	)		(7	)		227			41			219			(107	)		215			483
Tax (expense) benefit on adjusted net realized gains (losses)		11			17			(2	)		(19	)		1			28			6			(15	)

Core operating income (loss)	$	(254	)	$	1,220		$	1,040		$	1,236		$	1,195		$	966		$	2,365		$	4,641

Catastrophe losses—after-tax	$	1,510		$	199		$	353		$	191		$	221		$	1,709		$	422		$	966
Unfavorable (favorable) prior period development (PPD)—after-tax	$	52		$	(94	)	$	(199	)	$	(112	)	$	(152	)	$	(42	)	$	(313	)	$	(624	)
Core operating income (loss) per share	$	(0.56	)	$	2.68		$	2.28		$	2.70		$	2.60		$	2.13		$	5.13		$	10.11
Impact of Cats on Core operating income per share—Unfavorable	$	(3.35	)	$	(0.44	)	$	(0.77	)	$	(0.41	)	$	(0.48	)	$	(3.77	)	$	(0.92	)	$	(2.11	)
Impact of PPD on Core operating income per share—Favorable (unfavorable)	$	(0.11	)	$	0.21		$	0.43		$	0.24		$	0.33		$	0.10		$	0.68		$	1.36
Impact of Cats and PPD on Core operating income per share—Unfavorable	$	(3.46	)	$	(0.23	)	$	(0.34	)	$	(0.17	)	$	(0.15	)	$	(3.67	)	$	(0.24	)	$	(0.75	)

(1)	Realized gains (losses) on partially-owned entities, which are investments where we hold more than an insignificant percentage of the investee’s shares. The net income or loss is included in other income (expense).


Reconciliation Non-GAAP 2		Page 31

Chubb Limited

Non-GAAP Financial Measures—3

(in millions of U.S. dollars, except share, per share data, and ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

Core operating ROE

Core operating return on equity (ROE) and Core operating return on tangible equity (ROTE) are annualized non-GAAP financial measures. The numerator includes core operating income (loss), net of tax. The denominator includes the average shareholders’ equity for the period adjusted to exclude unrealized gains (losses) on investments, net of tax. For the ROTE calculation, the denominator is also adjusted to exclude goodwill and other intangible assets, net of tax. These measures enhances the understanding of the return on shareholders’ equity by highlighting the underlying profitability relative to shareholders’ equity and tangible equity excluding the effect of unrealized gains and losses on our investments.


	2Q-20			2Q-19			YTD 2020			YTD 2019			Full Year 2019
Net income (loss)	$	(331	)	$	1,150		$	(79	)	$	2,190		$	4,454
Core operating income (loss)	$	(254	)	$	1,195		$	966		$	2,365		$	4,641
Equity—beginning of period, as reported ⁽¹⁾	$	52,188		$	52,355		$	55,259		$	50,300		$	50,300
Less: unrealized gains (losses) on investments, net of deferred tax		667			1,014			2,543			(545	)		(545	)

Equity—beginning of period, as adjusted	$	51,521		$	51,341		$	52,716		$	50,845		$	50,845

Less: goodwill and other intangible assets, net of tax	$	19,569		$	20,070		$	20,012		$	20,054		$	20,054

Equity—beginning of period, as adjusted ex goodwill and other intangible assets	$	31,952		$	31,271		$	32,704		$	30,791		$	30,791

Equity—end of period, as reported	$	54,760		$	53,802		$	54,760		$	53,802		$	55,331
Less: unrealized gains (losses) on investments, net of deferred tax		3,424			2,033			3,424			2,033			2,543

Equity—end of period, as adjusted	$	51,336		$	51,769		$	51,336		$	51,769		$	52,788

Less: goodwill and other intangible assets, net of tax		19,783			20,170			19,783			20,170			20,012

Equity—end of period, as adjusted ex goodwill and other intangible assets	$	31,553		$	31,599		$	31,553		$	31,599		$	32,776

Weighted average equity, as reported	$	53,474		$	53,079		$	55,010		$	52,051		$	52,816
Weighted average equity, as adjusted	$	51,429		$	51,555		$	52,026		$	51,307		$	51,817
Weighted average equity, as adjusted ex goodwill and other intangible assets	$	31,753		$	31,435		$	32,129		$	31,195		$	31,784
ROE		-2.5	%		8.7	%		-0.3	%		8.4	%		8.4	%
Core operating ROE		-2.0	%		9.3	%		3.7	%		9.2	%		9.0	%
Core operating ROTE		-3.2	%		15.2	%		6.0	%		15.2	%		14.6	%
Private equities realized gains (losses), after-tax ⁽²⁾	$	(189	)	$	237		$	(205	)	$	193		$	434
Impact of Private equities if included in Core operating ROE—Favorable (unfavorable) ⁽²⁾		-1.5 pts			1.8 pts			-0.8 pt			0.8 pt			0.8 pt

Reconciliation of Book Value and Tangible Book Value per Share, excluding mark-to-market


	June 30 2020		March 31 2020		December 31 2019		QTD % Change			YTD % Change
Book value	$	54,760	$	52,188	$	55,331
Less: unrealized gains (losses) on investments, net of deferred tax		3,424		667		2,543

Book value excluding mark-to-market		51,336		51,521		52,788
Less: goodwill and other intangible assets, net of tax		19,783		19,569		20,012

Tangible book value excluding mark-to-market	$	31,553	$	31,952	$	32,776

Denominator		451,360,023		451,367,782		451,971,567

Book value per share excluding mark-to-market	$	113.74	$	114.14	$	116.80		-0.4	%		-2.6	%
Tangible book value per share excluding mark-to-market	$	69.90	$	70.79	$	72.52		-1.3	%		-3.6	%

(1)	January 1, 2020 included a $72 million after-tax reduction to beginning equity principally related to the adoption of the current expected credit loss accounting guidance.

(2)	We record the change in the fair value mark and gains (losses) on sales of private equity funds as realized gains (losses) instead of investment income.


Reconciliation Non-GAAP 3		Page 32

Chubb Limited

Non-GAAP Financial Measures—4

(in millions of U.S. dollars, except ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

P&C combined ratio

The P&C combined ratio includes the impact of realized gains and losses on crop derivatives. These derivatives were purchased to provide economic benefit, in a manner similar to reinsurance protection, in the event that a significant decline in commodity pricing will impact underwriting results. We view gains and losses on these derivatives as part of the results of our underwriting operations.

The following tables present the calculation of combined ratio, as reported, for each segment to P&C combined ratio, adjusted for catastrophe losses (Cats) and prior period development (PPD).


Q2 2020		North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C
Numerator
Losses and loss expenses
Losses and loss expenses		$	3,498		$	762		$	312		$	1,485		$	73		$	276		$	6,406
Realized (gains) losses on crop derivatives			—			—			1			—			—			—			1

Adjusted losses and loss expenses	A	$	3,498		$	762		$	313		$	1,485		$	73		$	276		$	6,407

Catastrophe losses and related adjustments
Catastrophe losses, net of related adjustments			(1,273	)		(110	)		(6	)		(399	)		(13	)		—			(1,801	)
Reinstatement premiums collected (expensed) on catastrophe losses			(3	)		(1	)		—			(16	)		—			—			(20	)

Catastrophe losses, gross of related adjustments			(1,270	)		(109	)		(6	)		(383	)		(13	)		—			(1,781	)

PPD and related adjustments
PPD, net of related adjustments—favorable (unfavorable)			146			1			—			36			16			(274	)		(75	)
Net premiums earned adjustments on PPD—unfavorable (favorable)			4			—			—			—			—			—			4
Expense adjustments—unfavorable (favorable)			1			—			—			—			—			—			1
PPD reinstatement premiums—unfavorable (favorable)			—			—			—			—			(1	)		—			(1	)

PPD, gross of related adjustments—favorable (unfavorable)			151			1			—			36			15			(274	)		(71	)

CAY loss and loss expense ex Cats	B	$	2,379		$	654		$	307		$	1,138		$	75		$	2		$	4,555

Policy acquisition costs and administrative expenses
Policy acquisition costs and administrative expenses	C	$	720		$	297		$	32		$	865		$	51		$	77		$	2,042
Expense adjustments—favorable (unfavorable)			(1	)		—			—			—			—			—			(1	)

Policy acquisition costs and administrative expenses, adjusted	D	$	719		$	297		$	32		$	865		$	51		$	77		$	2,041

Denominator
Net premiums earned	E	$	3,595		$	1,192		$	376		$	2,194		$	163					$	7,520
Reinstatement premiums (collected) expensed on catastrophe losses			3			1			—			16			—						20
Net premiums earned adjustments on PPD—unfavorable (favorable)			4			—			—			—			—						4
PPD reinstatement premiums—unfavorable (favorable)			—			—			—			—			(1	)					(1	)

Net premiums earned excluding adjustments	F	$	3,602		$	1,193		$	376		$	2,210		$	162					$	7,543

P&C combined ratio
Loss and loss expense ratio	A/E		97.3	%		63.8	%		83.1	%		67.7	%		45.5	%					85.2	%
Policy acquisition cost and administrative expense ratio	C/E		20.0	%		25.0	%		8.7	%		39.4	%		31.1	%					27.1	%

P&C combined ratio			117.3	%		88.8	%		91.8	%		107.1	%		76.6	%					112.3	%

CAY P&C combined ratio ex Cats
Loss and loss expense ratio, adjusted	B/F		66.1	%		54.7	%		81.5	%		51.6	%		46.8	%					60.4	%
Policy acquisition cost and administrative expense ratio, adjusted	D/F		19.9	%		24.9	%		8.7	%		39.1	%		31.4	%					27.0	%

CAY P&C combined ratio ex Cats			86.0	%		79.6	%		90.2	%		90.7	%		78.2	%					87.4	%

Combined ratio
Combined ratio																					112.3	%
Add: impact of gains and losses on crop derivatives																					0.0	%

P&C combined ratio																					112.3	%

Note: The ratios above are calculated using whole U.S. dollars. Accordingly, calculations using rounded amounts may differ. Letters A, B, C, D, E, and F included in the table are references for calculating the ratios above.


Reconciliation Non—GAAP 4		Page 33

Chubb Limited

Non-GAAP Financial Measures—5

(in millions of U.S. dollars, except ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

P&C combined ratio (continued)


YTD 2020		North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C
Numerator
Losses and loss expenses
Losses and loss expenses		$	5,679		$	1,445		$	375		$	2,743		$	160		$	287		$	10,689
Realized (gains) losses on crop derivatives			—			—			3			—			—			—			3

Adjusted losses and loss expenses	A	$	5,679		$	1,445		$	378		$	2,743		$	160		$	287		$	10,692

Catastrophe losses and related adjustments
Catastrophe losses, net of related adjustments			(1,391	)		(131	)		(14	)		(489	)		(13	)		—			(2,038	)
Reinstatement premiums collected (expensed) on catastrophe losses			(3	)		(1	)		—			(16	)		—			—			(20	)

Catastrophe losses, gross of related adjustments			(1,388	)		(130	)		(14	)		(473	)		(13	)		—			(2,018	)

PPD and related adjustments
PPD, net of related adjustments—favorable (unfavorable)			251			—			14			40			23			(285	)		43
Net premiums earned adjustments on PPD—unfavorable (favorable)			4			—			3			—			—			—			7
PPD reinstatement premiums—unfavorable (favorable)			—			—			—			—			(1	)		—			(1	)

PPD, gross of related adjustments—favorable (unfavorable)			255			—			17			40			22			(285	)		49

CAY loss and loss expense ex Cats	B	$	4,546		$	1,315		$	381		$	2,310		$	169		$	2		$	8,723

Policy acquisition costs and administrative expenses
Policy acquisition costs and administrative expenses	C	$	1,471		$	610		$	47		$	1,765		$	106		$	143		$	4,142
Expense adjustments—favorable (unfavorable)			—			—			—			—			—			—			—

Policy acquisition costs and administrative expenses, adjusted	D	$	1,471		$	610		$	47		$	1,765		$	106		$	143		$	4,142

Denominator
Net premiums earned	E	$	6,971		$	2,392		$	470		$	4,501		$	349					$	14,683
Reinstatement premiums (collected) expensed on catastrophe losses			3			1			—			16			—						20
Net premiums earned adjustments on PPD—unfavorable (favorable)			4			—			3			—			—						7
PPD reinstatement premiums—unfavorable (favorable)			—			—			—			—			(1	)					(1	)

Net premiums earned excluding adjustments	F	$	6,978		$	2,393		$	473		$	4,517		$	348					$	14,709

P&C combined ratio
Loss and loss expense ratio	A/E		81.5	%		60.4	%		80.4	%		61.0	%		46.0	%					72.8	%
Policy acquisition cost and administrative expense ratio	C/E		21.1	%		25.5	%		10.0	%		39.2	%		30.3	%					28.2	%

P&C combined ratio			102.6	%		85.9	%		90.4	%		100.2	%		76.3	%					101.0	%

CAY P&C combined ratio ex Cats
Loss and loss expense ratio, adjusted	B/F		65.2	%		54.9	%		80.4	%		51.2	%		48.7	%					59.3	%
Policy acquisition cost and administrative expense ratio, adjusted	D/F		21.0	%		25.5	%		10.0	%		39.0	%		30.5	%					28.2	%

CAY P&C combined ratio ex Cats			86.2	%		80.4	%		90.4	%		90.2	%		79.2	%					87.5	%

Combined ratio
Combined ratio																					101.0	%
Add: impact of gains and losses on crop derivatives																					0.0	%

P&C combined ratio																					101.0	%


Reconciliation Non-GAAP 5		Page 34

Chubb Limited

Non-GAAP Financial Measures—6

(in millions of U.S. dollars, except ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

P&C combined ratio (continued)


Q2 2019		North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C
Numerator
Losses and loss expenses
Losses and loss expenses		$	2,214		$	747		$	316		$	1,125		$	90		$	34		$	4,526
Realized (gains) losses on crop derivatives			—			—			(7	)		—			—			—			(7	)

Adjusted losses and loss expenses	A	$	2,214		$	747		$	309		$	1,125		$	90		$	34		$	4,519

Catastrophe losses and related adjustments
Catastrophe losses, net of related adjustments			(137	)		(117	)		(2	)		(9	)		(10	)		—			(275	)
Reinstatement premiums collected (expensed) on catastrophe losses			—			—			—			—			—			—			—

Catastrophe losses, gross of related adjustments			(137	)		(117	)		(2	)		(9	)		(10	)		—			(275	)

PPD and related adjustments
PPD, net of related adjustments—favorable (unfavorable)			185			16			—			20			—			(33	)		188
Net premiums earned adjustments on PPD—unfavorable (favorable)			(3	)		—			—			—			—			—			(3	)
Expense adjustments—unfavorable (favorable)			(2	)		—			—			—			—			—			(2	)

PPD, gross of related adjustments—favorable (unfavorable)			180			16			—			20			—			(33	)		183

CAY loss and loss expense ex Cats	B	$	2,257		$	646		$	307		$	1,136		$	80		$	1		$	4,427

Policy acquisition costs and administrative expenses
Policy acquisition costs and administrative expenses	C	$	718		$	308		$	31		$	894		$	49		$	74		$	2,074
Expense adjustments—favorable (unfavorable)			2			—			—			—			—			—			2

Policy acquisition costs and administrative expenses, adjusted	D	$	720		$	308		$	31		$	894		$	49		$	74		$	2,076

Denominator
Net premiums earned	E	$	3,390		$	1,168		$	378		$	2,225		$	159					$	7,320
Net premiums earned adjustments on PPD—unfavorable (favorable)			(3	)		—			—			—			—						(3	)

Net premiums earned excluding adjustments	F	$	3,387		$	1,168		$	378		$	2,225		$	159					$	7,317

P&C combined ratio
Loss and loss expense ratio	A/E		65.3	%		64.0	%		81.9	%		50.6	%		55.9	%					61.7	%
Policy acquisition cost and administrative expense ratio	C/E		21.2	%		26.3	%		8.2	%		40.2	%		31.8	%					28.4	%

P&C combined ratio			86.5	%		90.3	%		90.1	%		90.8	%		87.7	%					90.1	%

CAY P&C combined ratio ex Cats
Loss and loss expense ratio, adjusted	B/F		66.7	%		55.3	%		81.4	%		51.1	%		49.7	%					60.5	%
Policy acquisition cost and administrative expense ratio, adjusted	D/F		21.2	%		26.4	%		8.2	%		40.1	%		32.0	%					28.4	%

CAY P&C combined ratio ex Cats			87.9	%		81.7	%		89.6	%		91.2	%		81.7	%					88.9	%

Combined ratio
Combined ratio																					90.2	%
Add: impact of gains and losses on crop derivatives																					-0.1	%

P&C combined ratio																					90.1	%


Reconciliation Non-GAAP 6		Page 35

Chubb Limited

Non-GAAP Financial Measures—7

(in millions of U.S. dollars, except ratios)

(Unaudited)

Regulation G—Non-GAAP Financial Measures (continued)

P&C combined ratio (continued)


YTD 2019		North America Commercial P&C Insurance			North America Personal P&C Insurance			North America Agricultural Insurance			Overseas General Insurance			Global Reinsurance			Corporate			Total P&C
Numerator
Losses and loss expenses
Losses and loss expenses		$	4,187		$	1,504		$	289		$	2,231		$	166		$	45		$	8,422
Realized (gains) losses on crop derivatives			—			—			(6	)		—			—			—			(6	)

Adjusted losses and loss expenses	A	$	4,187		$	1,504		$	283		$	2,231		$	166		$	45		$	8,416

Catastrophe losses and related adjustments
Catastrophe losses, net of related adjustments			(231	)		(246	)		(4	)		(34	)		(10	)		—			(525	)
Reinstatement premiums collected (expensed) on catastrophe losses			—			—			—			—			—			—			—

Catastrophe losses, gross of related adjustments			(231	)		(246	)		(4	)		(34	)		(10	)		—			(525	)

PPD and related adjustments
PPD, net of related adjustments—favorable (unfavorable)			316			26			61			24			8			(43	)		392
Net premiums earned adjustments on PPD—unfavorable (favorable)			(1	)		—			32			—			—			—			31
Expense adjustments—unfavorable (favorable)			(6	)		—			(3	)		—			—			—			(9	)
PPD reinstatement premiums—unfavorable (favorable)			—			(3	)		—			—			—			—			(3	)

PPD, gross of related adjustments—favorable (unfavorable)			309			23			90			24			8			(43	)		411

CAY loss and loss expense ex Cats	B	$	4,265		$	1,281		$	369		$	2,221		$	164		$	2		$	8,302

Policy acquisition costs and administrative expenses
Policy acquisition costs and administrative expenses	C	$	1,417		$	607		$	39		$	1,739		$	102		$	137		$	4,041
Expense adjustments—favorable (unfavorable)			6			—			3			—			—			—			9

Policy acquisition costs and administrative expenses, adjusted	D	$	1,423		$	607		$	42		$	1,739		$	102		$	137		$	4,050

Denominator
Net premiums earned	E	$	6,475		$	2,322		$	433		$	4,339		$	327					$	13,896
Net premiums earned adjustments on PPD—unfavorable (favorable)			(1	)		—			32			—			—						31
PPD reinstatement premiums—unfavorable (favorable)			—			(3	)		—			—			—						(3	)

Net premiums earned excluding adjustments	F	$	6,474		$	2,319		$	465		$	4,339		$	327					$	13,924

P&C combined ratio
Loss and loss expense ratio	A/E		64.7	%		64.7	%		65.5	%		51.4	%		50.6	%					60.6	%
Policy acquisition cost and administrative expense ratio	C/E		21.8	%		26.2	%		9.0	%		40.1	%		31.5	%					29.0	%

P&C combined ratio			86.5	%		90.9	%		74.5	%		91.5	%		82.1	%					89.6	%

CAY P&C combined ratio ex Cats
Loss and loss expense ratio, adjusted	B/F		65.9	%		55.2	%		79.5	%		51.2	%		50.1	%					59.6	%
Policy acquisition cost and administrative expense ratio, adjusted	D/F		21.9	%		26.2	%		9.0	%		40.1	%		31.5	%					29.1	%

CAY P&C combined ratio ex Cats			87.8	%		81.4	%		88.5	%		91.3	%		81.6	%					88.7	%

Combined ratio
Combined ratio																					89.6	%
Add: impact of gains and losses on crop derivatives																					0.0	%

P&C combined ratio																					89.6	%


Reconciliation Non-GAAP 7		Page 36

Chubb Limited

Glossary

Chubb Limited Consolidated comprises all segments including Corporate.

P&C combined ratio: The sum of the loss and loss expense ratio, policy acquisition cost ratio and the administrative expense ratio excluding the life business and including the realized gains and losses on the crop derivatives.

Book value per common share: Shareholders’ equity divided by the shares outstanding.

Tangible book value per common share: Shareholders’ equity less goodwill and other intangible assets, net of tax, divided by the shares outstanding.

Average market yield of fixed maturities: Weighted average yield to maturity of our fixed income portfolio based on the market prices of the holdings as of that date.

Average yield on invested assets: Adjusted net investment income divided by average cost of fixed maturities and other investments, and average market value of equity securities.

Total capitalization: The sum of the short-term debt, long-term debt, trust preferreds, and shareholders’ equity.

Chubb integration expenses: Chubb integration expenses comprise legal and professional fees and all other costs directly related to the integration activities of the Chubb Corp acquisition. Chubb integration expenses are incurred by the overall company and are therefore included in Corporate. These costs are not related to the on-going business activities of the segments and are therefore excluded from our definition of segment income.

Catastrophe losses (Cats): We generally define catastrophe loss events consistent with the definition of the Property Claims Service (PCS) for events in the U.S. and Canada. PCS defines a catastrophe as an event that causes damage of $25 million or more in insured losses and affects a significant number of insureds, including from pandemics such as COVID-19. For events outside of the U.S. and Canada, we generally use a similar definition. Catastrophe loss events are events that occurred in the current calendar year only. Changes in catastrophe loss estimates in the current calendar year that relate to loss events that occurred in previous calendar years are considered prior period development.

Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years.

Reinstatement premiums are additional premiums paid on certain reinsurance agreements in order to reinstate coverage that had been exhausted by loss occurrences. The reinstatement premium amount is typically a pro rata portion of the original ceded premium paid based on how much of the reinsurance limit had been exhausted.

Net premiums earned adjustments within prior period development are adjustments to the initial premium earned on retrospectively rated policies based on actual claim experience that develops after the policy period ends. The premium adjustments correlate to the prior period loss development on these same policies and are fully earned in the period the adjustments are recorded.

Prior period expense adjustments typically relate to either profit commission reserves or policyholder dividend reserves based on actual claim experience that develops after the policy period ends. The expense adjustments correlate to the prior period loss development on these same policies.

NM: Not meaningful.


Glossary		Page 37

Chubb Ltd - FORM 8-K - EX-99.2 - July 28, 2020

Attached files

Chubb Ltd Reports