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M904*V0\_0K$&
M
SECURITIES AND EXCHANGE COMMISSION
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
New Jersey
1-8661
13-2595722
(State or other jurisdiction of
(Commission
(IRS Employer
incorporation)
File Number)
Identification No.)
15 Mountain View Road, Warren, New Jersey
07059
(Address of principal executive offices)
(Zip Code)
Registrants telephone number, including area code
(908) 903-2000
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02
Results of Operations and Financial Condition.
(a)
The following information, including the text of the exhibits attached hereto, is
furnished pursuant to this Item 2.02 of Form 8-K. On January 28, 2010, The Chubb Corporation
(Chubb) issued a press release announcing its results for the quarter and year ended December
31, 2009. On January 28, 2010, Chubb also posted on its web site at www.chubb.com the
Supplementary Investor Information Report (SIIR) relating to its 2009 fourth quarter and
year-end results and The Chubb Corporation 2009 Update on Asbestos Reserves (Asbestos Report).
Copies of the press release, the SIIR and the Asbestos Report, all of which are incorporated
by reference into this Item 2.02 as if fully set forth herein, are furnished as Exhibits 99.1,
99.2 and 99.3, respectively, to this Form 8-K. In its press release, the SIIR, the Asbestos
Report and the conference call to discuss its 2009 fourth quarter and year-end results,
scheduled to be webcast at 5:00 P.M. on January 28, 2010, Chubb presents, and will present,
its results of operations in the manner that it believes is most meaningful to investors,
which includes certain measures that are not prepared in accordance with accounting principles
generally accepted in the United States.
Item 9.01
Financial Statements and Exhibits.
(d)
Exhibits.
99.1
Press release dated January 28, 2010 (furnished pursuant to Item 2.02 of Form 8-K)
99.2
Supplementary Investor Information Report (furnished pursuant to Item 2.02 of
Form 8-K)
99.3
The Chubb Corporation 2009 Update on Asbestos Reserves (furnished pursuant to
Item 2.02 of Form 8-K)
THE CHUBB CORPORATION
Date: January 28, 2010
By:
/s/ John J. Kennedy
Name:
John J. Kennedy
Title:
Senior Vice President and
Chief Accounting Officer
FILED ON JANUARY 28, 2010
Exhibit No.
Description
Press release dated January 28, 2010 (furnished pursuant to Item 2.02 of Form 8-K)
Supplementary Investor Information Report (furnished pursuant to Item 2.02 of Form 8-K)
The Chubb Corporation 2009 Update on Asbestos Reserves (furnished pursuant to Item
2.02 of Form 8-K)
News
from The Chubb Corporation
The Chubb Corporation
15 Mountain View Road P.O. Box 1615
Warren, New Jersey 07061-1615
Telephone: 908-903-2000
Operating Income per Share Is $1.66;
Combined Ratio Is 84.7%
Operating Income per Share Is $6.14;
Combined Ratio Is 86.0%
In Range of $5.15 to $5.55
Net written premiums that are flat to down 2%, including about a 2 percentage point
positive impact of currency based on 2009 year end exchange rates.
Catastrophe losses that have an impact of 3 percentage points on the 2010 combined ratio
in keeping with historical levels, compared to the unusually low 0.8 point impact in 2009.
This assumption accounts for approximately $0.50 of the difference between 2009 operating
income per share and 2010 guidance. The impact of each percentage point of catastrophe
losses on 2010 operating income per share is approximately $0.22.
A combined ratio between 90% and 92% for the year, based on combined ratios of 90% to
93% for CPI, 92% to 95% for CCI and 84% to 87% for CSI.
Flat property and casualty investment income after taxes.
Approximately 328 million average diluted shares outstanding for the year.
Investors:
Glenn A. Montgomery
(908) 903-2365
Media:
Mark E. Greenberg
(908) 903-2682
global political conditions and the occurrence of terrorist attacks, including any nuclear,
biological, chemical or radiological events;
the effects of the outbreak or escalation of war or hostilities;
premium pricing and profitability or growth estimates overall or by lines of business or
geographic area, and related expectations with respect to the timing and terms of any required
regulatory approvals;
adverse changes in loss cost trends;
our ability to retain existing business and attract new business;
our expectations with respect to cash flow and investment income and with respect to other
income;
the adequacy of our loss reserves, including:
-
our expectations relating to reinsurance recoverables;
-
the willingness of parties, including us, to settle disputes;
-
developments in judicial decisions or regulatory or legislative
actions relating to coverage and liability, in particular, for
asbestos, toxic waste and other mass tort claims;
-
development of new theories of liability;
-
our estimates relating to ultimate asbestos liabilities;
-
the impact from the bankruptcy protection sought by various asbestos
producers and other related businesses; and
-
the effects of proposed asbestos liability legislation, including the
impact of claims patterns arising from the possibility of legislation
and those that may arise if legislation is not passed;
the availability and cost of reinsurance coverage;
the occurrence of significant weather-related or other natural or human-made disasters,
particularly in locations where we have concentrations of risk;
the impact of economic factors on companies on whose behalf we have issued surety bonds,
and in particular, on those companies that file for bankruptcy or otherwise experience
deterioration in creditworthiness;
the effects of disclosures by, and investigations of, companies relating to possible
accounting irregularities, practices in the financial services industry, investment losses or
other corporate governance issues, including:
-
claims and litigation arising out of stock option backdating, spring loading
and other equity grant practices by public companies;
-
the effects on the capital markets and the markets for directors and officers and
errors and omissions insurance;
-
claims and litigation arising out of actual or alleged accounting or other
corporate malfeasance by other companies;
-
claims and litigation arising out of practices in the financial services industry;
-
claims and litigation relating to uncertainty in the credit and broader financial
markets; and
-
legislative or regulatory proposals or changes;
the effects of changes in market practices in the U.S. property and casualty insurance
industry arising from any legal or regulatory proceedings, related settlements and industry
reform, including changes that have been announced and changes that may occur in the future;
the impact of legislative and regulatory developments on our business, including those
relating to terrorism, catastrophes and the financial markets;
any downgrade in our claims-paying, financial strength or other credit ratings;
the ability of our subsidiaries to pay us dividends;
general political, economic and market conditions whether globally or in the markets in
which we operate, including:
-
changes in interest rates, market credit spreads and the performance
of the financial markets;
-
currency fluctuations;
-
the effects of inflation;
-
changes in domestic and foreign laws, regulations and taxes;
-
changes in competition and pricing environments;
-
regional or general changes in asset valuations;
-
the inability to reinsure certain risks economically; and
-
changes in the litigation environment;
our ability to implement managements strategic plans and initiatives.
(Unaudited)
Periods Ended December 31
Fourth Quarter
Twelve Months
2009
2008
2009
2008
(in millions)
$
2,783
$
2,899
$
11,077
$
11,782
58
3
254
46
2,841
2,902
11,331
11,828
1,547
1,559
6,268
6,898
836
877
3,377
3,546
16
12
27
(17
)
6
11
28
40
436
443
1,631
1,361
405
398
1,585
1,652
12
7
36
30
393
391
1,549
1,622
4
2
(3
)
9
833
836
3,177
2,992
(56
)
(55
)
(238
)
(214
)
777
781
2,939
2,778
208
212
771
733
569
569
2,168
2,045
126
(162
)
15
(241
)
$
695
$
407
$
2,183
$
1,804
$
317
$
316
$
1,252
$
1,297
Periods Ended December 31
Fourth Quarter
Twelve Months
2009
2008
2009
2008
343.1
359.6
353.0
366.8
332.0
352.3
332.0
352.3
$
1.66
$
1.58
$
6.14
$
5.58
.37
(.45
)
.04
(.66
)
$
2.03
$
1.13
$
6.18
$
4.92
$
$
.01
$
(.17
)
$
(1.08
)
Dec. 31
Dec. 31
2009
2008
$
47.09
$
38.13
Fixed Maturities
at Amortized Cost
44.37
38.38
Fourth Quarter
Twelve Months
2009
2008
2009
2008
54.6
%
53.9
%
55.4
%
58.5
%
30.1
30.4
30.6
30.2
84.7
%
84.3
%
86.0
%
88.7
%
%
(.3
)%
.8
%
5.1
%
PERIODS ENDED DECEMBER 31
Fourth Quarter
Twelve Months
2009
2008
2009
2008
(in millions)
$
1,591
$
1,963
$
6,006
$
6,509
(44
)
(404
)
262
389
$
1,547
$
1,559
$
6,268
$
6,898
Net Premiums Written
Combined Loss and
% Increase
Expense Ratios
2009
2008
(Decrease)
2009
2008
(in millions)
$
577
$
602
(4
)%
90.4
%
87.6
%
2,339
2,449
(4
)
80.4
83.7
741
775
(4
)
90.8
97.5
3,657
3,826
(4
)
84.1
87.1
1,121
1,210
(7
)
85.8
85.3
1,514
1,654
(8
)
96.7
95.0
761
851
(11
)
92.7
82.1
1,264
1,278
(1
)
83.3
108.8
4,660
4,993
(7
)
89.9
93.9
2,413
2,546
(5
)
90.1
85.0
326
353
(8
)
37.4
69.9
2,739
2,899
(6
)
84.1
83.3
11,056
11,718
(6
)
86.5
89.1
21
64
(67
)
*
*
$
11,077
$
11,782
(6
)
86.0
88.7
$
149
$
145
3
%
94.2
%
84.8
%
568
590
(4
)
75.8
77.1
190
204
(7
)
85.5
89.3
907
939
(3
)
80.7
80.9
286
295
(3
)
86.9
79.6
353
373
(5
)
97.9
96.4
151
185
(18
)
97.1
87.6
311
321
(3
)
78.5
87.8
1,101
1,174
(6
)
89.9
88.8
688
699
(2
)
89.5
88.4
83
77
8
40.5
52.0
771
776
(1
)
84.1
83.8
2,779
2,889
(4
)
85.2
84.8
4
10
(60
)
*
*
$
2,783
$
2,899
(4
)
84.7
84.3
*
Combined loss and expense ratios are no longer presented for Reinsurance Assumed since this
business is in run-off.
The
Chubb
Corporation
Supplementary
Investor
Information
December 31, 2009
SUPPLEMENTARY INVESTOR INFORMATION
TABLE OF CONTENTS
DECEMBER 31, 2009
Page
1
2
3
3
4
4
4
5
6-10
11-15
16-17
AS OF DECEMBER 31
2009
2008
% of Total
% of Total
$
1,918
5
%
$
2,478
7
%
19,587
47
18,345
47
16,991
40
14,410
37
1,433
3
1,479
4
2,075
5
2,026
5
$
42,004
100
%
$
38,738
100
%
$
1,388
$
(136
)
218
(84
)
1,606
(220
)
562
(77
)
$
1,044
$
(143
)
$
3,975
$
3,975
15,634
13,432
$
19,609
$
17,407
20.3
%
22.8
%
332.0
352.3
$
47.09
$
38.13
$
44.37
$
38.38
Periods Ended December 31
Fourth
Twelve
From
Quarter
Months
December 2005
2009
2009
to December 31, 2009
$489
$1,065
$5,952
$49.65
$47.09
$50.08
9,842,744
22,623,775
118,839,875
AS OF DECEMBER 31
Cost or
Carrying
Amortized Cost
Value (a)
2009
2008
2009
2008
(in millions)
$
1,017
$
1,602
$
1,017
$
1,602
1,286
774
1,327
780
205
451
202
504
25
25
$
2,533
$
2,827
$
2,571
$
2,886
Cost or
Carrying
Amortized Cost
Value (a)
2009
2008
2009
2008
(in millions)
$
901
$
876
$
901
$
876
18,720
18,299
19,587
18,345
15,184
13,818
15,664
13,630
1,010
1,112
1,231
975
2,050
2,026
2,050
2,026
$
37,865
$
36,131
$
39,433
$
35,852
(a)
Short term investments are carried at amortized cost, which approximates fair value. Fixed
maturities and equity securities are carried at fair value. Other invested assets include
private equity limited partnerships carried at Chubbs equity in the net assets of the
partnerships.
Periods Ended December 31
Fourth Quarter
Twelve Months
2009
2008
2009
2008
(in millions)
$
13
$
12
$
40
$
51
$
192
$
188
$
755
$
742
119
118
465
497
13
15
55
77
(7
)
(5
)
(23
)
(19
)
$
317
$
316
$
1,252
$
1,297
19.3
%
19.2
%
19.2
%
20.0
%
3.34
%
3.45
%
3.39
%
3.49
%
AS OF DECEMBER 31
2009
2008
2007
(in millions)
$
14,500
$
12,281
$
12,998
$
11,074
$
11,759
$
11,829
0.76:1
0.96:1
0.91:1
TWELVE MONTHS ENDED DECEMBER 31, 2009
Net Unpaid Losses
All Other
IBNR
Unpaid Losses
Increase
Increase
Increase
12/31/09
12/31/08
(Decrease)
(Decrease)
(Decrease)
(in millions)
$
400
$
391
$
9
$
(8
)
$
17
665
715
(50
)
(14
)
(36
)
872
815
57
44
13
1,937
1,921
16
22
(6
)
1,615
1,586
29
58
(29
)
5,988
5,660
328
224
104
2,138
1,982
156
83
73
758
839
(81
)
(32
)
(49
)
10,499
10,067
432
333
99
7,552
7,175
377
380
(3
)
58
68
(10
)
(1
)
(9
)
7,610
7,243
367
379
(12
)
20,046
19,231
815
734
81
740
924
(184
)
(118
)
(66
)
$
20,786
$
20,155
$
631
$
616
$
15
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Personal
Other
Total
Automobile
Homeowners
Personal
Personal
2009
2008
2009
2008
2009
2008
2009
2008
$
577
$
602
$
2,339
$
2,449
$
741
$
775
$
3,657
$
3,826
2
10
35
(22
)
(2
)
(27
)
35
(39
)
579
612
2,374
2,427
739
748
3,692
3,787
352
370
1,195
1,208
393
406
1,940
1,984
3
(13
)
(64
)
34
44
82
(17
)
103
355
357
1,131
1,242
437
488
1,923
2,087
168
176
766
796
235
250
1,169
1,222
$
56
$
79
$
477
$
389
$
67
$
10
$
600
$
478
61.3
%
58.3
%
47.6
%
51.2
%
59.1
%
65.2
%
52.1
%
55.1
%
29.1
29.3
32.8
32.5
31.7
32.3
32.0
32.0
90.4
%
87.6
%
80.4
%
83.7
%
90.8
%
97.5
%
84.1
%
87.1
%
5.2
%
5.1
%
21.1
%
20.8
%
6.7
%
6.6
%
33.0
%
32.5
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Commercial
Commercial
Commercial
Commercial
Workers
Property
Total
Multiple Peril
Casualty
Compensation
and Marine
Commercial
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
$
1,121
$
1,210
$
1,514
$
1,654
$
761
$
851
$
1,264
$
1,278
$
4,660
$
4,993
32
19
55
32
25
11
(10
)
(40
)
102
22
1,153
1,229
1,569
1,686
786
862
1,254
1,238
4,762
5,015
566
611
834
885
375
375
710
735
2,485
2,606
8
231
237
145
101
(96
)
187
288
525
574
611
1,065
1,122
520
476
614
922
2,773
3,131
404
430
437
471
182
201
434
439
1,457
1,541
22
34
22
34
$
175
$
188
$
67
$
93
$
62
$
151
$
206
$
(123
)
$
510
$
309
49.8
%
49.7
%
67.9
%
66.6
%
68.1
%
57.5
%
49.0
%
74.5
%
58.5
%
62.8
%
36.0
35.6
28.8
28.4
24.6
24.6
34.3
34.3
31.4
31.1
85.8
%
85.3
%
96.7
%
95.0
%
92.7
%
82.1
%
83.3
%
108.8
%
89.9
%
93.9
%
10.1
%
10.3
%
13.7
%
14.0
%
6.9
%
7.2
%
11.4
%
10.9
%
42.1
%
42.4
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Professional
Total
Liability
Surety
Specialty
2009
2008
2009
2008
2009
2008
$
2,413
$
2,546
$
326
$
353
$
2,739
$
2,899
85
48
5
(12
)
90
36
2,498
2,594
331
341
2,829
2,935
1,410
1,608
21
132
1,431
1,740
184
(52
)
(9
)
(2
)
175
(54
)
1,594
1,556
12
130
1,606
1,686
635
636
108
108
743
744
6
6
6
6
$
269
$
402
$
205
$
97
$
474
$
499
63.8
%
60.0
%
3.7
%
38.8
%
56.9
%
57.6
%
26.3
25.0
33.7
31.1
27.2
25.7
90.1
%
85.0
%
37.4
%
69.9
%
84.1
%
83.3
%
21.8
%
21.6
%
2.9
%
3.0
%
24.7
%
24.6
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
Total
Reinsurance
Worldwide
Insurance
Assumed
Total
2009
2008
2009
2008
2009
2008
$
11,056
$
11,718
$
21
$
64
$
11,077
$
11,782
227
19
27
27
254
46
11,283
11,737
48
91
11,331
11,828
5,856
6,330
150
179
6,006
6,509
446
574
(184
)
(185
)
262
389
6,302
6,904
(34
)
(6
)
6,268
6,898
3,369
3,507
8
39
3,377
3,546
28
40
28
40
$
1,584
$
1,286
$
74
$
58
1,658
1,344
(27
)
17
$
1,631
$
1,361
56.0
%
59.0
%
*
%
*
%
55.4
%
58.5
30.5
30.1
*
*
30.6
30.2
86.5
%
89.1
%
*
%
*
%
86.0
%
88.7
99.8
%
99.5
%
0.2
%
0.5
%
100.0
%
100.0
*
Combined, loss and expense ratios are no longer presented for Reinsurance Assumed since this
business is in run-off.
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2009 AND 2008
Outside
the
Worldwide
United States
United States
Total
2009
2008
2009
2008
2009
2008
$
8,383
$
8,920
$
2,694
$
2,862
$
11,077
$
11,782
300
79
(46
)
(33
)
254
46
8,683
8,999
2,648
2,829
11,331
11,828
4,834
5,212
1,172
1,297
6,006
6,509
24
308
238
81
262
389
4,858
5,520
1,410
1,378
6,268
6,898
2,437
2,538
940
1,008
3,377
3,546
28
40
28
40
$
1,360
$
901
$
298
$
443
1,658
1,344
(27
)
17
$
1,631
$
1,361
56.1
%
61.6
%
53.2
%
48.7
%
55.4
%
58.5
%
29.2
28.6
34.9
35.2
30.6
30.2
85.3
%
90.2
%
88.1
%
83.9
%
86.0
%
88.7
%
75.7
%
75.7
%
24.3
%
24.3
%
100.0
%
100.0
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE QUARTERS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Personal
Other
Total
Automobile
Homeowners
Personal
Personal
2009
2008
2009
2008
2009
2008
2009
2008
$
149
$
145
$
568
$
590
$
190
$
204
$
907
$
939
1
2
27
11
3
(2
)
31
11
150
147
595
601
193
202
938
950
96
91
266
363
110
119
472
573
1
(10
)
(11
)
(98
)
(6
)
(2
)
(16
)
(110
)
97
81
255
265
104
117
456
463
44
43
187
195
60
64
291
302
$
9
$
23
$
153
$
141
$
29
$
21
$
191
$
185
64.7
%
55.1
%
42.9
%
44.1
%
53.9
%
57.9
%
48.6
%
48.7
%
29.5
29.7
32.9
33.0
31.6
31.4
32.1
32.2
94.2
%
84.8
%
75.8
%
77.1
%
85.5
%
89.3
%
80.7
%
80.9
%
5.4
%
5.0
%
20.4
%
20.4
%
6.8
%
7.0
%
32.6
%
32.4
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE QUARTERS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Commercial
Commercial
Commercial
Commercial
Workers
Property
Total
Multiple Peril
Casualty
Compensation
and Marine
Commercial
2009
2008
2009
2008
2009
2008
2009
2008
2009
2008
$
286
$
295
$
353
$
373
$
151
$
185
$
311
$
321
$
1,101
$
1,174
(1
)
(2
)
34
29
32
20
11
(7
)
76
40
285
293
387
402
183
205
322
314
1,177
1,214
157
189
229
289
95
98
183
234
664
810
(7
)
(61
)
36
(19
)
29
20
(38
)
(66
)
20
(126
)
150
128
265
270
124
118
145
168
684
684
98
106
104
109
40
49
104
110
346
374
5
8
5
8
$
37
$
59
$
18
$
23
$
14
$
30
$
73
$
36
$
142
$
148
52.6
%
43.7
%
68.5
%
67.2
%
69.7
%
59.9
%
45.0
%
53.5
%
58.3
%
56.7
%
34.3
35.9
29.4
29.2
27.4
27.7
33.5
34.3
31.6
32.1
86.9
%
79.6
%
97.9
%
96.4
%
97.1
%
87.6
%
78.5
%
87.8
%
89.9
%
88.8
%
10.3
%
10.2
%
12.7
%
12.9
%
5.4
%
6.4
%
11.2
%
11.0
%
39.6
%
40.5
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE QUARTERS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Professional
Total
Liability
Surety
Specialty
2009
2008
2009
2008
2009
2008
$
688
$
699
$
83
$
77
$
771
$
776
(49
)
(72
)
(3
)
12
(52
)
(60
)
639
627
80
89
719
716
412
441
7
92
419
533
2
(34
)
(2
)
(74
)
(108
)
414
407
5
18
419
425
170
164
28
23
198
187
1
3
1
3
$
55
$
56
$
46
$
45
$
101
$
101
64.8
%
64.9
%
6.3
%
20.9
%
58.4
%
59.6
%
24.7
23.5
34.2
31.1
25.7
24.2
89.5
%
88.4
%
40.5
%
52.0
%
84.1
%
83.8
%
24.7
%
24.1
%
3.0
%
2.7
%
27.7
%
26.8
%
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE QUARTERS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Total
Reinsurance
Worldwide
Insurance
Assumed
Total
2009
2008
2009
2008
2009
2008
$
2,779
$
2,889
$
4
$
10
$
2,783
$
2,899
55
(9
)
3
12
58
3
2,834
2,880
7
22
2,841
2,902
1,555
1,916
36
47
1,591
1,963
4
(344
)
(48
)
(60
)
(44
)
(404
)
1,559
1,572
(12
)
(13
)
1,547
1,559
835
863
1
14
836
877
6
11
6
11
$
434
$
434
$
18
$
21
452
455
(16
)
(12
)
$
436
$
443
55.1
%
54.8
%
*
%
*
%
54.6
%
53.9
%
30.1
30.0
*
*
30.1
30.4
85.2
%
84.8
%
*
%
*
%
84.7
%
84.3
%
99.9
%
99.7
%
0.1
%
0.3
%
100.0
%
100.0
%
*
Combined, loss and expense ratios are no longer presented for Reinsurance Assumed since this business is in run-off.
PROPERTY AND CASUALTY UNDERWRITING RESULTS
FOR THE QUARTERS ENDED DECEMBER 31, 2009 AND 2008
(DOLLARS IN MILLIONS)
Outside
the
Worldwide
United States
United States
Total
2009
2008
2009
2008
2009
2008
$
2,026
$
2,202
$
757
$
697
$
2,783
$
2,899
93
36
(35
)
(33
)
58
3
2,119
2,238
722
664
2,841
2,902
1,231
1,555
360
408
1,591
1,963
(36
)
(352
)
(8
)
(52
)
(44
)
(404
)
1,195
1,203
352
356
1,547
1,559
588
638
248
239
836
877
6
11
6
11
$
330
$
386
$
122
$
69
452
455
(16
)
(12
)
$
436
$
443
56.6
%
54.0
%
48.8
%
53.6
%
54.6
%
53.9
%
29.1
29.1
32.8
34.3
30.1
30.4
85.7
%
83.1
%
81.6
%
87.9
%
84.7
%
84.3
%
72.8
%
76.0
%
27.2
%
24.0
%
100.0
%
100.0
%
Periods Ended December 31
Fourth Quarter
Twelve Months
2009
2008
2009
2008
(dollars in millions)
$
2,780
$
1,628
$
2,183
$
1,804
$
15,576
$
13,518
$
14,578
$
13,992
17.8
%
12.0
%
15.0
%
12.9
%
$
2,276
$
2,276
$
2,168
$
2,045
$
14,480
$
13,734
$
14,065
$
13,885
15.7
%
16.6
%
15.4
%
14.7
%
The Chubb Corporation
2009 Update on Asbestos
Reserves
Date of release 01/28/2010
Forward Looking Statements
The following materials contain "forward looking statements,"
including those relating to loss reserves and claim estimates, that
are subject to certain risks and uncertainties which could cause
actual results to differ materially from those expressed or
suggested by such statements. Such risks or uncertainties
include but are not limited to those which may be noted more fully
in the materials themselves, as well as those discussed or
identified from time to time in The Chubb Corporation's public
filings with the Securities and Exchange Commission. The Chubb
Corporation assumes no obligation to update any forward-looking
information set forth in the following materials, which speak as of
January 28, 2010 or as otherwise specified in the materials.
2009AsbestosSlides012810
Contents
Purpose of Updated Review
Conclusions
Evaluation Methodology
Exposure Analysis
Asbestos Payments and Reserves
Three Year Reserve Comparison
Summary
2009AsbestosSlides012810
Purpose of Review
Reassess Chubb's ultimate liability regarding asbestos
exposures using an internal analysis, supported by our
independent outside consulting actuaries
Determine appropriate reserve levels
Ensure aggressive case management of asbestos claims
manage our exposure
identify trends or issues that may impact exposure
Provide relevant substantive information needed by
investors and rating agencies
2009AsbestosSlides012810
Conclusions
Our 2009 analysis of asbestos liabilities concluded current net
reserves are adequate
The carried net reserve of $689M at 12/31/09 represents Chubb's
best estimate of our ultimate asbestos liability
This amount contemplates approximately a 5% reinsurance
recoverable
Net payments for asbestos liabilities in 2009 were $58M
Reserves at 12/31/09 calculate to a 3 year survival ratio of 11.8
2009AsbestosSlides012810
Evaluation Methodology
Chubb segmented its defendant policyholders into two
groups
Traditional defendant policyholders (Tiers 1 & 2)
Those engaged in asbestos mining, manufacturing and
building products industries
Peripheral defendant policyholders (Tiers 3 & 4)
Those who manufactured, distributed, or installed an
asbestos-containing product or who owned or operated
a facility where asbestos products were present
2009AsbestosSlides012810
Exposure Analysis
Within these policyholder categories:
All Tier 1 & 2 accounts and Tier 3 & 4 accounts with Chubb incurred
losses of at least $3M or judged to have high potential exposure were
evaluated individually. Claimant information and available coverage
were reviewed for each defendant policyholder, including terms of
coverage, policy limits and aggregate limits.
Tier 3 & 4 accounts not individually evaluated were analyzed in the
aggregate using statistical techniques. Factors considered include
available coverage, claimant count, report year, bankruptcy, coverage
dispute and case reserve amount.
Future claims from unknown defendant policyholders were estimated
based on claim reporting patterns and projected claim severities.
2009AsbestosSlides012810
Asbestos Payments & Reserves by Category
# $ $
Traditional Defendants Tier 1 4 - 36
Traditional Defendants Tier 2 18 10 139
Peripheral Defendants Tiers 3 & 4 374 48 359
All Other 23
Reserves for future claims from
unknown policyholders TBD - 132
____ ____ ____
Total 396 58 689
No. of Open Total Net Net Asbestos
Policy- Paid Reserves
holders in 2009 At 12/31/09
At 12/31/09
($ in millions)
2009AsbestosSlides012810
Asbestos Payments & Reserves by Category
Total net asbestos reserves: $689M
Case reserves of $311M
Established by Claim Department on known claims
IBNR reserves of $378M
Includes provision for:
potential reserve development on known defendant
policyholders (development)
future claims from unknown defendant policyholders
(pure IBNR)
future declaratory judgment actions and other
litigation
2009AsbestosSlides012810
Asbestos Net Loss Reserve Comparison
($ in Millions)
2007
2008
Beginning Reserves
$793
$789
Incurred Losses & LAE
0
75
CY Payments for
Losses
(28)
(54)
CY Payments for LAE
(18)
(17)
Ending Reserves
$747
$793
IBNR portion of
Ending Reserves
$436
$437
2009
$747
0
(38)
(20)
$689
$378
2009AsbestosSlides012810
Summary
Chubb's asbestos net reserves of $689M at 12/31/09 are
based on our 2009 analysis of our ultimate asbestos
liabilities
This reserve represents Chubb's best estimate of our
ultimate asbestos liability
This reserve amount is at full (undiscounted) value
No consideration has been given for legislative or judicial
relief
The net reserve reflects a modest reinsurance recoverable
amount of approximately 5% of the gross reserve
2009AsbestosSlides012810
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