The Chubb Corporation on Thursday reported that net income in the first quarter of 2013 was $656 million, compared to $506 million in the first quarter of 2012. First quarter net income per share increased 36% to $2.48 in 2013 from $1.83 in 2012.
Operating income, which the company defines as net income excluding after-tax realized investment gains and losses, was $566 million in the first quarter of 2013 and $469 million in the first quarter of 2012. First quarter operating income per share increased 26% to $2.14 in 2013 from $1.70 in 2012.
The first quarter combined loss and expense ratio was 84.6% in 2013 and 90.2% in 2012. The impact of catastrophes on the first quarter combined ratio was 0.6 percentage points in 2013 and 0.8 points in 2012. Excluding the impact of catastrophes, the first quarter combined ratio was 84.0% in 2013 and 89.4% in 2012. The expense ratio for the first quarter was 32.3% in 2013 and 32.2% in 2012.
Chubb's estimated overall gross and net losses from Storm Sandy remained unchanged from the amounts previously reported, although estimated commercial lines losses declined slightly and personal lines losses increased by a similar amount.
Net written premiums for the first quarter of 2013 increased 4% to $3.1 billion. Foreign currency translation had an insignificant effect on total premium growth in the first quarter. Premiums were up 3% in the U.S. and up 6% outside the U.S. (up 7% in local currencies).
Property and casualty investment income after taxes for the first quarter declined 6% to $288 million in 2013 from $308 million in 2012.
Net income for the first quarter of 2013 reflected net realized investment gains of $138 million before tax ($0.34 per share after tax). Net income for the first quarter of 2012 reflected net realized investment gains of $56 million before tax ($0.13 per share after tax).
"Chubb is off to a great start in 2013," said John D. Finnegan, Chairman, President and Chief Executive Officer. "Operating income per share of $2.14 and net income per share of $2.48 were both the highest of any quarter in Chubb's history. Our combined ratio was an outstanding 84.6%, reflecting the impact of higher rates, strong underlying underwriting performance and low catastrophe losses. We are also encouraged by the renewal rate increases we continued to obtain in all of our business units."
During the first quarter of 2013, Chubb repurchased approximately 3.9 million shares of its common stock at a total cost of $326 million (an average cost per share of $82.86). As of March 31, 2013, there was $1.1 billion available for share repurchases under the current authorization.
Average diluted shares outstanding for the first quarter were 264.8 million in 2013 and 276.2 million in 2012.
Book value per share was $61.79 at March 31, 2013, compared to $57.37 at March 31, 2012 and $60.45 at December 31, 2012.