Chubb’s Q1 profit falls on California wildfires losses

(Reuters) — Insurer Chubb Ltd. reported a 38% fall in first-quarter profit on Tuesday, as catastrophe losses from the California wildfires weighed on its underwriting performance and investment returns.

A series of wildfires in California earlier this year claimed several lives and caused estimated economic damage as high as $250 billion.

The Zurich-based insurer’s pre-tax catastrophe loss almost quadrupled to $1.64 billion, with around $1.47 billion stemming from the California wildfires.

The company had forecast a pre-tax net cost of $1.5 billion from the wildfires, which are considered the costliest in U.S. history, according to several estimates.

“We had a good first quarter that was overshadowed by the significant catastrophe losses we incurred from the California wildfires,” Chubb CEO Evan Greenberg said.

The results mirror those of peer W.R. Berkley, whose first-quarter profit also fell on Monday as industry-wide catastrophe losses offset operational gains.

In recent years, insurers have been significantly impacted by natural disasters, particularly as extreme weather-related events have become more frequent.

Chubb’s Global P&C net premiums written, which excludes Agriculture, were up 3% to $10.65 billion for the three months ended March 31.

In March, the company announced an agreement to acquire Liberty Mutual’s insurance businesses in Thailand and Vietnam, representing around $275 million in combined net premiums written in 2024.

The insurer’s net investment income surged 12.2% to $1.56 billion for the quarter ended March 31. The company also reported $302 million in foreign currency gains.

Chubb reported a combined ratio of 95.7%, compared to 86% a year earlier. A ratio below 100% shows that an insurer earned more in premiums than it paid out in claims.