Chubb's Q4 profit drops on big Sandy costs
WARREN, N.J. (AP) — Property and casualty insurer Chubb Corp. on Thursday said fourth-quarter net income dropped 77.4 percent as it suffered heavy costs related to Superstorm Sandy.
The company also announced a plan to repurchase as much as $1.3 billion of its common stock. Chubb bought back 369,900 shares at a total cost of $28 million, or an average cost of $76.54 a share, during the fourth quarter.
Net income was $102 million, or 38 cents a share, down from $452 million, or $1.60 a share, in the fourth quarter of 2011.
Pre-tax costs related to Sandy totaled $882 million. The Oct. 29 storm was one of the worst ever to strike the Northeast and is blamed for more than 130 deaths and tens of billions of dollars in property damage. Chubb, along with Allstate Corp. and Travelers Cos., had a major share of the coverage in areas with heavy damage from Sandy, which hit densely populated areas in New York and New Jersey.
Excluding after-tax investment gains and losses, Chubb's operating income was $44 million, or 16 cents a share. That compared with $460 million, or $1.63 a share, in last year's fourth quarter.
Chubb expects 2013 operating income of $6.40 to $6.80 a share, with net written premiums up 2 to 4 percent.
Net premiums written in the fourth quarter slipped 2 percent to $2.91 billion from $2.97 billion a year earlier.
Chubb's net income for all of 2012 was $1.55 billion, or $5.69 a share, compared with $1.68 billion or $5.76 a share in 2011.
Shares of Warren, N.J.-based Chubb fell 14 cents to close at $80.31. They rose $1.21 to $81.52 in after-hours trading.