ChubbCB

The company earned $7.26 per share, beating the $6.77 analysts expected. This growth was fueled by a combined ratio of 83.8 percent. This number measures claims and expenses against premiums; anything under 100 percent means the company is making a profit on the insurance policies themselves before even counting its investment returns. A result this far below 90 percent shows the company is still pricing its risks much better than its peers.

While total revenue of $14.71 billion was slightly below expectations, the underlying business looks healthy. Premiums grew about 6 percent when excluding some large, volatile commercial accounts. Growth was especially strong in international markets and in the middle-market and small business segments. The company is successfully walking away from less profitable business to protect its margins, which is exactly what a disciplined insurer should do.

See the full quarter, and how our tracked metrics did

Source: 8-K filing

Key highlights

• Profitability remains high: The combined ratio, which measures insurance costs and claims against premiums collected, reached 83.8% compared to 85.6% last year. A lower number is better because it means the company kept more of every dollar in premiums as profit after paying out claims and expenses.
• Investment income hits record: Adjusted net investment income grew 11.4% to a record $1.88 billion as the company benefitted from its larger $175 billion portfolio and better returns on its bonds. This steady stream of cash helps provide a cushion when insurance markets are more competitive or difficult.
• International business leading growth: Overseas insurance premiums grew 10.2% while North American commercial premiums fell 2.3% during the quarter. Management is choosing to walk away from certain large property deals where prices are too low, which is why the international and small business divisions are now the primary engines for growth.
• Tangible book value rising: Tangible book value per share, a key measure of what the company's physical assets are worth to each owner, grew 17.1% over the last year to $131.93. This represents real wealth creation for shareholders that is not tied to the swings of the stock market.
• Underwriting discipline continues: Management stated that they will not knowingly sell insurance at a loss even though property pricing remains soft in many global markets. They expect the temporary dip in property insurance growth to fade over time as they maintain their strict standards for which risks they are willing to cover.

Our take: This was a very strong quarter where Chubb proved it can grow its bottom line even when some insurance markets get too competitive. By refusing to chase bad deals in large property accounts and leaning into record investment income, the company is protecting its long-term value. The case for owning this disciplined insurer remains firmly on track.