Here's the skinny on Chubb: The insurer is best known for comprehensive personal homeowners insurance for the demographic that owns yachts (the company insures those, too). Chubb also offers commercial property/casualty insurance including multiple peril, property and marine, and workers' compensation. Its specialty insurance arm offers professional liability policies for executives across a spectrum of industries and also provides construction and commercial surety bonds. Chubb distributes its products through 8,500 independent agents and brokers in 120 offices across the US and in more than 25 countries. The company began in 1882 when Thomas Chubb and his son began writing marine insurance in New York City.
Although the US accounts for more than 70% of Chubb's revenues, developing its presence in foreign markets through organic growth is an element of the company's strategy. As a result, its international operations have grown faster than its US operations. The company's primary international markets include Canada, Brazil (and other select Latin American countries), Australia, Europe, and parts of Asia.
The Chubb group of companies include a number of property/casualty subsidiaries. The commercial insurance units together account for about 40% of annual revenues. The company reported an increase in its personal insurance operations in 2012 due to new business and strong retention rates; it also expanded its commercial segment that year.
Marketing and Sales
Chubb's commercial arm prefers to target small and midsized public and privately held companies, and has reduced the number of larger public companies in its customer list.
In 2012 the company expanded its partnership marketing operations by forming a collaboration with chief executive organization Vistage International to provide personal and commercial risk management and insurance information and products to its members (private company CEOs).
Revenue growth has been relatively flat for Chubb over the last few years, including fiscal 2012 when the firm reported earnings of some $13.6 billion. The company experienced an increase in premiums earned (on growth in the personal and commercial insurance segments) and investment income that year; however, growth was offset by declines in net investment gains.
Net income declined by 8% 2012 to some $1.6 billion due to lower investment gains and lower property/casualty investment income. Profits also shifted downwards in 2011 due to decreased underwriting income on higher catastrophe losses. Natural catastrophes, including earthquakes, wildfires, tornadoes, windstorms, and Hurricane Irene, cost the property/casualty insurance industry more than $100 billion in 2011. Chubb's share of that was over $1 billion in losses from natural catastrophes.
Chubb primarily grows through organic means, including increased customer acquisition and retention efforts. In addition, the firm occasionally expands its product offerings and enters new markets. In 2013, for instance, the Chubb Custom Insurance division gained approval to begin providing domestic surplus insurance policies in all 50 US states.