Business insurer Chubb Corp. said Thursday that its second-quarter earnings fell 34 percent, coming in below Wall Street's estimates, on high catastrophe losses.
For the period ended June 30, the company reported net income of $469 million, or $1.27 per share, compared with $709 million, or $1.75 per share, in the year-ago period.
Operating income, which excludes net realized investment gains and losses, declined to $518 million, or $1.40 per share, from $648 million, or $1.60 per share, in the second quarter of last year.
Analysts polled by Thomson Financial, on average, estimated earnings of $1.47 per share. Analyst estimates typically exclude one-time, unusual items.
Chubb said unusually high catastrophe losses in the quarter weighed on results. Catastrophe losses totaled 28 cents per share, compared with a catastrophe loss of 18 cents per share in the prior-year quarter. The catastrophe losses were primarily related to storms in the Midwest that mostly affected Chubb's commercial property and marine insurance line.
The company also reported net realized investment losses of $49 million in the quarter, compared with gains of $61 million the same time last year.
Total net premiums written were essentially flat at $3.05 billion. Premiums declined 3 percent in the U.S. but rose 11 percent outside the U.S., the company said.
The combined ratio for the quarter rose to 88.5 percent from 82.7 percent. Combined ratios measure the amount of money insurers pay out in claims and expenses compared with how much they receive from writing new business. A ratio above 100 means the insurer pays out more in claims and expenses than it takes in from writing new premiums.
Shares fell $1 to close at $47.61. Shares continued to decline in after-hours trading, losing $2.11, or 4.4 percent, to $45.50.
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