Chubb's Financial Strategy and Long-Term Goals

Chubb's financial strategy focuses on increasing net income, managing interest expenses, issuing senior unsecured notes, and maintaining a strong balance sheet. The consolidation of Huatai Group's results and effective balance sheet management highlight Chubb's commitment to long-term growth and financial stability.

"Financial Highlights for the Three Months Ended June 30, 2024 • Net income attributable to Chubb was $2.2 billion compared with $1.8 billion in the prior year period." --- (Chubb, sec filing, 2024/Q2)

"Three Months Ended March 31 (in millions of U.S. dollars) 2024 2023 Total mark-to-market gain on private equity, pre-tax $ 134   $ 257 Interest Expense Interest expense for the three months ended March 31, 2024, was $178 million comprising $183 million related to fixed expenses on existing debt obligations and variable expenses, and a $5 million benefit related to the amortization of the fair value of debt assumed in the Chubb Corp acquisition." --- (CB, sec filing, 2024/Q1)

"AM Best has assigned a Long-Term Issue Credit Rating (Long-Term IR) of "a+" (Excellent) to Chubb INA Holdings LLC's (Chubb) (Delaware) recently announced USD 700 million issuance of 4.65% senior unsecured notes due 2029." --- (Chubb, press release, 2024/07/29)

"We continue to effectively manage our balance sheet and ended the quarter in a strong financial position, including book value that exceeded $60 billion and cash and invested assets of $143 billion, each topping last quarter's all-time highs." --- (CB, earning call, 2024/Q1)

"For the three and six months ended June 30, 2024, the results of operations of Huatai Group are reported at 100 percent in our consolidated results starting from the acquisition date, with amounts attributable to shareholders other than Chubb reflected under Noncontrolling interests." --- (CB, sec filing, 2024/Q2)

Chubb's Dividend History and Recent Declarations

Chubb Limited declared a quarterly dividend of $0.91 per share, payable on October 4, 2024. The dividends are paid in four quarterly installments in U.S. dollars. Notably, Chubb received no dividends from Chubb INA during the first half of 2024 and 2023.

"ZURICH, Aug. 8, 2024 /PRNewswire/ -- The Board of Directors of Chubb Limited (NYSE:CB) today declared a quarterly dividend equal to $0.91 per share, payable on October 4, 2024 to shareholders of record at the close of business on September 13, 2024." --- (CB, press release, 2024/08/08)

"The dividend will be payable out of legal reserves in four quarterly installments and will be made in United States dollars by the company's transfer agent, as described in the Chubb Limited 2024 proxy statement." --- (CB, press release, 2024/05/16)

"Chubb Limited received no dividends from Chubb INA during the six months ended June 30, 2024 and 2023." --- (CB, sec filing, 2024/Q2)

Impact of Dividends on Chubb's Stock Performance

Chubb's stock performance has been positively influenced by its dividend policies. The company's shareholders' equity rose by $1.0 billion, despite returning $666 million to shareholders, indicating strong financial health. Additionally, the 5.8% dividend increase to $3.64 per share annually reflects confidence in sustained growth, likely bolstering investor sentiment and stock performance.

"• Chubb shareholders' equity increased $1.0 billion in the quarter, primarily from net income attributable to Chubb of $2.1 billion, partially offset by total capital returned to shareholders of $666 million and net unrealized losses on our investment portfolio of $648 million, principally due to the mark-to-market impact in the fixed-income portfolio." --- (Chubb, sec filing, 2024/Q1)

"Outcome of voting on all shareholder meeting agenda items were as recommended by the Board ZURICH, May 16, 2024 /PRNewswire/ -- Chubb Limited (NYSE:CB) announced today that at its 2024 Annual General Meeting, held at the company's offices in Zurich, Switzerland, shareholders approved a 5.8% increase in the company's dividend to $3.64 per share annually ($0.91 per share, per quarter) from $3.44 per share ($0.86 per share, per quarter)." --- (CB, press release, 2024/05/16)

Berkshire Hathaway's Investment Philosophy

Berkshire Hathaway's investment philosophy emphasizes long-term value creation through retaining earnings and reinvesting profits rather than paying dividends. This approach, coupled with a focus on capital allocation principles and maintaining substantial cash reserves, has been a cornerstone of their strategy, ensuring stability and growth beyond Warren Buffett's tenure.

"Imagine if everybody in this room were following the investment advice of somebody that said, you know, for 1% a year, I'll tell you how to invest your money. And in 1950, when we started in 1965, they would have they would have said, well, buy Berkshire Hathaway." --- (BRK.B, event transcript, 2024/05/04)

"And sometimes, if you'll turn to the next page, well, you'll see how that's built up the shareholders' equity so that Berkshire had at March 31, dollars 574,000,000,000 and through retaining earnings and we've been retaining earnings ever since we took control of Berkshire Hathaway except one day, as I remember, I think it was maybe 1968 or 9, The directors declared a $0.10 a share dividend and I think I must have been in the restroom or something at the time." --- (BRK.B, event transcript, 2024/05/04)

"Berkshire Hathaway Inc. (BRK.B)'s AGM On 2024-05-04 Analysts' Questions: operator: Without directly answering the question, I think there is one important thing is I think as we go through any transition, it's important to know that the capital allocation principles that Berkshire lives by today will continue to survive Warren." --- (BRK.B, event transcript, 2024/05/04)

"And and I thought, this is ridiculous. You know? He is so good. And it was a little the the the hardest thing for me, and I think it's hard for a lot of investors, is that Berkshire Hathaway doesn't pay dividends, and I was in a place in my life where I wanted some dividends, you know, and and why I said, well, you just sell stock, you know?" --- (BRK.B, event transcript, 2024/05/04)

"He has never minded that. I also feel as if and he doesn't pay attention to just exactly where the stock is trading or anything, but it's not as if the market is penalizing Berkshire Hathaway for having $200,000,000,000 in cash." --- (BRK.B, event transcript, 2024/05/04)

Implications of Berkshire's Investment for the Insurance Industry

Berkshire Hathaway's significant focus on its insurance business, coupled with its cautious approach to cyber insurance and strong profitability, underscores its strategic importance. Chubb's recent acquisitions and robust investment income highlight the competitive landscape. Berkshire's investment strategies and performance set a high benchmark, influencing industry standards and practices.

"And insurance is the most important business at Berkshire. Marketable securities are important, but they're not in the class exactly as our insurance business. And Ajit, We we won't have the same business if Ajit isn't running it, but we'll have a very good business." --- (BRK.B, event transcript, 2024/05/04)

"In addition, we closed on two small acquisitions this quarter Healthy Paws, a pet insurance business, and Catalyst Aviation, which together diluted tangible book value by about $300 million. Core operating ROE and return on tangible equity were 13.3% and 21.1%, respectively, for the quarter, and 13.6% and a record 21.6%, respectively, year-to-date. Turning to investments, our A-rated portfolio produced adjusted net investment income of $1.56 billion, which included approximately $30 million of higher-than-normal income from private equity and other areas." --- (CB, earning call, 2024/Q2)

"And profitability has also been fairly high. I think profitability is at least 20% of the total premium has ended up as profit in the pockets of the insurance bearers. Now having said that, we at Berkshire tend to be very, very careful when it comes to taking on cyber insurance liabilities." --- (BRK.B, event transcript, 2024/05/04)

"The insurance industry can support it and does. The insurance industry can't particularly lead it." --- (CB, earning call, 2024/Q1)

"We pay no attention to those at Berkshire. But you will see that we had a better than average quarter. And Ajit Jain wants me to point out to everyone that you cannot take the insurance earnings of the Q1 and multiply by 4." --- (BRK.B, event transcript, 2024/05/04)