Chubb Limited

Chubb’s moat is multi-factor and rooted in: 1) Intangible assets and brand in complex commercial lines and high net worth personal lines; J.D. Power’s 2025 study ranks Chubb highest in homeowner property claims satisfaction, supporting trust and retention.

Score: 85. 2) Switching costs via embedded risk engineering, multinational servicing, bespoke policy wordings, and claims expertise that are hard to replicate for large accounts; policy and program changes entail operational and compliance frictions.

Score: 85. 3) Cost advantage from scale: a broad global portfolio allows better risk selection, reinsurance purchasing power, and a competitive expense ratio across cycles.

Score: 80. 4) Efficient scale: many specialty and multinational lines have limited market capacity where a few global carriers can profitably serve demand without inviting excessive new entrants. Score: 80. 5) Network effects are limited in insurance; data scale helps pricing but does not create a classic two‑sided network.

Score: 55. Weighting these elements (switching costs and cost/scale weighted highest) supports an aggregate moat score of roughly low‑to‑mid 80s. We still flag potential moat erosion from technology‑enabled MGAs, aggressive competitors in E&S/property, and judicial trends (social inflation) that raise loss costs in casualty lines.

Chubb’s pricing power is solid but cyclical by line. Management notes property pricing for large account retail and E&S grew more competitive in 2025, though terms remained stable; casualty continues to firm where rate is needed. The company’s diversified mix lets it redeploy capacity to lines with superior economics, keeping margins strong.

High-net-worth personal lines and A&H/Life carry additional pricing resilience given affluent clientele and product attachment. Record underwriting income and improved current accident year ratios ex‑cat suggest margin headroom despite normalizing property rates.

Score reflects proven but cyclical pricing strength, with upside from casualty and international consumer franchises, balanced by regulator sensitivity in certain markets.

Chubb’s earnings engine combines three relatively steady sources over time: underwriting profit, investment income on a large high-quality bond book, and growing life/A&H income.

However, catastrophe volatility and social inflation in long‑tail casualty introduce noise in any single quarter. 2024 full‑year P&C combined ratio was 86.6 percent and Q3 2025 reached a record 81.8 percent, while adjusted net investment income continued to rise.

This indicates a predictable mid‑teens core operating ROE through the cycle, even as individual quarters fluctuate with CATs. Score balances durable multi‑year growth drivers with CAT and judicial risk.

Chubb’s capital base and liquidity are exceptional. AM Best affirms A++ financial strength and aa+ group ICRs with a stable outlook, citing strongest balance sheet strength and very strong operating performance.

Q3 2025 book value per share rose to 182.22 and tangible book to 120.13; shareholders’ equity ex‑AOCI was over 73 billion as of Q1 2025. Long‑term debt was about 14.4 billion at 2024 year‑end and 15.7 billion by Q3 2025, consistent with modest financial leverage relative to equity and invested assets.

Investment portfolio quality and global reinsurance programs further mitigate stress scenarios. Score reflects ability to absorb shocks and continue compounding through cycles.

Management’s record is strong: 32 consecutive annual dividend increases (to 3.88 per share in 2025) and a new 5 billion repurchase authorization effective July 1, 2025. The company actively repurchased stock in 2025, including 1.23 billion in Q3 at an average price management deemed below intrinsic value.

Strategic M&A has been disciplined and long‑term oriented, notably the Cigna Asia A&H/Life acquisition completed in 2022 for 5.36 billion and majority control of Huatai Group in China, which Chubb now consolidates (ownership about 85.5 percent at 12/31/2024).

These moves expand consumer insurance and life earnings internationally while preserving underwriting culture. Stock‑based compensation and dilution are reasonable for a company of this scale. Score reflects thoughtful reinvestment, returns of capital, and accretive deals over time.

Chairman and CEO Evan G. Greenberg has built a rare culture of underwriting excellence and risk discipline since the ACE era, with a clear focus on per‑share value creation rather than volume. Communication is forthright, targets are conservative, and the organization executes across 54 countries with a deep bench of segment leaders.

The company guides to sustaining double‑digit EPS growth and mid‑teens core ROE through the medium term, which is credible given its track record and current cycle dynamics. Governance and risk management are strong relative to peers. Score recognizes durable, owner‑oriented stewardship.