WARREN, N.J., Jan. 28 /PRNewswire-FirstCall/ -- The Chubb Corporation (NYSE: CB) today reported that net income in the fourth quarter of 2009 was $695 million or $2.03 per share, compared to $407 million or $1.13 per share in the fourth quarter of 2008.
Operating income, which the company defines as net income excluding after-tax realized investment gains and losses, was $569 million, the same as in the fourth quarter of 2008. Operating income per share increased 5% to $1.66 from $1.58.
Net written premiums for the fourth quarter were $2.8 billion, a decline of 4%; excluding the effect of currency fluctuation, premiums were down 5%. Premiums were down 8% in the U.S. and up 9% outside the U.S. (up 4% in local currencies).
The fourth quarter combined loss and expense ratio was 84.7% in 2009 and 84.3% in 2008. The impact of fourth quarter catastrophe losses on the combined ratio was negligible in both 2009 and 2008. The expense ratio for the fourth quarter was 30.1% in 2009 and 30.4% in 2008.Property and casualty investment income after taxes for the fourth quarter was $317 million in 2009 and $316 million in 2008. Net income for the fourth quarter of 2009 included net realized investment gains of $193 million before tax ( $0.37 per share after-tax), largely related to the company's alternative investments. Net income for the fourth quarter of 2008 reflected net realized investment losses of $250 million before tax ( $0.45 per share after-tax), stemming primarily from impairments of equity securities and a decline in the value of alternative investments. During the fourth quarter of 2009, Chubb repurchased 9.8 million shares of its common stock at a total cost of $489 million. Book value per share increased 4% to $47.09 at December 31, 2009 from $45.43 at the end of the third quarter. Full Year Results For the year ended December 31, 2009, net income was $2.2 billion or $6.18 per share, compared to $1.8 billion or $4.92 per share for the year ended December 31, 2008. Operating income totaled $2.2 billion in 2009 and $2.0 billion in 2008. Operating income per share increased 10% to $6.14 in 2009 from $5.58 in 2008. Total net written premiums in 2009 decreased 6% to $11.1 billion from $11.8 billion in 2008; excluding the effect of currency fluctuation, premiums were down 4%. Premiums were down 6% in the U.S. and down 6% outside the U.S. (up 3% in local currencies). The combined ratio in 2009 was 86.0%, compared to 88.7% in 2008. The impact of catastrophes accounted for 0.8 percentage points of the combined ratio in 2009 and 5.1 points in 2008. Excluding the impact of catastrophes, the combined ratio was 85.2% in 2009 and 83.6% in 2008. The expense ratio for the year was 30.6% in 2009 and 30.2% in 2008.