Chubb suspends share buybacks due to uncertainty on Sandy losses
(Reuters) - Property insurer Chubb Corp, a major player in the U.S. Northeast, has suspended share buybacks because it is unsure how large its losses will be from Superstorm Sandy.
Chubb, in a quarterly filing late Thursday, said the temporary halt was necessary to comply with securities laws because it cannot yet estimate Sandy's impact.
"As a result, it is possible that we may not complete the repurchase of all of the shares under our current share repurchase authorization by the end of January 2013, as previously contemplated," the company said.
Chubb, one of the most aggressive repurchasers of its own shares in the insurance industry, had $357 million left on its existing buyback program as of September 30.
Chubb shares fell 0.7 percent to $73.91 in morning trading. Since hitting a new all-time on October 18, the stock is down 9 percent.
Chubb is considered one of the most-exposed insurers to Sandy, given its market share in the affected region. Industry players now generally agree that last week's storm is likely to have caused at least $20 billion in insured losses.
"When comparing lost market capitalization relative to our expected Sandy charges, all of these stocks appear to have over-discounted the losses," Langen McAlenney analyst Larry Greenberg said in a note Friday on Chubb and its peers. (Reporting By Ben Berkowitz; editing by John Wallace)