* Expects earnings of $6.75-$6.95/shr vs est of $7.34
* Net profit down 14 pct to $499 mln
* Net written premiums up about 4 pct to $3.22 bln
* Shares fall about 3.5 pct
(Adds comments from conference call)
By Avik Das
July 24 Chubb Corp lowered its full-year
earnings forecast after severe weather in the United States and
an unusually high number of fires led to bigger insurance
payouts in the second quarter.
The company's shares fell 3.5 percent in extended trading.
The property and casualty insurer said it now expects to
earn about $6.75-$6.95 per share in 2014, below its earlier
forecast of $7.10-$7.40.
Analysts on average were expecting $7.34 per share,
according to Thomson Reuters I/B/E/S.
The outlook for the remainder of the year was unchanged.
"We reduced our guidance primarily because of our operating
results in the first half of this year," a Chubb executive said
on a post-earnings call.
Chubb's second-quarter profit also missed estimates.
"Our results this quarter were adversely impacted by
catastrophe and non-catastrophe losses related to severe weather
in the United States as well as an unusually high level of
homeowners' and commercial fire losses," CEO John Finnegan said.
Net profit fell about 14 percent to $499 million, or $2.03
per share, for the second quarter ended June 30, from $579
million, or $2.21 per share, a year earlier.
Losses and loss expenses widened 5.8 percent to $1.79
"The losses are unlikely to move the needle on pricing in
the space, given the recent lack of large-scale catastrophes,"
Macquarie Securities analyst Amit Kumar said.
On an operating basis, the Warren, New Jersey-based insurer
earned $1.70 per share, below the $1.90 analysts expected.
Rival Travelers Cos Inc also reported a
steeper-than-expected fall in quarterly operating profit, hurt
by bigger catastrophe losses and a slowing pace of premium rate
Chubb's net written premiums rose about 4 percent to $3.22
Its combined loss-and-expense ratio fell to 90 percent from
88.8 percent. The ratio, an indicator of the total claims and
expenses incurred over net earned premiums, crossing 100 percent
shows the company has an underwriting loss.
Shares of Chubb closed at $92.76 on Thursday on the New York
(Editing by Don Sebastian, Robin Paxton and Joyjeet Das)