S&P CONFIRMS HIGHEST RATING FOR CHUBB GROUP CLAIMS-PAYING ABILITY SCORES "AAA'

S&P CONFIRMS HIGHEST RATING FOR CHUBB GROUP CLAIMS-PAYING ABILITY SCORES "AAA'

Standard & Poor's confirmed its highest stamp of approval on the insurance giant Chubb.

The rating agency Wednesday affirmed its "AAA" claims-paying ability rating - its highest - of the Warren, N.J.-based Chubb Group.S&P also affirmed its "AAA" claims-paying ability rating of subsidiary Chubb LifeAmerica Group, whose members include Chubb Life Insurance Co. of America, Colonial Life Insurance Co. of America, and Chubb Sovereign Life Insurance Co.

Chubb is one of the few U.S. insurers with a global presence and is ranked among the top 15 property/casualty insurers in the United States, based on net premiums written. Predominantly a commercial lines writer, Chubb's strategy is to provide customers with products and services of higher value and thus less price-sensitive to competitive pressures.

This value-added strategy has enabled Chubb to achieve an average combined ratio below 100 percent over the five-year period between 1990-1994. (This, however, excludes the effects of the Fibreboard case, concerning asbestosis liability, and the return premium related to medical malpractice business.)

Chubb Corp. saw its second-quarter net income for 1995 increase, to $185 million, or $2.09 a share, from $146.7 million, or $1.65 a share, for the second quarter of 1994. Net income for the six months ended June 30, also rose, to $331.7 million, or $3.75 a share, from $219.9 million, or $2.48 a share, for the like period of 1994.

The credit rating agency said that while underwriting profitability is excellent, investment income continues to furnish the bulk of the group's earnings. Since 1990, investment income has contributed between $452 million and $553 million in pretax dollars and thus allowed the company to achieve return on revenues in excess of 12 percent. Standard & Poor's expects profitability to remain consistent with historical levels.

Finally, Standard & Poor's believes capitalization provides a superior level of support for current and future business needs.