Dino Robusto - Executive Vice President and President of Personal Lines & Claims Richard Spiro - Chief Financial Officer and Executive Vice President Paul Krump - Executive Vice President and President of Commercial and Specialty Lines John Finnegan - Chairman, Chief Executive Officer, President, Chairman of Executive Committee and Chairman of Finance Committee

Vinay Misquith - Crédit Suisse AG Jay Gelb - Barclays Capital Keith Walsh - Citigroup Inc Gregory Locraft - Morgan Stanley Jay Cohen - BofA Merrill Lynch Robert Glasspiegel - Langen McAlenney Ian Gutterman - Adage Capital Robert Glasspiegel - Janney Montgomery Scott LLC Michael Nannizzi - Goldman Sachs Group Inc. Matthew Heimermann - JP Morgan Chase & Co Joshua Shanker - Deutsche Bank AG David Small - Bear Stearns

Good day, everyone and welcome to The Chubb Corporation's First Quarter 2011 Earnings Conference. Today's call is being recorded. Before we begin, Chubb has asked me to make the following statements. In order to help you understand Chubb, its industries and its results, members of Chubb's management team will include in today's presentation forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. It is possible that actual results might differ from estimates and forecasts that Chubb's management team might make today. Additional information regarding factors that could cause such differences appears in Chubb's filings with the Securities and Exchange Commission. In prepared remarks and responses to the questions during today's presentation of Chubb's first quarter 2011 financial results, Chubb's management may refer to financial measures that are not derived from Generally Accepted Accounting Principles or GAAP. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP and related information is provided in the press release and the financial supplement for the first quarter 2011, which are available on the Investors section of Chubb's website at www.chubb.com. Please also note that no portion of this conference may be reproduced or rebroadcast in any form without the prior written consent of Chubb. Replays of this webcast will be available through May 20, 2011. Those listening after April 21, 2011, should please note that the information and forecast provided in this recording will not necessarily be updated and it is possible that the information will no longer be current. Now I'd like to turn the conference over to Mr. Finnegan.

Thank you for joining us. As with the case in last year's first quarter, the big story for the property and casualty insurance industry this past quarter was the usually high level of natural catastrophes around the globe. For Chubb, this resulted in total catastrophe losses of $270 million before tax. As a reminder, when we filed our 2010 Form 10-K in late February, we disclosed in the subsequent events section a loss estimate of $150 million to $200 million before tax for 2011 catastrophe events we could quantify as of that date. The New Zealand earthquake had just occurred, and as we indicated in the 10-K, it was too early to include an estimate for that event. After the filing, there were 5 additional catastrophes in the United States and the earthquake in Japan, which together with the New Zealand earthquake, brought our current estimate to $270 million. Dino will provide more detail in a few minutes. The impact of catastrophes translate into 9.5 points of the combined ratio and reduced our first quarter results by $0.59 per share. Nevertheless, we produced a combined ratio of 93.7% and operating income of $1.35 per share. Our x cat combined ratio for the quarter was a strong 84.2%. Net written premiums were up 3% for the second consecutive quarter, an encouraging sign. This increase, which was unaffected by currency fluctuation, was driven by strong growth overseas and positive growth in the United States. During the first quarter, we had net realized investment gains of $160 million before tax or $0.35 per share after tax largely from our alternative investments. This brought our first quarter net income per share to an especially strong $1.70, up 22% over last year, resulting in annualized ROE of 13.1%. GAAP book value per share at March 31, 2011 was $53.26. That's a 2% increase since year end 2010 and an 11% increase since March 31, 2010. Our capital position is excellent. During the first quarter, we increased our common stock dividend for the 29th consecutive year. We also continue to actively buy back our stock as Ricky will discuss later. And now Paul will review the performance of Chubb's Commercial and Specialty Insurance operations.

Thanks, John. The Chubb Commercial Insurance net written premiums for the first quarter were up 7% to $1.3 billion. The combined ratio was 100.7% versus 93.8% in the first quarter of 2010. Excluding the impact of catastrophes, CCI's first quarter combined ratio was 84.5% in 2011 compared to 82.4% in 2010. In the United States, while the standard commercial market remained competitive, we were encouraged that CCI renewal rates were flat, a slight improvement from the fourth quarter. Retention for the first quarter was a strong 87%, 1 point better than the fourth quarter and up 3 points from the first quarter a year ago. Our new-to-lost business ratio was 1.3:1 in both this year's first quarter and last year's fourth quarter compared to 1.0:1 in the first quarter last year. We saw continued signs that the overall economy is getting better in the United States. For example, our CCI renewal exposure was flat for the quarter, a solid improvement compared to negative 2% in the first quarter a year ago. And as was the case in the fourth quarter of 2010, our growth included additional premiums from mid-term endorsements for such items as equipment purchases and from workers' compensation products that reflected larger payrolls. At Chubb Specialty Insurance, net written premiums for the first quarter were down 1% to $639 million. CSI's combined ratio was 82.4% versus 80.9% in the first quarter of 2010. Net written premiums for professional liability were down 3% and the combined ratio was 86.8% compared to 86.2% in the first quarter of 2010. Renewal rates for professional liability in the U.S. in the first quarter of 2011 were down 3%, and the renewal retention was 87%. Both percentages are identical to those in the fourth quarter of 2010. The new-to-lost business ratio for professional liability was 1.1:1 in the first quarter, also the same as last quarter. For Surety, net written premiums in the first quarter were up 16% and the combined ratio was 50.5%. Surety's strong growth resulted from existing customers, winning new bond-able projects both in and outside of the United States. As you know, Surety is a very lumpy business and the environment continues to be challenging. With respect to general market conditions in the Specialty business, we are not seeing as many encouraging signs as we are in CCI. However, competition appears to be stabilizing. The market for professional liability lines remains the most competitive as a result of relatively benign industry claim trends and newer market entrants, particularly on the excess D&O layers. The price competition is greatest in directors and officers for publicly traded companies including financial institutions, which comprises some 20% of our professional liability book. And with that, I'll turn it over to Dino, who will review personal lines and claims.

Thanks, Paul. Chubb Personal Insurance net written premiums increased 2% in the first quarter to $894 million. CPI produced a combined ratio of 93.8% compared to 104.4% in the corresponding quarter last year. The impact of catastrophes for the quarter was 7.8 points in 2011, whereas, in the first quarter of 2010, the impact of cats was 22.8 points. The large impact cat events in 2011 for CPI were the severe winter weather in the United States and the flooding in Brisbane, Australia. The earthquakes in New Zealand and Japan had only minimal impact on CPI. When I discuss company-wide claim trends in a few minutes, I will cover the broader impact of cats on Chubb overall. On an x cat basis, CPI's combined ratio was 86% in the first quarter compared to an extremely good 81.6% in the first quarter of 2010. The difference is primarily attributable to losses from winter storms in both the U.S. and Europe this year that were not classified as cats. In contrast, we suffered higher weather-related losses in the first quarter a year ago, but most were from events that were classified as cats. In addition, the x cat comparison is affected by an unusually low level of fire losses in the first quarter of 2010, whereas, fire losses in the first quarter of this year were consistent with historical averages. The growth in CPI reflected positive movement in new business, both in premium and in-force count as well as endorsement activity. Growth was particularly strong outside the United States. Homeowner premiums were up 3% for the quarter and the combined ratio was 94.8%. Excluding catastrophes, the homeowners combined ratio was 82.5% and was impacted by the unusually high level of non-cat winter weather activity in the U.S. and Europe as I just mentioned. Personal auto premiums increased 11% driven by growth outside the United States. In the U.S., the expansion of our multi-tiered Panorama pricing program into additional states has made us competitive for more customers while preserving our historical profit margins. Indeed, premium growth in those states where Panorama has been introduced has been nearly 4.5 percentage points better than in those states where it is not. The combined ratio for personal auto was a strong 92.8%. In other personal, which includes our accident, yacht and personal excess liability lines, premiums were down 6% and the combined ratio was 92.2%. Growth of other personal was negatively impacted by the runoff of the employer healthcare stop loss business in our accident division, resulting from our decision to exit this business. We are pleased with the momentum in homeowners and personal auto in the U.S. as both premiums and policy in-force count improved this quarter. Homeowners' policy in-force retention improved to 91% and auto improved to 88%. Endorsement activity was positive and grew for the fourth consecutive quarter compared to the first quarter of 2010 when endorsement activity was actually negative. We are seeing general rate taking in the industry for both auto and the homeowners as evidenced by public rate filings. The majority of the file rate changes by companies we track so auto go up by low-single digits and homeowners increased more aggressively to mid-single digits. This is understandable as the industry clearly needs these rate increases. Fortunately, CPI has had excellent underwriting performance, and we do not have a need for significant across-the-board rate increases at this time. As a result, we have seen improvement in both new business and renewal retention, which we ascribe in part to the fact that the rate increases taken by competitors have improved our relative rate position. The improvement is also in part due to the recovering economy. Since the second quarter of 2010, we have seen clients adding jewelry, contents and autos to their policies mid-term. Turning to claims for the company overall. Let me now give you some details on the big story, as John put it, the unusually high level of natural catastrophes in the quarter. Specifically, there were 7 weather events in the northeast, Midwest and southwest regions of the United States which were reclassified as catastrophes. In the aggregate, losses from these U.S. catastrophes are expected to be roughly $100 million in the first quarter. Outside the United States, Australia was impacted by flooding in Northern Queensland, followed by flooding in Brisbane and the state of Victoria. Shortly thereafter, Cyclone Yasi affected multiple areas of Australia, including its second largest city, Melbourne. Chubb's losses for these 4 events are expected to be about $110 million. The earthquake in New Zealand caused significant damage in the central business district of Christchurch, where our losses are expected to be roughly $25 million. And finally, as far as the devastating earthquake and ensuing tsunami in Japan are concerned, although the settlement of claims from this event will be slow to conclude, we expect that Chubb's losses will be about $35 million. Before turning it over to Ricky, I wanted to say a quick word about April catastrophes. You are no doubt aware that April has seen a number of storms including tornadoes across multiple states, 3 of which have been declared cats as well as dozens of wildfires in Texas over the last 2 weeks that have reportedly destroyed more than 1 million acres. We are in the process of assessing our losses from these events. But it is too early to estimate our overall exposure. Ricky?

Thanks, Dino. As usual, I will discuss our financial results for the quarter. I will also provide an update on capital management and the April 1 renewal of our major property reinsurance program. Looking at our first quarter operating results, we had underwriting income of $202 million despite the $270 million of cat losses that were discussed earlier. Property and casualty investment income after tax was down 1% to $310 million. Net income was higher than operating income in the quarter due to net realized investment gains before tax of $160 million or $0.35 per share after tax, with $0.30 per share coming from our alternative investments portfolio. For comparison, in the first quarter of 2010, we had net realized investment gains before tax of $127 million or $0.25 per share after-tax, of which $0.17 per share came from alternative investment. As a reminder, we include our share of the change in the net equity of our alternative investments in net realized investment gains and losses, which is not a component of operating income, unlike some insurers who include them in investment income and therefore in operating income. If we had included the change in net equity from alternative investments in investment income instead of a net realized investment gains, for the first quarter our operating income per share would have been higher by $0.30. Unrealized depreciation before tax at March 31, 2011, was $1.6 billion compared to $1.7 billion at year end 2010. The total carrying value of our consolidated investment portfolio was $42.5 billion as of March 31, 2011, slightly higher than the amount at year end 2010. The composition of our portfolio remains largely unchanged from the prior quarter. The average duration of our fixed maturity portfolio is 3.8 years and the average credit rating is Aa2. We also continue to have excellent liquidity at the holding company. At March 31, 2011, our holding company portfolio included $2.3 billion of investment, including $975 million of short-term investments. Book value per share under GAAP at March 31, 2011, was $53.26 compared to $52.24 at year end 2010, an increase of 2%. Adjusted book value per share, which we calculate with available-for-sale fixed maturities at amortized cost, was $50.41 compared to $49.05 at 2010 year end. As for reserves, we estimate that we had favorable development in the first quarter of 2011 on prior year reserves by SBU as follows: In CPI, we had about $40 million. CCI had about $100 million. CSI had about $75 million, and reinsurance assumed had about $5 million, bringing our total favorable development to about $220 million for the quarter. This represents a favorable impact on the first quarter combined ratio of about 7.5 points overall. For comparison, in the first quarter of 2010, we also had about $220 million of favorable development for the company overall, including $30 million in CPI, $90 million in CCI, $90 million in CSI and $10 million in reinsurance assumed. The favorable impact on the combined ratio in the first quarter of 2010 was nearly 8 points. During the first quarter of 2011, our loss reserves increased by $433 million, including an increase of $463 million for the insurance business and a decrease of $30 million for the reinsurance assumed business, which is in runoff. About $200 million of the overall increase in reserves relates to catastrophes. The impact of currency fluctuation on loss reserves during the quarter resulted in an increase in reserves of about $135 million. Turning to capital management. We repurchased 6.6 million shares at an aggregate cost of $387 million during the quarter. The average cost of our repurchases in the quarter was $58.91 per share. At the end of the first quarter, we had 21.9 million shares remaining under our current share repurchase authorization. And as we told you on our last earnings call, we expect to complete this program by the time we announce our year end 2011 financial results in January 2012. In February, our board raised the quarterly common stock dividend by 5% to $0.39 per share or $1.56 on an annual basis. This is our 29th consecutive annual dividend increase, a continued indication of our consistent performance and financial strength in a cyclical industry. I would now like to say a few words about our reinsurance program. On April 1, we renewed our major property treaties, including our North American cat treaty, our non-U.S. cat treaty and our commercial property per risk treaty. All of these programs provide coverage similar to 2010, although we did make minor changes in some of the layers to help us better manage our exposures and costs. For example, we modestly increased our retention in the first and second layers of our North American cat treaty while also modestly increasing coverage in some of the higher layers. The reinsurance market was orderly and there was enough capacity to meet our needs in each treaty. The overall cost of the 3 treaties was flat to last year. In addition, we successfully completed our fourth catastrophe bond, East Lane IV, in March to replace 2 of our maturing cat bonds. Under this arrangement, we purchased $475 million of fully collateralized multiyear coverage to supplement our northeast program. Similar to our previous cat bonds, we have an indemnity base trigger, which means that our right to collect is based on our actual incurred losses as opposed to industry- or index-based losses. East Lane IV was very well received in the marketplace. We like the diversification that these cat bond arrangements bring to our overall reinsurance program. Importantly, they provides us with a cost-effective alternative to traditional reinsurance with pricing locked in for 3 or 4 years and we have fully collateralized protection. Finally with respect to our 2011 earnings guidance, as we've done in the past, we are deferring revisiting our guidance until after the second quarter when we have more information about how the year is progressing. And now I'll turn it back to John.

Thanks, Ricky. In a difficult catastrophe environment, Chubb performed extremely well in the first quarter. Here are the highlights. We had operating income per share of $1.35 despite a $0.59 per share impact of catastrophe losses. We had net realized investment gains of $0.35 per share, largely from our alternative investments, which brought our net income per share to $1.70 and annualized net income ROE to 13.1%. Book value per share increased by $1.02 since 2010 year end to $53.26. Our x cat combined ratio was very strong at 84.2%. Premiums grew an encouraging 3% for the second consecutive quarter. We continue to manage our capital by buying back our shares and by increasing our dividend by 5%. In summary, we had a very good first quarter despite substantial cat losses. There are varying opinions among industry observers about whether the recent cat events will trigger hardening at the market. Instead of speculating, we'll focus on executing on the things we do well, which are disciplined underwriting, taking care of customers by paying claims fairly and promptly, prudent investing, maintaining a strong balance sheet and actively managing our capital. These are the true differentiators, which we believe will enable us to continue to provide significantly above-average returns to our investors. And with that, I'll open the line to your questions.

[Operator Instructions] Our first question will come from Keith Walsh from Citi. Keith Walsh - Citigroup Inc: John, just first question regarding CCI. The 7% growth is just very, very strong. But if you can may be break that down a little bit between rate, and thinking about exposures, what's really driving that number? One of your competitors this morning talked about getting better rate within the small commercial market. If you could just talk to that a little bit, and I have got a follow-up.

Let me turn that one over to Paul Krump.

Good evening, Keith. First, the recent pickup in CCI's growth is coming from a combination of several factors as you suggest. First, renewal retention has been very strong as indicated by the 87% we saw this quarter. Second, insurable exposures are no longer declining as they had been until recently due to the weak economy. Our average renewal exposure change has improved to flat, for example, where it was negative through third Q of 2010. Endorsement and auto premiums have also improved. The new business is up modestly. Although the market environment remains quite competitive, we still do find opportunities. And finally, about 1 point of that growth this quarter is due to reinsurance premium reinstatement effect due to the events in last year's first quarter. As a point of reference, new business in CCI in the first quarter made up about 16% of the total portfolio. That's the exact percentage of what new business made up of the new business to the total in 2010. Keith Walsh - Citigroup Inc: Thank you. And then the second question I've got is regarding the RMS model changes. I guess, John or Ricky, if you could talk to first off, do you use RMS? And what is the impact you see from these model changes to your PMLs within specifically Texas, Florida and the Mid-Atlantic, please. Thanks.

Hey, Keith, it's Ricky. I think I'll take that one. The answer to your first question is we do use RMS as one of our models. I think it's still too early to draw any definitive conclusions from the data from the new model. We'll know more over the coming months as we better understand the model and validate its impact on our book of business. This work includes ensuring data accuracy, testing the assumptions of the new model and calculating return periods by line and in the aggregate. It also involves thinking about the potential impact of actions on our customers, agents and other constituencies. Having said that, let me make a few general comments. First, it's become clear that relying on a single cat model was less than ideal. So over the past few years, we have considered multiple views and this most recent model change will be considered in that context. Second, directionally, similar to the estimated impact for the industry as a whole, we would expect that our PMLs in the aggregate will increase under the new model, but it's too soon to definitively say by how much. And going forward, we'll continue to analyze results of the new model, and we will review our business, capital and reinsurance needs as appropriate. Keith Walsh - Citigroup Inc: Okay. Thank you, Ricky.

And we'll take our next question from Matthew Heimermann from JPMorgan Matthew Heimermann - JP Morgan Chase & Co: A question on personal auto in the U.S. specifically, now this the mail campaign going on for the last several quarters, and I'd just be curious if you're seeing that translate into growth right now and how the response rates compare to what you might have expected, and then I've got a follow-up.

I'm not sure I understood the first part of the question, Matthew. [Technical Difficulty] Matthew Heimermann - JP Morgan Chase & Co: All right. Let me try again. Hopefully, this is -- I apologize, I'm on the move. You've had a mail campaign going on in the U.S. for auto insurance and -- I think trying to further your penetration of auto, and I'd just be curious whether or not that's translating in incremental growth right now and how the response rates compare with your expectations, and then I've got a follow-up. Hopefully that was clear.

Yes, it was. Thank you. Yes, we have had a mail campaign and what we are doing is targeting our homeowner insured’s for which we don't have auto and providing a mailing out there. We actually have gotten a pretty good response rate, about a 10% response rate. And we're quoting on the business. And our hit ratios are a little bit above what we had anticipated. So actually, the mail campaign is working out a little bit better than expected. And we're going to continue it through 2011. Matthew Heimermann - JP Morgan Chase & Co: Is there any -- and I guess my follow-up would be just in the high net worth business in the Personal Insurance segment generally. Should we -- are there any -- are you contemplating any other advertising pushes either with distribution or customers whether it's related to using auto to drive potentially homeowners? Or also just expanding the other article contacts coverage within the existing base?

No. There's nothing really that we're planning on changing in our advertising strategy. We've got some good momentum with the economy that's picked up. And as we indicated a little earlier, we're growing the portfolio. And we're going to just keep on doing what we're doing with our valued partners in the distribution network. Matthew Heimermann - JP Morgan Chase & Co: Okay. Thanks much.

Thank you.

We'll hear from Jay Gelb with Barclays Capital Jay Gelb - Barclays Capital: Thanks very much. John, we haven't discussed merger and acquisition, I would say, on the call for a while. And I just wanted to get your updated thoughts there. Is there anything you'd be interested in buying?

You never can say there's nothing ever, but I would say that we're not an active looker in the mergers and acquisitions area. We haven't been and we're not now. Jay Gelb - Barclays Capital: Okay. And then on personal lines, we seem to be getting indications that competition's picking up there. Can you talk a little bit about that?

Clearly, this business... Jay Gelb - Barclays Capital: And I should say in high-end personal lines, in Chubb's focus area.

Yes, there's clearly -- this market has attracted some new competitors. But we feel very comfortable with our position. We believe we've got a world-class brand and a franchise that are unique within our industry. And the important thing is it wasn't created overnight. Our position in the high net worth market is the product of almost 30 years of experience of offering broad coverages and settling claims. We've appraised about 700,000 high-end homes. We've paid over 1 million claims. And we've developed some real expertise in satisfying the unique needs of our high-value customers so. It's been very profitable, so we understand why competitors are chasing the high net worth market. But there are barriers to success that we believe are difficult to surmount. And we continue to raise those barriers with new products and services. And I think this innovation is going to continue to keep us as number 1.

Jay, just a little perspective. I hear that question often and certainly there's a kernel of truth to it, but I think it focuses on the new entrants and forgets about what's happened to some of the previous competitors. When I came here, I have a good snapshot, I came here 8 years ago, and at the time we had 2 big competitors in the high net worth area, one of whom was growing and becoming more aggressive. And today, the one that became more aggressive is far less aggressive and the second is imploding. So they've been replaced by 1 or 2 other competitors who are definitely being more aggressive coming in the business. But it's hard to say whether it's more competitive now than it was then. Jay Gelb - Barclays Capital: I see. Okay, thank you.

We'll hear next from Vinay Misquith from Credit Suisse Vinay Misquith - Crédit Suisse AG: Could you talk about the competitive dynamic in the industry this quarter versus last quarter both on the CCI and CSI please?

Yes. Paul will handle that.

Sure. I would tell you that all up in CCI -- let me take them one at a time here. First of all, we were real pleased that retention was up. We were pleased that rates aren't falling down. We were able to write a modicum more of new business. Auto premiums, endorsements were also real positive, so I would tell you that we fought the competition. It was encouraging. John's point about personal lines just a few minutes ago is applicable here. There's always competition, whether the market is so-called hard or so-called soft. But I would tell you that we're pleased with where we sit right now in CCI. As respect CSI, I commented that the most competitive place is publicly traded D&O. That really is probably across the board for Chubb, the most competitive area we have. Again, there's a difference there though between what we see in not-for-profit employment practices liability, crime, financial fidelity, et cetera. And we continue to grow that book of business. In fact, right now, the for-profit non-public business is larger than the public business for us. So it's competitive out there in the public space, but that, again, is not unexpected.

I think commercial feels a little better than it has been over the past few quarters. The numbers would support that to a certain degree, but they're not overwhelming, but the feel is a little bit better. Specialty, I think the feel is that it didn't worsen, but we haven't seen any significant turnaround. Vinay Misquith - Crédit Suisse AG: Fair enough. Just curious as to why you think this is happening? Because there is a view out there that there is a significant amount of excess capital in the industry and loss cost trends have been fairly benign. So curious as to why you think that competition is stabilizing right now.

I don't know that we've seen a major breakthrough here. We're still talking sort of directionally and feel. I will say that given what's happened in the industry, it may be true that loss trends are benign, but if you take the commercial industry, I think we get flat rate and most others don't get that, they get negative rate and loss trends aren't that benign. Ultimately, you do have margin compression. I think all the projections for the industry this year are that combined ratios will be higher than they were last year. And in the first quarter, we began to see cat activity that was pretty significant. So you're right, there are factors that impact the market in both directions. But it's been a pretty darn tough market for a while. There may be a few things that are sort of moving it the other way. Again, it's a feel rather than a hard data supported opinion at the time, not right now, but it's a feel. Vinay Misquith - Crédit Suisse AG: Sure, fair enough. And just as a follow-up on the reinsurance cost, could you help me understand whether the new RMS model is factored into the April 1 renewals?

We did not use the new model for our North American treaty. We have to build 40-plus regional portfolios in order to get ready for our April 1 renewal. And since we only received the model in late February, that was an impossibility. So therefore, all of our modeling and the subsequent marketing to the reinsurers is with the old RMS version 9 model. Whether or not any of the reinsurers tried to run our portfolio through their new model, we don't know. But if they did, it wasn't apparent to us in the renewal negotiation. Vinay Misquith - Crédit Suisse AG: Sure, fair enough. And you mentioned that the cost was the same. Now was the pricing also the same versus last year?

Yes. I mean, overall, yes, it was flat. Vinay Misquith - Crédit Suisse AG: Okay, great. Thank you.

We'll hear next from Greg Locraft with Morgan Stanley Gregory Locraft - Morgan Stanley: Thanks, and good evening. I just wanted turn to the capital management side. And you guys bought back 6.6 million shares in the quarter. And it's definitely a nice amount of the shares outstanding, but it's actually the lowest amount you've bought back in almost 2 years on a quarterly basis. Should we be reading anything into that amount? And is there any reason why it has decelerated recently?

No. I don't think you should be reading anything into it. I think we've laid out clearly on this call, in my prepared remarks and in the prior call what our plan is in terms of our existing authorization. And we intend to, barring any unforeseen circumstances, complete the program by January 2012. Gregory Locraft - Morgan Stanley: Okay. And there wasn't any kind of -- because of the losses or any of the stuff during the quarter, that you weren't blacked out or there weren't -- there weren't fewer days, I guess, where you could go into market or anything and this was just...

There was no conscious effort one way or the other. Gregory Locraft - Morgan Stanley: Okay, perfect. Thanks. The other question is just on the Japan, Australia, New Zealand business. Where is that coming through in the reported financials? And then, could you also just give us a sense as to how big that business is or has been historically in terms of premiums and profits and where that might go in terms of your appetite for business going forward?

Sure. This is Paul. You're seeing the losses coming through in Australia in both the personal lines and in the commercial lines. You'd see them in the commercial lines both in CMP and in the property marine space. I think, Dino mentioned that New Zealand and Japan were virtually all commercial losses. So you'll see those in the property space and in the packaged space.

And, Gregory, in terms of our financials, in our supplementary investor information that we posted on the website, on Page 10 of that document, you can see that the breakout between our U.S. business and our outside the U.S. business. Gregory Locraft - Morgan Stanley: Okay. So Page 10, yes and then -- so how much of this is Japan, New Zealand and Australia versus, I guess, the rest of the world?

In losses, you're talking? Gregory Locraft - Morgan Stanley: I'm looking at the o U.S. part in the supplement and it looks like...

If you're talking about premiums, I can give you some perspective. And then Dino could reiterate the numbers on the losses. About 74% of our premiums come from the United States, 26% come, obviously, from outside the United States. The split is basically, 10 points of those 26 points come out of Europe. The remaining 16 points from overseas is pretty evenly split between Asia, Latin America and Canada. If you look at it on -- by SBU basis, all three of the SBUs really hover right around 25, 26 points or so of premium coming from outside the United States. When you look at countries like Japan and New Zealand, basically any losses emanating there from large multinational customers because we really don't write indigenous risk there given the quake potential, so we save that for those larger multinational accounts where we get an inherent spread of risk. Gregory Locraft - Morgan Stanley: Excellent, thank you. Thank you very much. And then just could you comment on maybe the appetite or what you're seeing on the ground in those regions for future business from a rate and demand perspective?

Let me maybe just back up a second. Because this is where we're get into speculation a little bit, and I rather just stick with the facts. I mean, what we're seeing in a place like Chile, where we had an earthquake last year, is that we're seeing large property rate increases. We're seeing deductibles double and triple. And we're seeing clients work with us on our mandatory loss control recommendations. Right now, frankly, it's just too early in Australia to tell you what is exactly going to happen. That said, we are quoting rate increases and we’re encouraged from the very early signs. As I mentioned before about New Zealand and Japan, we're really not in those marketplaces other than for risk domicile outside of them that had some incidental exposure in those countries. So we're not a good -- a bellwether for that. With respect to the very large markets of Europe and the United States, we have yet to see any kind of firming in those markets because of these large catastrophes outside the United States. That doesn't surprise us because it basically takes some time for those types of things to wash through. Gregory Locraft - Morgan Stanley: Okay, that's great. Thanks for the help.

And we'll hear next from Michael Nannizzi from Goldman Sachs. Michael Nannizzi - Goldman Sachs Group Inc.: Thanks a lot. Just a couple of questions. You mentioned you saw some growth in surety, about 15% year-over-year, up from about 1% in the fourth quarter. Another company today had said that, that market was particularly challenging. Can you kind of just talk about -- I think you mentioned that you saw your existing customers see more opportunity. But can you go into little bit more detail on what you're seeing in that surety marketplace, please?

Yes, we were real pleased. This is a small line and it is very lumpy. We had about a dozen clients, existing clients win bondable new projects. So it's very hard to predict when they're going to actually get these jobs and if they get these jobs, so I won't read too much into just 3 months. We're pleased to take them when we can. We think we've got a really good surety book of business. We have seen some new competitors enter the surety space. Our forte really is pristine, midsize and larger contractors. We really have just a couple of competitors there. Oftentimes, these large contractors need lots of capacity and actually look to co-surety. So we're very comfortable with our book of business in that space. So, again, this is one where our profile is a little bit different than the market. Michael Nannizzi - Goldman Sachs Group Inc.: Thank you very much. And then just one question just on expense trend. I noticed that in personal lines the expenses are a little higher, looks like other personal and then commercial lines expenses were about flat, but premiums were higher. So how should we interpret that? Are you building scale in new areas in personal lines or new products, maybe, that you're covering in that other personal category? Or how should we think about the change...

Let me answer it a little generally first and then Dino, you could -- I mean, expense ratios are affected obviously by a number of factors. One is the numerator, total expenses, one is the denominator, premiums written that applies to individual line. In addition, though, what is the driving force behind it, one, how much you're spending, but that's also a function of your business mix. Certain businesses, personal lines, for example, have a little bit higher commission rate than others. Other businesses, workers comp, have a lower commission rate. So you'll see different expense ratios depending on business mix. Also because of variety of reasons, it depends on geography. Overseas, you generally pay more in commissions than you do in the U.S. We've had a growing overseas business, so some of the increases you see in our overall expense ratio reflects that fact with better overseas. Fortunately, the loss rations are little bit better, so it's a good offset. As you talk about personal lines, personal lines has been an area where we've had an especially large improvement in our business overseas. Personal lines growth has been largely accounted for by our overseas business. So again, because of the higher commissions there, you're seeing a higher expense ratio in personal lines, but you're still seeing a very good combined ratio. Michael Nannizzi - Goldman Sachs Group Inc.: Is part of that -- Sorry, go ahead.

So I was going to say specifically on your other insurance that you referenced, you had the 2 dynamics that John just referenced. The other insurance is down 6%, so you've got the revenue down, which will affect the expense ratio. And in that line of business, we have our accident and health, which we are clearly interested in growing and investing in. So you've got both the dynamics on the, specifically, the other insurance that you asked about. Michael Nannizzi - Goldman Sachs Group Inc.: Got it. So I mean, I'm just wondering, is some of that due to scale building like in areas where you're looking to establish larger presence? I would imagine if you're going into countries or different regions that there's an aspect of building an expense base before you build a revenue base.

I would think that where you see that, it would be more accident and health. But the scale building is people and some systems, but not a lot. I think it's -- largely in the other lines, it's related to commission surcharge. Michael Nannizzi - Goldman Sachs Group Inc.: Got it. And just one more if I could, and just kind of a broader question, I guess, for Dino and Paul. Now you've been in your seats for a full quarter, what are your key priorities in your new respective roles? And what changes are you making? Do you want to make to kind of have an impact as you kind of put your first full year behind you?

Based on this -- Hi, it's Dino. I mean, based on the success that personal lines has had over the decades and everyone that's led it before, I think that the best thing to do is to continue to move it forward the way we have been. And really, that is the mission and the priority in personal lines. Keep doing what we're doing in the United States and outside the United States. And hopefully, that will be enough for me to make an impact.

Yes. This is Paul. Similar to what Dino just said. Both Dino and I have been here for almost 30 years, and we've been part of management building the businesses for a very long time, so we like the businesses we're in. We're always looking for new opportunities. I'd suggest our move into Lloyd's last year was one example. So where I was looking around at adjacencies and ways to improve the business, but ultimately, we love our brand, we love what we do in the claims side and we're going to continue to do that. Michael Nannizzi - Goldman Sachs Group Inc.: Thanks.

Our next question will come from Jay Cohen from Bank of America Merrill Lynch.

Hello? Jay?

And looks like we've lost Jay here. [Operator Instructions] Until then, we'll move on to Bob Glasspiegel from Langen McAlenney. Robert Glasspiegel - Langen McAlenney: Good afternoon barely. Wondered if you could help me out with your auto strategy internationally? Your strength of the company in personal lines has been homeowners. You've got a lot more premiums and a long-term record of success in the U.S. It seems like on the margin, you said the growth in personal line is coming internationally. What countries are you growing? What's your strategy in that segment? Why auto instead of homeowners internationally?

So let me just talk about personal lines in general outside the U.S. relative to where we have our premium, and I'll comment specifically on auto. Canada's our second largest jurisdiction relative to personal lines premium. And there, we target the same customer profile as we have in the United States. Their mix by product is consistent. Canada now is not as litigious as the U.S., so we write slightly less personal excess coverage, offset by slightly more automobile. Latin America is our next largest geography outside the United States, with the bulk of the business coming from Brazil. Now Brazil is the only jurisdiction where our product mix differs because of large proportion of our business that you see comes from auto. This is driven by a much lower demand for homeowners and valuable articles coverage. However, and this is the important point, our target market profile for auto is similar to the U.S. as we compete only at the high end of the market and we do so profitably. Then we move on to next largest geography, is Europe, where the bulk of the business comes from the U.K. and Ireland and the target profile is similar to the U.S. and Canada. And finally in our Asia-Pacific region, it's our smallest geography. The bulk of the premium there is in Australia. We have minimal exposure in Singapore and Japan. Robert Glasspiegel - Janney Montgomery Scott LLC: How do you build distribution in new markets?

In personal lines? Robert Glasspiegel - Janney Montgomery Scott LLC: Right.

In places like Canada, obviously, the United Kingdom, Australia, is the standard. It's the same type of distribution network as it is in here. And we have appointed brokers and independent agents that does exist also in Latin America. But we will also look at alternative distribution vehicles and emerging markets and partnering with banks and other financial institutions. Robert Glasspiegel - Langen McAlenney: But you don't have the brand you have in United States as far as customer and agents when you're entering these new markets. So do you just pay more commissions? Or how do you build the relationships?

First of all, really, we're not talking new markets. I mean, the countries that we're strongest in, with the exception of Brazil, are the traditional commonwealth brokerage countries where we've been forever. I mean, so our reputation and brand is similar. It's only, for the most part, it's really Brazil where we've been very successful so far. But that said, that's a one-off. The rest of it is pretty much like the U.S. And we've been there for several decades in Brazil. Robert Glasspiegel - Langen McAlenney: It just seems like you're growing faster outside the U.S. than you are in the U.S.

We have a smaller base, of course, a lower base to begin with. Jay Cohen - BofA Merrill Lynch: Okay, thank you.

And we'll take our next question from Jay Cohen with Bank of America Merrill Lynch Jay Cohen - BofA Merrill Lynch: Can you hear me now?

Yes. Jay Cohen - BofA Merrill Lynch: Two questions on accident year loss ratios. I guess, first in CCI, it looks like it's quite a bit higher than it had been running. I'm assuming that's -- and I'm excluding catastrophes. I'm assuming there's the sort of non-cat weather issues that's affecting that. Is that fair in CCI?

Let me -- it's really not that significant a change. But let me say, as I think, if you do the numbers, CCI looks like it's a little bit above 92 on an x cat accident year basis. So that's about 2 points or so above last year's first quarter. Some of that is a little bit of non-cat related weather, although, that's mostly applicable to personal lines. Some of it is just the general deterioration year-over-year. However, there's a certain lumpiness even here. If you, for example, compare the 92.3% this quarter, 2011, to the calendar year 2009 and 2010, this quarter is actually better on an x cat accident year basis than 2009 and 2010. So first quarter last year was a very good quarter compared to the rest of 2010. So we're up a little from that, but we're really down, we're down a full point from the calendar year 2010. Jay Cohen - BofA Merrill Lynch: Got it, that's fair. And then in CSI, it looks like it's actually quite good. I'm looking at the loss ratio, accident year loss ratio x cat. Looks like it's the best in about 5 quarters despite the fact that pricing has been coming down. It looked a little bit better than I would have guessed.

Well, I think we talked a little about the fourth quarter last year, in the accident year last year. What we're talking about is if you go back to 2008, obviously, the accident year picks were pretty high for that year because we were in the middle of the credit crisis. 2009, we've had some residual effects from the credit crisis we were trying to accommodate. As we got into 2010, we brought down our combined ratios, our initial accident year picks on a basis that we didn't expect to have it anywhere near as many cats, what we recall cat claims in a specialty sense which were credit crisis made-of type claims. And looks like we were, at least at this point, looks like we are right. 2011, we've seen almost a total end to those type of claims. So we're feeling a little bit more confident about the environment. Now in specialty, while it's still subject to the same rules of rate movements versus loss trends, any individual period is much more affected by the absence or the presence of systematic events. And you look back over that 2008, 2009 period, you have much bigger systematic events. Jay Cohen - BofA Merrill Lynch: Got it, okay. Thank you.

And we'll hear next from Ian Gutterman from Adage Capital Ian Gutterman - Adage Capital: I guess first on the reserve releases in CCI. They're at the highest they've been in I could tell for all the quarters for providing it a time when most people would be expecting releases to be starting to dry up a little bit. Can you give a little bit more color on what's going on there? Maybe which of the lines it was coming from or what accident years or was there anything onetime in that?

Sure. But I think in general, in terms of what years the favorable developments coming overall, it was largely from 2007 and prior. We still were favorable, I think, in the 2008 to 2010 years as well, but less so than in those earlier years. In terms of CCI specifically, the majority of the favorable development was in casualty and it was driven by our commercial excess business. Ian Gutterman - Adage Capital: Okay, great.

The other classes within CCI were modestly favorable as well, with some offset on a couple of other lines. Ian Gutterman - Adage Capital: Right. And then also in CCI, when I look at the premium growth picking up, do you have any rough sense of what that was U.S. versus international?

It was the same. Ian Gutterman - Adage Capital: So actually growth was picking up in the U.S. there and then I'd assume then it was down in the U.S. in the other segments because you only put about 1% overall total U.S.?

Personal lines down a little in the U.S. and specialty of course was down overall, so it was down in the U.S. Ian Gutterman - Adage Capital: And then just last quick one. You mentioned earlier in the call about this Panorama product in the U.S. auto. What exactly is that?

It's just some more sophisticated segmentation modeling, more sophisticated data analytics that allows us to segment our customers and align price and exposure in a much more sophisticated manner. Ian Gutterman - Adage Capital: And is this -- sort of what's, I guess, the strategical -- I mean, I understand it on one hand, but on the other hand, I always maybe wrongly had the impression that Chubb started auto as an accommodation, it wasn't really an area of focus. Is that changing now?

Well, I think it's an area of focus to us relative to the homeowner customers that we have. And we want to try to solve their needs. They like our claims handling. And so we are interested in writing profitable auto. And this Panorama helps us do that effectively. Ian Gutterman - Adage Capital: So it doesn't sound like then you're going to agents in trying to get agents to just bring in new auto customers and hope they'll bring the home too.

No. We're not competing against the mass market, guys. No.

It's the mailing. I was suggesting where we -- the mailing out to homeowners and looking for their auto.

We feel we've left some good auto business on the table before and with existing customers on the homeowner’s side, and we're going after it a little bit more aggressively. And to do so, it sure helps to have a better pricing model. That pricing model Panorama is a little bit of a catch-up to where a lot of the other industry competitors who have much bigger auto books what they have currently. Ian Gutterman - Adage Capital: That makes sense, thank you, guys.

And our next question will come from David Small with JPMorgan. David Small - Bear Stearns: Just a quick question. There's been a lot of discussion today around improved pricing. Could you just help us understand how much better would the pricing environment need to get before you decided to grow your business faster rather than buying back stock? And essentially, how much better does the pricing need to get before it's a better financial decision to grow your business versus shrink the balance sheet? Thanks.

I don't know that we've -- I know we've done that analysis because I'm not sure if that's imminent. We have a significant capital position, so it would obviously depend on a few things. One, you'd have to get rate that's so attractive that the returns are better than the buybacks, of course. Second, you'd have to determine whether or not you could do both. I mean, the question would be then, what would be the impact on your capital position of having increased premiums? That would be a function of not only rate, but presumably, if you're getting better rate, it might be a better economic environment, you might be getting better exposure, better premium base. So it's an evaluation we're always ready to do. But then there's certainly no commercial rate price trigger for a decision on the stock buyback program. David Small - Bear Stearns: Thanks.

And we do have one other question in the queue at this point. It will come from Josh Shanker with Deutsche Bank Joshua Shanker - Deutsche Bank AG: Thanks for taking the question. I'm just curious if you could talk a little bit about your claims handling experiences this winter, whether it was the frequency of incident with higher or lower than the past and how your teams respond to that.

Yes. Thanks, Josh. I mean, clearly, there was a lot of activity, a lot of claims activity in the first quarter from a count standpoint, both from catastrophes and weather-related non-cat events. Fortunately, with the large claim property staff that we have on the ground and the fact that we equip them with enormous amount of mobile equipment, we can bring them in and we move the lot into the northeast, and our response rate has been excellent. We do send out customer surveys on all of our homeowner and automobile claims and early survey results on the actual catastrophe, particularly from January, we've got them back now, are well over 96% highly satisfied. So clearly, we've been able to keep up with the pace. But hopefully over time, it will slow down. Joshua Shanker - Deutsche Bank AG: So it has feel like it has accelerated significantly for you?

Well, clearly, the first quarter was, as we've indicated, a heavy cat quarter. Now recognize that last year, you had the northeaster, which was much more significant because that generated thousands and thousands of claims in one event. So. Joshua Shanker - Deutsche Bank AG: Thanks for the color.

And there are no further questions at this point. I'd like to turn the conference back over to the speakers for any additional or closing remarks.

Okay. Thank you. Thanks to all of you for joining us tonight. Have a good evening.

Once again, this does conclude today's conference call. We thank you all for your participation.