Chubb bullish on China, but won't push unit to rushed gains
Property/casualty insurer Chubb is taking the long view to growth on the Chinese market as it moves towards majority ownership of its Chinese unit, looking at a five- to seven-year time horizon for getting its game in high gear, chief executive officer Evan Greenberg (pictured) indicated.
"Potential within any of its businesses is huge, but it takes time," Greenberg told the Q4 investor call. "It takes time to affect strategy, to train people, to implement strategy and be patient that you take risk when you can get adequately paid and you don’t break discipline."
Asked if Chubb could move quickly to gain benefit from its Chinese asset upon taking majority control, Greenberg toned expectations.
"I don’t see it as an immediate impact; I don’t think of it that way," he said. "I look at it over a five- to seven-year time horizon and it is one of the next great peaks for Chubb to climb, and we will."
Comments follow word in Q4 that Chubb had struck deals with several fellow shareholders in Chinese unit Huatai Group that could take its stake from a minority position to over 86% ownership. Those deals have yet to be reviewed by the Chinese regulators.
"This is a very rare asset for a foreigner to be able to purchase; it has a lot of potential," Greenberg said, citing a profile spanning non-life, life, and varied asset management.
Greenberg talks up the growth potential of the Chinese market while talking down any threats or concerns from how rule of law issues might impact the Chinese institutional framework.
"If you believe, as I do, that China will continue to grow and will continue to emerge, though it won’t be in a straight line, .... it requires a much larger insurance and financial services industry and much greater private sector participation," he said.
Asked outright on rule of law, Greenberg demurs with talk of "a wide variance" in conditions across the globe, "starting right here in the United States." Legal regimes on personal law and personal responsibility are "evolving".
"I wouldn’t throw a stone at China on that basis and I would say that China fits right into the spectrum of countries."
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