‘Troubling’ bailouts punish best companies - Chubb
Chubb CEO John Finnegan, said government bailouts punish the best-run companies and impede the functioning of markets.
"The opportunities for financially strong companies to absorb the business of weakened competitors were initially compelling," Finnegan said in the insurer's annual letter to shareholders.
"This is as it should be in a free market unimpeded by federal intervention. But the willingness of the federal government to prop up weakened competitors by artificially injecting capital is troubling."
The statement has been seen as a criticism of the way the US handled problems at US rival AIG which received a rescue valued at $182.3bn after bad bets tied to home loans and turned over a majority stake to the US.
Joel Ario, the Pennsylvania insurance regulator, is reviewing pricing by AIG, which has said it is charging appropriate rates.
Mr Finnegan also said in the letter that difficulties faced by the industry will be "exacerbated by the likelihood that catastrophe losses will increase this year to levels more in line with historical experience."
This story was originally published by Reinsurance
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