Form 4: Chubb Ltd Executive Vice President Peter C. Enns Reports Acquisition of Performance Stock Units

Executive Vice President of Chubb Ltd, Peter C. Enns, reports the acquisition of performance stock units (PSUs) under the company's 2016 Long-Term Incentive Plan.

Summary

• On March 3, 2025, Peter C. Enns, Executive Vice President of Chubb Ltd, reported the acquisition of performance stock units (PSUs).
• These PSUs were awarded under the Chubb Limited 2016 Long-Term Incentive Plan.
• A total of 11,737 PSUs were awarded, vesting in whole or in part on the third anniversary of the award, contingent upon meeting certain service and performance-based criteria.
• An additional 11,737 PSUs were awarded as a premium performance award, also vesting on the third anniversary subject to similar criteria.
• Each PSU represents a contingent right to receive one Common Share of Chubb Ltd.
• Any PSUs that have not vested by the third anniversary will be cancelled.
• Dividends will accumulate and be distributed only when and to the extent that the PSUs have vested.
• The total number of PSUs beneficially owned by Enns following the reported transactions is 24,526, including previously reported PSUs from other tranches.

Sentiment

Score: 7

Explanation: The document reflects a standard executive compensation practice, indicating alignment of interests between management and shareholders. The sentiment is neutral to positive as it incentivizes performance.

Positives

• The award of performance stock units aligns executive compensation with the long-term performance of Chubb Ltd.
• The vesting criteria based on service and performance incentivize the executive to contribute to the company's success.
• The accumulation and distribution of dividends upon vesting further align the executive's interests with those of shareholders.

Risks

• The PSUs may be cancelled if the service and performance-based criteria are not met.
• The value of the PSUs is contingent upon the future performance of Chubb Ltd's Common Shares.

Future Outlook

The vesting of the PSUs is contingent upon the satisfaction of certain service and performance-based criteria over the next three years.

Industry Context

The use of performance stock units is a common practice in executive compensation within the insurance industry, aligning executive incentives with shareholder value and company performance.

Comparison to Industry Standards

• Many companies in the financial services sector, including insurers like American International Group (AIG) and Prudential Financial, use performance-based equity awards as part of their executive compensation packages.
• These awards typically vest based on metrics such as revenue growth, profitability, and return on equity, similar to the service and performance-based criteria mentioned in the Chubb Ltd plan.
• The specific terms and conditions of these awards can vary significantly based on company size, performance goals, and industry practices.

Stakeholder Impact

• Shareholders: The PSU awards align executive interests with shareholder value creation.
• Employees: The PSU awards can serve as a motivational tool for other employees.
• Management: The PSU awards provide an incentive for executives to achieve company performance goals.

Next Steps

• The executive must continue to meet the service and performance-based criteria for the PSUs to vest.
• Chubb Ltd will monitor the executive's performance and track progress towards the vesting criteria.
• The vested PSUs will be converted into Common Shares on the third anniversary of the award, subject to the satisfaction of the vesting conditions.

Key Dates