WARREN, New Jersey, February 4, 2003 -- The Chubb Corporation (NYSE: CB) today announced results for its fourth quarter and full year ended December 31, 2002. Highlights included the following:

• Fourth quarter net income of $56.6 million, or $0.33 per share;

• Fourth quarter operating earnings of $83.7 million, or $0.48 per share;

• Fourth quarter results include:

• Fourth quarter net written premiums increased 33% to $2.4 billion; and

• Chubb expects full-year 2003 operating EPS of $4.60 to $5.00 (including $0.30 per share for the cost of expensing stock options, which Chubb will begin recognizing for accounting purposes in 2003).

Chubb reported net income of $56.6 million, or $0.33 per share, for the fourth quarter compared with $28.7 million, or $0.16 per share, in the same quarter last year. Operating earnings, which exclude after-tax realized investment gains and losses, were $83.7 million, or $0.48 per share, in the final quarter of 2002 compared with $36.5 million, or $0.21 per share, in the corresponding quarter of 2001.

Results for the fourth quarter of 2002 were affected by a number of significant items including:

• A $75 million pre-tax increase in net asbestos loss reserves reflecting a reduction of our estimate of reinsurance recoverables;

• A $100 million pre-tax increase in European D&O and E&O loss reserves;

• A $40 million after-tax valuation allowance from not being able to recognize for accounting purposes certain U.S. tax benefits relating to Chubb’s European losses; and

• An $88 million pre-tax benefit to earnings reflecting the decrease in surety loss reserves resulting from the previously announced Mahonia/Enron settlement.

The $88 million benefit was due to the fact that, in the fourth quarter of 2001, Chubb took a pre-tax charge of $220 million relating to its Enron surety exposure, which reflected a potential 100% payment on the Mahonia/Enron surety bonds.

Earnings for the fourth quarter 2002 also included a pre-tax loss for the non-insurance operations of Chubb Financial Solutions (CFS) of $13.9 million compared to income of $3.9 million in the fourth quarter of 2001. For 2002, CFS' non-insurance operations reported a pre-tax loss of $69.8 million, compared to income of $9.2 million for 2001.

John D. Finnegan, Chubb's President and CEO, said, "Although our fourth quarter earnings were adversely affected by the additions to reserves relating to asbestos reinsurance recoverables and European D&O and E&O as well as the tax valuation allowance and the CFS loss, I am pleased with what I am seeing in the financial performance of Chubb’s property and casualty businesses. Pricing trends continue to be favorable. Premium growth was 33% for the quarter and our expense ratio fell to 30.9% from 32.0% in the fourth quarter of 2001. These trends show every sign of continuing through 2003, which should enable us to see significantly improved results in the near term and to create a foundation for enhanced and sustainable profitability."

Net income for the year 2002 was $222.9 million, or $1.29 per share, compared with $111.5 million, or $0.63 per share, last year. Operating earnings for 2002 totaled $200.9 million, or $1.16 per share, compared with $111.0 million, or $0.63 per share, in 2001. The 2002 results reflect a $700 million pre-tax increase in net loss reserves for asbestos claims, the $40 million tax valuation allowance relating to Chubb’s European losses and the $88 million pre-tax benefit resulting from the settlement in the Mahonia/Enron surety bond lawsuit. The 2001 results reflect pre-tax costs of $645 million related to the September 11^th attack and the pre-tax charge of $220 million relating to Chubb’s Enron surety exposure.

In the fourth quarter of 2002, Chubb did not repurchase any shares of its common stock. Total 2002 repurchases were 1,500,000 shares.

For the fourth quarter, net property and casualty premiums written increased 33% to $2.4 billion. The combined ratio of 101.2% for the fourth quarter compares with 111.9% in the same period last year. Excluding the $75 million asbestos reserve adjustment for reinsurance recoverables and the benefit of the $88 million relating to the settlement of the Mahonia/Enron lawsuit, the fourth quarter combined ratio was 101.8%. Excluding the loss of $220 million, net of reinsurance, on surety bonds related to Enron, the 2001 fourth quarter combined ratio was 99.0%. Catastrophe losses were $23.2 million in the fourth quarter of 2002, adding 1.1 percentage points to the combined ratio, and $7.8 million in the fourth quarter of 2001, representing 0.5 percentage point of the combined ratio.

For the year 2002, net premiums written increased 31% to $9.0 billion. The combined ratio was 106.7% in 2002 and 113.4% in 2001. Excluding the $700 million strengthening of reserves for asbestos claims and the benefit of the $88 million relating to the settlement of the Mahonia/Enron lawsuit, the 2002 combined ratio was 99.1%. Excluding the costs of $645 million, net of reinsurance, related to the September 11^th attack, the combined ratio for the year 2001 was 103.9%. Excluding as well the Enron-related surety bond losses, the combined ratio for 2001 was 100.5%. Catastrophe losses in 2002 were $98.4 million, adding 1.2 percentage points to the combined ratio. Catastrophe losses in 2001 other than those related to the September 11^th attack were $114.3 million, adding 1.7 percentage points to the combined ratio.

Property and casualty investment income after taxes increased 2.6% to $194.1 million in the fourth quarter of 2002 from $189.2 million in the corresponding quarter of 2001. Fourth quarter property and casualty investment income per share increased 2.7% to $1.13 from $1.10. For the full year, property and casualty investment income increased 1.5% to $760.6 million from $749.1 million in 2001. Property and casualty investment income per share increased 3.3% to $4.40 in 2002 from $4.26 in 2001.

Chubb Commercial Insurance (CCI) had a fourth quarter combined ratio of 102.7% and premium growth of 26%. Excluding the $75 million asbestos reinsurance adjustment, the combined ratio was 93.3%. Chubb Specialty Insurance (CSI) had a combined ratio of 104.3% and premium growth of 54%, fueled in part by a substantial increase in Chubb Re’s premiums. Excluding the $88 million benefit for the Mahonia/Enron surety bond settlement, the combined ratio was 114.8%. Chubb Personal Insurance (CPI) had a combined ratio of 95.0%, and premiums grew 17%.

For all of 2002, Chubb Commercial Insurance's net written premiums grew 36%, and it had a combined ratio for the year of 118.6% (94.5% excluding the effect of the $700 million asbestos reserve strengthening). Chubb Specialty Insurance grew 36% and had a combined ratio of 101.8% (104.8% excluding the $88 million benefit for the Mahonia/Enron surety bond settlement). Chubb Personal Insurance premiums grew 17%, making 2002 the eighth consecutive year in which the rate of premium growth increased for Chubb Personal Insurance. Chubb Personal Insurance’s combined ratio for 2002 was 97.2%.

Reviewing Chubb’s performance in its property and casualty businesses, Mr. Finnegan said, "Chubb’s largest business unit, Chubb Commercial Insurance, continues to produce exceptionally strong growth and solid underwriting results due to increased rates, disciplined risk selection and tighter terms and conditions. While Chubb Specialty Insurance continues to face challenges in the D&O and E&O areas due to claims arising from the corporate scandals and Wall Street excesses of recent years, we expect to see this business begin to return to profitability through a combination of dramatically better pricing and improved terms and conditions, together with a gradual decline in new claims by year-end 2003. Chubb Personal Insurance continues to be profitable despite the adverse effect on its combined ratio of water damage and mold claims, and we are taking the regulatory and underwriting actions that we believe are necessary to return it to its historical profit margins."

John Finnegan said, "Since joining Chubb in December, I have initiated a systematic review of each business unit and discrete drill-downs on certain key issues. This review, while still in progress, is confirming for me the strength of Chubb’s property and casualty franchise, which has the ingredients to give us great potential for profitable growth, especially in today’s market environment, in which a flight to quality is occurring.

• "First, Chubb has a reputation for integrity, speed, and fairness in its claims handling. This is a magnet for new business and a major factor in retention.

• "Second, Chubb has built a very strong network of producer relationships.

• "Third, in its P&C businesses, Chubb has established an excellent reputation for a successful niche underwriting strategy and superior underwriting performance.

"However, in order to generate the kinds of returns we would like to deliver to our shareholders over the full course of the business cycle, I believe we need to focus on the basics: disciplined capital deployment, attention to underwriting, maintenance of our reputation for claims service and aggressive risk management, all within the prism of a clear commitment to enhanced and sustainable profitability. Because of the very favorable market conditions for our three property and casualty insurance business units, it is particularly important at this stage in the cycle that we deploy our resources to allow those businesses to take advantage of the favorable environment and build a solid foundation for enhanced and sustainable profitability.

"Consistent with this focus," Mr. Finnegan said, "we are reviewing our strategic alternatives with respect to Chubb Financial Solutions. Chubb formed CFS in 2000 to engage in developing and providing risk-financing services through the capital and insurance markets. Since its formation, the business has grown dramatically and recent market movements have resulted in pricing levels that have created a favorable environment for writing superior quality credit default swaps. While I believe that CFS has attractive growth and return on equity characteristics, I have concerns about its fit within Chubb at this time. With the hardening of the insurance market, our property and casualty businesses are well positioned and are offering us some of the best opportunities that we have seen in years. In order to get the full benefit of those opportunities, we will need to commit increasing amounts of capital to these core businesses which could limit the capital resources available for the CFS business."

In 2003, Chubb expects to achieve strong top-line and bottom-line growth, based on anticipated continuing favorable market conditions for Chubb Commercial Insurance; continuing rate increases and a leveling off of D&O and E&O claim activity in Chubb Specialty Insurance; a gradually improving homeowners outlook in Chubb Personal Insurance; and, strong cash generation that will result in higher investment income. Subject to the risks outlined in the company's forward looking information safe-harbor statements, Chubb expects:

• Net premiums written to grow this year by 20% to 25%, based on 17% to 21% growth in CCI, 27% to 31% growth in CSI and 13% to 17% growth in CPI;

• A combined ratio between 96% and 99% for the year, based on a combined ratio of 91% to 95% for CCI, 100% to 104% for CSI and 97% to 99% for CPI;

• Property and casualty investment income after taxes to increase 5% to 7%;

• Given the volatility of CFS’ reported earnings, we have assumed for this purpose breakeven results for CFS; and

• Operating earnings per share for the year of about $4.60 to $5.00, including $0.30 per share for the cost of expensing stock options, which the company will begin recognizing for accounting purposes in 2003.

Founded in 1882, the Chubb Group of Insurance Companies provide property and casualty insurance for personal and commercial customers worldwide through 5,000 independent agents and brokers. Chubb's global network includes branches and affiliates throughout North America, Europe, Latin America, Asia and Australia.

Operating income, a non-GAAP financial measure, is net income excluding after tax realized investment gains and losses. Management uses operating income, among other measures, to evaluate its performance because the realization of investment gains and losses in any given period is largely discretionary as to timing and could distort the analysis of trends.

Book value per share represents the portion of consolidated shareholders' equity attributable to one share of common stock outstanding as of the balance sheet date. Consolidated shareholders' equity includes, as part of accumulated other comprehensive income, the after-tax appreciation or depreciation on the Corporation's available-for-sale fixed maturities carried at market value. The appreciation or depreciation on available-for-sale fixed maturities is subject to fluctuation due to changes in interest rates and therefore could distort the analysis of trends. Management believes that book value per common share with available-for-sale fixed maturities at amortized cost, a non-GAAP financial measure, is an important measure of the underlying equity attributable to one share of common stock.

The combined loss and expense ratio, expressed as a percentage, is a measure of underwriting profitability. The Corporation uses the statutory definition of combined loss and expense ratio. It is the sum of the ratio of losses to premiums earned (loss ratio) plus the ratio of underwriting expenses to premiums written (expense ratio) after reducing both premium amounts by dividends to policyholders.

All financial results herein are unaudited as of the date of this release.

Certain statements in this communication may be considered to be "forward looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995, such as statements that include words or phrases "will result", "is expected to", "will continue", "is anticipated", or similar expressions. Such statements are subject to certain risks, uncertainties and assumptions about our business. The factors which could cause actual results to differ materially from those suggested by any such statements include but are not limited to those discussed or identified from time to time in the Corporation's public filings with the Securities and Exchange Commission and specifically to risks or uncertainties associated with:

• the availability of primary and reinsurance coverage, including the implications relating to terrorism legislation and regulation;

• global political conditions and the occurrence of any terrorist attacks, including any nuclear, biological or chemical events;

• the outbreak of war;

• premium price increases and profitability or growth estimates overall or by lines of business or geographic area, and related expectations with respect to the timing and terms of any required regulatory approvals;

• our expectations with respect to cash flow projections and investment income and with respect to other income;

• the adequacy of loss reserves including:

• the impact of the current economic climate on companies on whose behalf we have issued surety bonds, and in particular, on those companies that have experienced deterioration in creditworthiness;

• the effects of disclosures by and investigations of public companies relating to possible accounting irregularities, practices in the energy and securities industries and other corporate governance issues, including:

• any downgrade in our claims-paying, financial strength or credit ratings;

• general economic conditions including: