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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 11-K

PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

þ

ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the fiscal year ended December 31, 2014

OR

 

¨

TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                to               

Commission file number 1-8661

A. Full title of the plan:

CAPITAL ACCUMULATION PLAN OF THE CHUBB

CORPORATION

B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

The Chubb Corporation (the “Corporation”)

15 Mountain View Road

Warren, New Jersey 07059

 

 

 

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Contents

 

Report of Independent Registered Public Accounting Firm			1
Financial Statements
Statements of Net Assets Available for Benefits			2
Statement of Changes in Net Assets Available for Benefits			3
Notes to Financial Statements			4
Supplemental Schedule
Schedule H, Line 4i – Schedule of Assets (Held at End of Year)			16
Signature			17
Exhibit 23.1			18

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Report of Independent Registered Public Accounting Firm

The Employee Benefits Committee

Capital Accumulation Plan of The Chubb Corporation

We have audited the accompanying statements of net assets available for benefits of the Capital Accumulation Plan of The Chubb Corporation (the Plan) as of December 31, 2014 and 2013, and the related statement of changes in net assets available for benefits for the year ended December 31, 2014. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2014 and 2013, and the changes in its net assets available for benefits for the year ended December 31, 2014, in conformity with U.S. generally accepted accounting principles.

The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2014, has been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The information in the supplemental schedule is the responsibility of the Plan’s management. Our audit procedures included determining whether the information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental schedule. In forming our opinion on the information, we evaluated whether such information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the information is fairly stated, in all material respects, in relation to the financial statements as a whole.

/s/ ERNST & YOUNG LLP

New York, New York

June 25, 2015

 

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Table of Contents

Capital Accumulation Plan of The Chubb Corporation

Statements of Net Assets Available for Benefits

 

		December 31
		2014				2013
Assets
Investments, at fair value:
Stable value funds		$	319,282,127			$	337,665,268
The Chubb Corporation common stock			536,345,540				537,012,432
Mutual funds			1,566,232,180				1,431,525,784
Money market funds			52,282,123				56,685,182
Total Investments			2,474,141,970				2,362,888,666
Receivables:
Employer contributions			382,795				1,585,803
Notes receivable from participants			26,312,964				26,168,177
Accrued interest and dividends			2,596,405				2,456,502
Due from broker			—				1,148,916
Total Receivables			29,292,164				31,359,398
Total Assets			2,503,434,134				2,394,248,064
Liabilities
Due to broker			1,896,454				—
Accrued investment fees			73,285				77,890
Total liabilities			1,969,739				77,890
Net assets reflecting investments at fair value			2,501,464,395				2,394,170,174
Adjustments from fair value to contract value for fully benefit-responsive investment contracts			(5,714,855	)			(6,510,076	)
Net assets available for benefits		$	2,495,749,540			$	2,387,660,098

See accompanying notes.

 

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Capital Accumulation Plan of The Chubb Corporation

Statement of Changes in Net Assets Available for Benefits

Year Ended December 31, 2014

 

Additions
Investment income:
Realized gain on sale of mutual funds		$	5,325,269
Unrealized gain on mutual funds			30,266,303
Realized loss on sale of The Chubb Corporation common stock			(3,941,042	)
Unrealized gain on The Chubb Corporation common stock			38,480,995
Interest and dividends			105,773,826
Total investment income			175,905,351
Interest income on notes receivable from participants			1,082,054
Contributions:
Participant:
Pre-tax			60,165,249
After-tax			1,945,288
Employer			26,854,986
Rollovers			3,943,034
Total contributions			92,908,557
Total additions			269,895,962
Deductions
Deductions from net assets attributable to:
Benefit payments			161,696,473
Defaulted participant notes receivable, net			2,773
Administrative expenses			107,274
Total deductions			161,806,520
Net increase			108,089,442
Net assets available for benefits
Beginning of year			2,387,660,098
End of year		$	2,495,749,540

See accompanying notes.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements

December 31, 2014

1. Plan Description

The following is a brief description of the Capital Accumulation Plan of The Chubb Corporation (the “Plan”). Participants should refer to the Plan document, which is maintained by the Employee Benefits Committee (the “Plan Administrator”), for a more complete description of the Plan’s provisions.

The Plan is a defined contribution plan and is subject to the provisions of the Employee Retirement Income Security Act (“ERISA”).

Eligibility

An employee becomes eligible to participate in the Plan, and to receive employer matching contributions, on the first day of the month following completion of one full calendar month of service.

Contributions

Participants may elect to contribute pre-tax and after-tax contributions, up to the maximum amount permitted by the Internal Revenue Code, but not greater than 50% of their compensation, as defined by the Plan. Effective July 1, 2008, the Company amended the Plan to provide automatic enrollment for eligible employees with initial pre-tax contributions by the employees of 4% of their compensation with an increase of 1% annually thereafter, to a maximum of 10%. Participants may also make rollover contributions from other qualified plans. The Company matches 100% of participant pre-tax contributions up to 4% of their annual compensation as defined in the Plan. Participants age 50 and older who contribute at least 4% of pre-tax pay qualify to make unmatched additional “catch-up” contributions according to the schedules and maximum amounts permitted by the Internal Revenue Code for each year.

Vesting

Participants are immediately and fully vested in their contributions plus actual earnings thereon. Participants in the Plan beginning January 1, 2012 become 100% vested in the Company’s matching contributions plus actual earnings thereon after three years of service. Participants prior to January 1, 2012 vest 20% annually in the Company’s matching contributions plus actual earnings thereon during the first two years of service and 100% after three years.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

1. Plan Description (continued)

 

Forfeitures

Employees who terminate employment prior to becoming 100% vested may forfeit the nonvested portion of their account balance, plus actual earnings thereon. Forfeitures, plus earnings thereon, can be used by the Company to reduce future employer contributions and to pay administrative expenses. Participants that resume employment prior to incurring five consecutive one year breaks in service are entitled to have previously forfeited amounts restored to their account. If forfeitures for any Plan year are not sufficient to restore forfeited amounts, the Company is required to contribute the remaining balance. Forfeitures from employees for the year ended December 31, 2014 were $548,701 with a balance of $124,380 available to reduce future employer contributions or to pay administrative expenses. For 2013, forfeitures amounted to $623,627 with a December 31, 2013 balance of $100,997.

Participant Accounts

Contributions are invested by Fidelity Management Trust Company (the “Trustee”) according to the investment options elected by the participants and are held by the Trustee in a trust. For participants automatically enrolled, the investment option selected is the Vanguard Target Date Retirement mutual fund with a target date closest to the participant’s 65^th birthday.

Loans

Participants may borrow a minimum of $1,000 up to a maximum equal to the lesser of a) $50,000, b) 50% of their vested account balance, or c) 50% of the participant’s annualized rate of compensation, as defined, at the time the loan is requested. Each participant can have up to two loans outstanding at any time as long as the two loans, collectively, do not exceed the maximum limits. The principal portion of the loan is repayable by check or through payroll deductions and bears interest at the prime rate, plus 1%, as determined on the last day of the month preceding the loan. As of December 31, 2014 and 2013, the interest rates on outstanding loans ranged from 4% to 9%.

Loans that are in default are accounted for as a reduction of net assets available for benefits in the year the default occurs.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

1. Plan Description (continued)

 

Payment of Benefits

Upon attaining the normal retirement age (65) or in certain circumstances, the attainment of age 59 ¹⁄₂, a participant is entitled to his or her vested benefits in the form of a lump sum payment, an annuity or installment payments, as prescribed by the Plan. In addition, participants may withdraw funds from the Plan upon termination of employment or, subject to the approval of the Plan Administrator, participants may request a withdrawal of a portion of their balance in the case of financial hardship, as defined. If a participant dies before or after retirement or after termination, any remaining balance in his or her account is paid to his or her estate or beneficiary under any of the following payment options: (a) a lump sum, (b) installments as elected by the participant prior to death, or (c) installment payments as elected by the participant’s beneficiary.

Upon request, any lump sum distribution to a participant or his or her beneficiary from The Chubb Corporation common stock may be made in shares in lieu of cash payments.

Administration Expenses

Unless paid by the Company, the Trustee pays the expenses of the Plan using plan assets. For 2014 and 2013, the following expenses have been paid by the Plan: (a) brokerage costs, (b) other expenses in connection with the purchase and sale of assets by the manager of funds, (c) fees paid for asset management, and (d) certain overhead expenses directly attributable to the administration of the Plan. Qualified Domestic Relations Order (QDRO) fees are paid for by the individual participant from the participant’s account, as these fees are not paid by the Plan sponsor or the Trustee.

Company Stock

The Plan permits participants to invest in common stock of the Company through the Plan’s Company Stock Fund. The Plan also includes an ESOP fund which is invested in Company stock. Participants in the ESOP fund are able to diversify their holdings out of the fund but are not permitted to purchase additional units. Both company stock funds may hold cash or short-term securities, although these are expected to be a small percentage of the fund’s net assets.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

2. Summary of Significant Accounting Policies

Basis of Presentation

The accounting and financial reporting policies of the Plan are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP).

Fair Value Measurement

The Plan’s investments are valued at fair value as of December 31, 2014 and 2013 (see Note 4) with the exception of fully benefit-responsive investment contracts, which are carried at contract value, and participant loans, which are carried at their unpaid principal balance plus any accrued but unpaid interest.

The Stable Value Portfolio (Fully Benefit-Responsive Investment Contracts)

The Plan includes investments in stable value funds that are fully benefit-responsive. The statements of net assets available for benefits present the fair value of the fully benefit-responsive investment contracts as well as the adjustment of the fully benefit-responsive investment contracts from fair value to contract value. The statements of net assets available for benefits are prepared on a contract value basis.

Fidelity Management Trust Co. acts as the manager of the Stable Value Portfolio (“SVP”).

It is the policy of the manager of the SVP to use its best efforts to maintain a stable net asset value of $1.00 per unit; however, there is no guarantee that the manager will be able to maintain this value.

The SVP is invested in short to intermediate term fixed income securities and cash equivalents represented by shares in a money market fund. In addition, the SVP includes “wrap” contracts issued by third parties and may include derivative instruments such as futures contracts and swap agreements.

A wrap contract is an agreement by a third party, such as a bank or insurance company, to make payments to a portfolio in certain circumstances. Wrap contracts are designed to allow a stable value portfolio to maintain a stable net asset value of $1.00 per unit and to protect the portfolio in extreme circumstances. In a typical wrap contract, the wrap issuer agrees to pay a portfolio the difference between the contract value and the fair value of the underlying assets once the fair value has been totally exhausted. This could happen if a portfolio experiences significant

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

2. Summary of Significant Accounting Policies (continued)

 

redemptions (redemption of most of a portfolio’s units) during a time when the fair value of a portfolio’s underlying assets is below contract value, and fair value is ultimately reduced to zero. If that occurs, the wrap issuer agrees to pay the portfolio an amount sufficient to cover unitholder redemptions and certain other payments (such as portfolio expenses), provided all the terms of the wrap contract have been met. Purchasing wrap contracts is similar to buying insurance, in that a portfolio pays a fee to protect against a relatively unlikely event (the redemption of most of the shares of a portfolio). Fees the SVP pays for wrap contracts are offset against interest income.

A wrap issuer may terminate a wrap contract at any time. In the event that the fair value of the SVP’s covered assets is below its contract value at the time of such termination, the manager of the SVP may elect to keep the wrap contract in place until such time as the fair value of the SVP’s covered assets is equal to its contract value, normally over the duration of the SVP’s covered assets measured at notification date.

The manager expects that a substantial percentage of the SVP’s assets to be underlying the wrap contracts, although this may change over time. Assets not underlying the wrap contracts will generally be invested in money market instruments and cash equivalents to provide necessary liquidity for participant withdrawals and exchanges.

To reduce exposure of the SVP to wrap credit risk, wrap contracts are diversified across multiple wrap counterparties, each agreeing to wrap a certain percentage of the covered underlying assets. The SVP’s ability to receive amounts due pursuant to these contracts is dependent upon the counterparties’ ability to meet their financial obligations (see Note 3).

The wrap contracts limit the ability of the SVP to transact at contract value upon the occurrence of certain events. Such events include the following: (i) amendments to the Plan including changes in the investment options, transfer procedures or withdrawal rights not consented to by the wrap issuer, (ii) termination of the Plan, (iii) changes to Plan’s prohibition of direct transfers from the SVP to a competing investment option, (iv) other Plan Sponsor events (e.g., divestitures or spin-offs of a subsidiary) that cause a significant withdrawal from the SVP or, (v) the failure of the plan to qualify for exemption from federal income taxes or any required prohibited transaction exemption under ERISA. The Plan Administrator does not believe that the occurrence of any such event, which would limit the Plan’s ability to transact at contract value with participants, is probable.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

2. Summary of Significant Accounting Policies (continued)

 

The crediting rate, and hence the SVP’s return, may be affected by many factors, including purchases and redemptions by unitholders. The impact depends on whether the fair value of the underlying assets is higher or lower than the contract value of those assets. If the fair value of the underlying assets is higher than their contract value, the crediting rate will ordinarily be higher than the yield of the underlying assets. If the fair value of underlying assets is lower than their contract value, the crediting rate will ordinarily be lower than the yield of the underlying assets.

Investment Income

Purchases and sales of securities are recorded on trade dates. Gains or losses on the sale of securities are based on revalued cost (fair value as of the prior year end). Dividend income is recorded on the ex-dividend date. Interest income is recorded on an accrual basis.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes and supplemental schedule. Actual results could differ from those estimates.

Payment of Benefits

Benefit payments to participants are recorded when paid.

New Accounting Pronouncements

In May 2015, the FASB issued Accounting Standards Update 2015-07, Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent), (ASU 2015-07). ASU 2015-07 removes the requirement to categorize within the fair value hierarchy investments for which fair values are estimated using the net asset value practical expedient provided by Accounting Standards Codification 820, Fair Value Measurement. Disclosures about investments in certain entities that calculate net asset value per share are limited under ASU 2015-07 to those investments for which the entity has elected to estimate the fair value using the net asset value practical expedient. ASU 2015-07 is effective for entities (other than public business entities) for fiscal years beginning after December 15, 2016, with retrospective application to all periods presented. Early application is permitted. Management expects to elect adoption of ASU 2015-07 for the 2015 Plan year. The adoption is not expected to have a material impact on the financial statements.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

3. Investments

The following open-end wrap contracts were held by the SVP at December 31, 2014:

 

Wrap Contract Provider		Rating				Underlying Assets at Fair Value				Underlying Assets at Contract Value
American General Life Insurance Co.			A+			$	51,179,585			$	50,282,286
JPMorgan Chase Bank, NA			A+				72,927,550				71,648,958
Transamerica Premier Life Insurance Co.			AA-				82,673,206				81,164,107
State Street Bank & Trust Co.			AA-				79,624,929				78,171,473
The Prudential Insurance Co. of America			AA-				32,876,857				32,300,448
Total wrap contracts						$	319,282,127			$	313,567,272

The following open-end wrap contracts were held by the SVP at December 31, 2013:

 

Wrap Contract Provider		Rating				Underlying Assets at Fair Value				Underlying Assets at Contract Value
American General Life Insurance Co.			A+			$	54,126,742			$	53,102,611
JPMorgan Chase Bank, NA			A+				77,127,052				75,667,732
Transamerica Premier Life Insurance Co.			AA-				87,432,589				85,716,583
State Street Bank & Trust Co.			AA-				84,208,828				82,556,093
The Prudential Insurance Co. of America			AA-				34,770,057				34,112,173
Total wrap contracts						$	337,665,268			$	331,155,192

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

3. Investments (continued)

 

At December 31, 2014 and 2013, all wrap contracts held are fully benefit responsive. The 12-month average yield and the annualized crediting rate are reflected below:

 

		2014				2013
Average Yield			1.64	%			1.67	%
Crediting Rate			1.70				1.57

The following presents the individual investments that represent 5% or more of the Plan’s net assets:

 

		2014				2013
Stable value funds, at fair value		$	319,282,127			$	337,665,268
Mutual funds, at fair value:
Dodge & Cox Balanced			170,410,361				159,186,179
Spartan 500 Ind. Advan.			196,624,708				177,755,612
Fidelity Contrafund K			250,173,508				239,478,675
Common Stock, at fair value:
The Chubb Corporation			536,345,540				537,012,432

4. Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, establishes a framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described as follows:

 

•

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

4. Fair Value Measurements (continued)

 

•

Level 2 – Inputs to the valuation methodology include: (a) quoted prices for similar assets or liabilities in active markets; (b) quoted prices for identical or similar assets or liabilities in inactive markets; (c) inputs other than quoted prices that are observable for the asset or liability; and (d) inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

 

•

Level 3 – Certain inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.

Following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2014 and 2013:

 

•

Stable Value Funds: Valued at the fair values of the underlying fixed income securities and terms of the underlying investment contracts as further discussed in Note 2. Fair values for the underlying fixed income securities are determined by utilizing prices obtained from a third party, nationally recognized pricing service or, in the case of securities for which prices are not provided by a pricing service, from third party brokers.

 

•

The Chubb Corporation Common Stock: Valued at the closing price reported on the New York Stock Exchange (the active market on which the security is traded).

 

•

Mutual and Money Market Funds: Valued based on quoted market prices, or if unavailable, directly from the fund company, representing the fair value of assets, minus liabilities.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

4. Fair Value Measurements (continued)

 

Assets at fair value as of December 31, 2014 are as follows:

 

		Level 1				Level 2				Level 3				Total
Stable value funds		$	—			$	319,282,127			$	—			$	319,282,127
The Chubb Corporation common stock			536,345,540				—				—				536,345,540
Mutual funds
Large-cap equity			302,739,625				—				—				302,739,625
Mid-cap equity			164,666,635				—				—				164,666,635
Small-cap equity			65,137,148				—				—				65,137,148
Multi-cap equity			389,318,953				—				—				389,318,953
International equity			131,388,892				—				—				131,388,892
Balanced funds			170,410,361				—				—				170,410,361
Target retirement date funds			219,263,707				—				—				219,263,707
Fixed income			123,306,859				—				—				123,306,859
Money market funds			52,282,123				—				—				52,282,123
Total assets at fair value		$	2,154,859,843			$	319,282,127			$	—			$	2,474,141,970

Assets at fair value as of December 31, 2013 are as follows:

 

		Level 1				Level 2				Level 3				Total
Stable value funds		$	—			$	337,665,268				—			$	337,665,268
The Chubb Corporation common stock			537,012,432				—				—				537,012,432
Mutual funds
Large-cap equity			271,783,105				—				—				271,783,105
Mid-cap equity			148,269,007				—				—				148,269,007
Small-cap equity			71,269,516				—				—				71,269,516
Multi-cap equity			360,038,460				—				—				360,038,460
International equity			142,851,279				—				—				142,851,279
Balanced funds			159,186,179				—				—				159,186,179
Target retirement date funds			158,352,905				—				—				158,352,905
Fixed income			119,775,333				—				—				119,775,333
Money market funds			56,685,182				—				—				56,685,182
Total assets at fair value		$	2,025,223,398			$	337,665,268			$	—			$	2,362,888,666

There were no transfers in or out of Level 1 or 2 during the years ended December 31, 2014 and 2013.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

5. Related Party Transactions

Certain Plan investments are shares of funds managed by Fidelity Management Trust Company (“FMTC”). FMTC is the trustee as defined by the Plan and, therefore, FMTC qualifies as a party-in-interest. Fees paid to FMTC by the Plan for management and administrative services amounted to $107,274 for the year ended December 31, 2014.

6. Plan Termination

While the Company has not expressed any intent to terminate the Plan, the Company reserves the right to amend, modify or terminate the Plan at any time. In the event of termination, the value of participants’ accounts will be paid in accordance with the provisions of the Plan and the provisions of ERISA.

7. Income Tax Status

The Plan has received a determination letter from the Internal Revenue Service dated June 27, 2014, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code) and therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualified status. The plan administrator, Fidelity, believes the Plan is being operated in compliance with the applicable requirements of the Code and therefore, believes the Plan is qualified and the related trust is tax-exempt. However, the plan administrator has indicated that it will take the necessary steps, if any, to bring the Plan’s operations into compliance with the Code.

Accounting principles generally accepted in the United States require plan management to evaluate uncertain tax positions taken by the Plan. The financial statement effects of a tax position are recognized when the position is more likely than not, based on the technical merits, to be sustained upon examination by the IRS. The Plan Administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2014 and 2013 there are no uncertain positions taken or expected to be taken. The Plan has recognized no interest or penalties related to uncertain tax positions. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to 2011.

 

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Capital Accumulation Plan of The Chubb Corporation

Notes to Financial Statements (continued)

 

8. Risks and Uncertainties

The Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is reasonably assured that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for benefits.

The Plan’s exposure to concentration of credit risk is limited by the diversification of investments. Additionally, the investments within each fund election are further diversified into various financial instruments, with the exception of The Chubb Corporation common stock. The Plan’s exposure to credit risk on fully benefit-responsive investment contracts is limited to the fair value of the contracts with each counterparty.

9. Reconciliation of Financial Statements to Form 5500

The following is a reconciliation between the statement of net assets available for benefits per the accompanying financial statements and the Form 5500:

 

		December 31
		2014				2013
Net assets available for benefits per Form 5500		$	2,501,464,395			$	2,394,170,174
Adjustment from fair value to contract value for fully benefit-responsive investment contracts			(5,714,855	)			(6,510,076	)
Net assets available for benefits at per financial statements		$	2,495,749,540			$	2,387,660,098

 

 

 

 

 

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Capital Accumulation Plan of The Chubb Corporation

EIN #13-2595722 – Plan # 002

Schedule H, Line 4i – Schedule of Assets

(Held at End of Year)

December 31, 2014

 

(a)		(b)		(c)		(d) **		(e)
		Identity of Issue, Borrower, Lessor or Similar Party		Description of Investments, Including Maturity Date, Rate of Interest, Collateral, Par or Maturity Date		Cost		Current Value
		Stable Value Funds:
		JP Morgan Chase		JPMorgan Chase Bank, NA				$	72,927,550
		AIG		American General Life Insurance Co.					51,179,585
		State Street Bank		State Street Bank & Trust Co.					79,624,929
		Aegon		Transamerica Premier Life Insurance Co.					82,673,206
		Prudential		The Prudential Insurance Co. of America					32,876,857
		Common Stock:
*		The Chubb Corporation		Common Stock					536,345,540
		Mutual Funds:
		Dodge & Cox		Dodge & Cox Balanced					170,410,361
		T. Rowe Price		T. Rowe Price Mid Cap Growth					109,396,643
		Morgan Stanley		MSIF CP FX Inc 1					70,559,894
		Vanguard		Vanguard Value Index Inst.					106,114,917
		Janus		Janus High Yield Bond					52,746,965
		Goldman Sachs		GS Midcap Value Ins.					55,269,992
		Vanguard		Vanguard Small Growth Index Inst.					35,361,146
*		Fidelity Spartan		Spartan 500 Ind. Advan.					196,624,708
*		Fidelity		Fidelity Contrafund K					250,173,508
*		Fidelity		Fidelity Diversified International K					107,238,712
*		Fidelity		Fidelity Fund K					39,854,214
*		Fidelity		Fidelity OTC K					99,291,231
		Royce		Royce Low Priced Stock IS					29,776,002
		Vanguard		Vanguard Target Retirement Income					7,845,176
		Vanguard		Vanguard Target Retirement 2010					4,804,631
		Vanguard		Vanguard Target Retirement 2015					24,377,786
		Vanguard		Vanguard Target Retirement 2020					46,380,579
		Vanguard		Vanguard Target Retirement 2025					43,270,302
		Vanguard		Vanguard Target Retirement 2030					30,941,448
		Vanguard		Vanguard Target Retirement 2035					22,884,124
		Vanguard		Vanguard Target Retirement 2040					13,150,969
		Vanguard		Vanguard Target Retirement 2045					12,694,818
		Vanguard		Vanguard Target Retirement 2050					8,332,254
		Vanguard		Vanguard Target Retirement 2055					2,661,304
		Vanguard		Vanguard Target Retirement 2060					1,920,316
		Wells Fargo		Wels Fargo Advantage Emerging Markets Fund					24,150,180
		Money Market Funds:
*		Fimm Government Port C1 I		Money Market Fund					45,562,827
*		Interest Bearing Cash		Money Market Fund					4,523,662
*		Fidelity STIF		Money Market Fund					2,195,634
		Participant loans		Interest rates from 4.00% – 9.00%					26,312,964
								$	2,500,454,934

 

*	Party-in-interest to the Plan.

**	Cost not disclosed as all investments are participant directed.

 

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Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Employee Benefits Committee has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: June 25, 2015

 

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