Travelers blows past Q2 profit expectations

Strong underwriting, investment gains bolster results

Travelers blows past Q2 profit expectations

Insurance News

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Insurance heavyweight Travelers Companies reported second-quarter earnings on Thursday that far exceeded analyst expectations, thanks to robust underwriting results and improved investment income.

The company reported net written premiums of $11.5 billion for the quarter ending June 30, reflecting a 4% increase from the same period last year, according to a Reuters report. Demand for property and casualty insurance has remained resilient despite ongoing economic uncertainty, as both businesses and consumers continue to seek protection against financial risks and natural disasters.

Shares of Travelers rose 1.1% in premarket trading following the earnings release, Reuters reported. The company is often seen as a key indicator for broader industry trends due to its scale and underwriting footprint.

Catastrophe-related losses – typically a significant variable in insurers' quarterly results – declined year-over-year. Pre-tax catastrophe losses for the quarter totaled $927 million, down from $1.51 billion a year ago. While some hailstorms impacted results, the quarter was relatively mild compared to previous periods marked by heightened weather-driven claims.

Travelers reported an underlying combined ratio of 84.7%, indicating it brought in more premium income than it paid out in claims and expenses. The company’s pre-tax underlying underwriting income rose 35% to $1.6 billion, underscoring its improved risk pricing and claims management.

Investment income also contributed to the stronger results, increasing 6% to $942 million. This growth was driven by returns on a mix of fixed-income and other low-risk financial assets.

Overall, adjusted earnings came in at $6.51 per share – well above Wall Street’s average estimate of $3.66, according to data from LSEG. Core income surged to $1.5 billion, nearly tripling the $585 million posted in the same quarter last year.

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