Travelers Beats Estimates With Record Underwriting Revenue

(Bloomberg) -- Travelers Cos. beat analysts’ profit estimates for the sixth consecutive quarter as higher investment income and record underwriting revenue helped the insurer shrug off sizable catastrophe losses brought on by Hurricane Ida and other natural disasters.

Pretax catastrophe losses climbed in the third quarter to $501 million from $397 million a year earlier, according to a statement Tuesday. Net premiums written clocked in at a record $8.3 billion, rising 7% from the same quarter last year. Retention was also higher. 

“Our strong top- and bottom-line results this quarter and year to date reflect the continued successful execution of our innovation strategy to develop and deploy capabilities designed to position Travelers for growth at attractive returns,” Chief Executive Officer Alan Schnitzer said in the statement.

Other Highlights:

• The insurer’s combined ratio was 98.6%, meaning Travelers retained 1.4 cents of every premium dollar after claims and expenses. That figure was 94.9% in the same period last year. The company said unfavorable reserve developments helped account for the difference.
• Private equity returns were once again a bright spot this quarter, helping net investment income increase 15%. Even so, low interest rates continue to drag on the fixed-income portion of the investment portfolio.
• The company reported earnings per share of $2.60 versus an average estimate of $1.89, according to 18 analysts surveyed by Bloomberg.
• For a snapshot on earnings: Travelers 3Q Core EPS Beats Estimates

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