Travelers Reports Improved Underwriting, Lower Catastrophe Losses

April 18, 2019 by Aparajita Saxena

Insurer Travelers Companies Inc.’s quarterly profit beat analysts’ estimates on Thursday, as improved underwriting and lower catastrophe losses offset a decline in net investment income.

New York-based Travelers, often seen as a bellwether for the insurance sector, said its net written premiums rose 3 percent to $7.06 billion in the first quarter, with growth across all business lines.

Catastrophe losses, net of reinsurance, fell by $161 million to $193 million. The company’s consolidated combined ratio for the 2019 first quarter was 93.7 versus 95.5 over the same, year-ago period.

Net investment income, which is how much the company earns from investments, fell 3.5 percent to $582 million due to lower private equity returns.

Insurers typically invest money they get from premiums in bonds and equities to earn profits, and a downturn in markets spells bad news for them.

The company’s net income rose 19 percent to $796 million, or $2.99 per share, in the quarter ended March 31. Core income was $2.83 per share, which beat analysts’ estimates of $2.74 per share, according to IBES data from Refinitiv.

*Carrier Management added additional material to this story.