Travelers announces major turnaround
Travelers announces major turnaround | Insurance Business Canada
Insurance News
Travelers announces major turnaround
CEO lifts the lid on improved results
Insurance News
By
Terry Gangcuangco
Insurance company Travelers has published its interim financial results, revealing a major turnaround in the second quarter.
Here’s how the insurer performed in the three months and six months ended June 30, 2024:
Metric
Q2 2024
Q2 2023
H1 2024
H1 2023
Net written premiums
US$11.12 billion
US$10.32 billion
US$21.30 billion
US$19.71 billion
Total revenues
US$11.28 billion
US$10.10 billion
US$22.51 billion
US$19.80 billion
Net income (loss)
US$534 million
US$(14 million)
US$1.66 billion
US$961 million
Core income
US$585 million
US$15 million
US$1.68 billion
US$985 million
Combined ratio
100.2%
106.5%
97.1%
101.1%
Lifting the lid on the numbers, Travelers chair and chief executive Alan Schnitzer stated: “We are pleased to have generated a strong bottom line result in a quarter that included a record level of severe convective storms across the United States.
“Core income of US$585 million, or US$2.51 per diluted share, benefited from excellent underlying results, favourable net prior year reserve development, and higher investment income.
“Underlying underwriting income of US$1.2 billion pre-tax was up 55% over the prior year quarter, driven by record net earned premiums of US$10.2 billion and a consolidated underlying combined ratio that improved 3.4 points to an excellent 87.7%.
“Net earned premiums were higher in all three of our business segments. The underlying combined ratio in our business insurance segment was an excellent 89.2%; the underlying combined ratio in our bond & specialty insurance business improved 1.7 points to a very strong 86.1%; and the underlying combined ratio in personal insurance improved by nearly eight points to a terrific 86.3%.”
The firm’s net written premiums for business insurance grew by 7%; for bond & specialty insurance, 8%; and for personal insurance, 9%.
Investments-wise, the company’s portfolio generated after-tax net investment income of US$727 million, thanks to what Schnitzer described as “strong and reliable returns” from Travelers’ growing fixed income portfolio as well as higher returns from its non-fixed income portfolio.
The CEO highlighted that Travelers returned US$498 million of excess capital to its shareholders in the quarter, including share repurchases worth US$253 million.
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