The Travelers Companies has reported a net income of $934 million, or $3.66 per diluted share, for the second quarter. That’s compared to a net loss of $40 million ($0.16 per diluted share) in the prior-year quarter. Core income was $870 million, compared to a core loss of $50 million in the prior-year quarter.
Net realized investment gains in Q2 were $61 million pre-tax ($47 million after tax), compared to $13 million pre-tax ($10 million after tax) in the prior-year quarter.
“We are very pleased to report excellent underwriting and investment results, generating second-quarter core income of $879 million, or $3.45 per diluted share, and core return on equity of 13.7%,” said Alan Schnitzer, chairman and CEO of Travelers. “Higher underlying underwriting income and net favorable prior-year reserve development, as well as a lower level of catastrophe losses, all contributed to higher core income compared to the prior-year quarter.”
The company’s strong results allowed Travelers to return $625 million of excess capital to shareholders in Q2, including $401 million of share repurchases, Schnitzer said.
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The company’s overall net written premiums grew 11% (8% adjusting for auto premium refunds in the prior-year quarter). In the company’s business insurance segment, net written premiums grew by 5%, with renewal premium change of 9.5% almost at an all-time high. Retention was higher, and the segment grew new business by 9%. In bond and specialty insurance, new written premiums rose by 16%. In personal insurance, net written premiums rose by 16%, or 8% adjusting for auto premium refunds in the prior-year quarter.
“Our excellent top-and bottom-line results this quarter and for the first half of the year demonstrate the continued successful execution of our strategy to grow the top line at attractive returns,” Schnitzer said, “as well as the effectiveness of our well-defined and consistent investment philosophy,
“Our focused innovation agenda has been an important contributor to the growth and profitability we have achieved, and we will continue to relentlessly pursue our priorities of extending our lead in risk expertise, providing great experiences to our customers, distribution partners and employees, and improving productivity and efficiency. With the momentum we have and the best talent in the industry, we are well-positioned to continue to create meaningful shareholder value over time.”