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Member, Beacon International Group, Ltd.
Strong underwriting results and lower natural catastrophe losses boosted Travelers Cos. Inc.’s 2015 second-quarter profit 18.9% over the prior-year period to $812 million, Travelers reported Tuesday.
Revenue decreased 1% from the second quarter of 2014 to $6.7 billion, the insurer said in its earnings statement.
Net written premiums for the second quarter of 2015 stayed virtually flat compared with the prior-year period at $6.2 million. Travelers’ business and International insurance segment saw domestic net written premiums increase 1% to 709 million, but international net written premiums decreased 15% to $534 million due to the impact of changes in foreign currency exchange rates, according to the statement.
Travelers’ combined ratio for the second quarter improved to 90.8%, compared with 95.1% in the prior-year quarter.
First half-profit was $1.65 billion, down from $1.74 billion last year. Year-to-date revenue was $13.33 billion, down from $13.49 billion. Net premium was $12.07 billion, a slight increase from the prior-year period’s $12.04 billion, while the combined ratio improved to 89.9% from 90.5%.
Strong underwriting results were the main driver, along with a tax benefit as an additional increase to profitability, Clifford Gallant, an analyst at Nomura Securities International Inc. in San Francisco, said in a report.
During a Tuesday conference call with investment analysts, questions arose in regards to the insurance company’s opinion of market changes from the acquisition of Chubb Corp. by Ace Ltd., but executives would only say they saw the transaction as no threat and did not foresee it causing a change in their business.
“We have great long-term and trusted relationships with our important broker and agent partners and we don’t see that being disrupted,” said Brian W. Maclean, Travelers’ president and chief operating officer.
Travelers Cos. Inc. reported net income of $833.0 million in the first quarter of 2015, a 21% decrease from the same period a year earlier that the property/casualty insurer attributed primarily to lower investment income, lesser prior-year reserve developments and slightly higher catastrophe losses.