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Member, Beacon International Group, Ltd.
(Reuters) — U.S. property/casualty insurer Travelers Cos. Inc. reported a 17% rise in first-quarter profit, helped by higher underwriting gains and an increase in net investment income.
Net income rose to $1.05 billion, or $2.95 per share, for the quarter ended March 31, from $896 million, or $2.33 per share, a year earlier.
Net investment income rose about 10% to $736 million as Travelers benefited from strong returns in its non-fixed income portfolio.
Underwriting gains jumped about 32% to $791 million.
Net written premiums rose about 5% to $5.87 billion, while total revenue rose 6% to $6.71 billion.
"Our very deep agent, broker and customer relationships, highly segmented pricing strategies and expense discipline continued to deliver strong and improving underwriting results," Chief Executive Jay Fishman said in a statement.
On an operating basis, Travelers, which is a component of the Dow Jones Industrial Average Index, earned $2.95 per share.
Analysts on average were expecting the company to earn $2.16 per share, according to Thomson Reuters I/B/E/S.
Travelers' results often differ from analysts' average expectations as the company does not give a forecast.
Pretax catastrophe losses, net of reinsurance, rose about 50% to $149 million.
Travelers' combined ratio, the percentage of premium revenue an insurer has to pay out in claims, fell to 88.2% in the quarter from 90.8%.
A combined ratio of under 100 indicates an underwriting profit.
Travelers had a market value of about $30 billion based on Monday's close of $86.40 on the New York Stock Exchange.
The company's shares have fallen by about 3.3% since the start of the year, while the Dow Jones Industrial Average Index has changed little during the same period.