(Reuters) — Property/casualty insurer Travelers Cos. Inc. reported a better-than-expected quarterly net profit on Tuesday, helped by a rise in investment earnings.
A large chunk of insurers' earnings come from investing their customers' premiums until the money is needed to pay claims.
Travelers said its net income rose 8.9% to $943 million, or $3.28 per share, in the fourth quarter ended Dec. 31, from $866 million, or $2.83 per share, a year earlier.
On an operating basis, the company earned $3.20 per share, beating analysts' average estimate of $2.73, according to Thomson Reuters I/B/E/S.
The insurer said its net investment income rose about 16% to $627 million in the quarter, helped by higher returns in the non-fixed income portfolio.
Pretax catastrophe losses, net of reinsurance, rose to $137 million from $46 million.
The underlying combined ratio rose to 92% from 90.7%.
A ratio below 100% means an insurer earns more in premiums than it pays out in claims.
(Reuters) — New Zurich Insurance Chief Executive Mario Greco pledged on Thursday to keep dividends at least steady through 2019 and stepped up cost cuts.