The Travelers Companies (TRV) Q3 2024 earnings summary

Executive summary

• Net income for Q3 2024 was $1.26 billion, up 212% year-over-year, with diluted EPS of $5.42 and core income of $1.218 billion, driven by strong underwriting, favorable reserve development, and higher investment income, despite elevated catastrophe losses.

• Net written premiums hit a record $11.3 billion, up 8% year-over-year, with growth across all segments.

• Combined ratio improved 7.8 points year-over-year to 93.2%, reflecting strong underlying profitability.

• Book value per share increased 39% to $122.00, and adjusted book value per share rose 13% to $131.30 over the prior year.

• $496 million was returned to shareholders in Q3 via dividends and share repurchases.

Financial highlights

• Net earned premiums grew 10% year-over-year to $10.7 billion; net investment income increased 18% pre-tax to $904 million, driven by higher yields and private equity returns.

• Underlying underwriting income reached a record $1.498 billion pre-tax, with an underlying combined ratio of 85.6%.

• Catastrophe losses were $939 million pre-tax, up from $850 million in the prior year quarter.

• Net realized investment gains were $55 million pre-tax, compared to losses of $65 million a year ago.

• Returned $496 million to shareholders in Q3: $253 million in share repurchases, $243 million in dividends.

Outlook and guidance

• Management expects after-tax net investment income of ~$700 million for Q4 2024 and Q1 2025, rising to $760 million by Q4 2025, and projects continued premium growth with strong retention.

• Preliminary estimate for Hurricane Milton losses is $75–$175 million pre-tax, net of reinsurance.

• Confident in continued strong performance and industry-leading returns into 2025 and beyond, with a long-term strategy targeting mid-teens core ROE.