Travelers plunges to Q2 loss despite 'modest' COVID-19 impact
Property/casualty insurer Travelers swung to loss in the second quarter 2020 on the back of high level of catastrophe losses, lower net investment income and lower reserve development than last year, partially offset by a higher underlying underwriting gain.
The insurer reported a second quarter net loss of $40 million, compared with a net income of $557 million in the prior year quarter.
The net written premiums stood at $7.346 billion, down from $7.450 billion in Q2 2019.
The combined ratio deteriorated to 103.7 percent in Q2 2020 from 98.4 percent in the prior year quarter.
Catastrophe losses in the quarter climbed to $854 million pre-tax, compared with $367 million pre-tax in Q2 2019.
Travelers said the net impact of COVID-19 and related economic conditions on the underwriting result was modest.
“Our second quarter results reflect an improved underlying underwriting gain that was more than offset by a high level of catastrophe losses and, as expected, losses in our non-fixed income investment portfolio,” said Alan Schnitzer, chairman and chief executive officer.
Schnitzer added: “We were very pleased with our marketplace execution in the quarter, particularly in light of the challenging economic environment. Net written premiums declined just slightly, as the impact of the pandemic on insured exposures in our commercial businesses and our auto refund program in Personal Insurance were largely offset by strong renewal rate change in all three segments."
“Our steady performance through these difficult times demonstrates the value of underwriting excellence and the strength and resilience of our franchise. With a strong balance sheet, our proven ability to execute on our marketplace strategies and the best talent in the industry, we remain well positioned to continue to deliver meaningful shareholder value over time,” he concluded.
