The Travelers Companies Inc. reported a 39% year-on-year decrease in net income to $819 million in the fourth quarter of 2022, compared to $1.33 billion in the same period last year.
For the full year, revenue fell by 22% to $2.84 billion, compared to $3.66 billion in 2021.
Core income for the fourth quarter was $810 million, down from $1.28 billion the previous year. Travelers attributed the drop to higher catastrophe losses, a lower underlying underwriting gain, and lower net investment income.
Travelers reported $2.99 billion in core income for the full year, a 15% decrease from $3.52 billion in 2021.
Furthermore, net written premiums for the quarter totaled $8.82 billion, a 10% increase over the previous year’s $7.99 billion. Travelers also reported net written premiums of $35.41 billion for the full year, an 11% increase over the previous year’s net written premiums of $31.95 billion.
Travelers’ net written premiums increased in all three of its core segments. Business insurance increased 11% to $4.39 billion, up from $3.96 billion the previous year.
Net written premiums in the Bond & Specialty Insurance line were $924 million for the quarter, a 2% increase over the previous year’s $905 million.
Finally, in its Personal Insurance segment, net written premiums increased 13% to $3.51 billion, up from $3.12 billion the previous year.
Overall, Travelers’ combined ratio was 94.5% for the quarter, compared to 88% in Q421, and 95.6% for the year, compared to 94.5% in 2021.
The underlying combined ratio for the quarter was 91.4%, up from 88.7% the previous year.
Commenting on the results, Alan Schnitzer, Chairman and Chief Executive Officer, said: “We are pleased to report solid fourth quarter 2022 results, particularly in light of the significant winter storm that swept across the U.S. and Canada in the last week of the year. Results in our commercial businesses were exceptional, with another quarter of strong growth at very attractive margins. Underlying results in Personal Insurance remain challenged by elevated industry-wide loss costs. We recorded another quarter of progress with strong pricing and other actions to address these challenges.”
He continued, “Our full year 2022 results benefited from higher core income from our commercial businesses, driven by record net earned premiums and strong profitability, including our best-ever underlying combined ratio in Business Insurance. Our high-quality investment portfolio generated after-tax net investment income of $2.2 billion for the year. Our underwriting and investment results, together with our strong balance sheet, enabled us to return nearly $3 billion of excess capital to shareholders, including more than $2 billion of share repurchases, while also growing adjusted book value per share and making important investments in our business.
“Our results this year cap off a decade of terrific performance. Over that period, we have significantly accelerated premium growth while generating superior returns with industry low volatility. Given our track record of successfully investing in differentiating capabilities and our ambitious roadmap, we are confident in the outlook for Travelers.”