Fourth Quarter 2022 Core Income per Diluted Share of
Full Year
Full Year Core Income of
Fourth quarter net income of
Results reflect record net earned premium, consolidated combined ratio of 94.5% and underlying combined ratio of 91.4%; underwriting results in commercial businesses were exceptional.
Catastrophe losses of
Net written premiums of
Net written premium growth in all three segments compared to the prior year quarter;
Total capital returned to shareholders of
Book value per share of
Board of Directors declares regular cash dividend of
Consolidated Highlights
($ in millions, except for per share amounts, and after-tax, except for premiums and revenues)
Three Months Ended
Twelve Months Ended
2022
2021
Change
2022
2021
Change
Net written premiums
$
8,829
$
7,995
10
%
$
35,414
$
31,959
11
%
Total revenues
$
9,636
$
9,011
7
$
36,884
$
34,816
6
Net income
$
819
$
1,333
(39
)
$
2,842
$
3,662
(22
)
per diluted share
$
3.44
$
5.37
(36
)
$
11.77
$
14.49
(19
)
Core income
$
810
$
1,289
(37
)
$
2,998
$
3,522
(15
)
per diluted share
$
3.40
$
5.20
(35
)
$
12.42
$
13.94
(11
)
Diluted weighted average shares outstanding
236.3
246.4
(4
)
239.7
250.8
(4
)
Combined ratio
94.5
%
88.0
%
6.5
pts
95.6
%
94.5
%
1.1
pts
Underlying combined ratio
91.4
%
88.7
%
2.7
pts
92.0
%
90.3
%
1.7
pts
Return on equity
15.8
%
18.6
%
(2.8
)
pts
12.2
%
12.7
%
(0.5
)
pts
Core return on equity
12.3
%
19.8
%
(7.5
)
pts
11.3
%
13.7
%
(2.4
)
pts
As of
2022
2021
Change
Book value per share
$
92.90
$
119.77
(22
)%
Adjusted book value per share
114.00
109.76
4
%
See Glossary of Financial Measures for definitions and the statistical supplement for additional financial data.
'We are pleased to report solid fourth quarter 2022 results, particularly in light of the significant winter storm that swept across the
'Core income for the fourth quarter was
'Our best-in-class marketplace execution produced 10% growth in net written premiums this quarter to almost
'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
'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.'
Consolidated Results
Three Months Ended
Twelve Months Ended
($ in millions and pre-tax, unless noted otherwise)
2022
2021
Change
2022
2021
Change
Underwriting gain:
$
449
$
926
$
(477
)
$
1,336
$
1,542
$
(206
)
Underwriting gain includes:
Net favorable prior year reserve development
185
95
90
649
538
111
Catastrophes, net of reinsurance
(459
)
(36
)
(423
)
(1,877
)
(1,847
)
(30
)
Net investment income
625
743
(118
)
2,562
3,033
(471
)
Other income (expense), including interest expense
(94
)
(77
)
(17
)
(340
)
(288
)
(52
)
Core income before income taxes
980
1,592
(612
)
3,558
4,287
(729
)
Income tax expense
170
303
(133
)
560
765
(205
)
Core income
810
1,289
(479
)
2,998
3,522
(524
)
Net realized investment gains (losses) after income taxes
9
44
(35
)
(156
)
132
(288
)
Impact of changes in tax laws and/or tax rates (1)
-
-
-
-
8
(8
)
Net income
$
819
$
1,333
$
(514
)
$
2,842
$
3,662
$
(820
)
Combined ratio
94.5
%
88.0
%
6.5
pts
95.6
%
94.5
%
1.1
pts
Impact on combined ratio
Net favorable prior year reserve development
(2.1
)
pts
(1.2
)
pts
(0.9
)
pts
(1.9
)
pts
(1.8
)
pts
(0.1
)
pts
Catastrophes, net of reinsurance
5.2
pts
0.5
pts
4.7
pts
5.5
pts
6.0
pts
(0.5
)
pts
Underlying combined ratio
91.4
%
88.7
%
2.7
pts
92.0
%
90.3
%
1.7
pts
Net written premiums
$
4,390
$
3,966
11
%
$
17,635
$
16,092
10
%
924
905
2
3,732
3,376
11
3,515
3,124
13
14,047
12,491
12
Total
$
8,829
$
7,995
10
%
$
35,414
$
31,959
11
%
(1) Impact is recognized in the accounting period in which the change is enacted
Fourth Quarter 2022 Results
(All comparisons vs. fourth quarter 2021, unless noted otherwise)
Net income of
Combined ratio:
The combined ratio of 94.5% increased 6.5 points due to higher catastrophe losses (4.7 points) and a higher underlying combined ratio (2.7 points), partially offset by higher net favorable prior year reserve development (0.9 points).
The underlying combined ratio of 91.4% increased 2.7 points. See below for further details by segment.
Net favorable prior year reserve development occurred in all three segments. See below for further details by segment.
Catastrophe losses primarily resulted from a significant winter storm that impacted most of the
Net investment income of
Net written premiums of
Full Year 2022 Results
(All comparisons vs. full year 2021, unless noted otherwise)
Net income of
Combined ratio:
The combined ratio of 95.6% increased 1.1 points due to a higher underlying combined ratio (1.7 points), partially offset by a smaller impact from catastrophe losses (0.5 points) and higher net favorable prior year reserve development (0.1 points).
The underlying combined ratio of 92.0% increased 1.7 points. See below for further details by segment.
Net favorable prior year reserve development occurred in all segments. See below for further details by segment.
Catastrophe losses included the fourth quarter winter storm described above, as well as Hurricanes Ian and Fiona and severe wind and hail storms in several regions of
Net investment income of
Net written premiums of
Shareholders' Equity
Shareholders' equity of
The Company repurchased 2.7 million shares during the fourth quarter at an average price of
The Board of Directors declared a regular quarterly dividend of
Business Insurance Segment Financial Results
Three Months Ended
Twelve Months Ended
($ in millions and pre-tax, unless noted otherwise)
2022
2021
Change
2022
2021
Change
Underwriting gain:
$
457
$
523
$
(66
)
$
1,244
$
640
$
604
Underwriting gain includes:
Net favorable prior year reserve development
127
74
53
381
173
208
Catastrophes, net of reinsurance
(125
)
43
(168
)
(654
)
(793
)
139
Net investment income
449
552
(103
)
1,864
2,265
(401
)
Other income (expense)
(22
)
(7
)
(15
)
(41
)
(21
)
(20
)
Segment income before income taxes
884
1,068
(184
)
3,067
2,884
183
Income tax expense
159
201
(42
)
536
499
37
Segment income
$
725
$
867
$
(142
)
$
2,531
$
2,385
$
146
Combined ratio
89.5
%
87.0
%
2.5
pts
92.5
%
95.7
%
(3.2
)
pts
Impact on combined ratio
Net favorable prior year reserve development
(2.8
)
pts
(1.8
)
pts
(1.0
)
pts
(2.2
)
pts
(1.1
)
pts
(1.1
)
pts
Catastrophes, net of reinsurance
2.8
pts
(1.0
)
pts
3.8
pts
3.8
pts
5.1
pts
(1.3
)
pts
Underlying combined ratio
89.5
%
89.8
%
(0.3
)
pts
90.9
%
91.7
%
(0.8
)
pts
Net written premiums by market
Domestic
Select Accounts
$
734
$
693
6
%
$
3,099
$
2,833
9
%
Middle Market
2,513
2,210
14
9,923
8,933
11
National Accounts
295
256
15
1,085
987
10
578
535
8
2,467
2,265
9
Total Domestic
4,120
3,694
12
16,574
15,018
10
International
270
272
(1
)
1,061
1,074
(1
)
Total
$
4,390
$
3,966
11
%
$
17,635
$
16,092
10
%
Fourth Quarter 2022 Results
(All comparisons vs. fourth quarter 2021, unless noted otherwise)
Segment income for
Combined ratio:
The combined ratio of 89.5% increased 2.5 points due to higher catastrophe losses (3.8 points), partially offset by higher net favorable prior year reserve development (1.0 points) and a lower underlying combined ratio (0.3 points).
The underlying combined ratio improved 0.3 points to a very strong 89.5%.
Net favorable prior year reserve development was primarily driven by better than expected loss experience in the domestic operations' workers' compensation product line for multiple accident years, partially offset by an addition to reserves in the domestic operations' general liability product line for excess coverages (excluding asbestos and environmental) for multiple accident years.
Net written premiums of
Full Year 2022 Results
(All comparisons vs. full year 2021, unless noted otherwise)
Segment income for
Combined ratio:
The combined ratio of 92.5% improved 3.2 points due to lower catastrophe losses (1.3 points), higher net favorable prior year reserve development (1.1 points) and a lower underlying combined ratio (0.8 points).
The underlying combined ratio improved 0.8 points to a very strong 90.9%, driven primarily by a 1.0 point improvement in the expense ratio.
Net favorable prior year reserve development was primarily driven by better than expected loss experience in the domestic operations' workers' compensation product line for multiple accident years and in the commercial property and commercial multi-peril product lines for recent accident years, partially offset by an addition to asbestos reserves of
Net written premiums of
Bond & Specialty Insurance Segment Financial Results
Three Months Ended
Twelve Months Ended
($ in millions and pre-tax, unless noted otherwise)
2022
2021
Change
2022
2021
Change
Underwriting gain:
$
201
$
147
$
54
$
830
$
569
$
261
Underwriting gain includes :
Net favorable prior year reserve development
51
24
27
222
105
117
Catastrophes, net of reinsurance
(9
)
(10
)
1
(25
)
(40
)
15
Net investment income
70
61
9
258
247
11
Other income
4
4
-
15
17
(2
)
Segment income before income taxes
275
212
63
1,103
833
270
Income tax expense
54
42
12
195
165
30
Segment income
$
221
$
170
$
51
$
908
$
668
$
240
Combined ratio
76.9
%
81.5
%
(4.6
)
pts
75.3
%
81.5
%
(6.2
)
pts
Impact on combined ratio
Net favorable prior year reserve development
(5.8
)
pts
(3.0
)
pts
(2.8
)
pts
(6.5
)
pts
(3.3
)
pts
(3.2
)
pts
Catastrophes, net of reinsurance
1.0
pts
1.2
pts
(0.2
)
pts
0.7
pts
1.3
pts
(0.6
)
pts
Underlying combined ratio
81.7
%
83.3
%
(1.6
)
pts
81.1
%
83.5
%
(2.4
)
pts
Net written premiums
Domestic
Management Liability
$
520
$
510
2
%
$
2,112
$
1,983
7
%
Surety
253
215
18
1,081
888
22
Total Domestic
773
725
7
3,193
2,871
11
International
151
180
(16
)
539
505
7
Total
$
924
$
905
2
%
$
3,732
$
3,376
11
%
Fourth Quarter 2022 Results
(All comparisons vs. fourth quarter 2021, unless noted otherwise)
Segment income for
Combined ratio:
The combined ratio of 76.9% improved 4.6 points due to higher net favorable prior year reserve development (2.8 points), a lower underlying combined ratio (1.6 points) and lower catastrophe losses (0.2 points).
The underlying combined ratio improved 1.6 points to a very strong 81.7%, driven primarily by the benefit of earned pricing.
Net favorable prior year reserve development was primarily driven by better than expected loss experience in the domestic operations' fidelity and surety product lines for recent accident years and in the general liability product line for management liability coverages for multiple accident years.
Net written premiums of
Full Year 2022 Results
(All comparisons vs. full year 2021, unless noted otherwise)
Segment income for
Combined ratio:
The combined ratio of 75.3% improved 6.2 points due to higher net favorable prior year reserve development (3.2 points), a lower underlying combined ratio (2.4 points) and lower catastrophe losses (0.6 points).
The underlying combined ratio improved 2.4 points to a very strong 81.1%, primarily driven by the benefit of earned pricing.
Net favorable prior year reserve development was primarily driven by better than expected loss experience in the domestic operations' fidelity and surety product lines for recent accident years.
Net written premiums of
Personal Insurance Segment Financial Results
Three Months Ended
Twelve Months Ended
($ in millions and pre-tax, unless noted otherwise)
2022
2021
Change
2022
2021
Change
Underwriting gain (loss):
$
(209
)
$
256
$
(465
)
$
(738
)
$
333
$
(1,071
)
Underwriting gain (loss) includes:
Net favorable (unfavorable) prior year reserve development
7
(3
)
10
46
260
(214
)
Catastrophes, net of reinsurance
(325
)
(69
)
(256
)
(1,198
)
(1,014
)
(184
)
Net investment income
106
130
(24
)
440
521
(81
)
Other income
18
21
(3
)
68
85
(17
)
Segment income (loss) before income taxes
(85
)
407
(492
)
(230
)
939
(1,169
)
Income tax expense (benefit)
(24
)
80
(104
)
(90
)
179
(269
)
Segment income (loss)
$
(61
)
$
327
$
(388
)
$
(140
)
$
760
$
(900
)
Combined ratio
105.3
%
91.1
%
14.2
pts
104.9
%
96.5
%
8.4
pts
Impact on combined ratio
Net (favorable) unfavorable prior year reserve development
(0.2
)
pts
0.1
pts
(0.3
)
pts
(0.3
)
pts
(2.2
)
pts
1.9
pts
Catastrophes, net of reinsurance
9.3
pts
2.3
pts
7.0
pts
9.0
pts
8.5
pts
0.5
pts
Underlying combined ratio
96.2
%
88.7
%
7.5
pts
96.2
%
90.2
%
6.0
pts
Net written premiums
Domestic
Automobile
$
1,614
$
1,456
11
%
$
6,482
$
5,827
11
%
Homeowners and Other
1,752
1,504
16
6,916
5,980
16
Total Domestic
3,366
2,960
14
13,398
11,807
13
International
149
164
(9
)
649
684
(5
)
Total
$
3,515
$
3,124
13
%
$
14,047
$
12,491
12
%
Fourth Quarter 2022 Results
(All comparisons vs. fourth quarter 2021, unless noted otherwise)
Segment loss for
Combined ratio:
The combined ratio of 105.3% increased 14.2 points due to a higher underlying combined ratio (7.5 points) and higher catastrophe losses (7.0 points), partially offset by net favorable prior year reserve development compared to net unfavorable prior year reserve development in the prior year quarter (0.3 points).
The underlying combined ratio of 96.2% increased 7.5 points, driven primarily by elevated losses in both the automobile and homeowners and other product lines, partially offset by a lower expense ratio.
Net favorable prior year reserve development was not significant in the quarter.
Net written premiums of
Full Year 2022 Results
(All comparisons vs. full year 2021, unless noted otherwise)
Segment loss for
Combined ratio:
The combined ratio of 104.9% increased 8.4 points due to a higher underlying combined ratio (6.0 points), lower net favorable prior year reserve development (1.9 points) and higher catastrophe losses (0.5 points).
The underlying combined ratio of 96.2% increased 6.0 points, driven primarily by elevated losses in both the automobile and homeowners and other product lines, partially offset by a lower expense ratio.
Net favorable prior year reserve development was not significant in the current year.
Net written premiums of
Financial Supplement and Conference Call
The information in this press release should be read in conjunction with the financial supplement that is available on our website at www.travelers.com. Travelers management will discuss the contents of this release and other relevant topics via webcast at
Following the live event, replays will be available via webcast for one year at http://investor.travelers.com and by telephone for 30 days by dialing 1.800.770.2030 within
About Travelers
Travelers may use its website and/or social media outlets, such as Facebook and Twitter, as distribution channels of material Company information. Financial and other important information regarding the Company is routinely accessible through and posted on our website at http://investor.travelers.com, our Facebook page at https://www.facebook.com/travelers and our Twitter account (@Travelers) at https://twitter.com/travelers. In addition, you may automatically receive email alerts and other information about Travelers when you enroll your email address by visiting the Email Notifications section at http://investor.travelers.com.
Travelers is organized into the following reportable business segments:
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