01—Abstract
Summary
Summary of the 10-K filed February 17, 2022. Cited figures are marked; the original filing is the authoritative source.
The Travelers Companies, Inc. reported strong financial performance for the fiscal year ending December 30, 2021.
Net income increased by 36% year-over-year to $3.66 billiona, translating to diluted earnings per share of $14.49. This robust growth was driven by higher net investment income, improved underwriting margins across its Business Insurance and Bond & Specialty Insurance segments, and a significant increase in net favorable prior year reserve development. The company also saw an 8% increase in gross written premiums and a 7% increase in net written premiums, reflecting growth across its core segments, particularly in Bond & Specialty Insurance.
Despite elevated catastrophe losses, notably from Hurricane Ida, the company maintained a combined ratio of 94.5%, a slight improvement from the previous year. Travelers continues to focus on disciplined underwriting and risk management, supported by a strong balance sheet with total investments of $87.38 billionb. The company also demonstrated a commitment to shareholder returns, with $3.08 billion returned through share repurchases and dividends, underscoring its financial strength and confidence in future operations.
02—Key points
Key Highlights
- Net income increased by 36% year-over-year to $3.66 billion.
- Diluted earnings per share rose to $14.49, a 38% increase from the prior year.
- Gross written premiums grew by 8% to $34.24 billion, and net written premiums increased by 7% to $31.96 billion.
- Combined ratio improved to 94.5%, indicating better underwriting efficiency.
- Catastrophe losses were significant at $1.85 billion but were managed effectively within the company's reinsurance framework.
- Net investment income increased by 36% to $3.03 billion.
- Shareholders received $3.08 billion in capital returns through dividends and share repurchases.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 17, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $34.82B$31.98B | +8.9% |
| SG&A Expenses | $4.68B$4.51B | +3.7% |
| Interest Expense | $340.00M$339.00M | +0.3% |
| Net Income | $3.66B$2.70B | +35.8% |
| EPS (Basic) | $14.63$10.56 | +38.5% |
| EPS (Diluted) | $14.49$10.52 | +37.7% |
| Shares Outstanding (Basic) | 248.50M253.50M | −2.0% |
| Shares Outstanding (Diluted) | 250.80M254.60M | −1.5% |
05—Questions
Frequently Asked Questions
What was Travelers' net income and earnings per share for fiscal year 2021?
The Travelers Companies, Inc. reported a net income of $3.66 billion, or $14.49 per diluted share, for the fiscal year ended December 30, 2021. This represents a significant increase from the previous year, driven by strong investment performance and improved underwriting results.
How did Travelers' premium volumes perform in 2021?
Travelers experienced robust premium growth in 2021. Gross written premiums increased by 8% to $34.24 billion, and net written premiums grew by 7% to $31.96 billion. This growth was distributed across its main segments, with Bond & Specialty Insurance showing particularly strong performance.
What was the impact of catastrophes on Travelers' results in 2021?
Travelers incurred $1.85 billion in catastrophe losses in 2021, primarily due to events like Hurricane Ida and severe weather events. While these losses impacted profitability, the company's reinsurance programs helped mitigate the full financial impact, contributing to a combined ratio of 94.5%.
How did Travelers manage its investment portfolio and what was the contribution to earnings?
Travelers maintained a high-quality, diversified investment portfolio with $87.38 billion in total investments, 93% of which are in fixed maturities and short-term securities. Net investment income increased by 36% to $3.03 billion in 2021, reflecting strong market performance, particularly in private equity partnerships, and a higher average investment base.
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