How did Travelers perform in the fourth quarter of 2024?

Travelers reported Q4 2024 net income of $2.082 billion ($8.96 per diluted share), up 28% from the prior year, and core income of $2.126 billion ($9.15 per diluted share), up 31%. The combined ratio improved to 83.2%, driven by a stronger underlying underwriting result and higher net favorable prior year reserve development.

What is the company's exposure to the recent Los Angeles wildfires?

Management acknowledged the wildfires and said the company will support affected customers. The release does not quantify the expected losses, which were not included in Q4 catastrophe results. Investors should look for a loss estimate in future disclosures, since wildfire losses could materially affect 2025 catastrophe costs.

Are there any concerns in the reserve or capital picture?

Reserves were a mixed picture: Q4 included $262 million of favorable development, but full-year Business Insurance included a $242 million addition to asbestos reserves. Capital remains healthy, with debt-to-capital of 22.4% (20.3% excluding unrealized losses), within the company's 15% to 25% target range. Unrealized investment losses rose to $4.609 billion pre-tax due to higher interest rates.

What does the capital return program look like going forward?

Travelers repurchased $252 million of stock in Q4 and had $5.04 billion of remaining authorization at year-end. The board declared a regular quarterly dividend of $1.05 per share, payable March 31, 2025, to holders of record on March 10, 2025.

Are these results final?

No. The financial supplement and certain balance sheet and cash flow figures are marked preliminary and unaudited. The Form 10-K, which the release says will be filed with the SEC, may include revisions to these numbers.

TRV 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed January 22, 2025. Cited figures are marked; the original filing is the authoritative source.

The Travelers Companies (TRV) reported strong fourth-quarter and full-year 2024 results, announced January 22, 2025.

Q4 2024 net income was $2.082 billion^a ($8.96 per diluted share, up 28%) and core income was $2.126 billion ($9.15 per diluted share, up 31%). The consolidated combined ratio improved 2.6 points to 83.2%, and the underlying combined ratio improved 1.9 points to 84.0%. Net written premiums rose 7% to $10.742 billion, and net investment income grew 23% pre-tax.

For full year 2024, net income and core income were each about $5 billion^b, core return on equity was 17.2%, and record operating cash flow was $9.074 billion. Book value per share rose 13% to $122.97, and adjusted book value per share rose 13% to $139.04. Management highlighted the company's exposure to the Los Angeles wildfires, which occurred after quarter end and are referenced in the forward-looking risk factors.

The release does not quantify a loss estimate for those wildfires, so investors should watch for that in subsequent disclosures. Q4 catastrophe losses were modest at $175 million^c pre-tax, mainly from Hurricane Milton and an increase in Hurricane Helene estimates, but full-year catastrophe losses were $3.335 billion pre-tax (8.0 points on the combined ratio). Favorable prior year reserve development of $262 million in Q4 supported results, although a $242 million addition to asbestos reserves was recorded in Business Insurance during the year.

Capital position remained solid. Debt-to-capital was 22.4% (20.3% excluding unrealized investment losses), within the 15% to 25% target range. The company repurchased $252 million^d of stock in the quarter, leaving $5.04 billion of authorization capacity, and declared a quarterly dividend of $1.05 per share.

Statutory capital and surplus was $27.7 billion. All figures are preliminary and unaudited until the Form 10-K is filed.

02—Key points

Key Highlights

Q4 2024 core income of $2.126 billion ($9.15 per diluted share, up 31%) reflected strong underlying underwriting and higher net investment income.
Consolidated combined ratio improved 2.6 points to 83.2%; underlying combined ratio improved 1.9 points to 84.0%, with all three segments contributing.
Net written premiums grew 7% in Q4 to $10.742 billion and 8% for the year to a record $43.356 billion, with growth across all segments.
Net investment income rose 23% pre-tax in Q4 to $955 million, driven by higher fixed income yields and private equity returns.
Full-year 2024 core return on equity was 17.2%, and record operating cash flow was $9.074 billion.
Adjusted book value per share grew 13% to $139.04; $2.1 billion was returned to shareholders in 2024 through dividends and buybacks.
Exposure to the Los Angeles wildfires is a forward-looking risk; the release does not quantify the loss, and full-year catastrophe losses were $3.335 billion pre-tax.

03—Questions

Frequently Asked Questions

How did Travelers perform in the fourth quarter of 2024?
Travelers reported Q4 2024 net income of $2.082 billion ($8.96 per diluted share), up 28% from the prior year, and core income of $2.126 billion ($9.15 per diluted share), up 31%. The combined ratio improved to 83.2%, driven by a stronger underlying underwriting result and higher net favorable prior year reserve development.
What is the company's exposure to the recent Los Angeles wildfires?
Management acknowledged the wildfires and said the company will support affected customers. The release does not quantify the expected losses, which were not included in Q4 catastrophe results. Investors should look for a loss estimate in future disclosures, since wildfire losses could materially affect 2025 catastrophe costs.
Are there any concerns in the reserve or capital picture?
Reserves were a mixed picture: Q4 included $262 million of favorable development, but full-year Business Insurance included a $242 million addition to asbestos reserves. Capital remains healthy, with debt-to-capital of 22.4% (20.3% excluding unrealized losses), within the company's 15% to 25% target range. Unrealized investment losses rose to $4.609 billion pre-tax due to higher interest rates.
What does the capital return program look like going forward?
Travelers repurchased $252 million of stock in Q4 and had $5.04 billion of remaining authorization at year-end. The board declared a regular quarterly dividend of $1.05 per share, payable March 31, 2025, to holders of record on March 10, 2025.
Are these results final?
No. The financial supplement and certain balance sheet and cash flow figures are marked preliminary and unaudited. The Form 10-K, which the release says will be filed with the SEC, may include revisions to these numbers.

04—Continue

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