قالب وردپرس درنا توس
Home / Insurance / Travelers see property price increases continuing

Travelers see property price increases continuing



Traveler Cos. Inc. expects increases in property insurance to continue into 2023 after Hurricane Ian as reinsurers’ increases and capacity constraints take their toll, the insurer’s top executives said Wednesday.

Travelers will be less affected by rising reinsurance costs because they don’t buy as much reinsurance as some insurers do, they said on a conference call with analysts discussing the insurer’s third-quarter results.

A constellation of factors will put upward pressure on property pricing and could extend to other parts of the market, Travelers CEO Alan Schnitzer said.

“Given what we expect will happen with reinsurance, there will be a rate requirement and beyond that capacity constraints that will be significant across the market,”

; he said.

Travelers reported third-quarter net income of $454 million, down 31% from a year earlier, as Hurricane Ian losses, lower investment income and realized investment losses hit the company’s bottom line.

However, the insurer saw revenues increase as rates and insured exposures increased.

Pretax catastrophe losses totaled $512 million in the quarter, up 2.3% from a year earlier, of which $326 million was related to Hurricane Ian, Travelers said.

Travelers’ share of Hurricane Ian’s losses based on estimates is favorable relative to its market share, Schnitzer said. The insurer has more effectively managed its catastrophe exposure and more effectively mobilized its claims response in recent years, he said.

The insurer’s total expense ratio improved to 98.2% during the quarter, compared to 98.6% the previous year. This was partially offset by a higher underlying total cost percentage.

Net investment income fell 23% to $593 million before tax. Realized net investment losses were $93 million before tax, compared to net realized investment gains of $8 million before tax in the prior quarter.

Net income premium increased 10.5% to $9.198 billion.

In the business insurance division, net premiums increased 9% to $4.37 billion, but segment revenue fell 16% to $471 million after tax.

Lower net investment income and higher catastrophe losses were partially offset by lower adverse net reserve development in the prior year and a higher underwriting gain, Travelers said.

Net premium growth was driven by growth in all domestic markets and industries, said Greg Toczydlowski, managing director of business insurance at Travelers.

“Premiums benefited from a strong turnaround and retention of renewal premiums, both of which were again historically high, as well as higher levels of new business,” Toczydlowski said.

Renewal premium change for domestic business increased 10.2% for the quarter, he said.

Its bond and specialty division reported an 8% increase in net premium income to $964 million, and segment revenue rose 39% to $242 million.


Source link