(Compares with estimates, adds details on claims, catastrophe losses)
July 23 (Reuters) - Insurer Travelers Cos Inc missed Wall Street estimates for second-quarter profit on Tuesday, as weather-related losses led to an 18% drop in underwriting gain.
Strong wind and hailstorms during the quarter tore apart homeowners’ roofs, pummeled cars and wreaked havoc, triggering a spate of claims that proved to be challenging for U.S. insurers including Travelers.
Claims rose 5.7% to $4.82 billion, leading to a drop in underwriting gain to $74 million in the quarter.
Catastrophe losses, net of reinsurance, fell 25% to $367 million but was better compared with a year earlier when it was $488 million.
New York-based Travelers, often seen as a bellwether for the insurance sector as it typically reports before its competitors, said net written premiums rose 4.5% to $7.45 billion.
Net investment income rose 9% to $648 million, due to higher returns from its fixed income and private equity portfolio business.
The company reported a combined ratio of 98.4% compared with 98.1% a year earlier. A ratio below 100% means the insurer earns more in premiums than it pays out in claims.
Net income rose to $557 million, or $2.10 per share, in the quarter ended June 30, from $524 million, or $1.92 per share, a year earlier. (reut.rs/2O8PJnl)
On an adjusted basis, the company earned $2.02 per share, while analysts were expecting $2.28 per share, according to IBES data from Refinitiv.
Total revenue rose 4.8% to $7.83 billion. (Reporting by Bharath Manjesh in Bengaluru; Editing by Shounak Dasgupta and Arun koyyur)
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