Travelers Companies, Inc. (NYSE:TRV) on Wednesday reported fourth-quarter 2025 earnings results, surpassing both EPS and revenue estimates.
Earnings Details
Sales rose 4% year over year (Y/Y) to $12.43 billion, outpacing analyst consensus estimates of $10.98 billion.
The company posted adjusted EPS of $11.13, beating the street view of $8.80.
Core income increased 18% Y/Y to $2.51 billion, led by stronger underlying underwriting results, higher net investment income, lower catastrophe losses, and increased favorable prior-year reserve development.
Net realized investment loss stood at $20 million pre-tax ($15 million after-tax), versus $55 million pre-tax ($44 million after-tax) in the prior year quarter.
Net investment income increased 10% Y/Y pre-tax to $1.054 billion in the quarter, led by higher average invested assets and increased average yield in the long-term fixed income investment portfolio.
Net written premiums rose 1% Y/Y to $10.86 billion in the quarter under review.
The combined ratio improved by 3.0 points to 80.2% in the quarter, aided by a higher underlying combined ratio (1.8 points), lower catastrophe losses (0.7 points), and increased net favorable prior-year reserve development (0.5 points).
Adjusted book value per share of $158.01, which excludes net unrealized investment losses, increased 14% over year-end 2024.
Segment Review
Business Insurance segment: Net written premiums rose 2% Y/Y to $5.5 billion, driven by growth in Select Accounts small commercial business (+4% Y/Y) and core Middle Market business (+3% Y/Y).
Bond & Specialty Insurance: Net written premiums reached $1.1 billion, up 4% Y/Y, supported by production growth in both surety and management liability.
Personal Insurance: Net written premiums totaled $4.2 billion, flat Y/Y, in the quarter.
Buyback & Dividend
The company repurchased 5.8 million shares during the quarter for a total cost of $1.65 billion.
As of December 31, 2025, the company had $2.015 billion of capacity under its share repurchase authorizations. The Board also approved an additional $5.0 billion share repurchase authorization.
The company declared a regular quarterly dividend of $1.10 per share, payable on March 31, to shareholders of record as of the close of business on March 10, 2026.
Management Commentary
“The business performed exceptionally well across the board, as strong underlying profitability, net favorable prior year reserve development and a lower level of catastrophe losses drove the improvement. All three segments delivered excellent underwriting results on both an underlying and an as-reported basis. Our high-quality investment portfolio generated after-tax net investment income of $867 million,” said Alan Schnitzer, chairman and CEO.
“Our investment expertise, growing portfolio and higher reinvestment rates are delivering meaningful growth in net investment income. Operating from this position of strength, we remain highly confident in the outlook for Travelers in 2026 and beyond.”
TRV Price Action: Travelers Companies shares were down 0.41% at $268.50 during premarket trading on Wednesday, according to Benzinga Pro data.
Photo via Shutterstock
