Travelers Profits Rise on High Retentions

NEW YORK (TheStreet) -- Travelers(TRV) posted strong fourth-quarter earnings amid high retention rates.

Travelers reported fourth-quarter net income of $1.29 billion, or $2.36 a share, compared with $801 million, or $1.35 a share, the same period last year. Operating income, excluding items, in the quarter was $1.16 billion, or $2.12 a share.

Travelers posted $6.5 billion in revenue during the fourth quarter, an increase of 11% from the prior year quarter.

"Our retention rates remained high and the impact of renewal rate changes on premiums remained positive across all three of our business segments," said Jay Fishman, Travelers' chief executive, in a statement. "This pricing dynamic is generally better than recent industry surveys and reflects our targeted pricing actions, the property and casualty market segments in which we compete, our strong underwriting capabilities and our success in differentiating Travelers to our independent agents, brokers and customers by the value we provide through our products and services."

Travelers' said that business insurance achieved strong underwriting results in the quarter as evidenced by its 78.8% combined ratio. The company said that although the impact on net written premiums from the economic downturn remained evident during the quarter, Travelers once again produced positive renewal rate changes, strong retentions and stable new business levels.

Financial, professional and international insurance net written premiums of $938 million were consistent with the prior-year quarter.

The company said that its personal insurance segment continues to deliver strong profits as demonstrated by its 90.4% combined ratio in the quarter.