Travelers has reported catastrophe losses of $2.266 billion pre-tax for Q1 of 2025, primarily driven by the January California wildfires, leading to an underwriting loss of $305 million for the quarter.
Of Travelers’ total catastrophe loss figure in Q1 2025, $1.731 billion pre-tax ($1.368 billion after-tax) was attributed to wildfire losses in Los Angeles, while severe wind and hail storms across multiple states accounted for the remaining amount.
According to the company, the Pallisades Fire was the primary driver of the Los Angeles wildfire losses, accounting for 77% of the $1.731 billion pre-tax total, or approximately $1.339 billion. The Eaton Fire contributed an additional $392 million.
With this in mind, Travelers’ net income was $395 million for Q1 2025, down compared to $1.123 billion in Q1 2024.
As mentioned, the firm also reported an underwriting loss of $305 million and a worsened combined ratio of 102.5% in the opening quarter of 2025, compared to an underwriting gain of $577 million in Q1 2024.
Despite these setbacks, Travelers posted a core income of $443 million in Q1 2025, driven by what it described as outstanding underlying results, strong net favourable prior-year reserve development, and higher investment income, all of which more than offset the impact of the aforementioned catastrophe losses.
Travelers’ net written premiums and total revenues also expanded in the opening quarter of 2025.
Alan Schnitzer, Chairman and Chief Executive Officer of Travelers, said, “Underlying underwriting income of $1.6 billion pre-tax was up more than 30% over the prior year quarter, driven by strong net earned premiums of $10.7 billion and a consolidated underlying combined ratio that improved 2.9 points to an excellent 84.8%.
He continued, “All three segments contributed to these terrific underlying results with strong and higher net earned premiums and excellent underlying profitability. All three segments also contributed meaningful levels of net favourable prior year reserve development.
“In addition, our high-quality investment portfolio continued to perform well, generating after-tax net investment income of $763 million, driven by strong and reliable returns from our growing fixed income portfolio and positive returns from our thoughtfully managed alternative portfolio.
“We are pleased to report a substantial profit for the quarter despite the devastating January California wildfires.”
The post Travelers sees Q1’25 underwriting loss amid $2.27bn catastrophe bill appeared first on ReinsuranceNe.ws.
