[Consolidated Results](index=2&type=section&id=Consolidated%20Results) [Financial Highlights](index=2&type=section&id=Financial%20Highlights) The company reported strong growth in the second quarter and year-to-date 2025, with significant increases in net income, core income, and earnings per share compared to the prior year, alongside healthy growth in total equity and book value per share, and continued share repurchases and dividend payments Q2 2025 and YTD 2025 Financial Highlights (in millions) | Metric | Q2 2025 | Q2 2024 | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $1,509 | $534 | $1,904 | $1,657 | | Diluted EPS | $6.53 | $2.29 | $8.23 | $7.09 | | Core Income | $1,504 | $585 | $1,947 | $1,681 | | Diluted Core EPS | $6.51 | $2.51 | $8.42 | $7.20 | | Return on Equity | 20.9% | 8.6% | 13.4% | 13.3% | | Book Value per Share | $131.11 | $109.08 | $131.11 | $109.08 | | Adjusted Book Value per Share | $144.57 | $126.52 | $144.57 | $126.52 | - Total assets grew to **$138.9 billion** at the end of Q2 2025 from **$129.3 billion** a year prior[3](index=3&type=chunk) - The company repurchased **1.8 million shares** at a cost of **$500 million** in Q2 2025 and has repurchased **2.8 million shares** for **$750 million** year-to-date[3](index=3&type=chunk) [Reconciliation to Net Income and Earnings Per Share](index=3&type=section&id=Reconciliation%20to%20Net%20Income%20and%20Earnings%20Per%20Share) This section reconciles GAAP Net Income to the non-GAAP measure of Core Income by adjusting for after-tax net realized investment gains or losses, showing that for Q2 2025, Net Income of $1,509 million was adjusted by a $5 million after-tax realized investment gain to arrive at Core Income of $1,504 million Reconciliation of Net Income to Core Income (Q2 2025, in millions) | Item | Amount | | :--- | :--- | | Net Income | $1,509 | | Net realized investment gains, after-tax | ($5) | | **Core Income** | **$1,504** | Reconciliation of Diluted EPS (Q2 2025) | Item | Per Share Amount | | :--- | :--- | | Net Income EPS | $6.53 | | Net realized investment gains, after-tax | ($0.02) | | **Core Income EPS** | **$6.51** | [Statement of Income - Consolidated](index=4&type=section&id=Statement%20of%20Income%20-%20Consolidated) The consolidated statement of income shows a significant increase in net income for Q2 2025, driven by higher premium revenues and controlled growth in claims and expenses compared to the prior-year quarter, with year-to-date revenues growing by 6.3% to $23.9 billion and net income rising to $1.9 billion Consolidated Income Statement Highlights (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $23,926 | $22,511 | +6.3% | | Premiums | $21,631 | $20,369 | +6.2% | | Net Investment Income | $1,872 | $1,731 | +8.1% | | Total Claims and Expenses | $21,577 | $20,485 | +5.3% | | **Net Income** | **$1,904** | **$1,657** | **+14.9%** | - Pre-tax catastrophe losses, net of reinsurance, were significantly higher at **$3.19 billion** YTD 2025 compared to **$2.22 billion** YTD 2024[8](index=8&type=chunk) - Favorable prior year reserve development more than doubled to **$693 million** pre-tax YTD 2025 from **$321 million** YTD 2024[8](index=8&type=chunk) [Net Income by Major Component and Combined Ratio - Consolidated](index=5&type=section&id=Net%20Income%20by%20Major%20Component%20and%20Combined%20Ratio%20-%20Consolidated) The company's consolidated combined ratio improved to 90.3% in Q2 2025 from 100.2% in Q2 2024, with the underlying combined ratio also improving to 84.7%, reflecting better underwriting results despite a significant impact from catastrophes Consolidated Combined Ratio Analysis | Ratio Component | Q2 2025 | Q2 2024 | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | :--- | :--- | | Combined Ratio | 90.3% | 100.2% | 96.3% | 97.1% | | Catastrophes Impact | 8.5% | 14.7% | 14.8% | 10.9% | | Prior Year Development | (2.9)% | (2.2)% | (3.2)% | (1.5)% | | **Underlying Combined Ratio** | **84.7%** | **87.7%** | **84.7%** | **87.7%** | - The underwriting gain in Q2 2025 was **$808 million** (net of tax), a significant turnaround from an underwriting loss of **$58 million** in Q2 2024[10](index=10&type=chunk) [Core Income - Consolidated](index=6&type=section&id=Core%20Income%20-%20Consolidated) Consolidated core income, which excludes realized investment gains/losses, reached $1.50 billion in Q2 2025, a substantial increase from $585 million in the prior-year quarter, and grew to $1.95 billion for the first half of 2025 from $1.68 billion in 2024, reflecting strong underlying operational performance Core Income Performance (in millions) | Period | Core Income | Core Income Before Tax | | :--- | :--- | :--- | | Q2 2025 | $1,504 | $1,875 | | Q2 2024 | $585 | $721 | | YTD 2Q2025 | $1,947 | $2,404 | | YTD 2Q2024 | $1,681 | $2,056 | [Selected Statistics - Property and Casualty Operations](index=7&type=section&id=Selected%20Statistics%20-%20Property%20and%20Casualty%20Operations) Statutory data for Property and Casualty operations shows a 3.4% increase in net written premiums to $22.0 billion for YTD 2025, with the statutory underwriting gain improving to $571 million from $326 million in the prior year, and statutory capital and surplus growing to $28.4 billion P&C Statutory Operations (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Gross Written Premiums | $24,115 | $23,175 | | Net Written Premiums | $22,031 | $21,299 | | Statutory Underwriting Gain | $571 | $326 | | Statutory Capital and Surplus | $28,364 | $25,210 | [Written and Earned Premiums - Property and Casualty Operations](index=8&type=section&id=Written%20and%20Earned%20Premiums%20-%20Property%20and%20Casualty%20Operations) For the first half of 2025, net written premiums for Property and Casualty operations increased by 3.6% to $22.1 billion, while net earned premiums grew by 6.2% to $21.6 billion compared to the same period in 2024 P&C Premiums (YTD, in millions) | Premium Type | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Gross Written | $24,141 | $23,175 | | Net Written | $22,058 | $21,297 | | Net Earned | $21,631 | $20,369 | [Business Insurance](index=9&type=section&id=Business%20Insurance) [Segment Income - Business Insurance](index=9&type=section&id=Segment%20Income%20-%20Business%20Insurance) The Business Insurance segment reported a 5.4% increase in segment income to $1.50 billion for the first half of 2025, driven by 6.6% growth in premium revenues and an increase in net investment income, partially offset by higher catastrophe losses Business Insurance Segment Income (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Premiums | $11,010 | $10,328 | | Net Investment Income | $1,318 | $1,241 | | **Segment Income** | **$1,496** | **$1,420** | - Pre-tax catastrophe losses for the segment increased to **$877 million** YTD 2025 from **$598 million** YTD 2024[22](index=22&type=chunk) [Segment Income by Major Component and Combined Ratio - Business Insurance](index=10&type=section&id=Segment%20Income%20by%20Major%20Component%20and%20Combined%20Ratio%20-%20Business%20Insurance) The Business Insurance segment's combined ratio improved to 93.6% in Q2 2025 from 96.1% in Q2 2024, though the underlying combined ratio deteriorated slightly to 88.3% from 89.2% in the prior year quarter, reflecting performance excluding the impacts of catastrophes and reserve development Business Insurance Combined Ratio Analysis | Ratio Component | Q2 2025 | Q2 2024 | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | :--- | :--- | | Combined Ratio | 93.6% | 96.1% | 94.9% | 94.7% | | Catastrophes Impact | 6.7% | 7.5% | 8.0% | 5.8% | | Prior Year Development | (1.4)% | (0.6)% | (1.4)% | (0.3)% | | **Underlying Combined Ratio** | **88.3%** | **89.2%** | **88.3%** | **89.2%** | [Selected Statistics - Business Insurance](index=11&type=section&id=Selected%20Statistics%20-%20Business%20Insurance) On a statutory basis, the Business Insurance segment saw net written premiums grow to $11.5 billion for YTD 2025, up from $11.1 billion in the prior year, with the statutory underwriting gain increasing to $402 million from $376 million over the same period Business Insurance Statutory Data (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Gross Written Premiums | $13,099 | $12,552 | | Net Written Premiums | $11,463 | $11,137 | | Statutory Underwriting Gain | $402 | $376 | [Net Written Premiums - Business Insurance](index=12&type=section&id=Net%20Written%20Premiums%20-%20Business%20Insurance) Net written premiums in Business Insurance grew 3.2% YTD to $11.5 billion, driven by the Domestic Middle Market and International segments, with Commercial Multi-Peril and Commercial Automobile showing strong growth, while Workers' Compensation premiums declined - Total Domestic net written premiums grew to **$10.4 billion** YTD 2025 from **$10.1 billion** YTD 2024[31](index=31&type=chunk) Net Written Premiums by Product Line (YTD, in millions) | Product Line | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Commercial multi-peril | $3,018 | $2,761 | | Commercial automobile | $2,049 | $1,887 | | Commercial property | $1,924 | $1,817 | | Workers' compensation | $1,771 | $1,866 | [Bond & Specialty Insurance](index=13&type=section&id=Bond%20%26%20Specialty%20Insurance) [Segment Income - Bond & Specialty Insurance](index=13&type=section&id=Segment%20Income%20-%20Bond%20%26%20Specialty%20Insurance) The Bond & Specialty Insurance segment demonstrated strong profitability, with segment income rising 27.1% to $464 million for the first half of 2025, fueled by higher premium revenues, increased net investment income, and significant favorable prior year reserve development Bond & Specialty Insurance Segment Income (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Premiums | $2,016 | $1,933 | | Net Investment Income | $209 | $184 | | **Segment Income** | **$464** | **$365** | - Favorable prior year reserve development was a key driver, increasing to **$148 million** pre-tax YTD 2025 from **$48 million** in the prior year period[34](index=34&type=chunk) [Segment Income by Major Component and Combined Ratio - Bond & Specialty Insurance](index=14&type=section&id=Segment%20Income%20by%20Major%20Component%20and%20Combined%20Ratio%20-%20Bond%20%26%20Specialty%20Insurance) This segment maintained excellent underwriting profitability with a combined ratio of 80.3% in Q2 2025 and 81.4% year-to-date, significantly aided by net favorable prior year reserve development, which had an 8.0% positive impact on the Q2 combined ratio Bond & Specialty Insurance Combined Ratio Analysis | Ratio Component | Q2 2025 | Q2 2024 | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | :--- | :--- | | Combined Ratio | 80.3% | 87.7% | 81.4% | 86.1% | | Prior Year Development | (8.0)% | (2.5)% | (7.3)% | (2.5)% | | Catastrophes Impact | 0.5% | 4.1% | 1.2% | 2.3% | | **Underlying Combined Ratio** | **87.8%** | **86.1%** | **87.5%** | **86.3%** | [Selected Statistics - Bond & Specialty Insurance](index=15&type=section&id=Selected%20Statistics%20-%20Bond%20%26%20Specialty%20Insurance) Statutory results for the Bond & Specialty Insurance segment show a 5.1% increase in net written premiums to $2.1 billion for YTD 2025, with the statutory underwriting gain growing substantially to $316 million from $222 million in the prior year Bond & Specialty Insurance Statutory Data (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Gross Written Premiums | $2,295 | $2,203 | | Net Written Premiums | $2,084 | $1,983 | | Statutory Underwriting Gain | $316 | $222 | [Net Written Premiums - Bond & Specialty Insurance](index=16&type=section&id=Net%20Written%20Premiums%20-%20Bond%20%26%20Specialty%20Insurance) Net written premiums for the segment grew 5.1% YTD to $2.1 billion, with growth observed across both Domestic and International markets, and Surety showing stronger growth than Management Liability within the Domestic market Net Written Premiums by Market (YTD, in millions) | Market | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Domestic - Management Liability | $1,142 | $1,129 | | Domestic - Surety | $675 | $621 | | International | $267 | $233 | | **Total** | **$2,084** | **$1,983** | [Personal Insurance](index=17&type=section&id=Personal%20Insurance) [Segment Income (Loss) - Personal Insurance](index=17&type=section&id=Segment%20Income%20%28Loss%29%20-%20Personal%20Insurance) The Personal Insurance segment's income more than doubled to $160 million for the first half of 2025, up from $67 million in the prior year, an improvement despite a significant increase in catastrophe losses, supported by premium growth, higher investment income, and strong favorable prior year reserve development Personal Insurance Segment Income (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Premiums | $8,605 | $8,108 | | **Segment Income (Loss)** | **$160** | **$67** | - Pre-tax catastrophe losses surged to **$2.29 billion** YTD 2025, compared to **$1.58 billion** in the same period of 2024[46](index=46&type=chunk) - Favorable prior year reserve development increased to **$392 million** pre-tax YTD 2025 from **$239 million** YTD 2024[46](index=46&type=chunk) [Segment Income (Loss) by Major Component and Combined Ratio - Personal Insurance](index=18&type=section&id=Segment%20Income%20%28Loss%29%20by%20Major%20Component%20and%20Combined%20Ratio%20-%20Personal%20Insurance) The Personal Insurance segment's combined ratio improved to 88.4% in Q2 2025 from 108.5% in Q2 2024, though the year-to-date combined ratio remained high at 101.7% due to severe catastrophe losses in the first quarter, while the underlying combined ratio showed significant improvement, reaching 79.3% in Q2 2025 Personal Insurance Combined Ratio Analysis | Ratio Component | Q2 2025 | Q2 2024 | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | :--- | :--- | | Combined Ratio | 88.4% | 108.5% | 101.7% | 102.8% | | Catastrophes Impact | 12.7% | 26.4% | 26.6% | 19.5% | | Prior Year Development | (3.6)% | (4.2)% | (4.5)% | (2.9)% | | **Underlying Combined Ratio** | **79.3%** | **86.3%** | **79.6%** | **86.2%** | - The segment recorded an underwriting loss of **$149 million** YTD 2025, an improvement from the **$214 million** loss in YTD 2024[49](index=49&type=chunk) [Selected Statistics - Personal Insurance](index=19&type=section&id=Selected%20Statistics%20-%20Personal%20Insurance) Statutory data for the Personal Insurance segment shows a 3.7% increase in net written premiums to $8.5 billion for YTD 2025, though the segment recorded a statutory underwriting loss of $147 million, an improvement from a $272 million loss in the prior year, while policies in force continued to decline for both Automobile and Homeowners Personal Insurance Statutory Data (YTD, in millions) | Metric | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Net Written Premiums | $8,484 | $8,179 | | Statutory Underwriting Loss | ($147) | ($272) | - Policies in force at the end of Q2 2025 were down **3.1%** for Automobile and **4.6%** for Homeowners compared to the prior year[52](index=52&type=chunk)[58](index=58&type=chunk)[61](index=61&type=chunk) [Selected Statistics - Automobile](index=21&type=section&id=Selected%20Statistics%20-%20Automobile) The Automobile line showed strong underwriting performance with a combined ratio of 85.3% in Q2 2025 and 84.3% YTD, resulting in a statutory underwriting gain of $651 million YTD 2025, a significant improvement from a $122 million gain in the prior year, though policies in force declined by 3.1% year-over-year Automobile Combined Ratio Analysis (YTD) | Ratio Component | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Combined Ratio | 84.3% | 96.3% | | Underlying Combined Ratio | 88.2% | 95.1% | - Policies in force for Automobile stood at **3.083 million** at the end of Q2 2025, down from **3.180 million** a year earlier[58](index=58&type=chunk) [Selected Statistics - Homeowners and Other](index=22&type=section&id=Selected%20Statistics%20-%20Homeowners%20and%20Other) The Homeowners and Other line was heavily impacted by catastrophes, resulting in a combined ratio of 117.9% for YTD 2025, with catastrophe losses adding 50.1 points to the YTD combined ratio, leading to a statutory underwriting loss of $798 million, and policies in force declining 4.6% year-over-year Homeowners Combined Ratio Analysis (YTD) | Ratio Component | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Combined Ratio | 117.9% | 109.1% | | Catastrophes Impact | 50.1% | 35.5% | | Underlying Combined Ratio | 71.4% | 77.6% | - Pre-tax catastrophe losses for Homeowners were **$2.23 billion** YTD 2025, up from **$1.45 billion** in the prior year period[61](index=61&type=chunk) [Net Written Premiums - Personal Insurance](index=20&type=section&id=Net%20Written%20Premiums%20-%20Personal%20Insurance) Net written premiums in the Personal Insurance segment grew 3.7% YTD to $8.5 billion, driven by the Homeowners and Other line, which saw premiums increase to $4.3 billion, while Automobile premiums were slightly down Net Written Premiums by Product Line (YTD, in millions) | Product Line | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Automobile | $3,827 | $3,860 | | Homeowners and Other | $4,333 | $3,982 | | **Total Domestic** | **$8,160** | **$7,842** | [Supplemental Detail](index=23&type=section&id=Supplemental%20Detail) [Interest Expense and Other](index=23&type=section&id=Interest%20Expense%20and%20Other) This section details non-operating expenses, primarily interest on debt, showing that for the first half of 2025, total interest expense was $198 million, resulting in an after-tax loss of $173 million for this component, consistent with the prior year Interest Expense and Other (YTD, in millions) | Item | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Interest Expense | $198 | $196 | | Total Claims and Expenses | $221 | $216 | | **Loss (after tax)** | **($173)** | **($171)** | [Consolidated Balance Sheet](index=24&type=section&id=Consolidated%20Balance%20Sheet) The company's consolidated balance sheet strengthened as of June 30, 2025, with total assets increasing to $138.9 billion from $133.2 billion at year-end 2024, and total shareholders' equity growing to $29.5 billion from $27.9 billion, driven by retained earnings growth Balance Sheet Highlights (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Investments | $98,065 | $94,223 | | Total Assets | $138,873 | $133,189 | | Claims and Claim Adjustment Expense Reserves | $66,941 | $64,093 | | Total Liabilities | $109,355 | $105,325 | | Total Shareholders' Equity | $29,518 | $27,864 | [Investment Portfolio](index=25&type=section&id=Investment%20Portfolio) As of June 30, 2025, the total investment portfolio was valued at $98.1 billion, up from $94.2 billion at year-end 2024, predominantly composed of fixed maturities ($87.6 billion), with a smaller allocation to equities and other investments, and the pre-tax book yield on fixed maturities increased to 3.74% Investment Portfolio Composition (in millions) | Investment Type | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Fixed Maturities | $87,569 | $83,666 | | Equity Securities | $651 | $687 | | Other Investments | $4,206 | $4,202 | | **Total Investments** | **$98,065** | **$94,223** | - Net unrealized investment losses included in shareholders' equity improved, decreasing to **$3.03 billion** from **$3.64 billion** at year-end 2024[67](index=67&type=chunk) [Investment Portfolio - Fixed Maturities Data](index=26&type=section&id=Investment%20Portfolio%20-%20Fixed%20Maturities%20Data) The fixed maturities portfolio of $87.6 billion as of June 30, 2025, is high-quality, with 98.8% of assets rated investment grade (Baa or better), an average weighted quality of Aa2/AA, and a slightly increased weighted average duration of 4.6 years from 4.3 years at the end of 2024 - The portfolio is well-diversified, with major holdings in Corporate bonds (**$41.1 billion**), Obligations of U.S. states (**$28.6 billion**), and Mortgage-backed securities (**$13.1 billion**)[69](index=69&type=chunk) - Investment grade securities (Aaa, Aa, A, Baa) constitute **$86.5 billion**, or **98.8%** of the total fixed maturities portfolio[70](index=70&type=chunk) [Investment Income](index=27&type=section&id=Investment%20Income) Net investment income increased to $1.87 billion for the first half of 2025, up 8.1% from $1.73 billion in the prior year period, with growth primarily driven by higher income from the fixed maturities portfolio, reflecting a higher average yield on a larger asset base Net Investment Income (YTD, in millions) | Source | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Fixed Maturities | $1,645 | $1,401 | | Short-term Securities | $112 | $140 | | Other | $143 | $216 | | **Net Investment Income (Pre-tax)** | **$1,872** | **$1,731** | [Net Realized Investment Gains (Losses) and Net Unrealized Investment Gains (Losses) included in Shareholders' Equity](index=28&type=section&id=Net%20Realized%20Investment%20Gains%20%28Losses%29%20and%20Net%20Unrealized%20Investment%20Gains%20%28Losses%29%20included%20in%20Shareholders%27%20Equity) The company recorded a net realized investment loss of $55 million before tax for YTD 2025, compared to a loss of $30 million in the prior year, while the net unrealized loss position in shareholders' equity improved, narrowing to $3.03 billion at the end of Q2 2025 from $3.64 billion at year-end 2024 - For YTD 2025, the company had a net realized investment loss of **$43 million** after tax[74](index=74&type=chunk) - The balance of net unrealized investment losses, net of tax, in shareholders' equity was **$3.031 billion** as of June 30, 2025[74](index=74&type=chunk) [Reinsurance Recoverables](index=29&type=section&id=Reinsurance%20Recoverables) As of June 30, 2025, net reinsurance recoverables totaled $8.06 billion, with the majority from highly-rated reinsurers, including the top five groups (Swiss Re, Berkshire Hathaway, Munich Re, Axa, Arch) all rated A+ or better by A.M. Best - Gross reinsurance recoverables were **$8.19 billion**, offset by a **$127 million** allowance for uncollectible reinsurance[76](index=76&type=chunk) - Of the rated reinsurance recoverables, **94%** were from reinsurers rated A- or better by A.M. Best[79](index=79&type=chunk) [Net Reserves for Losses and Loss Adjustment Expense](index=30&type=section&id=Net%20Reserves%20for%20Losses%20and%20Loss%20Adjustment%20Expense) Total statutory loss reserves increased to $59.1 billion at the end of Q2 2025 from $56.3 billion at year-end 2024, with the company recording significant net favorable prior year reserve development of $693 million YTD 2025, more than double the $321 million from the prior year, with all segments contributing favorably Favorable Prior Year Reserve Development (YTD, in millions) | Segment | YTD 2Q2025 | YTD 2Q2024 | | :--- | :--- | :--- | | Business Insurance | $153 | $34 | | Bond & Specialty Insurance | $148 | $48 | | Personal Insurance | $392 | $239 | | **Total** | **$693** | **$321** | [Asbestos Reserves](index=31&type=section&id=Asbestos%20Reserves) Net asbestos reserves decreased to $1.24 billion as of June 30, 2025, down from $1.34 billion at the end of 2024, primarily due to paid losses, with no new incurred losses reported during the first half of 2025 Asbestos Reserve Roll-Forward (YTD 2025, in millions) | Item | Amount | | :--- | :--- | | Beginning Net Reserves (Dec 31, 2024) | $1,338 | | Incurred Losses (Net) | $0 | | Paid Losses (Net) | ($103) | | **Ending Net Reserves (June 30, 2025)** | **$1,237** | [Capitalization](index=32&type=section&id=Capitalization) The company maintained a strong capital position with total capital (excluding unrealized investment gains/losses) of $40.6 billion as of June 30, 2025, and the total debt to capital ratio improved to 19.8% from 20.3% at year-end 2024 Capitalization Summary (in millions) | Item | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Debt | $8,034 | $8,033 | | Common Equity (Adjusted) | $32,549 | $31,504 | | **Total Capital (Adjusted)** | **$40,583** | **$39,537** | - The total debt to capital ratio (excluding net unrealized investment gains/losses) was **19.8%** at June 30, 2025[87](index=87&type=chunk) [Statutory Capital and Surplus to GAAP Shareholders' Equity Reconciliation](index=33&type=section&id=Statutory%20Capital%20and%20Surplus%20to%20GAAP%20Shareholders%27%20Equity%20Reconciliation) This schedule reconciles the statutory capital and surplus of $28.4 billion to the GAAP shareholders' equity of $29.5 billion as of June 30, 2025, with key adjustments including the add-back of goodwill and deferred acquisition costs, and deductions for noninsurance companies and certain investment valuations Statutory to GAAP Equity Reconciliation (June 30, 2025, in millions) | Item | Amount | | :--- | :--- | | Statutory Capital and Surplus | $28,364 | | Goodwill and intangible assets | $3,644 | | Investments | ($3,305) | | Noninsurance companies | ($4,032) | | Deferred acquisition costs | $3,524 | | Other Adjustments | $339 | | **GAAP Shareholders' Equity** | **$29,518** | [Statement of Cash Flows](index=34&type=section&id=Statement%20of%20Cash%20Flows) For the first half of 2025, the company generated strong net cash from operating activities of $3.7 billion, while cash used in investing activities was $2.5 billion, primarily for net purchases of fixed maturities, and financing activities used $1.2 billion, driven by $750 million in share repurchases and $490 million in dividend payments Cash Flow Summary (YTD 2Q2025, in millions) | Cash Flow Source | Amount | | :--- | :--- | | Net Cash from Operating Activities | $3,694 | | Net Cash used in Investing Activities | ($2,524) | | Net Cash used in Financing Activities | ($1,237) | | **Net Decrease in Cash** | **($40)** | - Key uses of cash in financing activities for YTD 2025 included **$750 million** for share repurchases and **$490 million** for dividend payments[95](index=95&type=chunk) [Glossary and Segment Descriptions](index=36&type=section&id=Glossary%20and%20Segment%20Descriptions) [Glossary of Financial Measures and Description of Reportable Business Segments](index=36&type=section&id=Glossary%20of%20Financial%20Measures%20and%20Description%20of%20Reportable%20Business%20Segments) This section defines key non-GAAP financial measures used by management to evaluate performance, such as Core Income, Return on Equity, and Underlying Combined Ratio, and provides detailed descriptions of the company's three reportable business segments: Business Insurance, Bond & Specialty Insurance, and Personal Insurance - **Core Income:** Defined as net income excluding after-tax net realized investment gains/losses and other non-recurring items, used by management to analyze segment performance[99](index=99&type=chunk) - **Underlying Combined Ratio:** This is the combined ratio excluding the impact of catastrophes and prior year reserve development, used to measure core underwriting performance[106](index=106&type=chunk) - **Business Segments:** - **Business Insurance:** Offers P&C products to businesses in the U.S. and internationally, covering select accounts, middle market, and national accounts[112](index=112&type=chunk) - **Bond & Specialty Insurance:** Provides surety, fidelity, and various liability coverages (management, professional) in the U.S. and other select countries[113](index=113&type=chunk) - **Personal Insurance:** Offers auto, homeowners, and other personal P&C products to individuals, primarily in the U.S. and Canada[115](index=115&type=chunk)

Earnings Report - Travelers Companies, Inc. is set to release its second-quarter earnings results on July 17, with analysts expecting earnings of $3.37 per share, an increase from $2.51 per share in the same period last year [1] - The projected quarterly revenue is $11.02 billion, compared to $10.24 billion a year earlier [1] Business Transactions - On May 27, Travelers agreed to sell its Canadian Personal Insurance business and the majority of its Canadian Commercial Insurance business to Definity for $2.4 billion [2] - Following this announcement, Travelers shares fell by 1.9%, closing at $250.62 [2] Analyst Ratings - Wells Fargo analyst Elyse Greenspan maintained an Equal-Weight rating and raised the price target from $260 to $264 [7] - Barclays analyst Alex Scott downgraded the stock from Overweight to Equal-Weight, cutting the price target from $280 to $274 [7] - Keefe, Bruyette & Woods analyst Meyer Shields maintained an Outperform rating and increased the price target from $290 to $303 [7] - Evercore ISI Group analyst David Motemaden maintained an Outperform rating and boosted the price target from $288 to $296 [7] - Jefferies analyst Yaron Kinar maintained a Hold rating and increased the price target from $265 to $270 [7]

Industry Overview - The insurance industry is expected to be influenced by better pricing, growing climate-related risks, and rapid digitalization through 2025 [1] - Commercial insurance rates increased by 2.8% in Q2 2025, while personal lines saw a 4.6% rise [1] - Speculation around potential Federal Reserve rate cuts in 2025 may impact the insurance sector [2] Company Analysis: Berkshire Hathaway (BRK.B) - Berkshire Hathaway is a diversified conglomerate with over 90 subsidiaries, with insurance being a significant contributor, accounting for approximately 25% of total revenues [4] - The insurance segment is positioned for growth due to increased market exposure, disciplined underwriting, and favorable pricing trends [4] - The company has a strong cash position exceeding $100 billion, minimal debt, and a solid credit profile, reflecting financial resilience [7] - BRK.B's net margin improved by 190 basis points year-over-year, and its return on equity is 7.2%, slightly below the industry average of 7.8% [7] - Revenue for BRK.B is projected to rise by 8.6% in 2025, while EPS estimates indicate a decrease of 6.7% [13] Company Analysis: Travelers Corporation (TRV) - Travelers is a leading provider of auto, homeowners, and commercial property-casualty insurance in the U.S. [8] - The company maintains a combined ratio under 95%, indicating strong underwriting results [9] - TRV plans to invest over $1 billion annually in technology to enhance operational efficiency and capitalize on cyber insurance opportunities [10] - Despite a projected 14.9% decrease in EPS for 2025, TRV's revenue is expected to increase by 5.8% [14] - TRV's return on equity stands at 16.1%, outperforming the industry average [12] Valuation Metrics - BRK.B trades at a price-to-book multiple of 1.56, above its five-year median of 1.40 [16] - TRV's price-to-book multiple is 2.04, also above its five-year median of 1.77 [16] Conclusion - Berkshire Hathaway is seen as a dynamic addition to portfolios, especially with Warren Buffett's leadership, while the transition to Greg Abel as CEO in 2026 is a point of interest [18] - Travelers demonstrates steady profitability and strong underwriting discipline, but faces challenges from inflation and competition in the property and casualty insurance sector [19][20]

Core Insights - The Travelers Companies, Inc. (TRV) is anticipated to show improvements in both revenue and earnings for the second quarter of 2025, with revenue expected to reach $12.20 billion, reflecting a 7.5% growth year-over-year [1] - The earnings consensus estimate is $3.49 per share, indicating a 39% increase from the previous year, despite a slight downward revision of 0.8% in the last 30 days [2][3] Revenue and Earnings Estimates - The Zacks Consensus Estimate for TRV's second-quarter revenues is $12.20 billion, which is a 7.5% increase from the prior year [1] - The earnings estimate is $3.49 per share, with a year-over-year increase of 39% [2] Earnings Prediction Model - The earnings prediction model indicates a potential earnings beat for Travelers, supported by a positive Earnings ESP of +8.76% and a Zacks Rank of 3 (Hold) [2][3] Segment Performance - All three segments are expected to perform well, with premiums projected to increase by 7.2% to $10.9 billion, driven by better pricing and strong retention [4] - The Personal Insurance segment is estimated to generate $4.4 billion in premiums, reflecting an 8.3% improvement year-over-year [6] - The Bond & Specialty Insurance segment is expected to reach $1 billion in premiums, indicating a 12.1% increase from the previous year [7] - The Business Insurance segment is projected to generate $5.4 billion in premiums, a 5.4% increase year-over-year [9] Investment Income - Net investment income is estimated to be approximately $725 million for the second quarter, with a Zacks Consensus Estimate of $945 million, representing a 6.8% increase from the prior year [5][8] Underwriting Profitability - Improved pricing and prudent underwriting practices are expected to enhance underwriting profitability, with the combined ratio estimated at 105.5 [10] Expense Outlook - Total expenses are anticipated to rise by 6.4% to $11.4 billion, influenced by higher claims and administrative costs [11]

Core Viewpoint - Wall Street analysts anticipate that Travelers (TRV) will report quarterly earnings of $3.49 per share, reflecting a year-over-year increase of 39%, with revenues expected to reach $12.2 billion, up 7.5% from the previous year [1] Earnings Estimates - Changes in earnings estimates are crucial for predicting investor reactions to the stock, with empirical studies showing a strong relationship between earnings estimate revisions and short-term price performance [2] Revenue Estimates - Analysts project 'Total Revenues - Net investment income' to be $945.04 million, indicating a 6.8% increase from the prior year [4] - The estimate for 'Total Revenues - Fee income' is $119.98 million, reflecting a 4.3% increase from the previous year [4] - 'Total Revenues - Premiums' is expected to reach $11.04 billion, marking a 7.8% increase from the year-ago quarter [4] - The consensus estimate for 'Total Revenues - Other Revenues' stands at $109.38 million, indicating a 4.2% increase from the prior year [5] Ratios and Performance Metrics - Analysts expect the 'Combined Ratio - Consolidated' to be 99.4%, an improvement from 100.2% reported in the same quarter last year [5] - The 'Loss and loss adjustment expense ratio - Consolidated' is projected at 70.3%, down from 71.4% in the previous year [6] - The 'Underwriting Expense Ratio - Consolidated' is estimated at 29.1%, compared to 28.8% reported last year [6] - For 'Business Insurance', the 'Loss and loss adjustment expense ratio' is expected to be 67.8%, up from 66.2% a year ago [7] - The 'Combined Ratio - Business Insurance' is projected at 98.0%, compared to 96.1% in the previous year [7] - The 'Combined Ratio - Bond & Specialty Insurance' is expected to be 86.1%, down from 87.7% last year [7] - The 'Underwriting Expense Ratio - Personal Insurance' is forecasted at 25.4%, compared to 24.8% last year [8] - The 'Underwriting Expense Ratio - Business Insurance' is expected to be 30.2%, up from 29.9% in the previous year [8] Stock Performance - Over the past month, Travelers shares have recorded a return of -3.4%, while the Zacks S&P 500 composite has seen a +4% change [8]

Core Insights - The iShares U.S. Insurance ETF (IAK) offers broad exposure to the Financials - Insurance segment, appealing to both retail and institutional investors due to its low costs, transparency, flexibility, and tax efficiency [1][2] Fund Overview - IAK is a passively managed ETF launched on May 1, 2006, with assets exceeding $779.12 million, positioning it as an average-sized ETF in its category [3] - The fund aims to replicate the performance of the Dow Jones U.S. Select Insurance Index, which includes companies providing specialized financial services [4] Cost Structure - The annual operating expenses for IAK are 0.39%, which is competitive within its peer group, and it has a 12-month trailing dividend yield of 1.85% [5] Sector Exposure and Holdings - IAK is fully allocated to the Financials sector, with Progressive Corp (PGR) making up approximately 16.98% of total assets, followed by Chubb Ltd (CB) and Travelers Companies Inc (TRV) [6] - The top 10 holdings constitute about 66.91% of total assets under management [7] Performance Metrics - As of July 14, 2025, IAK has gained approximately 2.35% year-to-date and 13.53% over the past year, with a trading range between $115.29 and $138.47 in the last 52 weeks [8] - The ETF has a beta of 0.66 and a standard deviation of 18.05% over the trailing three-year period, indicating a medium risk profile [8] Alternatives - IAK holds a Zacks ETF Rank of 3 (Hold), suggesting it is a viable option for investors seeking exposure to the Financials ETFs sector [9] - Other alternatives include Invesco KBW Property & Casualty Insurance ETF (KBWP) and SPDR S&P Insurance ETF (KIE), with respective assets of $471.58 million and $827.52 million [10]

Group 1 - The Travelers Companies, Inc. is a leading property and casualty insurance provider in the United States, known for gradually increasing dividends and actively repurchasing shares over the last two decades [1] - The company has successfully served its shareholders, which has led to appreciation from investors [1] Group 2 - The CrickAnt is an actuary for an insurance company and contributes to the Cash Flow Club, focusing on company cash flows and access to capital [1] - The Cash Flow Club offers features such as access to a leader's personal income portfolio targeting a yield of over 6%, community chat, a "Best Opportunities" List, performance transparency, and coverage of various sectors including energy midstream, commercial mREITs, BDCs, and shipping [1]

Core Insights - Shares of The Travelers Companies, Inc. (TRV) have increased by 26.8% over the past year, outperforming the Finance sector and the Zacks S&P 500 composite, which grew by 17.8% and 9.1% respectively [1] - The company has a market capitalization of $59.90 billion, with an average trading volume of 1.3 million shares over the last three months [1] Stock Performance - TRV shares closed at $264.41, trading above the 50-day and 200-day simple moving averages of $263.84 and $251.68, indicating strong upward momentum [4] - The average price target from 21 analysts for TRV is $285.24 per share, suggesting a potential upside of 7.5% from the last closing price [13] Financial Projections - The Zacks Consensus Estimate for Travelers' 2025 revenues is $49.17 billion, reflecting a year-over-year growth of 5.8% [9] - The consensus estimates for 2026 earnings per share and revenues indicate increases of 30.7% and 6.3% respectively from the 2025 estimates [9] - Travelers has consistently beaten earnings estimates in the past four quarters, with an average surprise of 75.37% [9] Analyst Sentiment - Eight out of 14 analysts covering TRV have raised their estimates for 2025, and six have done so for 2026 in the past 60 days, leading to a 2.9% and 1.7% increase in the consensus estimates for those years [10] Growth Drivers - TRV is positioned for growth due to high retention rates, favorable pricing, and new business gains, with plans to introduce new products in the Bond and Specialty segment in 2025 [6][17] - The company expects fixed-income net investment income to rise from $725 million in Q2 to $790 million in Q4 2025 [6][19] Valuation Metrics - TRV shares are trading at a premium, with a price-to-book value of 2.13X compared to the industry average of 1.56X [7] - The company has a Value Score of B, indicating it is an attractive value stock [7] Return on Investment - The return on equity (ROE) for the trailing 12 months is 16.1%, significantly higher than the industry average of 7.8% [15] - The return on invested capital (ROIC) has been increasing, currently at 9%, compared to the industry average of 5.9% [16] Strategic Positioning - Travelers maintains a conservative balance sheet with a debt-to-capital ratio between 15% and 25%, and has been increasing its book value for the past decade [20] - The company has a strong presence in the U.S. property-casualty insurance market, supported by a diversified portfolio and solid capital strength [21] Dividend Policy - Travelers has increased its dividends for 21 consecutive years, with a dividend yield of 1.7%, which is attractive compared to the industry average of 0.2% [22]

Investors might want to bet on Travelers (TRV) , as it has been recently upgraded to a Zacks Rank #2 (Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change.The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.The power of a changing earnings ...

Group 1: Company Overview - Banco Santander-Chile (BSAC) is one of 857 companies in the Finance group, currently ranked 6 within the Zacks Sector Rank [2] - The Zacks Rank system emphasizes earnings estimates and revisions, with BSAC currently holding a Zacks Rank of 1 (Strong Buy), indicating a positive earnings outlook [3] Group 2: Performance Metrics - Over the past three months, the Zacks Consensus Estimate for BSAC's full-year earnings has increased by 7.3%, reflecting stronger analyst sentiment and an improving earnings outlook [4] - Year-to-date, BSAC has returned approximately 30.8%, significantly outperforming the average Finance sector return of 6% [4] Group 3: Industry Context - BSAC belongs to the Banks - Foreign industry, which includes 66 stocks and is currently ranked 19 in the Zacks Industry Rank; this industry has gained an average of 22.6% year-to-date, indicating BSAC's strong performance within its specific sector [6] - In contrast, another Finance sector stock, Travelers (TRV), has a year-to-date return of 12.9% and belongs to the Insurance - Property and Casualty industry, which is ranked 54 and has moved +8.9% year-to-date [5][6] Group 4: Investment Outlook - Investors interested in Finance stocks should continue to monitor Banco Santander-Chile and Travelers for their solid performance trends [7]