Travelers Companies Inc. (NYSE: TRV) jumps over 3.5% in pre trading session on Wednesday as for the quarter ended March 31, 2023, the company reported net income of $975 million, or $4.13 per diluted share, compared to $1.018 billion, or $4.15 per diluted share, in the prior year period. Core income was $970 million, or $4.11 per diluted share, in the current quarter, compared to $1.037 billion, or $4.22 per diluted share, in the prior year quarter.
Core income fell principally as a result of greater catastrophe losses and reduced net favorable prior year reserve development, which were offset in part by a higher underlying underwriting gain and higher net investment income. The current quarter’s underlying underwriting gain includes a $211 million one-time tax advantage. This tax gain is shown in the income tax line on the Consolidated Statement of Income and so has no effect on the combined ratio or the underlying combined ratio.
Net realized investment gains were $6 million pre-tax ($5 million after-tax) in the current quarter, compared to net realized investment losses of $23 million pre-tax ($19 million after-tax) in the prior year quarter. The impact of share repurchases boosted per-diluted share amounts.
The company states that best-in-class marketplace performance drove a 12% increase in net written premiums to a record $9.4 billion this quarter, with contributions from all three sectors. In Business Insurance, net written premiums increased by 15% to $5.2 billion. Renewal premium change remained historically high in the sector at 9.6%, but retention remained very robust at 87%. New business was up 17% to a record $639 million. Net written premiums climbed marginally at Bond & Specialty Insurance, with outstanding retention of 90% and new business growth of 25% in their management liability division. Surety net written premiums were up again.
They are quite delighted with the high production performance in both of our commercial business divisions, given the favorable returns. Higher pricing drove 12% top-line increase in Personal Insurance. Renewal premium change in their Homeowners and Other business jumped to 20.2% and 13.9% in their Auto business.
With another solid quarter of profitability and growth driven by our underwriting and investing skills, the year is off to a great start. Simultaneously, we continue to execute successfully on our innovation approach, which has resulted to dramatically faster premium growth, exceptional returns, and minimal volatility in the sector over the last decade. With the greatest personnel in the business, we are well positioned for success in a variety of economic and operating circumstances, and we are confident in our ability to produce shareholder value over time.
