(Reuters) -Loews Corp reported a rise in third-quarter profit on Monday, as lower catastrophe losses benefited its insurance unit.
Insurance spending has been steady despite mounting macroeconomic uncertainty as businesses and individuals continued to seek protection against financial risks, property damage and natural disasters.
The absence of major catastrophes can cause a tailwind to insurers as losses from hurricanes, wildfires and storms – key swing factors for the industry – often affect earnings despite efforts to price in risks and share them through reinsurance.
Loews operates in insurance, energy, hospitality and packaging via units including CAN Financial, Boardwalk Pipelines, Loews Hotels and Altium Packaging.
The company rakes in the bulk of its revenue from CAN Financial, the insurance giant in which it owns a more than 90% stake, according to data compiled by LSEG.
The New York-based company said its insurance unit’s core income increased 40% to $409 million from a year ago, helped by lower catastrophe-related losses, improved underlying underwriting results and higher net investment income.
Loews’ insurance unit reported an underlying combined ratio of 92.8% in its property and casualty business due to lower catastrophe losses, compared with 97.2% a year earlier.
A ratio below 100% means an insurer earned more in premiums than it paid out in claims.
Net income attributable to Loews rose to $504 million, or $2.43 per share, in the three months ended September 30, compared with $401 million, or $1.82 per share, a year earlier.
Loews stock has risen nearly 17.6% this year, compared with a 16.3% rise in the benchmark S&P 500 index.
(Reporting by Prakhar Srivastava in Bengaluru; Editing by Shreya Biswas)
Comments