Travelers Still a Winner In Pandemic’s Judicial Backlog
$666 million reserve increase fueled by likely insurance losses that have yet to be adjudicated.
April 19, 2022
The Travelers Companies (TRV), an insurance firm, continues to benefit from the pandemic induced judicial backlog. Court backlogs spiked following COVID-19 lockdowns, delaying legal verdicts and settlements for which Travelers will one day owe clients it insures. In its latest 10-Q, Travelers revealed its claims reserve increased $666, or 1.2% from the year prior’s quarter, due in part, to:

“...reduced claim settlement activity largely due to continued disruptions in the judicial system related to COVID-19…”

Separately, as Travelers grows premium volumes it may return less capital to shareholders, due, in part, to S&P’s proposed increases in capital requirements for insurance companies. If the company is required to hold more capital to prevent downgrades of its claims-paying and financial strength ratings, Travelers may not be able to repurchase shares as in the amounts originally desired.
Related: PGR, BRK.A, BRK.B, ALL, CINF, MKL, ACGL, WRB, CNA, FNF, ORI, FAF
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