The Travelers Companies, Inc.

the second quarter results teleconference for travelers. We ask that you hold all questions until the completion of formal remarks, at which time you will be given instructions for the question and answer session. As a reminder, this conference is being recorded on July 19th, 2024. At this time, I would like to turn the conference over to Ms. Abby Goldstein, Senior Vice President of Investor Relations. Ms. Goldstein, you may begin.

Thank you. Good morning, and welcome to Travelers' discussion of our second quarter 2024 results. We released our press release, financial supplement, and webcast presentation earlier this morning. All of these materials can be found on our website at travelers.com under the investor section. Speaking today will be Alan Schnitzer, Chairman and CEO, Dan Fry, Chief Financial Officer, and our three segment presidents, Greg Teslowski of Business Insurance, Jeff Clank of Bond and Specialty Insurance, and Michael Klein of Personal Insurance. They will discuss the financial results of our business and the current market environment. They will refer to the webcast presentation as they go through prepared remarks, and then we will take your questions. Before I turn the call over to Alan, I'd like to draw your attention to the explanatory note included at the end of the webcast presentation. Our presentation today includes forward-looking statements. The company cautions investors that any forward-looking statement involves risks and uncertainties and is not a guarantee of future performance. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. These factors are described under forward-looking statements in our earnings press release and in our most recent 10Q and 10K filed with the SEC. We do not undertake any obligation to update forward-looking statements. Also in our remarks or responses to questions, we may mention some non-GAAP financial measures. Reconciliations are included in our recent earnings press release financial supplement and other materials available in the investor section on our websites. And now I'd like to turn the call over to Alan.

Thank you, Abby. Good morning, everyone, and thank you for joining us today. We are pleased to have generated a strong bottom line result in the quarter that included a record number of severe convective storms across the United States. Excellent underlying results, favorable net prior year reserve development, and higher net investment income contributed to core income of $585 million, or $2.51 per diluted share. underlying underwriting income of $1.2 billion pre-tax was up 55% over the prior year quarter. This year's exceptional result was driven by record net earned premiums of $10.2 billion and a consolidated underlying combined ratio that improved 3.4 points to an excellent 87.7%. Net earned premiums were higher in all three of our business segments. The underlying combined ratio in our business insurance segment was an excellent 89.2%. and the underlying combined ratio in our bond and specialty business improved 1.7 points to a very strong 86.1%. Looking at our two commercial segments together, the aggregate BI-BSI underlying combined ratio was an outstanding 88.7% for the quarter. The underlying combined ratio in personal insurance improved by nearly 8 points to a terrific 86.3%. Turning to the top line, We grew net written premiums by 8% to $11.1 billion in the quarter, outstanding execution by our colleagues in the field across all three segments contributed to our top-line success. We are very pleased to report terrific production results in our commercial segments, where, as you've heard, margins are attractive. In business insurance, we grew net written premiums by 7% to more than $5.5 billion. Rural premium change remained very strong at 10.1%, while retention remained high at 85%. A combination of strong pricing and retention reflects deliberate execution on our part and a marketplace that continues to be generally disciplined. New business increased 9% to a record $732 million, a reflection of the fact that our customers and distribution partners value the products and services that we offer and the experiences that we provide. In bond and specialty insurance, we grew net written premiums by 8% to more than $1 billion, driven by very strong retention of 90% in our high-quality management liability business and excellent production in our market-leading surety business, where we grew net written premiums by 11%. At year-end 2023, we shared that across our two commercial segments, our E&S writings had reached $2.5 billion for the year, double the level from 2021. Year-to-date, we've grown E&S net written premiums by 16%. The margins continue to be quite attractive. In personal insurance, continued strong pricing drove 9% growth in net written premiums, with growth of 10% in auto and 8% in home. You'll hear more shortly from Greg, Jeff, and Michael about our segment results. Turning to investments, our high-quality investment portfolio continued to perform well. generating after-tax net investment income of $727 million, driven by strong and reliable terms from our growing fixed income portfolio and higher returns from our non-fixed income portfolio. Our investment results benefit from the strong cash flow we've generated over a sustained period. This quarter marks the seventh consecutive quarter in which we've generated more than a billion dollars in operating cash flow. This isn't to measure that we are the industry top a lot about, but it's important. Cash flow is what enables us to make strategic investments in our business, return excess capital to shareholders, and grow our investment portfolio. Since 2016, we've invested $11 billion in important technology initiatives, returned more than $20 billion of excess capital to our shareholders, and grown our investment portfolio by more than $25 billion. It's a virtuous cycle, as well-conceived and executed strategic initiatives, an effective capital management strategy, and a thoughtful investment strategy contribute to attractive returns and growth and adjusted book value per share. Strong underwriting is the flywheel that sets it all in motion. Thanks to exceptional franchise value and excellent marketplace execution, we've profitably grown our premium base from about $25 billion in 2016 to more than $40 billion today. Our growth over this period of time has been largely organic, selling products in which we have deep expertise through distribution partners with whom we have long-standing relationships and in geographies where we have a thorough understanding of the regulatory environment and other market dynamics. In other words, our competitive advantages have enabled us to effectively execute a relatively low-risk growth strategy. The success of that strategy is evidenced by a return on equity that has averaged about 900 basis points over the 10-year treasury over that period at industry-low volatility. What all this boils down to is steady, consistent growth and adjusted book value per share after making important investments in our business and returning substantial excess capital to shareholders. And as a leader in the US PNC market with broad product capability, demonstrated success with innovation and plenty of market share headroom, we're confident there's a lot more opportunity in front of us. To sum it up, we continue to be very confident in the outlook for our business. Our results for the first half of the year include strong premium growth, an excellent bottom line result, record operating cash flow, and steadily rising investment returns in our growing fixed income portfolio. With a strong and diversified business and balance sheet, we delivered 13.6% core return on equity over the last 12 months, despite substantial industry-wide catastrophe losses. With this momentum, we remain well positioned for success this year and beyond. And with that, I'm pleased to turn the call over to Dan.