As sexy as frozen broccoli... Travelers is one of America's largest sellers of insurance to businesses and car owners — it offers everything from condo, to home, and renters' insurance (contain your excitement). While insurance may not get your heart racing, Traveler's latest quarterly earnings juuust might:
- Profit soared 50% last quarter to $1.3B, up from $873M a year earlier.
- But total sales were up just 4% for the quarter. What's with the massive profit jump?
Do less... Already did. We did way less driving, traveling, and general moving-around-ing in 2020. Travelers’ car and home insurance profits soared 40% from October to December last year while the third wave of US Covid cases hit. The forever-at-home life had us driving way less, which meant fewer accidents for Travelers to cover.
- Travelers was still collecting premiums while we were WFH'ing (but it spent significantly less on coverage).
- That means more profit — especially since Travelers didn't issue any refunds for the lower mileage, like some other insurers did.
Some companies are earnings benchmarks... With insurance earnings season kicking off, analysts watched Travelers to gauge how other car insurers might've performed. "Less mileage, more profit" could be true for others, too. Meanwhile, health care earnings might be less rosy, based on UnitedHealth's latest report: after posting its most profitable quarter ever in July, United saw quarterly earnings plunge as you finally returned to the doc's office. All those postponed "revenge" visits = more bills for UnitedHealth.