Catastrophe losses drove the company's combined ratio up 13.9 points to 104.5.

For the first nine months of this year, net income dropped $1.5 billion to $808 million over the same period last year. Net income per share dropped $2.80 a share to $1.88. Revenues have increased 2 percent, or $293 million, to $19.1 billion. Net premium written is up 3 percent, or $525 million, to $19.9 billion.

The combined ratio over the first nine months of 2011 increased 14.2 points to 108.3.

In a statement, Jay Fishman, chairman and chief executive officer of Travelers says the company has increased its efforts to improve pricing in its underwriting. He says the company's “competitive advantages” will enable it to make those price increases stick. Following the “wind and hail storms, we further emphasized and accelerated these efforts.”

During a conference call today with financial analyst's, Fishman and Brian MacLean, Traveler's president and chief operating officer, say that they have instructed underwriters to close any underwriting price gaps between new and renewal business. They say underwriting margins are above loss trends and that they need to keep a close eye on those trends in the future.

“By the time we get to the second quarter, I would believe that the combined ratio would begin to shrink,” Fishman told an analyst.

Fishman told analysts that the increases the company seeks has nothing to do with market cycles and executives made the decision last year that it was necessary for Travelers to begin seeking rate increases.

“We're not reacting to the marketplace,” Fishman points out. “We're just deciding for ourselves what we're going to do and how we're going to price the product. We'll see what happens.”

He laid out the company's strategy, saying, “We are seeking improved pricing as well as terms and conditions on the insurance products we sell. We are doing so not only because interest rates may remain low for some time, but also given the possibility that the more active weather patterns, such as we have experienced over the past few years, may continue.”

He notes the company's strategy is bearing fruit pointing to price increases sticking in its business insurance segment. Pure renewals, excluding national accounts, rose 3 percent in the quarter and just over 4 percent in the month of September.

In personal lines, increases on renewals have ranged from 8 to 9 percent and 3 to 4 percent on auto. However, due to the regulatory environment governing personal lines rate increases, Fishman says “it will take some time before our more recent actions will show in our results.”

This story was updated at 4:05 p.m. EDT with additional detail on Travelers pricing strategy from Jay Fishman