Here’s Why Insurance Stocks are Popping

Travelers Cos. (NYSE:TRV) shares rose 5.6%, as investors focused on the insurer’s ability to push through higher rates in the face of severe weather and reviewed the impact of Hurricane Irene and several more storms that fell short of disaster status.

Hit with $394 million in after-tax catastrophe losses third-quarter profit fell 67% from a year ago, but it was less than disaster costs incurred in the second quarter: $1.09 billion after taxes. Travelers’ confidence in its ability to raise rates also helped to give a boost to shares of other insurers such as Chubb Corp. (NYSE:CBand ACE Ltd. (NYSE:ACE) both rallied, while Allstate Corp. (NYSE:ALL) jumped too.

Travelers’(NYSE:TRV) stock was up $2.93 at $54.39 as the best-performing component of the Dow Jones Industrial Average (NYSE:DIAand one of the biggest winners on the S&P 500 Index (NYSE:SPY).