Core income for the quarter was $879 million or $3.45 per diluted share, generating a core return on equity of 13.7%.
In terms of underwriting results, higher underlying underwriting income and net favorable prior year reserve development, as well as a lower level of catastrophe losses, all contributed to higher core income.
Underlying underwriting income was 8% higher than in the prior year quarter, driven by record net earned premiums of $7.6 billion and an excellent underlying combined ratio of 91.4%.
In Business Insurance, net earned premiums were higher and the underlying combined ratio improved by 3.7 points.
Our high-quality investment portfolio generated net investment income of $682 million after tax, reflecting very strong returns in our non-fixed income portfolio.
These excellent results, together with our strong balance sheet, enabled us to grow adjusted book value per share by 13% over the past year after making important investments for the future and returning significant excess capital to our shareholders.
During the quarter, we returned $625 million of excess capital to shareholders, including $401 million of share repurchases.
During the quarter, we grew net written premiums to $8.1 billion, an increase of 11% or 8% after adjusting for the auto premium refunds in the prior year quarter.
In Business Insurance, net written premiums grew by 5%, driven by retention, which ticked up almost 1 point; renewal premium change at a near record high of 9.5%; and 9% growth in new business.
Inside renewal premium change, pure renewal rate change was a strong 7.1%.
In Bond & Specialty Insurance, net written premiums increased by 16%, driven by record renewal premium change of 12.7% in our management liability business, while retention remained strong.
Net written premiums increased 8% after adjusting for the auto premium refunds in the prior year quarter.
We've accelerated our domestic auto policies in force growth from 1% to 4% over the last six quarters, bringing PIF count to a record high.
Core income for the second quarter was $879 million compared to a core loss of $50 million in the prior year quarter.
Our second quarter results include $475 million of pre-tax cat losses compared to $854 million in last year's second quarter.
On a year-to-date basis, we have accumulated about $1.5 billion of qualifying losses toward the aggregate retention of $1.9 billion on our property aggregate catastrophe XOL Treaty.
The Treaty provides $350 million of coverage on the first $500 million of losses above the aggregate retention amount.
Underlying underwriting income increased 8% to $617 million pre-tax, reflecting a higher level of earned premium in each of our segments and a strong underlying combined ratio of 91.4%, consistent with the prior year.
The underlying loss ratio came in at 61.7%, up 1.3 points from last year's second quarter as the beneficial impact of earned pricing in excess of loss trend was more than offset by the comparison to a very low pandemic-related personal auto loss ratio in the year ago quarter.
Expense ratio of 29.7% is 1.3 points lower than the prior year quarter as last year's result was elevated primarily due to the premium refunds we provided to our personal auto customers.
In Personal Insurance, both auto and property losses came in better than expected for recent accident years, resulting in $65 million pre-tax net favorable PYD.
In Bond & Specialty Insurance, $44 million of pre-tax, net favorable PYD was driven by favorable loss experience in surety and fidelity related to recent accident years.
In Business Insurance, net favorable prior year reserve development of $73 million was driven by better-than-expected loss experience in workers' comp across multiple accident years, partially offset by reserve strengthening in our run-off book.
Net investment income improved to $682 million after tax this quarter.
Our non-fixed income portfolio turned in particularly strong results this quarter, reflecting performance in the equity markets, contributing $265 million after tax.
For the remainder of 2021, we expect fixed income NII, including earnings from short-term securities, of between $425 million and $435 million after tax per quarter.
Operating cash flows for the quarter of $1.8 billion were again very strong.
All our capital ratios were at or better than target levels and we ended the quarter with holding company liquidity of approximately $2.4 billion.
During the second quarter, we took advantage of favorable market conditions and raised $750 million to help fund the future growth with a 30-year debt issuance at 3.05%, representing our second lowest 30-year coupon ever and achieving one of the tightest spreads ever for a 30-year note issued by an insurance company.
And accordingly, our after tax net unrealized investment gain increased from $2.8 billion as of March 31 to $3.2 billion at June 30.
Adjusted book value per share, which excludes net unrealized investment gains and losses, was $103.88 at quarter end, up 4% since year-end and up 13% year-over-year.
We returned $625 million of capital to our shareholders during the second quarter with $224 million of dividends and $401 million in share repurchases.
In the annual reset for the 2021 hurricane season, the attachment point was adjusted from $1.87 billion to $1.98 billion while the total cost of the program was flat year-over-year.
Segment income was $643 million for the quarter compared to a loss of $58 million in the prior year quarter.
We're particularly pleased with the underlying combined ratio of 93.3%, which improved by 3.7 points from the second quarter of 2020, primarily attributable to three things.
First, about 2 points of the improvement resulted from earned pricing exceeding loss cost trends.
Another 0.5 point or so resulted from lower non-cat weather.
In terms of non-cat weather, while the year-over-year improvement was about a 0.5 point favorable, as I just mentioned, this quarter's result was about 1.5 point better than what we assumed for the quarter.
Net written premiums were up 5%, benefiting from strong renewal premium change, including both strong renewal rate and exposure levels that are trending back to pre-pandemic levels and higher year-over-year new business volumes.
As for domestic production, renewal premium change was 9.5%, a historically high result and up almost 4 points from the second quarter of last year.
Underlying the RPC, we achieved strong renewal rate change of 7.1% and healthy exposure growth that reflects improving trends in our customers' outlook for their businesses.
New business was up more than 9% with both select and middle-market contributing.
While this quarter's renewal rate change of 7.1% remains well in excess of loss trends, it was a little lower sequentially.
As illustrated on Slide 12, in our middle market and national property businesses, we achieved rate increases in 84% of the accounts that renewed in the second quarter, up from 81% in last year's second quarter.
As for the individual businesses, in Select, renewal rate change was 4.3%, more than 2 points higher than the second quarter of 2020, while retention was 80%.
Exposure growth was up over 4% for the quarter, which is an encouraging sign as the economy reopens.
Lastly, new business was up 6% over the prior year quarter, driven by the continued success of our new BOP 2.0 product, which is now live in 31 states.
In middle market, renewal premium change of over 9% and retention of 87% were both historically high.
Renewal rate change at 7.4% remained strong and well in excess of loss trends.
Finally, new business was up 16% over the prior year quarter, driven by the success with larger accounts, as well as some improvement in the quality of the flow in the market.
Segment income was $187 million, considerably more than double the prior year quarter, driven by favorable prior year reserve development, a significantly improved underlying underwriting margin and higher business volumes.
The underlying combined ratio of 83.4% improved by over 4.5 points from the prior year quarter as pricing that exceeded loss cost trends drove a lower underlying loss ratio.
Net written premiums grew an exceptional 16% in the quarter with solid contributions from all our businesses.
In management liability renewal premium change was a record 12.7%, driven by near record rate.
Retention remained strong at 86%.
New business increased 6% from the second quarter of last year; our first quarterly increase since the beginning of the pandemic with strong new business pricing.
Segment income of $121 million was up $111 million from the prior year quarter, benefiting from lower catastrophes, higher net investment income and higher net favorable prior year reserve development.
Our second quarter combined ratio improved from the prior year quarter by about 1.5 points to 99.7%.
Net written premiums grew 16%.
Recall that in the prior year quarter, we provided $216 million of premium refunds to automobile customers in response to the impact of the pandemic.
Adjusting for these premium refunds, net written premiums grew a very strong 8% with Domestic Homeowners up 12% and Domestic Automobile up 4%.
Automobile delivered another excellent quarter with a combined ratio of 91.6%.
The underlying combined ratio was an impressive 92%, although up 6 points from the prior year quarter, which reflected lower loss activity during the initial months of the pandemic.
In Homeowners and Other, the second quarter combined ratio of 108.3% was 6 points lower than the prior year quarter, driven by a 13.5 point reduction in catastrophe losses.
Partially offsetting the catastrophe favorability was an 8 point increase in the underlying combined ratio.
Domestic Automobile retention was up slightly to a strong 85%.
New business increased by 19% and policies in force grew 4%.
Domestic Homeowners and Other delivered another excellent quarter with retention remaining strong at 85%, renewal premium change increasing to 8.2%, and new business growth of 28%, reflective of increased quote activity and increase in average premium, along with the ongoing successful rollout of Quantum Home 2.0.
Policies in force grew 7%.
When we launched Quantum Auto 2.0, we designed it with a modular product structure to give customers what they need and to deliver long-term performance.
Regarding telematics, we've seen take-up rates for IntelliDrive increase by 30% since the launch of our second-generation offering, which features a fully redesigned mobile experience, monitors distracted driving and improves our ability to match price to driving behavior.
The Quantum Home 2.0 product is now available in over 40 states, generating consistent growth in policies in force.
With advancements in our MyTravelers mobile app, we continue to digitize the customer journey with over 600,000 customers already downloading the app since its launch earlier this year.
Jeff has been at Travelers for more than 20 years.

Summary:
Core income for the quarter was $879 million or $3.45 per diluted share, generating a core return on equity of 13.7%.
In terms of underwriting results, higher underlying underwriting income and net favorable prior year reserve development, as well as a lower level of catastrophe losses, all contributed to higher core income.
During the quarter, we grew net written premiums to $8.1 billion, an increase of 11% or 8% after adjusting for the auto premium refunds in the prior year quarter.
Our second quarter results include $475 million of pre-tax cat losses compared to $854 million in last year's second quarter.