(Adds details from conference call, analysts' quotes)

By Sudarshan Varadhan

July 21 (Reuters) - Travelers Cos Inc reported its lowest quarterly earnings since 2012, when hurricane Sandy struck the U.S. Atlantic coast, but managed to beat market expectations.

The insurer said its adjusted combined ratio - a key measure of profitability - deteriorated due to an increase in weather-related losses and as "loss cost trends exceeded pricing."

Analysts on a conference call flooded Travelers' executives with questions about the pricing of the company's policies.

"Investors and certified analysts are trying to figure out how much underlying margins will shrink, going forward," Amit Kumar, an analyst at Macquarie Research, told Reuters.

Earnings estimates could be tweaked lower if margins continue to shrink, he said.

Travelers said on Thursday its second-quarter earnings were hit by a series of weather-related and other natural disasters, including the Fort McMurray wildfires in Canada.

Insurers have also been hit by claims stemming from hail storms in Texas, earthquakes in Japan and Ecuador and floods in Europe during the quarter.

Travelers, the only insurer in the Dow 30, said underwriting margins for the rest of 2016 and into 2017 were likely to be little changed from the corresponding periods of 2015 and 2016.

Pre-tax catastrophe losses, net of reinsurance, rose more than 50 percent to $333 million in the three months to June 30.

Net income fell 18 percent to $664 million, or $2.24 per share, in the second quarter compared with a year earlier.

That was the lowest net profit since the the fourth quarter of 2012 when profit fell by about half to $300 million due to claims related to hurricane Sandy, one of the most expensive natural disasters in U.S. history.

Chubb Ltd, Bermuda-based Validus Holdings Ltd and XL Group Plc have all said that their catastrophe losses would be higher in the quarter.

Still, Travelers' operating income of $2.20 per share handily beat the average analysts' estimate of $2.07, according to Thomson Reuters I/B/E/S.

Paul Newsome, an analyst at Sandler O'Neill Research, said many analysts had expected Travelers' catastrophe losses to be higher.

"It seems like somehow the company missed many of the large catastrophe losses that struck other property-casualty insurers," he wrote in a note.

Travelers' shares were down 0.5 percent at $116.41 in early afternoon trading.

(Reporting By Sudarshan Varadhan in Bengaluru; Editing by Savio D'Souza and Ted Kerr)