The Travelers Companies, Inc. · NYSE:TRV
The Travelers Companies — Goldman Sachs Financial Services Conference 2011
14 slides from The Travelers Companies's conference presentation, Dec 6, 2011
Slide 1: Jay S. Fishman, Chairman & Chief Executive Officer
Jay S. Fishman Chairman & Chief Executive Officer Goldman Sachs Financial Services Conference December 6, 2011
Slide 2: The Environment
The Environment • Impact of lower rate on margin in Business Insurance over last several years • Prospect of continued low investment yields • Potential for abnormally high weather losses to continue 1
Slide 3: Operating Return on Equity
Operating Return on Equity 2005 - 20101 2011 YTD2 Long-term fixed investment portfolio 8.5% 7.9% Short-term fixed investment portfolio 0.4% 0.1% Non-fixed investment portfolio 0.7% 1.1% Total investment portfolio 9.6% 9.1% Underwriting gain (ex. Catastrophes / PYD) 4.8% 2.1% Prior year reserve devel
Slide 4: Insurance Pricing: Renewal Rate Change
Insurance Pricing Renewal Rate Change1 Travelers Business Insurance (Excluding National Accounts) 8% 6% 4% 2% -% (2%) (4%) (6%) (8%) 1Q 2Q 3Q 4Q 2005 2006 2007 2008 2009 2010 2010 2010 2010 1 Represents the estimated change in average premium on policies that renew, excluding exposure changes. Note:
Slide 5: Adverse Weather: U.S. Historical Catastrophes
Adverse Weather U.S. Historical Catastrophes Industry Insured Losses $62 ($ in billions) 40 2005 Hurricanes Katrina, Rita, Wilma $ 35 30 25 20 15 10 5 0 2005 2006 2007 2008 2009 2010 2011 Tornado / Hail Hurricane Winter Storm Fire Earthquake Other 4 Source: PCS Incurred Losses as of October 2011.
Slide 6: Travelers' Focus
Travelers’ Focus • Drive for improved rate and terms & conditions • Manage operating costs • Maintain high credit quality investment portfolio • Return excess capital to shareholders (no change in philosophy) 5
Slide 7: Travelers' Focus: Seek Rate - Pricing Environment, Business Insurance
Travelers’ Focus: Seek Rate Pricing Environment – Business Insurance 2011 Renewal Rate Change1 by Month Business Insurance Commercial (ex. National Accounts) Accounts July 3.0% 3.4% August 2.3% 3.5% September 4.2% 5.6% October 5.2% 6.9% November 5.8% 8.2% 1 Represents the estimated change in average
Slide 8: Travelers' Focus: Seek Rate - Pricing Environment, Business Insurance
Travelers’ Focus: Seek Rate Pricing Environment - Business Insurance Travelers Business Insurance (Excluding National Accounts) ♦ Renewal Rate Change1 % • Exposure/Other % ▲ Renewal Premium Change2 % 8% 6% 4% 2% -% 2% 4% 6% 8% 2005 2006 2007 2008 2009 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4QTD3 2010 2010 2010 2010 2
Slide 9: Travelers' Focus: Seek Rate - Pricing Environment, Personal Insurance
Travelers’ Focus: Seek Rate Pricing Environment - Personal Insurance Travelers Automobile Travelers Homeowners & Other Renewal Premium Change1 Renewal Premium Change1 6% 10% 8% 4% 6% 4% 2% 2% 0% 0% 1Q 2Q 3Q 4QTD2 1Q 2Q 3Q 4QTD2 2005 2006 2007 2008 2009 2010 2005 2006 2007 2008 2009 2010 2011 2011 20
Slide 10: Return Excess Capital to Shareholders
Return Excess Capital to Shareholders Common Share Repurchases and Dividends ($ in millions) $5,670 $3,990 $3,685 $2,834 $2,215 $1,817 $622 2005 2006 2007 2008 2009 2010 Nine Months Ended Sept. 30, 2011 Common Share Repurchases and Dividends as a Percentage of Net Income 38.3% 43.2% 80.1% 96.9% 110.
Slide 11: Explanatory Note
Explanatory Note This presentation contains, and management may make, certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. Words such as “may,” “w
Slide 12: Explanatory Note (continued)
Explanatory Note (continued) As noted above, this presentation contains, and management may make, certain “forward-looking statements”. Some of the factors that could cause actual results to differ from those expressed in, or implied or projected by, the forward-looking statements include, but are n
Slide 13: Disclosure
Disclosure • For further information, please see Travelers reports filed with the SEC pursuant to the Securities Exchange Act of 1934 which are available at the SEC’s website (www.sec.gov) • Copies of this presentation and the accompanying webcast are publicly available on the Travelers website (www
Slide 14: TRAVELERS J
rN TRAVELERS J
The Travelers Companies — Goldman Sachs Financial Services Conference 2011 on 6ix