The Travelers Companies, Inc. · NYSE:TRV
The Travelers Companies — ST Paul Travelers Companies — Merrill Lynch Insurance Investors Conference 2006
27 slides from The Travelers Companies's conference presentation, Feb 16, 2006
Slide 1: Jay Fishman, Chairman & CEO – Merrill Lynch Insurance Investors Conference
ST PAUL TRAVELERS Jay Fishman, Chairman & CEO Merrill Lynch Insurance Investors Conference February 16, 2006
Slide 2: Explanatory Note
ST PAUL Explanatory Note TRAVELERS “This presentation may contain, and managementmay make, cera “Yorwatdooking statements” wihin the meaning ofthe Private Secures Ligation Reform Act of 1895. Al statements, oer than satementsorhistotea fais, maybe forwardookg statements. Specialy, the Company may ma
Slide 3: Building Upon Strengths of the Franchise
Building Upon Strengths of the Franchise TRAVELERS > The Franchise > Top-Line Initiatives > Catastrophe Exposure Management > Financial Strength
Slide 4: The Franchise
The Franchise TRAVELERS ‘Gin milions, afer-tax) Full Year 2005 GAAP Operating Combined Income Ratio! Reported results $ 2,026 101.3 % Includes the following items: Catastrophe losses $ (1,472) (10.7) % Favorable (unfavorable): A&E development (686) 4.2) (Other net prior year development 360 28 Total
Slide 5: The Franchise – Diversified product offering
The Franchise TRAVELERS Gneiee 2005 NWP $20,386 Specialty Commercial pan 41% Personal 31% _ re conuay ca con Diversified product offering and exposure base 4
Slide 6: The Franchise – Market share rankings by line
STPAUL The Franchise TRAVELERS Commercial Mutti-Peril ! Commercial Auto ® Company DWP ($8) _% Market Company DWP ($8) % Market 1 St Paul Travelers $34 92% 4 St Paul Travelers: $26 8.0% 2 Hartford 20 5.9% 2 Zurich 18 5.9% 3 Chubb 18 5.5% 3 Progressive 18 58% 4 State Farm 18 44% 4 AIG 15 48% 6 Zurich
Slide 7: The Franchise – Commercial lines market share by state
The Franchise STPAUL TRAVELERS Commercial Lines Industry St. Paul Travelers Commercial Lines Market Share Rank by State State DWP ($B) a 1 | California $40.0 2 2___| New York 205 2 3__| Texas 15.6 2 4 _| Florida 15.4 4 5 _| Mllinois 128 3 6 _| Pennsylvania 10.0 2 7 | New Jersey 9.0 2 8 | Michigan 74
Slide 8: The Franchise – Specialty
The Franchise TRAVELERS Specialty Select Commercial National Portfolio Advantage Accounts Multivariate | [Slot Rated Pricing Individual Account Pricing Underwriting & Pricing CAG—Field Bond National Casualty Nort Construction. Residual Markets FPS Discover Re National Programs _* Technology Agribusi
Slide 9: The Franchise – Select Accounts
The Franchise TRAVELERS Select Accounts > Local operating model with scale Customer specialization and segmentation > Ease-of-use automation > Industry-leading service centers Strategic focus on multivariate pricing a6 Retention % 8 76 (Sinmi 1004 2004 3004 4004 1005 2005 2005 4005 FyO4 EYOS Frnamil
Slide 10: The Franchise – Commercial Accounts
The Franchise TRAVELERS Commercial Accounts > Broad appetite and product offering > Experienced underwriters > Superior MIS leading to pricing precision > Strong risk control, claim and policyholder service > Local presence and underwriting authority Retention % 3 74 (Sinmi 104 2Q04 3004 4004 1005 2
Slide 11: The Franchise – Specialty
The Franchise FRAVELERS Specialty > Focused appetite and product offerings >» Specialized underwriting, risk control and claim professionals >» Relationships with specialized distributors Domestic International Specialty Specialy * En En 2 (inmiy — EYO4 —EYOS Fy04 — EY0S Renewal price pelle 6% = 3%
Slide 12: The Franchise – Personal
The Franchise FRAVELERS Personal > Product sophistication > Claim effectiveness » Distribution and marketing agility > Ease of doing business Homeowners Auto &.Other Sinmg —-EYOAEYOS. Fyoa FYOS Renewal pice perl 5% _% 9% 8% Polciesinfoce 2,264 2,347 agi 4219 patio $3433 3477 $2496 2.751 90.8% 86.1%
Slide 13: The Franchise – Business unit strengths
STPAUL The Franchise TRAVELERS ‘Select Accounts Commercial Accounts > Local operating model with scale > Broad appetite and product offering » Customer specialization and segmentation > Experienced underwriters > Ease-of-use automation » Superior MIS leading to pricing precision > Industry-leading s
Slide 14: Value Proposition of our Businesses
STPAUL The Franchise TRAVELERS Value Proposition of our Businesses Organizational Strengths > Disciplined Underwriting > Operational Excellence > World Class Analytics Organizational Goals Superior Technology Innovative Sales Culture 13
Slide 15: Top-Line Initiatives
STPAUL TRAVELERS Top-Line Initiatives 14
Slide 16: Further Penetrate Distribution Force
Further Penetrate Distribution Force TRAVELERS St. Paul Travelers contracts with over 11,000 distributors Percent of Agents / Brokers Distributing Product Across Multiple Business Units * Percent of 2005 Direct Written Premium 28% More than ‘One 39% 9% 63% 61% Market more products through existing d
Slide 17: Continue to Drive Business Collaboration
Continue to Drive Business Collaboration TRAVELERS Select platform > Insure throughout a tech company's life-cycle Technology Underwriting . Technology / Select Accounts > Technology underwriting expertise ‘ > Product demand for small insureds > Service customers with existing Boiler & Machinery / C
Slide 18: Enhancing Product and Platform
Enhancing Product and Platform TRAVELERS Select Accounts >» Completed roll-out of MasterPac and PacPlus in fourth quarter 2005 >» Broadened our risk appetite and product offering to serve larger-sized accounts within small commercial, and now cover over 700 sub-industry class (SIC) codes » Increased
Slide 19: Develop Sophisticated Pricing Mechanisms
Develop Sophisticated Pricing Mechanisms FRAVELERS Present Future Extend utilization of predictive modeling 18
Slide 20: Re-examine Industry Appetites
Re-examine Industry Appetites TRAVELERS > Within certain attractive industry areas, we are still under-penetrated > Analyze market shares at a granular level: > by product line » by line of business / business unit > by geography » Re-examine historical underwriting appetite Continue to test convent
Slide 21: Foster Sales and Marketing Culture
. STPAUL Foster Sales and Marketing Culture TRAVELERS Field Marketing Structure > 14 Regional Executives > 15 Regional Distribution Directors > 33 District Executives » Over 500 sales staff and production underwriters in Select Accounts > Over 400 sales and marketing staff in Personal > Non-U.S. pre
Slide 22: Catastrophe Exposure Management
STPAUL TRAVELERS Catastrophe Exposure Management a
Slide 23: Catastrophe Exposure Management
STPAUL Catastrophe Exposure Management TRAVELERS >» Seeking increased revenues and / or modifying terms and conditions, i.e., deductibles, insured values, etc., when appropriate > Redefining coastal exposure: “there’s more coast than we thought” >» Ona corporate basis, re-analyzing earnings at risk
Slide 24: STA's Reinsurance Policy and Impact
. " STPAUL STA’s Reinsurance Policy and Impact TRAVELERS > STA utilizes reinsurance to transfer risk / reward of certain exposures, which aids in the company's ability to: * Withstand larger catastrophic events without experiencing negative ratings implications or triggering the need to raise capita
Slide 25: Financial Strength
STPAUL Financial Strength TRAVELERS (G in mitons) Dec 31, 2005 Operating Income $ 2,026 Shareholders equity | $ 21,990 Debt 5,850 Total capital | $ 27,840 Debt to total capital ' 21.0% Statutory Surplus $ 18,002 Net Whitten Premium to Surplus 1.13:1 Holding Company Liquid Assets $ 1,570 Strong finan
Slide 26: Disclosure
STPAUL Disclosure TRAVELERS: + For further information please see St. Paul 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 are publicly available on St. Paul Travelers website (h
Slide 27: Searchable text section of graphics
Searchable text section of graphics shown above [L OGO] Jay Fishman, Chairman & CEO Merrill Lynch Insurance Investors Conference February 16, 2006 Exp lanatory Note [LOGO] This presentation may contain, and management may make, certain “forward-looking statements” within the meaning of the Private S
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