Consolidating Financial Statements (Tables)

12 Months Ended

Dec. 31, 2018

Consolidating Financial Statements of The Travelers Companies, Inc. and Subsidiaries (Unaudited) disclosure

Consolidating Statement of Income (Unaudited) [Table Text Block]

CONSOLIDATING STATEMENT OF INCOME (Unaudited)

For the year ended December 31, 2018

(in millions)	TPC		Other Subsidiaries		TRV			Eliminations			Consolidated
Revenues
Premiums	$	18,508	$	8,551	$	—		$	—		$	27,059
Net investment income	1,704		738		32			—			2,474
Fee income	432		—		—			—			432
Net realized investment gains (losses) (1)	118		9		(13		)	—			114
Other revenues	96		112		—			(5		)	203
Total revenues	20,858		9,410		19			(5		)	30,282
Claims and expenses
Claims and claim adjustment expenses	12,344		5,947		—			—			18,291
Amortization of deferred acquisition costs	2,972		1,409		—			—			4,381
General and administrative expenses	2,947		1,335		20			(5		)	4,297
Interest expense	48		—		304			—			352
Total claims and expenses	18,311		8,691		324			(5		)	27,321
Income (loss) before income taxes	2,547		719		(305		)	—			2,961
Income tax expense (benefit)	437		115		(114		)	—			438
Net income of subsidiaries	—		—		2,714			(2,714		)	—
Net income	$	2,110	$	604	$	2,523		$	(2,714	)	$	2,523

___________________________________________

(1) Total other-than-temporary impairments (OTTI) for the year ended December 31, 2018, and the amounts comprising total OTTI that were recognized in net realized investment gains (losses) and in other comprehensive income (OCI), were as follows:

(in millions)	TPC			Other Subsidiaries		TRV		Eliminations		Consolidated
Total OTTI losses	$	(1	)	$	—	$	—	$	—	$	(1	)
OTTI losses recognized in net realized investment gains (losses)	$	(1	)	$	—	$	—	$	—	$	(1	)
OTTI losses recognized in OCI	$	—		$	—	$	—	$	—	$	—

CONSOLIDATING STATEMENT OF INCOME (Unaudited)

For the year ended December 31, 2017

(in millions)	TPC		Other Subsidiaries		TRV			Eliminations			Consolidated
Revenues
Premiums	$	17,562	$	8,121	$	—		$	—		$	25,683
Net investment income	1,627		759		24			(13		)	2,397
Fee income	447		—		—			—			447
Net realized investment gains (1)	19		131		66			—			216
Other revenues	101		68		—			(10		)	159
Total revenues	19,756		9,079		90			(23		)	28,902
Claims and expenses
Claims and claim adjustment expenses	11,735		5,732		—			—			17,467
Amortization of deferred acquisition costs	2,820		1,346		—			—			4,166
General and administrative expenses	2,906		1,249		25			(10		)	4,170
Interest expense	48		—		321			—			369
Total claims and expenses	17,509		8,327		346			(10		)	26,172
Income (loss) before income taxes	2,247		752		(256		)	(13		)	2,730
Income tax expense (benefit)	519		290		(130		)	(5		)	674
Net income of subsidiaries	—		—		2,190			(2,190		)	—
Net income	$	1,728	$	462	$	2,064		$	(2,198	)	$	2,056

___________________________________________

(1) Total other-than-temporary impairments (OTTI) for the year ended December 31, 2017, and the amounts comprising total OTTI that were recognized in net realized investment gains and in other comprehensive income (OCI), were as follows:

(in millions)	TPC			Other Subsidiaries			TRV		Eliminations		Consolidated
Total OTTI losses	$	(4	)	$	(9	)	$	—	$	—	$	(13	)
OTTI losses recognized in net realized investment gains	$	(5	)	$	(9	)	$	—	$	—	$	(14	)
OTTI gains recognized in OCI	$	1		$	—		$	—	$	—	$	1

CONSOLIDATING STATEMENT OF INCOME (Unaudited)

For the year ended December 31, 2016

(in millions)	TPC		Other Subsidiaries		TRV			Eliminations			Consolidated
Revenues
Premiums	$	16,788	$	7,746	$	—		$	—		$	24,534
Net investment income	1,569		720		13			—			2,302
Fee income	458		—		—			—			458
Net realized investment gains (losses) (1)	30		39		(1		)	—			68
Other revenues	248		36		—			(21		)	263
Total revenues	19,093		8,541		12			(21		)	27,625
Claims and expenses
Claims and claim adjustment expenses	10,232		4,838		—			—			15,070
Amortization of deferred acquisition costs	2,702		1,283		—			—			3,985
General and administrative expenses	2,928		1,242		5			(21		)	4,154
Interest expense	48		—		315			—			363
Total claims and expenses	15,910		7,363		320			(21		)	23,572
Income (loss) before income taxes	3,183		1,178		(308		)	—			4,053
Income tax expense (benefit)	999		208		(168		)	—			1,039
Net income of subsidiaries	—		—		3,154			(3,154		)	—
Net income	$	2,184	$	970	$	3,014		$	(3,154	)	$	3,014

___________________________________________

(1) Total other-than-temporary impairments (OTTI) for the year ended December 31, 2016, and the amounts comprising total OTTI that were recognized in net realized investment gains (losses) and in other comprehensive income (OCI), were as follows:

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations		Consolidated
Total OTTI losses	$	(19	)	$	(20	)	$	(1	)	$	—	$	(40	)
OTTI losses recognized in net realized investment gains (losses)	$	(13	)	$	(15	)	$	(1	)	$	—	$	(29	)
OTTI losses recognized in OCI	$	(6	)	$	(5	)	$	—		$	—	$	(11	)

Consolidating Statement of Comprehensive Income (Unaudited) [Table Text Block]

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (Unaudited)

For the year ended December 31, 2018

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Net income	$	2,110		$	604		$	2,523		$	(2,714	)	$	2,523
Other comprehensive loss:
Changes in net unrealized gains on investment securities:
Having no credit losses recognized in the consolidated statement of income	(1,028		)	(461		)	—			—			(1,489		)
Having credit losses recognized in the consolidated statement of income	(20		)	(7		)	—			—			(27		)
Net changes in benefit plan assets and obligations	1			(4		)	(53		)	—			(56		)
Net changes in unrealized foreign currency translation	(144		)	(103		)	—			—			(247		)
Other comprehensive loss before income taxes and other comprehensive loss of subsidiaries	(1,191		)	(575		)	(53		)	—			(1,819		)
Income tax benefit	(231		)	(101		)	(17		)	—			(349		)
Other comprehensive loss, net of taxes, before other comprehensive loss of subsidiaries	(960		)	(474		)	(36		)	—			(1,470		)
Other comprehensive loss of subsidiaries	—			—			(1,434		)	1,434			—
Other comprehensive loss	(960		)	(474		)	(1,470		)	1,434			(1,470		)
Comprehensive income	$	1,150		$	130		$	1,053		$	(1,280	)	$	1,053

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (Unaudited)

For the year ended December 31, 2017

(in millions)	TPC			Other Subsidiaries		TRV			Eliminations			Consolidated
Net income	$	1,728		$	462	$	2,064		$	(2,198	)	$	2,056
Other comprehensive income (loss):
Changes in net unrealized gains on investment securities:
Having no credit losses recognized in the consolidated statement of income	313			25		(44		)	—			294
Having credit losses recognized in the consolidated statement of income	6			2		—			—			8
Net changes in benefit plan assets and obligations	(1		)	8		22			—			29
Net changes in unrealized foreign currency translation	83			108		—			—			191
Other comprehensive income (loss) before income taxes and other comprehensive income of subsidiaries	401			143		(22		)	—			522
Income tax expense	98			10		2			—			110
Other comprehensive income (loss), net of taxes, before other comprehensive income of subsidiaries	303			133		(24		)	—			412
Other comprehensive income of subsidiaries	—			—		436			(436		)	—
Other comprehensive income	303			133		412			(436		)	412
Comprehensive income	$	2,031		$	595	$	2,476		$	(2,634	)	$	2,468

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (Unaudited)

For the year ended December 31, 2016

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Net income	$	2,184		$	970		$	3,014		$	(3,154	)	$	3,014
Other comprehensive loss:
Changes in net unrealized gains on investment securities:
Having no credit losses recognized in the consolidated statement of income	(696		)	(198		)	11			—			(883		)
Having credit losses recognized in the consolidated statement of income	11			10			—			—			21
Net changes in benefit plan assets and obligations	25			11			(20		)	—			16
Net changes in unrealized foreign currency translation	73			(114		)	—			—			(41		)
Other comprehensive loss before income taxes and other comprehensive loss of subsidiaries	(587		)	(291		)	(9		)	—			(887		)
Income tax benefit	(222		)	(66		)	(1		)	—			(289		)
Other comprehensive loss, net of taxes, before other comprehensive loss of subsidiaries	(365		)	(225		)	(8		)	—			(598		)
Other comprehensive loss of subsidiaries	—			—			(590		)	590			—
Other comprehensive loss	(365		)	(225		)	(598		)	590			(598		)
Comprehensive income	$	1,819		$	745		$	2,416		$	(2,564	)	$	2,416

Consolidating Balance Sheet (Unaudited) [Table Text Block]

CONSOLIDATING BALANCE SHEET (Unaudited)

At December 31, 2018

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Assets
Fixed maturities, available for sale, at fair value (amortized cost $63,601)	$	43,683		$	19,697		$	84		$	—		$	63,464
Equity securities, at fair value (cost $382)	105			92			171			—			368
Real estate investments	2			902			—			—			904
Short-term securities	1,855			759			1,371			—			3,985
Other investments	2,746			810			1			—			3,557
Total investments	48,391			22,260			1,627			—			72,278
Cash	181			192			—			—			373
Investment income accrued	434			187			3			—			624
Premiums receivable	5,089			2,417			—			—			7,506
Reinsurance recoverables	5,904			2,466			—			—			8,370
Ceded unearned premiums	522			56			—			—			578
Deferred acquisition costs	1,930			190			—			—			2,120
Deferred taxes	167			302			(24		)	—			445
Contractholder receivables	3,867			918			—			—			4,785
Goodwill	2,578			1,368			—			(9		)	3,937
Other intangible assets	224			121			—			—			345
Investment in subsidiaries	—			—			26,993			(26,993		)	—
Other assets	2,220			15			669			(32		)	2,872
Total assets	$	71,507		$	30,492		$	29,268		$	(27,034	)	$	104,233
Liabilities
Claims and claim adjustment expense reserves	$	34,093		$	16,575		$	—		$	—		$	50,668
Unearned premium reserves	9,414			4,141			—			—			13,555
Contractholder payables	3,867			918			—			—			4,785
Payables for reinsurance premiums	169			120			—			—			289
Debt	693			32			5,871			(32		)	6,564
Other liabilities	4,133			849			496			—			5,478
Total liabilities	52,369			22,635			6,367			(32		)	81,339
Shareholders’ equity
Common stock (1,750.0 shares authorized; 263.7 shares issued and 263.6 shares outstanding)	—			401			23,144			(401		)	23,144
Additional paid-in capital	11,634			7,023			—			(18,657		)	—
Retained earnings	8,065			879			35,211			(8,951		)	35,204
Accumulated other comprehensive loss	(561		)	(446		)	(1,859		)	1,007			(1,859		)
Treasury stock, at cost (510.9 shares)	—			—			(33,595		)	—			(33,595		)
Total shareholders’ equity	19,138			7,857			22,901			(27,002		)	22,894
Total liabilities and shareholders’ equity	$	71,507		$	30,492		$	29,268		$	(27,034	)	$	104,233

CONSOLIDATING BALANCE SHEET (Unaudited)

At December 31, 2017

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Assets
Fixed maturities, available for sale, at fair value (amortized cost $61,316)	$	43,240		$	19,372		$	82		$	—		$	62,694
Equity securities, available for sale, at fair value (cost $440)	161			111			181			—			453
Real estate investments	54			878			—			—			932
Short-term securities	2,751			914			1,230			—			4,895
Other investments	2,673			854			1			—			3,528
Total investments	48,879			22,129			1,494			—			72,502
Cash	157			187			—			—			344
Investment income accrued	418			183			5			—			606
Premiums receivable	4,852			2,292			—			—			7,144
Reinsurance recoverables	5,842			2,467			—			—			8,309
Ceded unearned premiums	493			58			—			—			551
Deferred acquisition costs	1,835			190			—			—			2,025
Deferred taxes	(89		)	173			(14		)	—			70
Contractholder receivables	3,854			921			—			—			4,775
Goodwill	2,592			1,368			—			(9		)	3,951
Other intangible assets	202			140			—			—			342
Investment in subsidiaries	—			—			27,946			(27,946		)	—
Other assets	2,181			(3		)	700			(14		)	2,864
Total assets	$	71,216		$	30,105		$	30,131		$	(27,969	)	$	103,483
Liabilities
Claims and claim adjustment expense reserves	$	33,386		$	16,264		$	—		$	—		$	49,650
Unearned premium reserves	8,957			3,958			—			—			12,915
Contractholder payables	3,854			921			—			—			4,775
Payables for reinsurance premiums	165			109			—			—			274
Debt	693			14			5,878			(14		)	6,571
Other liabilities	4,161			882			524			—			5,567
Total liabilities	51,216			22,148			6,402			(14		)	79,752
Shareholders’ equity
Common stock (1,750.0 shares authorized; 271.5 shares issued and 271.4 shares outstanding)	—			390			22,886			(390		)	22,886
Additional paid-in capital	11,634			6,972			—			(18,606		)	—
Retained earnings	8,036			594			33,460			(8,628		)	33,462
Accumulated other comprehensive income (loss)	330			1			(343		)	(331		)	(343		)
Treasury stock, at cost (500.9 shares)	—			—			(32,274		)	—			(32,274		)
Total shareholders’ equity	20,000			7,957			23,729			(27,955		)	23,731
Total liabilities and shareholders’ equity	$	71,216		$	30,105		$	30,131		$	(27,969	)	$	103,483

Consolidating Statement of Cash Flows (Unaudited) [Table Text Block]

CONSOLIDATING STATEMENT OF CASH FLOWS (Unaudited)

For the year ended December 31, 2018

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Cash flows from operating activities
Net income	$	2,110		$	604		$	2,523		$	(2,714	)	$	2,523
Net adjustments to reconcile net income to net cash provided by operating activities	1,141			605			(363		)	474			1,857
Net cash provided by operating activities	3,251			1,209			2,160			(2,240		)	4,380
Cash flows from investing activities
Proceeds from maturities of fixed maturities	5,158			1,906			22			—			7,086
Proceeds from sales of investments:
Fixed maturities	2,449			1,096			1			—			3,546
Equity securities	65			107			6			—			178
Real estate investments	66			8			—			—			74
Other investments	403			108			—			—			511
Purchases of investments:
Fixed maturities	(9,404		)	(4,096		)	(26		)	—			(13,526		)
Equity securities	(8		)	(99		)	(10		)	—			(117		)
Real estate investments	(1		)	(73		)	—			—			(74		)
Other investments	(454		)	(83		)	—			—			(537		)
Net sales (purchases) of short-term securities	895			154			(141		)	—			908
Securities transactions in course of settlement	(80		)	24			—			—			(56		)
Acquisition, net of cash acquired	—			(4		)	—			—			(4		)
Other	(310		)	(8		)	—			—			(318		)
Net cash used in investing activities	(1,221		)	(960		)	(148		)	—			(2,329		)
Cash flows from financing activities
Treasury stock acquired — share repurchase authorization	—			—			(1,270		)	—			(1,270		)
Treasury stock acquired — net employee share-based compensation	—			—			(51		)	—			(51		)
Dividends paid to shareholders	—			—			(814		)	—			(814		)
Payment of debt	—			—			(600		)	—			(600		)
Issuance of debt	—			18			591			(18		)	591
Issuance of common stock — employee share options	—			—			132			—			132
Dividends paid to parent company	(2,003		)	(255		)	—			2,258			—
Net cash used in financing activities	(2,003		)	(237		)	(2,012		)	2,240			(2,012		)
Effect of exchange rate changes on cash	(3		)	(7		)	—			—			(10		)
Net increase in cash	24			5			—			—			29
Cash at beginning of year	157			187			—			—			344
Cash at end of year	$	181		$	192		$	—		$	—		$	373
Supplemental disclosure of cash flow information
Income taxes paid (received)	$	437		$	254		$	(283	)	$	—		$	408
Interest paid	$	47		$	—		$	300		$	—		$	347

CONSOLIDATING STATEMENT OF CASH FLOWS (Unaudited)

For the year ended December 31, 2017

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Cash flows from operating activities
Net income	$	1,728		$	462		$	2,064		$	(2,198	)	$	2,056
Net adjustments to reconcile net income to net cash provided by operating activities	1,500			701			(32		)	(77		)	2,092
Net cash provided by operating activities	3,228			1,163			2,032			(2,275		)	4,148
Cash flows from investing activities
Proceeds from maturities of fixed maturities	6,576			2,168			6			—			8,750
Proceeds from sales of investments:
Fixed maturities	1,007			846			1			—			1,854
Equity securities	97			414			254			—			765
Real estate investments	—			23			—			—			23
Other investments	357			124			—			(13		)	468
Purchases of investments:
Fixed maturities	(8,513		)	(3,697		)	(40		)	—			(12,250		)
Equity securities	(68		)	(133		)	(258		)	—			(459		)
Real estate investments	(1		)	(58		)	—			—			(59		)
Other investments	(444		)	(97		)	—			—			(541		)
Net sales (purchases) of short-term securities	(303		)	(120		)	397			—			(26		)
Securities transactions in course of settlement	(55		)	5			3			—			(47		)
Acquisition, net of cash acquired	—			25			(477		)	13			(439		)
Other	(244		)	3			—			—			(241		)
Net cash used in investing activities	(1,591		)	(497		)	(114		)	—			(2,202		)
Cash flows from financing activities
Treasury stock acquired — share repurchase authorization	—			—			(1,378		)	—			(1,378		)
Treasury stock acquired — net employee share-based compensation	—			—			(62		)	—			(62		)
Dividends paid to shareholders	—			—			(785		)	—			(785		)
Payment of debt	—			—			(657		)	—			(657		)
Issuance of debt	—			14			789			(14		)	789
Issuance of common stock — employee share options	—			—			173			—			173
Dividends paid to parent company	(1,624		)	(665		)	—			2,289			—
Net cash used in financing activities	(1,624		)	(651		)	(1,920		)	2,275			(1,920		)
Effect of exchange rate changes on cash	3			8			—			—			11
Net increase (decrease) in cash	16			23			(2		)	—			37
Cash at beginning of year	141			164			2			—			307
Cash at end of year	$	157		$	187		$	—		$	—		$	344
Supplemental disclosure of cash flow information
Income taxes paid (received)	$	481		$	206		$	(173	)	$	—		$	514
Interest paid	$	47		$	—		$	320		$	—		$	367

CONSOLIDATING STATEMENT OF CASH FLOWS (Unaudited)

For the year ended December 31, 2016

(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Cash flows from operating activities
Net income	$	2,184		$	970		$	3,014		$	(3,154	)	$	3,014
Net adjustments to reconcile net income to net cash provided by operating activities	1,282			139			(122		)	156			1,455
Net cash provided by operating activities	3,466			1,109			2,892			(2,998		)	4,469
Cash flows from investing activities
Proceeds from maturities of fixed maturities	6,589			2,380			6			—			8,975
Proceeds from sales of investments:
Fixed maturities	768			647			2			—			1,417
Equity securities	47			45			—			—			92
Real estate investments	—			69			—			—			69
Other investments	386			180			—			—			566
Purchases of investments:
Fixed maturities	(7,921		)	(3,676		)	(12		)	—			(11,609		)
Equity securities	(6		)	(42		)	(3		)	—			(51		)
Real estate investments	(1		)	(47		)	—			—			(48		)
Other investments	(453		)	(127		)	—			—			(580		)
Net sales (purchases) of short-term securities	(501		)	383			(81		)	—			(199		)
Securities transactions in course of settlement	12			(32		)	(1		)	—			(21		)
Other	(331		)	(10		)	3			—			(338		)
Net cash used in investing activities	(1,411		)	(230		)	(86		)	—			(1,727		)
Cash flows from financing activities
Treasury stock acquired — share repurchase authorization	—			—			(2,400		)	—			(2,400		)
Treasury stock acquired — net employee share-based compensation	—			—			(72		)	—			(72		)
Dividends paid to shareholders	—			—			(757		)	—			(757		)
Payment of debt	—			—			(400		)	—			(400		)
Issuance of debt	—			—			491			—			491
Issuance of common stock — employee share options	—			—			332			—			332
Dividends paid to parent company	(2,140		)	(858		)	—			2,998			—
Net cash used in financing activities	(2,140		)	(858		)	(2,806		)	2,998			(2,806		)
Effect of exchange rate changes on cash	1			(10		)	—			—			(9		)
Net increase (decrease) in cash	(84		)	11			—			—			(73		)
Cash at beginning of year	225			153			2			—			380
Cash at end of year	$	141		$	164		$	2		$	—		$	307
Supplemental disclosure of cash flow information
Income taxes paid (received)	$	737		$	287		$	(132	)	$	—		$	892
Interest paid	$	47		$	—		$	311		$	—		$	358