Consolidating Financial Statements (Unaudited) (Tables)

3 Months Ended

Mar. 31, 2019

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 three months ended March 31, 2019



(in millions)	TPC		Other Subsidiaries		TRV			Eliminations			Consolidated
Revenues
Premiums	$	4,689	$	2,166	$	—		$	—		$	6,855
Net investment income	416		155		11			—			582
Fee income	109		—		—			—			109
Net realized investment gains ⁽¹⁾	22		15		16			—			53
Other revenues	38		34		—			—			72
Total revenues	5,274		2,370		27			—			7,671

Claims and expenses
Claims and claim adjustment expenses	3,024		1,418		—			—			4,442
Amortization of deferred acquisition costs	745		372		—			—			1,117
General and administrative expenses	722		330		5			—			1,057
Interest expense	12		—		76			—			88
Total claims and expenses	4,503		2,120		81			—			6,704
Income (loss) before income taxes	771		250		(54		)	—			967
Income tax expense (benefit)	146		42		(17		)	—			171
Net income of subsidiaries	—		—		833			(833		)	—
Net income	$	625	$	208	$	796		$	(833	)	$	796

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(1)	Total other-than-temporary impairments (OTTI) for the three months ended March 31, 2019, 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	$	(1	)	$	—	$	—	$	—	$	(1	)
OTTI losses recognized in net realized investment gains	$	(1	)	$	—	$	—	$	—	$	(1	)
OTTI losses recognized in OCI	$	—		$	—	$	—	$	—	$	—

CONSOLIDATING STATEMENT OF INCOME (Unaudited)

For the three months ended March 31, 2018



(in millions)	TPC		Other Subsidiaries			TRV			Eliminations			Consolidated
Revenues
Premiums	$	4,468	$	2,069		$	—		$	—		$	6,537
Net investment income	412		185			6			—			603
Fee income	103		—			—			—			103
Net realized investment gains (losses) ⁽¹⁾	2		(12		)	(1		)	—			(11		)
Other revenues	27		28			—			(1		)	54
Total revenues	5,012		2,270			5			(1		)	7,286

Claims and expenses
Claims and claim adjustment expenses	2,910		1,386			—			—			4,296
Amortization of deferred acquisition costs	705		356			—			—			1,061
General and administrative expenses	729		328			6			(1		)	1,062
Interest expense	11		—			78			—			89
Total claims and expenses	4,355		2,070			84			(1		)	6,508
Income (loss) before income taxes	657		200			(79		)	—			778
Income tax expense (benefit)	106		32			(29		)	—			109
Net income of subsidiaries	—		—			719			(719		)	—
Net income	$	551	$	168		$	669		$	(719	)	$	669

_________________________________________________________


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

(in millions)

TPC

Other

Subsidiaries

TRV

Eliminations

Consolidated

Total OTTI losses

—

OTTI losses recognized in net realized investment gains (losses)

—

OTTI gains recognized in OCI

—

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

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (Unaudited)

For the three months ended March 31, 2019



(in millions)	TPC		Other Subsidiaries		TRV		Eliminations			Consolidated
Net income	$	625	$	208	$	796	$	(833	)	$	796

Other comprehensive income:
Changes in net unrealized gains (losses) on investment securities:
Having no credit losses recognized in the consolidated statement of income	979		435		2		—			1,416
Having credit losses recognized in the consolidated statement of income	4		1		—		—			5
Net changes in benefit plan assets and obligations	—		—		12		—			12
Net changes in unrealized foreign currency translation	19		31		—		—			50
Other comprehensive income before income taxes and other comprehensive income of subsidiaries	1,002		467		14		—			1,483
Income tax expense	208		93		5		—			306
Other comprehensive income, net of taxes, before other comprehensive income of subsidiaries	794		374		9		—			1,177
Other comprehensive income of subsidiaries	—		—		1,168		(1,168		)	—
Other comprehensive income	794		374		1,177		(1,168		)	1,177
Comprehensive income	$	1,419	$	582	$	1,973	$	(2,001	)	$	1,973

CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS) (Unaudited)

For the three months ended March 31, 2018



(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Net income	$	551		$	168		$	669		$	(719	)	$	669

Other comprehensive income (loss):
Changes in net unrealized gains (losses) on investment securities:
Having no credit losses recognized in the consolidated statement of income	(838		)	(364		)	(1		)	—			(1,203		)
Having credit losses recognized in the consolidated statement of income	(1		)	(1		)	—			—			(2		)
Net changes in benefit plan assets and obligations	—			—			22			—			22
Net changes in unrealized foreign currency translation	(25		)	31			—			—			6
Other comprehensive income (loss) before income taxes and other comprehensive loss of subsidiaries	(864		)	(334		)	21			—			(1,177		)
Income tax expense (benefit)	(175		)	(77		)	8			—			(244		)
Other comprehensive income (loss), net of taxes, before other comprehensive loss of subsidiaries	(689		)	(257		)	13			—			(933		)
Other comprehensive loss of subsidiaries	—			—			(946		)	946			—
Other comprehensive loss	(689		)	(257		)	(933		)	946			(933		)
Comprehensive loss	$	(138	)	$	(89	)	$	(264	)	$	227		$	(264	)

Consolidating Balance Sheet (Unaudited) [Table Text Block]

CONSOLIDATING BALANCE SHEET (Unaudited)

At March 31, 2019



(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Assets
Fixed maturities, available for sale, at fair value (amortized cost $64,216)	$	45,336		$	20,079		$	85		$	—		$	65,500
Equity securities, at fair value (cost $375)	105			106			189			—			400
Real estate investments	1			968			—			—			969
Short-term securities	1,645			581			1,868			—			4,094
Other investments	2,772			781			1			—			3,554
Total investments	49,859			22,515			2,143			—			74,517
Cash	150			207			—			—			357
Investment income accrued	406			182			3			—			591
Premiums receivable	5,356			2,591			—			—			7,947
Reinsurance recoverables	6,496			1,785			—			—			8,281
Ceded unearned premiums	838			97			—			—			935
Deferred acquisition costs	1,987			203			—			—			2,190
Deferred taxes	(76		)	222			(31		)	—			115
Contractholder receivables	4,801			10			—			—			4,811
Goodwill	2,581			1,377			—			(9		)	3,949
Other intangible assets	222			119			—			—			341
Investment in subsidiaries	—			—			28,475			(28,475		)	—
Other assets	2,470			393			349			—			3,212
Total assets	$	75,090		$	29,701		$	30,939		$	(28,484	)	$	107,246

Liabilities
Claims and claim adjustment expense reserves	$	34,800		$	15,918		$	—		$	—		$	50,718
Unearned premium reserves	9,872			4,250			—			—			14,122
Contractholder payables	4,801			10			—			—			4,811
Payables for reinsurance premiums	380			255			—			—			635
Debt	693			—			6,364			—			7,057
Other liabilities	4,287			1,049			227			—			5,563
Total liabilities	54,833			21,482			6,591			—			82,906

Shareholders’ equity
Common stock (1,750.0 shares authorized; 262.0 shares issued and 261.9 shares outstanding)	—			401			23,243			(401		)	23,243
Additional paid-in capital	11,634			7,083			—			(18,717		)	—
Retained earnings	8,390			807			35,803			(9,205		)	35,795
Accumulated other comprehensive income (loss)	233			(72		)	(682		)	(161		)	(682		)
Treasury stock, at cost (514.2 shares)	—			—			(34,016		)	—			(34,016		)
Total shareholders’ equity	20,257			8,219			24,348			(28,484		)	24,340
Total liabilities and shareholders’ equity	$	75,090		$	29,701		$	30,939		$	(28,484	)	$	107,246

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, available for sale, 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 Statement of Cash Flows (Unaudited) [Table Text Block]

CONSOLIDATING STATEMENT OF CASH FLOWS (Unaudited)

For the three months ended March 31, 2019



(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Cash flows from operating activities
Net income	$	625		$	208		$	796		$	(833	)	$	796
Net adjustments to reconcile net income to net cash provided by operating activities	(110		)	(42		)	(227		)	222			(157		)
Net cash provided by operating activities	515			166			569			(611		)	639
Cash flows from investing activities
Proceeds from maturities of fixed maturities	1,043			508			5			—			1,556
Proceeds from sales of investments:
Fixed maturities	551			218			—			—			769
Equity securities	19			20			—			—			39
Real estate investments	—			—			—			—			—
Other investments	90			15			—			—			105
Purchases of investments:
Fixed maturities	(2,228		)	(682		)	(4		)	—			(2,914		)
Equity securities	(1		)	(20		)	(1		)	—			(22		)
Real estate investments	—			(77		)	—			—			(77		)
Other investments	(134		)	(12		)	—			—			(146		)
Net sales (purchases) of short-term securities	210			178			(497		)	—			(109		)
Securities transactions in course of settlement	283			13			(1		)	—			295
Other	(80		)	(2		)	—			—			(82		)
Net cash provided by (used in) investing activities	(247		)	159			(498		)	—			(586		)
Cash flows from financing activities
Treasury stock acquired — share repurchase authorization	—			—			(375		)	—			(375		)
Treasury stock acquired — net employee share-based compensation	—			—			(46		)	—			(46		)
Dividends paid to shareholders	—			—			(205		)	—			(205		)
Payment of debt	—			(32		)	—			32			—
Issuance of debt	—			—			492			—			492
Issuance of common stock — employee share options	—			—			63			—			63
Dividends paid to parent company	(300		)	(279		)	—			579			—
Net cash used in financing activities	(300		)	(311		)	(71		)	611			(71		)
Effect of exchange rate changes on cash	1			1			—			—			2
Net increase (decrease) in cash	(31		)	15			—			—			(16		)
Cash at beginning of year	181			192			—			—			373
Cash at end of period	$	150		$	207		$	—		$	—		$	357
Supplemental disclosure of cash flow information
Income taxes paid	$	4		$	1		$	—		$	—		$	5
Interest paid	$	16		$	—		$	34		$	—		$	50

CONSOLIDATING STATEMENT OF CASH FLOWS (Unaudited)

For the three months ended March 31, 2018



(in millions)	TPC			Other Subsidiaries			TRV			Eliminations			Consolidated
Cash flows from operating activities
Net income	$	551		$	168		$	669		$	(719	)	$	669
Net adjustments to reconcile net income to net cash provided by operating activities	(126		)	(57		)	(22		)	90			(115		)
Net cash provided by operating activities	425			111			647			(629		)	554
Cash flows from investing activities
Proceeds from maturities of fixed maturities	1,453			493			4			—			1,950
Proceeds from sales of investments:
Fixed maturities	729			356			—			—			1,085
Equity securities	8			18			—			—			26
Real estate investments	—			—			—			—			—
Other investments	76			38			—			—			114
Purchases of investments:
Fixed maturities	(2,836		)	(1,078		)	(6		)	—			(3,920		)
Equity securities	(1		)	(18		)	(1		)	—			(20		)
Real estate investments	—			(33		)	—			—			(33		)
Other investments	(115		)	(27		)	—			—			(142		)
Net sales (purchases) of short-term securities	729			201			(520		)	—			410
Securities transactions in course of settlement	147			56			(1		)	—			202
Other	(52		)	(1		)	—			—			(53		)
Net cash provided by (used in) investing activities	138			5			(524		)	—			(381		)
Cash flows from financing activities
Treasury stock acquired — share repurchase authorization	—			—			(350		)	—			(350		)
Treasury stock acquired — net employee share-based compensation	—			—			(51		)	—			(51		)
Dividends paid to shareholders	—			—			(197		)	—			(197		)
Payment of debt	—			—			(100		)	—			(100		)
Issuance of debt	—			—			491			—			491
Issuance of common stock — employee share options	—			—			85			—			85
Dividends paid to parent company	(544		)	(85		)	—			629			—
Net cash used in financing activities	(544		)	(85		)	(122		)	629			(122		)
Effect of exchange rate changes on cash	(1		)	3			—			—			2
Net increase in cash	18			34			1			—			53
Cash at beginning of year	157			187			—			—			344
Cash at end of period	$	175		$	221		$	1		$	—		$	397
Supplemental disclosure of cash flow information
Income taxes paid	$	13		$	43		$	—		$	—		$	56
Interest paid	$	16		$	—		$	23		$	—		$	39