8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  February 1, 2007

The St. Paul Travelers Companies, Inc.

(Exact name of registrant as specified in its charter)

Minnesota	001-10898	41-0518860
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification Number)
385 Washington Street Saint Paul, Minnesota		55102
(Address of principal executive offices)		(Zip Code)

(651) 310-7911
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.  Results of Operations and Financial Condition.

On February 1, 2007, The St. Paul Travelers Companies, Inc. (the “Company”) issued a press release announcing the results of the Company’s operations for the quarter ended December 31, 2006, and the availability of the Company’s fourth quarter financial supplement on the Company’s web site.  The press release and the financial supplement are furnished as Exhibits 99.1 and 99.2 to this Report and are hereby incorporated by reference in this Item 2.02.

As provided in General Instruction B.2 of Form 8-K, the information and exhibits contained in this Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01.  Financial Statements and Exhibits.

(d)           Exhibits.

Exhibit No.	Description
99.1	Press Release, dated February 1, 2007, reporting results of operations (This exhibit is furnished and not filed.)
99.2	Fourth Quarter 2006 Financial Supplement of The St. Paul Travelers Companies, Inc. (This exhibit is furnished and not filed.)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:       February 1, 2007	THE ST. PAUL TRAVELERS COMPANIES, INC.
	By:	/s/ Bruce A. Backberg
		Name:  Bruce A. Backberg
		Title:  Senior Vice President

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated February 1, 2007, reporting results of operations (This exhibit is furnished and not filed.)
99.2	Fourth Quarter 2006 Financial Supplement of The St. Paul Travelers Companies, Inc. (This exhibit is furnished and not filed.)

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EX-99.1

Exhibit 99.1

St. Paul Travelers Companies
385 Washington Street
St. Paul, MN 55102-1396
www.stpaultravelers.com

NEWS RELEASE

St. Paul Travelers Reports Fourth Quarter 2006
Net Income of $1.189 Billion, or $1.68 per Diluted Share

Announces $3 Billion Increase to Current Share Repurchase Program

Full Year 2006 Net Income of $4.208 Billion, or $5.91 per Diluted Share

Full Year 2006 Return on Equity of 17.9%

SAINT PAUL, Minn. (February 1, 2007) — The St. Paul Travelers Companies, Inc. (“St. Paul Travelers,” NYSE: STA) today reported net income of $1.189 billion, or $1.75 per basic share and $1.68 per diluted share, for the quarter ended December 31, 2006, compared to $179 million, or $0.26 per basic and diluted share, for the quarter ended December 31, 2005.  Operating income in the current quarter was $1.193 billion, or $1.75 per basic share and $1.69 per diluted share, compared to $151 million, or $0.22 per basic and diluted share, in the prior year quarter.

Net and operating income in the current quarter included after-tax benefits of $100 million ($157 million pre-tax) for net favorable prior year reserve development and $43 million ($66 million pre-tax) due to the re-estimation of the current year loss ratios for the first three quarters of 2006.  Catastrophe losses negatively impacted current quarter net and operating income by $13 million after-tax ($21 million pre-tax).  In the prior year quarter, net and operating income included an after-tax charge of $372 million ($557 million pre-tax) for net unfavorable prior year reserve development, primarily due to increases to asbestos and environmental reserves, and an after-tax benefit of $45 million ($70 million pre-tax) due to the re-estimation of the current year loss ratios for the first three quarters of 2005.  Catastrophe losses in the prior year quarter negatively impacted net and operating income by $435 million after-tax ($623 million pre-tax).

Full year 2006 net income and income from continuing operations was $4.208 billion, or $6.12 per basic share and $5.91 per diluted share.  For full year 2005, net income was $1.622 billion, or $2.39 per basic share and $2.33 per diluted share, and income from continuing operations was $2.061 billion, or $3.04 per basic share and $2.95 per diluted share.  Net income in the prior year was negatively impacted by a $439 million after-tax loss in discontinued operations, primarily due to a tax charge related to the Company’s divestiture of its 78 percent equity interest in Nuveen Investments, Inc. (“Nuveen”).  Operating income for full year 2006 was $4.200 billion, or $6.11 per basic share and $5.90 per diluted share, compared to $2.026 billion, or $2.99 per basic share and $2.90 per diluted share, in the prior year.  Catastrophe losses in the prior year negatively impacted net and operating income by $1.472 billion after-tax ($2.189 billion pre-tax).

Highlights

·Operating return on equity of 19.6 percent for the quarter and 17.9 percent for the full year.  

·Book value per share (excluding FAS 115) of $36.20, a 15 percent increase from year-end 2005.

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·Net written premiums of $5.437 billion, a 3 percent increase from the prior year quarter.  Excluding Business Insurance Other, the Company’s runoff operations, net written premiums increased 4 percent.

·Record net investment income of $701 million after-tax, an 11 percent increase from the prior year quarter.

·Strong GAAP combined ratios in all segments in the current quarter, with Business Insurance at 90.9 percent; Financial, Professional & International Insurance at 90.4 percent; and Personal Insurance at 78.1 percent. 

·Repurchased 14.4 million common shares for a total cost of $750 million in the quarter, under the previously authorized $2 billion share repurchase program. 

Jay Fishman, Chairman and Chief Executive Officer, remarked, “We are extremely pleased with our company’s performance in the fourth quarter and for the full year.  Operating income for the quarter was approximately $1.2 billion, with a very strong operating return on equity of 19.6 percent.  For the first time in our company’s history, our annual revenues exceeded $25 billion.  We grew net written premiums 5 percent for the year, excluding our run-off operations, by continuing to deliver high-quality products and services to meet our agents’, brokers’ and customers’ needs.

“In keeping with our commitment to active capital management, we repurchased $750 million of our company’s stock in the fourth quarter, bringing our full year repurchases to more than $1.1 billion under our share repurchase program.  I am also pleased to announce that our Board has authorized an increase of $3 billion to our program, bringing the total authorization remaining to approximately $3.9 billion, or 11 percent of our outstanding shares based on yesterday’s closing price.  We are targeting to complete the entire program over the next 24 months.

“Margins remained very healthy, as evidenced by our full year combined ratio of 88.1 percent.  This was driven in some measure by a benign year for catastrophe losses – the opposite of what we experienced in the preceding two years – as well as favorable reserve development.  Retentions were high throughout the year, a reflection that our customers continue to find value in their relationships with us, and new business volume was up for the year.

“Looking ahead to 2007, our company is in a great financial and competitive position, and we have the resources necessary to continue building upon our success,” concluded Mr. Fishman.

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Consolidated Fourth Quarter and Full Year Highlights

($ in millions, except for per share amounts, and	Three Months Ended December 31,								Twelve Months Ended December 31,
after-tax except for premiums)	2006			2005			Change		2006			2005			Change
Gross written premiums	$	5,932		$	5,877		1	%	$	24,039		$	23,736		1	%
excluding Business Insurance Other	5,925			5,822			2		24,009			23,358			3
Net written premiums	5,437			5,294			3		21,150			20,386			4
excluding Business Insurance Other	5,441			5,239			4		21,125			20,139			5
Net earned premiums	5,328			5,136			4		20,760			20,341			2
Underwriting gain (loss)	487			(463		)	NMF		1,542			(344		)	NMF
Net investment income	701			632			11		2,712			2,438			11
Operating income	1,193			151			690		4,200			2,026			107
per diluted share	$	1.69		$	0.22		668		$	5.90		$	2.90		103
Income from continuing operations	1,189			178			568		4,208			2,061			104
per diluted share	$	1.68		$	0.26		546		$	5.91		$	2.95		100
Net income	1,189			179			564		4,208			1,622			159
per diluted share	$	1.68		$	0.26		546		$	5.91		$	2.33		154
Book value per share	$	36.86		$	31.94		15		$	36.86		$	31.94		15
Adjusted book value per share	$	36.20		$	31.47		15		$	36.20		$	31.47		15
GAAP combined ratio	86.7		%	111.1		%	(24.4	)pts	88.1		%	101.3		%	(13.2	)pts
Operating return on equity	19.6		%	2.8		%	16.8	pts	17.9		%	9.6		%	8.3	pts
Continuing operations return on equity	19.1		%	3.2		%	15.9	pts	17.9		%	9.5		%	8.4	pts
Return on equity	19.1		%	3.2		%	15.9	pts	17.9		%	7.5		%	10.4	pts

See Glossary of Financial Measures for definitions and the statistical supplement for additional financial data

Fourth Quarter 2006 Consolidated Results

Net written premiums increased 3 percent from the prior year quarter.  This result was primarily driven by strong retention rates, modest renewal price increases across most businesses and improved new business volume, due in part to initiatives to increase new business submission flow.

Net investment income in the current quarter was a record $701 million after-tax ($910 million pre-tax), an 11 percent increase from the prior year quarter.  The increase was primarily driven by higher fixed income investment returns, strong operating cash flows and greater non-fixed income investment returns.

The GAAP combined ratio in the current quarter was 86.7 percent, a 24.4 point improvement from the 111.1 percent reported in the prior year quarter. The current quarter GAAP combined ratio benefited by 3.0 points due to net favorable prior year reserve development, partially offset by 0.4 points for catastrophe losses.  The prior year quarter GAAP combined ratio included 12.2 points for catastrophe losses and 10.8 points for net unfavorable prior year reserve development.  In the current and prior year quarter, the re-estimation of current year loss ratios benefited the GAAP combined ratio by 1.2 and 1.4 points, respectively.

Capital Management

St. Paul Travelers’ Board of Directors has authorized a $3 billion increase to the current share repurchase program, bringing the total remaining authorization to approximately $3.9 billion.  Under the program, repurchases may be made from time to time in the open-market, in private transactions, pursuant to pre-set trading plans meeting the requirements of Rule 10b5-1 of the Securities Exchange Act of 1934 or otherwise.  This program does not have a stated expiration date.  The timing and actual number of shares to be repurchased will depend on a variety of factors, including corporate and regulatory requirements, price, weather and other market conditions.

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During the fourth quarter of 2006, the Company repurchased 14.4 million of its common shares for a total cost of $750 million under the previously authorized share repurchase program.  Through December 31, 2006, the Company has repurchased an aggregate of 22.8 million shares for a total cost of $1.121 billion under the program.  Also, during the fourth quarter of 2006, the Company fully redeemed its St. Paul Capital Trust I 7.6% Trust Preferred Securities for a total cost of $593 million.  The redemption was funded by the issuance of senior debt earlier in 2006 and resulted in an after-tax gain of $27 million ($42 million pre-tax).

Full Year 2006 Consolidated Results

Net and operating income of $4.208 billion and $4.200 billion, respectively, for the year ended December 31, 2006, included an after-tax benefit of $255 million ($394 million pre-tax) for net favorable prior year reserve development and an after-tax charge of $67 million ($103 million pre-tax) for catastrophe losses.  In the prior year, net and operating income of $1.622 billion and $2.026 billion, respectively, included after-tax charges of $216 million ($325 million pre-tax) for net unfavorable prior year reserve development and $1.472 billion ($2.189 billion pre-tax) for catastrophe losses.

The GAAP combined ratio in the current year was 88.1 percent, a 13.2 point improvement from the 101.3 percent reported in the prior year.  The current year GAAP combined ratio benefited by 1.9 points for net favorable prior year reserve development, partially offset by 0.5 points for catastrophe losses.  The prior year GAAP combined ratio included 10.7 points for catastrophe losses and 1.6 points for net unfavorable prior year reserve development.

Net investment income in the current year was a record $2.712 billion after-tax ($3.517 billion pre-tax), an 11 percent increase from the prior year.  The increase was driven by higher fixed income investment returns, strong operating cash flows, the investment of approximately $2.4 billion of proceeds received from the sale of Nuveen in 2005, and greater non-fixed income investment returns.

For the full year 2006, operating return on equity was 17.9 percent, compared to 9.6 percent in the prior year period.

Business Insurance Segment Financial Results

For the fourth quarter 2006, the Business Insurance segment reported operating income of $703 million, compared to an operating loss of $110 million in the prior year quarter.  The current quarter benefited from net favorable prior year reserve development, the absence of catastrophe losses and higher net investment income.

The current quarter included an after-tax benefit of $7 million ($14 million pre-tax) for net favorable prior year reserve development, compared to an after-tax charge of $438 million ($657 million pre-tax) for net unfavorable prior year reserve development in the prior year quarter, due to increases to asbestos and environmental reserves.  There were no catastrophe losses reported in the current quarter, compared to an after-tax charge of $293 million ($449 million pre-tax) for catastrophe losses in the prior year quarter.  The current quarter included a minimal benefit from the re-estimation of the current year loss ratios for the first three quarters of 2006.  In comparison, the prior year quarter included an after-tax benefit of $32 million ($50 million pre-tax) due to the re-estimation of the current year loss ratios for the first three quarters of 2005.

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The GAAP combined ratio was 90.9 percent in the current quarter, a 39.5 point improvement from the 130.4 percent reported in the prior year quarter.  There were no catastrophe losses in the current quarter, while catastrophe losses added 16.3 points to the prior year quarter GAAP combined ratio.  The current quarter GAAP combined ratio benefited by 0.5 points for net favorable prior year reserve development, compared to an impact of 24.0 points for net unfavorable prior year reserve development in the prior year quarter.  The current quarter GAAP combined ratio benefited by 0.3 points due to the re-estimation of the current year loss ratios for the first three quarters of 2006, compared to a benefit of 1.8 points related to the first three quarters of 2005.

Net written premiums, excluding Business Insurance Other, increased 2 percent from the prior year quarter, primarily due to growth in Target Risk Underwriting and Industry-Focused Underwriting, partially offset by a decline in National Accounts.

Within Select Accounts, excluding the impact of the transfer of certain small business insurance programs to Specialized Distribution, net written premiums increased slightly from the prior year quarter.  Retention rates were strong, consistent with recent quarters; renewal price changes were positive, consistent with recent quarters; and new business volume increased from the prior year quarter.

Commercial Accounts net written premiums were level with the prior year quarter.  Retention rates continued to be strong, consistent with recent quarters; renewal price changes were slightly negative, a change from recent quarters; and new business volume increased from the prior year quarter, due to successful marketing efforts to increase submission volume.

Industry-Focused Underwriting net written premiums increased due to strong business volumes in the Construction, Technology and Oil & Gas business units, benefiting from favorable economic conditions in these industry sectors.  Growth in Target Risk Underwriting net written premiums was primarily driven by renewal price increases for catastrophe-prone exposures in National Property, Inland Marine and Ocean Marine. National Accounts net written premiums declined as a result of lower volumes in the Discover Re unit, favorable loss experience on retrospectively rated policies and lower workers’ compensation rates in California.

Financial, Professional & International Insurance Segment Financial Results

For the fourth quarter 2006, the Financial, Professional & International Insurance segment reported operating income of $175 million, compared to $57 million in the prior year quarter.  The current quarter benefited from the absence of catastrophe losses and certain positive tax impacts from non-U.S. operations.

There were no catastrophe losses reported in the current quarter, compared to an after-tax charge of $89 million ($92 million pre-tax) for catastrophe losses in the prior year quarter.  Operating income in the current quarter included an after-tax benefit of $3 million ($4 million pre-tax) for net favorable prior year reserve development, compared to an after-tax benefit of $13 million ($18 million pre-tax) in the prior year quarter.

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The GAAP combined ratio was 90.4 percent in the current quarter, a 7.1 point improvement from the 97.5 percent reported in the prior year quarter.  The improvement was primarily due to the absence of catastrophe losses, which added 11.1 points to the prior year quarter GAAP combined ratio.  The current quarter GAAP combined ratio benefited by 0.4 points for net favorable prior year reserve development, compared to a benefit of 2.1 points in the prior year quarter.

Gross written premiums increased 2 percent from the prior year quarter due to modest growth in all businesses, while net written premiums increased 8 percent, primarily due to the timing of certain reinsurance transactions.  Gross and net written premiums in the prior year quarter benefited from the inclusion of an extra reporting month for the Company’s Lloyd’s operations, which eliminated a one-month reporting lag.  Excluding this impact, gross and net written premiums increased 4 and 10 percent, respectively.

The Bond and Financial & Professional Services units have been combined and are now being reported as Bond & Financial Products.  For Bond & Financial Products, excluding the surety line of business for which the following statistics do not apply, retention rates were strong, consistent with recent quarters; renewal price changes were positive, but lower than recent quarters; and new business volume decreased from the prior year quarter, due to competitive pressures.  For International, which includes the Company’s operations in the U.K., Ireland and Canada, retention rates were very strong, increasing from recent quarters; renewal price changes were positive, increasing from recent quarters; and new business volume increased slightly from the prior year quarter.

Personal Insurance Segment Financial Results

For the fourth quarter 2006, the Personal Insurance segment reported operating income of $348 million, compared to $249 million in the prior year quarter.  The current quarter benefited from lower catastrophe losses, greater net favorable prior year reserve development, increased earned premium volume, the continuation of favorable loss trends and higher net investment income.

The current quarter included an after-tax charge of $13 million ($21 million pre-tax) for catastrophe losses, compared to $53 million ($82 million pre-tax) in the prior year quarter.  The current quarter also included an after-tax benefit of $90 million ($139 million pre-tax) for net favorable prior year reserve development, primarily due to better than expected automobile loss experience resulting in part from claim initiatives and non-catastrophe homeowners claim severity resulting in part from less than expected repair costs.  The prior year quarter included an after-tax benefit of $53 million ($82 million pre-tax) for net favorable prior year reserve development.  Loss experience has trended favorably in the current accident year due to lower than expected automobile claim activity, resulting in an after-tax benefit of $37 million ($56 million pre-tax) from the re-estimation of the current year loss ratios for the first three quarters of 2006.  The prior year quarter included an after-tax benefit of $12 million ($19 million pre-tax) due to the re-estimation of the current year loss ratios for the first three quarters of 2005.

The GAAP combined ratio was 78.1 percent in the current quarter, a 6.4 point improvement from the 84.5 percent reported in the prior year quarter.  Catastrophe losses added 1.3 points to the current quarter GAAP combined ratio, compared to 5.2 points in the prior year quarter.  Net favorable prior year reserve development benefited the current quarter GAAP combined ratio by 8.2 points, compared to a benefit of 5.3 points in the prior year quarter.  The current quarter GAAP combined ratio benefited by 3.3 points due to the re-estimation of the current year loss ratios for the first three quarters of 2006, compared to a similar benefit in the prior year quarter of 1.2 points related to the first three quarters of 2005.

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Personal Insurance net written premiums increased 6 percent from the prior year quarter.  This result was primarily attributable to continued strong retention rates and renewal price increases.

Automobile net written premiums increased 3 percent, and policies in force increased 10 percent from the prior year quarter.  Excluding the estimated impact of transitioning to six-month policies for new business, net written premiums would have increased approximately 6 percent.  Retention rates were strong and renewal price changes were positive, both consistent with recent quarters.  New business volume increased slightly from the prior year quarter, after adjusting for the six-month policy impact.

Homeowners and Other net written premiums increased 9 percent, and policies in force increased 8 percent from the prior year quarter.  Retention rates were strong, consistent with recent quarters, and renewal price changes increased from recent quarters. New business volume decreased from the prior year quarter, due in part to coastal risk management.

2007 Annual Guidance

St. Paul Travelers expects 2007 earnings per diluted share in the range of $5.20 to $5.45. This guidance is based on a number of assumptions, including:

·      Catastrophe losses of $530 million pre-tax and $355 million after-tax;

·      No prior year reserve development, favorable or unfavorable;

·      Growth in average invested assets in the low single digits, after taking into account dividends and approximately $2 billion of share repurchases for the year; and

·      Weighted average diluted shares of approximately 690 million, including the impact of the assumed share repurchases and normal growth in share count from employee equity awards.

Financial Supplement and Conference Call

The information in this press release should be read in conjunction with a financial supplement that is available on our Web site at www.stpaultravelers.com.  The management of St. Paul Travelers will discuss the contents of this release via Webcast at 9 a.m. Eastern (8 a.m. Central) on Thursday, February 1, 2007.  Prior to the Webcast, a related slide presentation will be available on the Company’s Web site.  Following the live event, an audio playback of the Webcast and the slide presentation will be available at the Company’s Web site.

To view the slides or to listen to the Webcast or the playback, visit the “Webcasts & Presentations” section of the St. Paul Travelers investor relations Web site at http://investor.stpaultravelers.com/.

About St. Paul Travelers

St. Paul Travelers is a leading provider of property casualty insurance.  For more information, visit www.stpaultravelers.com.

Glossary of Financial Measures

The following measures are used by the Company’s management to evaluate financial performance against historical results and establish targets on a consolidated basis.  In some cases, these measures are considered non-GAAP financial measures under applicable SEC rules because they are not displayed as separate line items in the consolidated statement of income or required to be disclosed in the notes to financial statements, and in some cases, include or exclude certain items not ordinarily included or excluded

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in the most comparable GAAP financial measure. In the opinion of the Company’s management, a discussion of these measures provides investors with a better understanding of the significant factors that comprise the Company’s periodic results of operations and how management evaluates the Company’s financial performance.

Operating income (loss) is net income (loss) excluding the after-tax impact of net realized investment gains (losses) and discontinued operations.  Operating income (loss) per share is operating income (loss) on a per share basis.

Return on equity is the ratio of net income to average equity.  Continuing operations return on equity is the ratio of income from continuing operations to average equity.  Operating return on equity is the ratio of operating income to average equity excluding net unrealized investment gains and losses and discontinued operations, net of tax.

In the opinion of the Company’s management, operating income, operating income per share and operating return on equity are meaningful indicators of underwriting and operating results.  These measures exclude net realized investment gains or losses, which can be significantly impacted by both discretionary and other economic factors and are not necessarily indicative of operating trends.  Internally, the Company’s management uses operating income, operating income per share and operating return on equity to evaluate performance against historical results and establish financial targets on a consolidated basis.

Underwriting gain (loss) is net earned premiums and fee income less claims and claim adjustment expenses and insurance-related expenses.

A catastrophe is a severe loss, resulting from natural and manmade events, including risks such as fire, earthquake, windstorm, explosion, terrorism and other similar events.  Each catastrophe has unique characteristics.  Catastrophes are not predictable as to timing or amount in advance, and therefore their effects are not included in earnings or claims and claim adjustment expense reserves prior to occurrence.  A catastrophe may result in the payment of reinstatement premiums and assessments from various pools.  In the opinion of the Company’s management, a discussion of the impact of catastrophes is meaningful for investors to understand the variability in periodic earnings.

Reinstatement premiums represent additional premiums payable to reinsurers to restore coverage limits that have been exhausted as a result of reinsured losses under certain excess of loss reinsurance treaties.

Loss reserve development is the increase or decrease in incurred claims and claim adjustment expenses as a result of the re-estimation of claims and claim adjustment expense reserves at successive valuation dates for a given group of claims.  Loss reserve development may be related to prior year or current year development.  In the opinion of the Company’s management, discussion of prior year loss reserve development is useful to investors as it allows them to assess the impact between prior year and current year development on current earnings and changes in claims and claim adjustment expense reserve levels from period to period.

GAAP combined ratio is the sum of the loss and loss adjustment expense ratio (loss and LAE ratio), the underwriting expense ratio and, where applicable, the ratio of dividends to policyholders to net premiums earned.  For GAAP, the loss and LAE ratio is the ratio of incurred losses and loss adjustment expenses reduced by an allocation of fee income to net earned premiums.  The underwriting expense ratio is the ratio of underwriting expenses incurred reduced by an allocation of fee income, billing and policy fees to net earned premiums. A GAAP combined ratio under 100% generally indicates an underwriting profit. A GAAP combined ratio over 100% generally indicates an underwriting loss. The GAAP combined ratio is an operating statistic that includes GAAP measures in the numerator and the denominator.

Gross written premiums reflect the direct and assumed contractually determined amounts charged to the policyholders for the effective period of the contract based on the terms and conditions of the insurance contract.  Gross written premiums are a measure of overall business volume.

Adjusted book value per share represents assets less liabilities and preferred shareholders’ equity excluding the after-tax impact of net unrealized investment gains and losses, divided by the number of shares outstanding. In the opinion of the Company’s management, adjusted book value is useful in an analysis of a property casualty company’s book value on a nominal basis as it removes the effect of changing prices on invested assets, which do not have an equivalent impact on unpaid claims and claim adjustment expense reserves.

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St. Paul Travelers has organized its businesses into the following operating and reporting segments, beginning with the third quarter 2006:

Business Insurance: The Business Insurance segment offers a broad array of property and casualty insurance and insurance-related services in the United States.  Business Insurance is organized into the following groups, which collectively comprise Business Insurance Core operations: Select Accounts; Commercial Accounts; National Accounts; Industry-Focused Underwriting including Construction, Technology, Public Sector Services, Oil & Gas and Agribusiness; Target Risk Underwriting including National Property, Inland Marine, Ocean Marine, Excess Casualty, Boiler & Machinery and Global Accounts; and Specialized Distribution including Northland, National Programs and Underwriting Facilities.  Business Insurance also includes the Special Liability Group and policies written by Gulf (primarily management and professional liability coverages), the Personal Catastrophe Risk operation (which was sold in 2005), and other runoff operations, which collectively are referred to as Business Insurance Other.

Financial, Professional & International Insurance: The Financial, Professional & International Insurance segment includes surety, crime, and financial liability businesses, which primarily use credit-based underwriting processes, as well as property and casualty products that are predominantly marketed on an international basis.  The businesses in Financial, Professional & International Insurance are Bond & Financial Products and International and Lloyd’s.

Personal Insurance: The Personal Insurance segment writes virtually all types of property and casualty insurance covering personal risks.  The primary coverages in this segment are personal automobile and homeowners insurance sold to individuals.

Discontinued Operations (Asset Management) comprises Nuveen Investments, whose core businesses are asset management and related research, as well as the development, marketing and distribution of investment products and services for the affluent, high net worth and institutional market segments.  During the third quarter of 2005, the Company completed the divestiture of its ownership interest of Nuveen Investments.

Prior quarter segment results have been reclassified from the historical presentation to conform with current business segment definitions where applicable.  The Company’s historical Commercial and Specialty segments have been realigned into two new segments: the Business Insurance segment and the Financial, Professional & International Insurance segment.  As a result, prior quarter results of certain businesses have been disaggregated from the historical Specialty segment and are now reported in the Business Insurance segment.  In addition, the Personal segment has been renamed Personal Insurance.

* * * * *

Forward Looking Statement

This press release 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.  Specifically, earnings guidance and statements about our share repurchase plans are forward looking, and we may make forward-looking statements about our results of operations (including, among others, premium volume, income from continuing operations, net and operating income, investment income, return on equity and combined ratio), financial condition (including, among others, invested assets and liquidity); and the sufficiency of our asbestos and other reserves (including, among others, asbestos claim payment patterns); the cost and availability of reinsurance coverage; catastrophe losses; and strategic initiatives.  Such statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements.

Some of the factors that could cause actual results to differ include, but are not limited to, the following: catastrophe losses could materially reduce our profitability and adversely impact our ratings, our ability to raise capital and the availability and cost of reinsurance; our business could be harmed because of our potential exposure to asbestos and environmental claims and related litigation; we are exposed to, and may face adverse developments involving mass tort claims such as those relating to exposure to potentially harmful products or substances; if actual claims exceed our loss reserves, or if changes in the estimated level of loss reserves are necessary, our financial results could be significantly and adversely affected; the effects of emerging claim and coverage issues on our business are uncertain; reinsurance may not protect us against losses; we may incur loss and loss adjustment expenses as a result of disclosures by, and investigations of, companies for which we have written directors’ and officers’ insurance relating to possible accounting

9

irregularities, corporate governance issues and stock option “backdating,” “spring loading” and other stock option grant practices; the insurance industry, including us, is the subject of a number of investigations by state and federal authorities in the United States, and we cannot predict the outcome of these investigations or their impact on our business or financial results; our businesses are heavily regulated and changes in regulation may reduce our profitability and limit our growth; a downgrade in our claims-paying and financial strength ratings could significantly reduce our business volumes, adversely impact our ability to access the capital markets and increase our borrowing costs; our investment portfolio may suffer reduced returns or losses which could reduce our profitability; the intense competition that we face could harm our ability to maintain or increase our profitability and premium volume; we may not be able to execute announced and future strategic initiatives as planned; the inability of our insurance subsidiaries to pay dividends to us in sufficient amounts would limit our ability to meet our obligations and to pay future dividends; assessments and other surcharges for guaranty funds, second-injury funds, catastrophe funds and other mandatory pooling arrangements may reduce our profitability; loss or significant restriction of the use of credit scoring or other variables in the pricing and underwriting of personal lines products could reduce our future profitability; disruptions to our relationships with our distributors, independent agents and brokers could adversely affect our future income and profitability; if we experience difficulties with outsourcing relationships, our ability to conduct our business might be negatively impacted; and the effects of corporate bankruptcies on surety bond claims.

Our forward-looking statements speak only as of the date of this press release or as of the date they are made, and we undertake no obligation to update forward-looking statements.  For a more detailed discussion of these factors, see the information under the caption “Risk Factors” in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission.

###

10

	Three months ended December 31,						Twelve months ended December 31,
($ in millions, except per share amounts, and after-tax)	2006			2005			2006			2005
Operating income	$	1,193		$	151		$	4,200		$	2,026
Net realized investment gains (losses)	(4		)	27			8			35
Income from continuing operations	1,189			178			4,208			2,061
Discontinued operations	—			1			—			(439		)
Net income	$	1,189		$	179		$	4,208		$	1,622
Basic earnings per share
Operating income	$	1.75		$	0.22		$	6.11		$	2.99
Net realized investment gains	—			0.04			0.01			0.05
Income from continuing operations	1.75			0.26			6.12			3.04
Discontinued operations	—			—			—			(0.65		)
Net income	$	1.75		$	0.26		$	6.12		$	2.39
Diluted earnings per share
Operating income	$	1.69		$	0.22		$	5.90		$	2.90
Net realized investment gains (losses)	(0.01		)	0.04			0.01			0.05
Income from continuing operations	1.68			0.26			5.91			2.95
Discontinued operations	—			—			—			(0.62		)
Net income	$	1.68		$	0.26		$	5.91		$	2.33
Weighted average number of common shares outstanding (basic)	679.2			688.3			687.1			676.3
Weighted average number of common shares outstanding and common stock equivalents (diluted)	711.0			694.1		(1)	716.7			712.8
Common shares outstanding at period end	678.3			693.4			678.3			693.4
Common stock dividends declared	$	176.0		$	160.0		$	696.0		$	622.0
Operating income (loss) by segment
Business Insurance	$	703		$	(110	)	$	2,622		$	1,044
Financial, Professional & International Insurance	175			57			609			391
Personal Insurance	348			249			1,132			775
	1,226			196			4,363			2,210
Interest Expense and Other	(33		)	(45		)	(163		)	(184		)
	$	1,193		$	151		$	4,200		$	2,026
Operating return on equity	19.6		%	2.8		%	17.9		%	9.6		%
Continuing operations return on equity	19.1		%	3.2		%	17.9		%	9.5		%
Return on equity	19.1		%	3.2		%	17.9		%	7.5		%

(1)The calculation of earnings per diluted share for the three months ended December 31, 2005 excluded the weighted average effects of the following securities convertible into the Company’s common shares because their effect was anti-dilutive: outstanding convertible preferred stock (3.8 million shares); zero coupon convertible notes (2.3 million shares); and convertible junior subordinated notes (16.7 million shares).

See Glossary of Financial Measures and the statistical supplement for additional financial data.

11

	Three months ended  December 31,						Twelve months ended  December 31,
($ in millions, pre-tax)	2006			2005			2006			2005
Revenues
Premiums	$	5,328		$	5,136		$	20,760		$	20,341
Net investment income	910			813			3,517			3,165
Fee income	138			159			591			664
Net realized investment gains (losses)	(5		)	33			11			17
Other revenues	98			40			211			178
	$	6,469		$	6,181		$	25,090		$	24,365
Revenues
Business Insurance	$	3,596		$	3,507		$	14,049		$	14,184
Financial, Professional & International Insurance	970			934			3,776			3,578
Personal Insurance	1,865			1,707			7,205			6,581
Total Segment Revenues	6,431			6,148			25,030			24,343
Interest Expense and Other	43			—			49			5
	6,474			6,148			25,079			24,348
Net realized investment gains (losses)	(5		)	33			11			17
	$	6,469		$	6,181		$	25,090		$	24,365
Gross written premiums
Business Insurance Core	$	3,215		$	3,216		$	13,017		$	13,075
Business Insurance Other	7			55			30			378
Total Business Insurance	3,222			3,271			13,047			13,453
Financial, Professional & International Insurance	1,029			1,012			3,981			3,809
Personal Insurance	1,681			1,594			7,011			6,474
	$	5,932		$	5,877		$	24,039		$	23,736
Net written premiums
Business Insurance Core	$	2,847		$	2,803		$	11,021		$	10,752
Business Insurance Other	(4		)	55			25			247
Total Business Insurance	2,843			2,858			11,046			10,999
Financial, Professional & International Insurance	964			893			3,393			3,159
Personal Insurance	1,630			1,543			6,711			6,228
	$	5,437		$	5,294		$	21,150		$	20,386
GAAP combined ratios:(1)
Business Insurance(2)
Loss and loss adjustment expense ratio	59.1		%	100.5		%	60.3		%	81.5		%
Underwriting expense ratio	31.8			29.9			30.6			28.9
Combined ratio	90.9		%	130.4		%	90.9		%	110.4		%
Financial, Professional & International Insurance(2)
Loss and loss adjustment expense ratio	54.9		%	62.7		%	53.7		%	56.8		%
Underwriting expense ratio	35.5			34.8			35.3			35.7
Combined ratio	90.4		%	97.5		%	89.0		%	92.5		%
Personal Insurance
Loss and loss adjustment expense ratio	48.7		%	56.4		%	54.8		%	62.2		%
Underwriting expense ratio	29.4			28.1			28.3			26.9
Combined ratio	78.1		%	84.5		%	83.1		%	89.1		%
Total Company(2)
Loss and loss adjustment expense ratio	55.1		%	81.0		%	57.5		%	71.9		%
Underwriting expense ratio	31.6			30.1			30.6			29.4
Combined ratio	86.7		%	111.1		%	88.1		%	101.3		%

(1)For purposes of computing GAAP ratios, billing and policy fees (which are a component of other revenues) are allocated as a reduction of other underwriting expenses.  In addition, fee income is allocated as a reduction of losses and loss adjustment expense and other underwriting expenses.

(2)Before policyholder dividends.

See Glossary of Financial Measures and the statistical supplement for additional financial data.

12

	Three months ended  December 31,						Twelve months ended  December 31,
($ in millions; after-tax except as noted)	2006			2005			2006			2005
Reconciliation of underwriting gain (loss) to net income
Pre-tax underwriting gain (loss)	$	674		$	(612	)	$	2,325		$	(389	)
Tax expense on underwriting results	(187		)	149			(783		)	45
Underwriting gain (loss)	487			(463		)	1,542			(344		)
Net investment income	701			632			2,712			2,438
Other, including interest expense	5			(18		)	(54		)	(68		)
Consolidated operating income	1,193			151			4,200			2,026
Net realized investment gains	(4		)	27			8			35
Income from continuing operations	1,189			178			4,208			2,061
Discontinued operations	—			1			—			(439		)
Net income	$	1,189		$	179		$	4,208		$	1,622

See Glossary of Financial Measures and the statistical supplement for additional financial data.

Contacts

Media:	Institutional Investors:	Individual Investors:
Shane Boyd	Michael Connelly	Marc Parr
651.310.3846, or	860.277.1507, or	860.277.0779
Marlene Ibsen	David Schlosberg
860.277.9039	917.778.6817

###

13

EX-99.2

Exhibit 99.2

The St. Paul Travelers Companies, Inc.
Financial Supplement - Fourth Quarter 2006

	Page Number
Business Realignment
Business Insurance	i
Financial, Professional & International Insurance	ii
Consolidated Results
Financial Highlights	1
Reconciliation to Net Income and Earnings Per Share	2
Statement of Income	3
Net Income by Major Component and Combined Ratio	4
Operating Income	5
Selected Statistics - Property and Casualty Operations	6
Written and Earned Premiums - Property and Casualty Operations	7
Business Insurance
Operating Income	8
Operating Income by Major Component and Combined Ratio	9
Selected Statistics	10
Net Written Premiums	11
Financial, Professional & International Insurance
Operating Income	12
Operating Income by Major Component and Combined Ratio	13
Selected Statistics	14
Net Written Premiums	15
Personal Insurance
Operating Income	16
Operating Income by Major Component and Combined Ratio	17
Selected Statistics	18
Selected Statistics - Automobile	19
Selected Statistics - Homeowners and Other	20
Supplemental Detail
Interest Expense and Other	21
Consolidated Balance Sheet	22
Investment Portfolio	23
Investment Portfolio - Fixed Maturities Data	24
Investment Income	25
Net Realized and Unrealized Investment Gains (Losses)	26
Reinsurance Recoverables	27
Net Reserves for Losses and Loss Adjustment Expense	28
Asbestos and Environmental Reserves	29
Capitalization	30
Statutory to GAAP Shareholders’ Equity Reconciliation	31
Statement of Cash Flows	32
Statement of Cash Flows (continued)	33
Glossary of Financial Measures and Description of Operating Segments	34

The information included in the Financial Supplement is unaudited. This document should be read in conjunction with the Company’s form 10-K which is filed with the Securities and Exchange Commission.

Index

The St. Paul Travelers Companies, Inc.
Financial Supplement - Fourth Quarter 2006
Business Realignment

In August 2006, the Company announced a realignment of two of its three reportable business segments. The former Commercial and Specialty segments were realigned into two new segments: the Business Insurance segment and the Financial, Professional & International Insurance segment. The Personal segment was renamed Personal Insurance. These changes were designed to reflect the manner in which the Company’s businesses are currently managed, and represent an aggregation of products and services based on type of customer, how the business is marketed and the manner in which the risks are underwritten. The following discussion relates to the two realigned segments. Financial data for all periods presented has been reclassified to be consistent with the new segment structure.

Business Insurance

The Business Insurance segment offers a broad array of property and casualty insurance and insurance-related services to its clients primarily in the United States. Business Insurance is organized into the following groups, which comprise Business Insurance’s Core operations collectively:

·    Select Accounts serves small businesses and offers commercial multi-peril, property, general liability, commercial auto and workers’ compensation insurance.

·    Commercial Accounts serves primarily mid-sized businesses for property and casualty products, including property, general liability, commercial multi-peril, commercial auto and workers’ compensation insurance. Certain units included in Commercial Accounts prior to the realignment are now included in the Industry-Focused Underwriting, Target Risk Underwriting or Specialized Distribution groups.

·    National Accounts comprises three business units. The largest provides casualty products and services to large companies, with particular emphasis on workers’ compensation, general liability and automobile liability. National Accounts also includes Discover Re, which provides property and casualty insurance products on an unbundled basis using third-party administrators for insureds who utilize programs such as collateralized deductibles, captive reinsurers and self-insurance. In addition, National Accounts includes the commercial residual market business, which primarily offers workers’ compensation products and services to the involuntary market.

·    Industry-Focused Underwriting. The following units serve targeted industries with differentiated combinations of insurance coverage, risk management, claims handling and other services:

·    Construction serves a broad range of construction businesses, offering guaranteed cost products for small to mid-sized policyholders and loss sensitive programs for larger accounts. For the larger accounts, the customer and the Company work together in actively managing and controlling exposure and claims and they share risk through policy features such as deductibles or retrospective rating. Products offered include workers’ compensation, general liability and commercial auto coverages, and other risk management solutions.

·    Technology serves small to mid-sized companies involved in telecommunications, information technology, medical technology and electronics manufacturing, offering a well-balanced comprehensive portfolio of products and services. These products include property, commercial auto, general liability, workers’ compensation, umbrella, internet liability, technology errors and omissions coverages and global companion products.

·    Public Sector Services markets insurance products and services to public entities including municipalities, counties, Indian Nation gaming and selected special government districts such as water and sewer utilities. The policies written by this unit typically cover property, commercial auto, general liability and errors and omissions exposures.

·    Oil & Gas provides specialized property and liability products and services for customers involved in the exploration and production of oil and natural gas, including operators and drilling contractors, as well as various service and supply companies and manufacturers that support upstream operations. The policies written by this business group insure drilling rigs, natural gas facilities, and production and gathering platforms, and cover risks including physical damage, liability and business interruption.

·    Agribusiness serves small to medium-sized agricultural businesses, including farms, ranches, wineries and related operations, offering property and liability coverages other than workers’ compensation.

·    Target Risk Underwriting. The following units serve commercial businesses requiring specialized product underwriting, claims handling and risk management services:

·    National Property serves large and mid-sized customers, including retailers, hospitals, colleges and universities, and owners of industrial parks, office buildings, apartments and amusement parks, covering losses on buildings, business assets and business interruption exposures.

·    Inland Marine provides insurance for goods in transit and movable objects for customers such as jewelers, museums, contractors and the transportation industry. Builders’ risk insurance is also offered to customers during the construction, renovation or repair of buildings and other structures.

·    Ocean Marine serves the marine transportation industry and related services, as well as other businesses involved in international trade. The Company’s product offerings fall under six main coverage categories: marine liability, cargo, hull and machinery, protection and indemnity, pleasure craft, and marine property and liability.

·    Excess Casualty serves small to mid-sized commercial businesses, offering mono-line umbrella and excess coverage where the Company does not write the primary casualty coverage, or where other business units within the Company prefer to outsource the underwriting of umbrella and excess business based on the expertise and/or limit capacity of Excess Casualty.

·    Boiler & Machinery serves customers ranging from small businesses to Fortune 100 companies, offering comprehensive breakdown coverages for equipment, including property and business interruption coverages. Through the BoilerRe unit, Boiler & Machinery also serves other property casualty carriers that do not have in-house expertise with reinsurance, underwriting, engineering, claim handling and risk management services for this type of coverage.

·    Global Accounts provides insurance to U.S. companies with foreign property and liability exposures (“home-foreign”), and foreign organizations with property and liability exposures located in the United States (“reverse-flow”), as part of a global program.

i

The St. Paul Travelers Companies, Inc.
Financial Supplement - Fourth Quarter 2006
Business Realignment (Continued) Business Insurance (Continued)

·    Specialized Distribution. The following units market and underwrite their products to customers predominantly through licensed wholesale, general and program agents that manage customers’ unique insurance requirements.

·    Northland provides insurance coverage for the commercial transportation industry, as well as commercial liability and package policies for small, difficult to place specialty classes of commercial business on an admitted or excess and surplus lines basis.

·    National Programs offers tailored property and casualty programs on an admitted basis for customers with common risk characteristics or coverage requirements. Programs available include those for entertainment, architects and engineers, equipment rental and golf services.

·    Underwriting Facilities serves small commercial businesses, offering general liability, property and commercial auto physical damage coverages on an admitted or excess and surplus lines basis.

Business Insurance also includes the Special Liability Group, (which manages the Company’s asbestos and environmental liabilities); the assumed reinsurance, health care, and certain international and other runoff operations; policies written by the Company’s Gulf operation (Gulf), which was placed into runoff during the second quarter of 2004, and the Company’s Personal Catastrophe Risk operation, which was sold in November 2005. The Company’s Personal Catastrophe Risk operation had been included in the Specialty segment prior to the August 2006 segment realignment. All of these operations are collectively referred to as Business Insurance Other.

Financial, Professional & International Insurance

The Financial, Professional & International Insurance segment includes surety and financial liability coverages, which require a primarily credit-based underwriting process, as well as property and casualty products that are primarily marketed on an international basis. The segment includes the following businesses:

·    Bond & Financial Products provides a wide range of customers with specialty bond and insurance products and risk management services. The range of products includes surety and fidelity bonds, employment practices liability insurance and fiduciary liability insurance. In addition, the following coverages are provided: professional liability and management liability for public corporations, private companies and not-for-profit organizations for losses caused by the negligence or misconduct of named directors and officers, professional liability for a variety of professionals, such as lawyers, design professionals and real estate agents for liability from errors and omissions committed in the course of professional conduct or practice, and a full range of property, auto, liability, fidelity and professional liability insurance for financial institutions.

In December 2006, the Company reached a definitive agreement to sell its Mexican surety company, Afianzadora Insurgentes, S.A. de C.V. The impact of this transaction will not be material to the Company’s ongoing operations or financial results.

·    International and Lloyd’s includes coverages marketed to and underwritten for several customer groups within the United Kingdom, Canada and the Republic of Ireland and business written through the Company’s operations at Lloyd’s. The International operations offer specialized insurance and risk management services to several customer groups, including those in the technology, public services, and financial and professional services industry sectors. The Company’s International operations primarily underwrite employers’ liability (similar to workers’ compensation coverage in the United States), public and product liability (the equivalent of general liability), professional indemnity (similar to professional liability coverage), motor (similar to automobile coverage in the United States) and property exposures. At Lloyd’s, the Company underwrites four principal lines of business—aviation, marine, global property, and accident and special risks—through Syndicate 5000, for which the Company provides 100% of the capital. During the second half of 2004, the Company made a decision to exit certain portions of the Lloyd’s personal lines business and, in early 2005, sold the right to renew this business as well as the operating companies that supported it.

ii

The St. Paul Travelers Companies, Inc.
Financial Highlights
($ and shares in millions, except per share data)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Income from continuing operations	$	877		$	931		$	75		$	178		$	1,006		$	970		$	1,043		$	1,189		$	2,061		$	4,208
Income from continuing operations per share:
Basic	$	1.31		$	1.39		$	0.11		$	0.26		$	1.45		$	1.40		$	1.52		$	1.75		$	3.04		$	6.12
Diluted	$	1.25		$	1.33		$	0.11		$	0.26		$	1.41		$	1.36		$	1.47		$	1.68		$	2.95		$	5.91
Net income	$	212		$	1,069		$	162		$	179		$	1,006		$	970		$	1,043		$	1,189		$	1,622		$	4,208
Net income per share:
Basic	$	0.31		$	1.59		$	0.24		$	0.26		$	1.45		$	1.40		$	1.52		$	1.75		$	2.39		$	6.12
Diluted	$	0.31		$	1.52		$	0.23		$	0.26		$	1.41		$	1.36		$	1.47		$	1.68		$	2.33		$	5.91
Operating income	$	859		$	966		$	50		$	151		$	1,011		$	959		$	1,037		$	1,193		$	2,026		$	4,200
Operating income per share:
Basic	$	1.28		$	1.44		$	0.07		$	0.22		$	1.46		$	1.39		$	1.51		$	1.75		$	2.99		$	6.11
Diluted	$	1.23		$	1.38		$	0.07		$	0.22		$	1.41		$	1.34		$	1.46		$	1.69		$	2.90		$	5.90
Continuing operations return on equity	16.6		%	17.4		%	1.3		%	3.2		%	17.9		%	17.0		%	17.6		%	19.1		%	9.5		%	17.9		%
Return on equity	4.0		%	20.0		%	2.9		%	3.2		%	17.9		%	17.0		%	17.6		%	19.1		%	7.5		%	17.9		%
Operating return on equity	16.7		%	18.6		%	0.9		%	2.8		%	18.1		%	16.6		%	17.4		%	19.6		%	9.6		%	17.9		%
Total assets, at period end	$	110,750		$	111,804		$	113,442		$	113,187		$	113,376		$	113,886		$	115,498		$	113,761		$	113,187		$	113,761
Total equity, at period end	$	20,732		$	22,369		$	22,408		$	22,303		$	22,837		$	23,052		$	24,747		$	25,135		$	22,303		$	25,135
Book value per share, at period end	$	30.51		$	32.90		$	32.14		$	31.94		$	32.59		$	33.14		$	35.69		$	36.86		$	31.94		$	36.86
Adjusted book value per share, at period end	$	30.10		$	31.48		$	31.46		$	31.47		$	32.68		$	33.83		$	35.10		$	36.20		$	31.47		$	36.20
Weighted average number of common shares outstanding (basic)	668.1			669.5			679.2			688.3			692.2			691.8			685.3			679.2			676.3			687.1
Weighted average number of common shares outstanding and common stock equivalents (diluted)	709.1			710.3			683.8			694.1			720.8			720.4			714.6			711.0			712.8			716.7
Common shares outstanding at period end	673.6			674.6			692.2			693.4			696.2			691.4			689.5			678.3			693.4			678.3
Common stock dividends declared	$	148		$	155		$	159		$	160		$	160		$	180		$	180		$	176		$	622		$	696
Common stock repurchased: (1)
Shares	0.2			0.1			0.4			0.1			0.5			5.7			2.8			15.1			0.8			24.1
Cost	$	8		$	6		$	13		$	6		$	22		$	253		$	126		$	781		$	33		$	1,182

(1)Includes 5.6 million, 2.8 million and 14.4 million common shares for a cost of $250 million, $121 million and $750 million for 2Q, 3Q, and 4Q 2006, respectively, repurchased under the previous Board authorized repurchase program of up to $2 billion.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

1

The St. Paul Travelers Companies, Inc.
Reconciliation to Net Income and Earnings Per Share
($ and shares in millions, except earnings per share)

																					YTD			YTD
	1Q			2Q			3Q		4Q		1Q			2Q		3Q		4Q			4Q			4Q
	2005			2005			2005		2005		2006			2006		2006		2006			2005			2006
Net income
Operating income	$	859		$	966		$	50	$	151	$	1,011		$	959	$	1,037	$	1,193		$	2,026		$	4,200
Net realized investment gains (losses)	18			(35		)	25		27		(5		)	11		6		(4		)	35			8
Income from continuing operations	877			931			75		178		1,006			970		1,043		1,189			2,061			4,208
Discontinued operations	(665		)	138			87		1		—			—		—		—			(439		)	—
Net income	$	212		$	1,069		$	162	$	179	$	1,006		$	970	$	1,043	$	1,189		$	1,622		$	4,208
Basic earnings per share
Operating income	$	1.28		$	1.44		$	0.07	$	0.22	$	1.46		$	1.39	$	1.51	$	1.75		$	2.99		$	6.11
Net realized investment gains (losses)	0.03			(0.05		)	0.04		0.04		(0.01		)	0.01		0.01		—			0.05			0.01
Income from continuing operations	1.31			1.39			0.11		0.26		1.45			1.40		1.52		1.75			3.04			6.12
Discontinued operations	(1.00		)	0.20			0.13		—		—			—		—		—			(0.65		)	—
Net income	$	0.31		$	1.59		$	0.24	$	0.26	$	1.45		$	1.40	$	1.52	$	1.75		$	2.39		$	6.12
Diluted earnings per share
Operating income	$	1.23		$	1.38		$	0.07	$	0.22	$	1.41		$	1.34	$	1.46	$	1.69		$	2.90		$	5.90
Net realized investment gains (losses)	0.02			(0.05		)	0.04		0.04		—			0.02		0.01		(0.01		)	0.05			0.01
Income from continuing operations	1.25			1.33			0.11		0.26		1.41			1.36		1.47		1.68			2.95			5.91
Discontinued operations	(0.94		)	0.19			0.12		—		—			—		—		—			(0.62		)	—
Net income	$	0.31		$	1.52		$	0.23	$	0.26	$	1.41		$	1.36	$	1.47	$	1.68		$	2.33		$	5.91

Adjustments to income from continuing operations and weighted average shares for income from continuing operations EPS calculations: (1)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Basic
Income from continuing operations, as reported	$	877		$	931		$	75		$	178		$	1,006		$	970		$	1,043		$	1,189		$	2,061		$	4,208
Preferred stock dividends, net of taxes	(2		)	(2		)	(1		)	(1		)	(1		)	(1		)	(1		)	(2		)	(6		)	(5		)
Income from continuing operations available to common shareholders - basic	$	875		$	929		$	74		$	177		$	1,005		$	969		$	1,042		$	1,187		$	2,055		$	4,203
Diluted
Income from continuing operations available to common shareholders - basic	$	875		$	929		$	74		$	177		$	1,005		$	969		$	1,042		$	1,187		$	2,055		$	4,203
Effect of dilutive securities:
Convertible preferred stock	2			2			—			—			1			1			1			2			6			5
Zero coupon convertible notes	1			1			—			—			1			1			1			1			4			4
Convertible junior subordinated notes	7			7			—			—			7			6			7			6			26			26
Equity unit stock purchase contracts	3			3			—			—			—			—			—			—			9			—
Income from continuing operations available to common shareholders - diluted	$	888		$	942		$	74		$	177		$	1,014		$	977		$	1,051		$	1,196		$	2,100		$	4,238
Common Shares
Basic
Weighted average shares outstanding	668			669			679			688			692			692			685			679			676			687
Diluted
Weighted average shares outstanding	668			669			679			688			692			692			685			679			676			687
Weighted average effects of dilutive securities:
Stock options and other incentive plans	2			2			5			6			6			6			7			10			4			8
Convertible preferred stock	5			4			—			—			4			3			4			3			4			3
Zero coupon convertible notes	2			3			—			—			2			2			2			2			2			2
Convertible junior subordinated notes	17			17			—			—			17			17			17			17			17			17
Equity unit stock purchase contracts	15			15			—			—			—			—			—			—			10			—
Diluted weighted average shares outstanding	709			710			684			694			721			720			715			711			713			717

(1)Adjustments to income from continuing operations and weighted average shares for income from continuing operations EPS calculations can also be used for the operating income and net income EPS calculations.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

2

The St. Paul Travelers Companies, Inc.
Statement of Income - Consolidated
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Revenues
Premiums	$	5,119		$	5,109		$	4,977		$	5,136		$	4,991		$	5,181		$	5,260		$	5,328		$	20,341		$	20,760
Net investment income	765			775			812			813			875			874			858			910			3,165			3,517
Fee income	171			165			169			159			150			153			150			138			664			591
Net realized investment gains (losses)	—			(55		)	39			33			(6		)	10			12			(5		)	17			11
Other revenues	50			43			45			40			40			37			36			98			178			211
Total revenues	6,105			6,037			6,042			6,181			6,050			6,255			6,316			6,469			24,365			25,090
Claims and expenses
Claims and claim adjustment expenses	3,223			3,101			4,361			4,242			3,042			3,153			3,047			3,002			14,927			12,244
Amortization of deferred acquisition costs	810			783			830			829			800			814			858			867			3,252			3,339
General and administrative expenses	813			789			789			838			794			866			869			929			3,229			3,458
Interest expense	71			70			70			75			76			78			88			82			286			324
Total claims and expenses	4,917			4,743			6,050			5,984			4,712			4,911			4,862			4,880			21,694			19,365
Income (loss) from continuing operations before income taxes	1,188			1,294			(8		)	197			1,338			1,344			1,454			1,589			2,671			5,725
Income tax expense (benefit)	311			363			(83		)	19			332			374			411			400			610			1,517
Income from continuing operations	877			931			75			178			1,006			970			1,043			1,189			2,061			4,208
Discontinued operations
Operating income (loss), net of taxes	(665		)	—			2			—			—			—			—			—			(663		)	—
Gain on disposal, net of taxes	—			138			85			1			—			—			—			—			224			—
Income (loss) from discontinued operations, net of taxes (1)	(665		)	138			87			1			—			—			—			—			(439		)	—
Net income	$	212		$	1,069		$	162		$	179		$	1,006		$	970		$	1,043		$	1,189		$	1,622		$	4,208
Other statistics:
Effective tax rate on net investment income	23.9		%	22.8		%	23.0		%	22.3		%	23.5		%	23.0		%	22.1		%	23.0		%	23.0		%	22.9		%
Net investment income (after-tax)	$	583		$	598		$	625		$	632		$	670		$	673		$	668		$	701		$	2,438		$	2,712
Catastrophes, net of reinsurance:
Pre-tax	$	31		$	11		$	1,524		$	623		$	—		$	67		$	15		$	21		$	2,189		$	103
After-tax	$	20		$	8		$	1,009		$	435		$	—		$	44		$	10		$	13		$	1,472		$	67

(1)In accordance with the Company’s plan to divest its equity ownership in Nuveen Investments, the Company classified Nuveen Investments as a discontinued operation beginning in 1Q 2005. Additionally, due to the taxable nature of the transaction, the Company recorded a charge of $687 million in discontinued operations in 1Q 2005, reflecting the difference between the tax basis and the GAAP carrying value of its investment in Nuveen Investments. A $138 million after-tax gain was recorded in 2Q 2005 related to the divestiture of 45.9 million shares of Nuveen Investments. An $85 million after-tax gain was recorded in 3Q 2005 related to the divesture of the remaining 27.5 million shares of Nuveen Investments.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

3

The St. Paul Travelers Companies, Inc.
Net Income by Major Component and Combined Ratio - Consolidated
($ in millions, net of tax)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Underwriting gain (loss)	$	291		$	383		$	(555	)	$	(463	)	$	337		$	311		$	407		$	487		$	(344	)	$	1,542
Net investment income	583			598			625			632			670			673			668			701			2,438			2,712
Other, including interest expense	(15		)	(15		)	(20		)	(18		)	4			(25		)	(38		)	5			(68		)	(54		)
Operating income	859			966			50			151			1,011			959			1,037			1,193			2,026			4,200
Net realized investment gains (losses)	18			(35		)	25			27			(5		)	11			6			(4		)	35			8
Discontinued operations	(665		)	138			87			1			—			—			—			—			(439		)	—
Net income	$	212		$	1,069		$	162		$	179		$	1,006		$	970		$	1,043		$	1,189		$	1,622		$	4,208
GAAP Combined ratio (1) (2)
Loss and loss adjustment expense ratio	61.3		%	59.4		%	86.3		%	81.0		%	58.9		%	59.5		%	56.7		%	55.1		%	71.9		%	57.5		%
Underwriting expense ratio	29.2		%	28.2		%	29.9		%	30.1		%	30.0		%	30.3		%	30.5		%	31.6		%	29.4		%	30.6		%
Combined ratio	90.5		%	87.6		%	116.2		%	111.1		%	88.9		%	89.8		%	87.2		%	86.7		%	101.3		%	88.1		%
Impact of catastrophes on combined ratio	0.6		%	0.2		%	30.3		%	12.2		%	0.0		%	1.3		%	0.3		%	0.4		%	10.7		%	0.5		%
Impact of prior year reserve development on combined ratio	-1.1		%	-1.5		%	-2.0		%	10.8		%	-1.0		%	-2.0		%	-1.7		%	-3.0		%	1.6		%	-1.9		%

(1)Before policyholder dividends.

(2)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of other underwriting expenses. In addition, fee income is allocated as a reduction of losses and loss adjustment expenses and underwriting expenses as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	29	$	26	$	26	$	25	$	28	$	26	$	28	$	28	$	106	$	110
Fee income:
Loss and loss adjustment expenses	$	76	$	63	$	72	$	66	$	92	$	66	$	59	$	59	$	277	$	276
Underwriting expenses	95		102		97		93		58		87		91		79		387		315
Total fee income	$	171	$	165	$	169	$	159	$	150	$	153	$	150	$	138	$	664	$	591

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

4

The St. Paul Travelers Companies, Inc.
Operating Income - Consolidated
($ in millions)

																		YTD		YTD
	1Q		2Q		3Q			4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005			2005		2006		2006		2006		2006		2005		2006
Revenues
Premiums	$	5,119	$	5,109	$	4,977		$	5,136	$	4,991	$	5,181	$	5,260	$	5,328	$	20,341	$	20,760
Net investment income	765		775		812			813		875		874		858		910		3,165		3,517
Fee income	171		165		169			159		150		153		150		138		664		591
Other revenues	50		43		45			40		40		37		36		98		178		211
Total revenues	6,105		6,092		6,003			6,148		6,056		6,245		6,304		6,474		24,348		25,079
Claims and expenses
Claims and claim adjustment expenses	3,223		3,101		4,361			4,242		3,042		3,153		3,047		3,002		14,927		12,244
Amortization of deferred acquisition costs	810		783		830			829		800		814		858		867		3,252		3,339
General and administrative expenses	813		789		789			838		794		866		869		929		3,229		3,458
Interest expense	71		70		70			75		76		78		88		82		286		324
Total claims and expenses	4,917		4,743		6,050			5,984		4,712		4,911		4,862		4,880		21,694		19,365
Operating income (loss) before income taxes	1,188		1,349		(47		)	164		1,344		1,334		1,442		1,594		2,654		5,714
Income tax expense (benefit)	329		383		(97		)	13		333		375		405		401		628		1,514
Operating income	$	859	$	966	$	50		$	151	$	1,011	$	959	$	1,037	$	1,193	$	2,026	$	4,200

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

5

The St. Paul Travelers Companies, Inc.
Selected Statistics - Property and Casualty Operations
($ in millions)

																								YTD			YTD
	1Q			2Q			3Q			4Q			1Q		2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006		2006			2006			2006			2005			2006
Statutory underwriting
Gross written premiums	$	5,920		$	5,909		$	6,030		$	5,877		$	5,810	$	6,197		$	6,100		$	5,932		$	23,736		$	24,039
Net written premiums	$	4,780		$	5,216		$	5,096		$	5,294		$	4,774	$	5,655		$	5,284		$	5,437		$	20,386		$	21,150
Net earned premiums	$	5,119		$	5,109		$	4,977		$	5,136		$	4,991	$	5,181		$	5,260		$	5,328		$	20,341		$	20,760
Losses and loss adjustment expenses	3,127			3,033			4,334			4,288			2,951		3,095			2,987			2,939			14,782			11,972
Underwriting expenses	1,435			1,461			1,437			1,507			1,493		1,609			1,524			1,644			5,840			6,270
Statutory underwriting gain (loss)	557			615			(794		)	(659		)	547		477			749			745			(281		)	2,518
Policyholder dividends	7			6			(5		)	14			9		6			5			6			22			26
Statutory underwriting gain (loss) after policyholder dividends	$	550		$	609		$	(789	)	$	(673	)	$	538	$	471		$	744		$	739		$	(303	)	$	2,492
Other statutory statistics
Reserves for losses and loss adjustment expenses	$	41,637		$	41,357		$	42,733		$	43,191		$	43,256	$	43,116		$	43,084		$	42,948		$	43,191		$	42,948
Increase (decrease) in reserves (1)	$	(91	)	$	(280	)	$	1,376		$	458		$	65	$	(140	)	$	(32	)	$	(136	)	$	1,463		$	(243	)
Statutory surplus	$	15,441		$	16,137		$	17,738		$	17,812		$	18,522	$	19,037		$	19,961		$	20,945		$	17,812		$	20,945
Net written premiums/surplus (2)	1.32:1			1.26:1			1.14:1			1.14:1			1.10:1		1.09:1			1.05:1			1.01:1			1.14:1			1.01:1

(1)Includes a reinsurance to close transaction for Lloyd’s in 1Q 2006, increasing reserves by $538 million.

(2)Based on 12 months of rolling net written premiums.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

6

The St. Paul Travelers Companies, Inc.
Written and Earned Premiums - Property and Casualty Operations
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Written premiums
Gross	$	5,920		$	5,909		$	6,030		$	5,877		$	5,810		$	6,197		$	6,100		$	5,932		$	23,736		$	24,039
Ceded	(1,140		)	(693		)	(934		)	(583		)	(1,036		)	(542		)	(816		)	(495		)	(3,350		)	(2,889		)
Net	$	4,780		$	5,216		$	5,096		$	5,294		$	4,774		$	5,655		$	5,284		$	5,437		$	20,386		$	21,150
Earned premiums
Gross	$	6,023		$	5,955		$	5,969		$	5,925		$	5,733		$	5,899		$	6,006		$	6,120		$	23,872		$	23,758
Ceded	(904		)	(846		)	(992		)	(789		)	(742		)	(718		)	(746		)	(792		)	(3,531		)	(2,998		)
Net	$	5,119		$	5,109		$	4,977		$	5,136		$	4,991		$	5,181		$	5,260		$	5,328		$	20,341		$	20,760

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

7

The St. Paul Travelers Companies, Inc.
Operating Income - Business Insurance
($ in millions)

Historical results conform with current business segment definitions.

																			YTD		YTD
	1Q		2Q		3Q			4Q			1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005			2005			2006		2006		2006		2006		2005		2006
Revenues
Premiums	$	2,845	$	2,819	$	2,707		$	2,745		$	2,643	$	2,715	$	2,737	$	2,781	$	11,116	$	10,876
Net investment income	569		590		591			591			636		635		610		657		2,341		2,538
Fee income	171		165		168			159			150		153		150		138		663		591
Other revenues	16		17		19			12			7		9		8		20		64		44
Total revenues	3,601		3,591		3,485			3,507			3,436		3,512		3,505		3,596		14,184		14,049
Claims and expenses
Claims and claim adjustment expenses	2,009		1,863		2,647			2,839			1,706		1,695		1,746		1,706		9,358		6,853
Amortization of deferred acquisition costs	395		381		405			389			376		374		397		400		1,570		1,547
General and administrative expenses	520		498		496			524			474		533		531		566		2,038		2,104
Interest expense	—		1		—			1			1		3		—		1		2		5
Total claims and expenses	2,924		2,743		3,548			3,753			2,557		2,605		2,674		2,673		12,968		10,509
Operating income (loss) before federal income taxes	677		848		(63		)	(246		)	879		907		831		923		1,216		3,540
Income taxes	170		231		(93		)	(136		)	228		252		218		220		172		918
Operating income (loss)	$	507	$	617	$	30		$	(110	)	$	651	$	655	$	613	$	703	$	1,044	$	2,622

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

8

The St. Paul Travelers Companies, Inc.
Operating Income by Major Component and Combined Ratio - Business Insurance
($ in millions, net of tax)

Historical results conform with current business segment definitions.

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Underwriting gain (loss)	$	61		$	149		$	(439	)	$	(582	)	$	155		$	159		$	131		$	181		$	(811	)	$	626
Net investment income	436			457			458			462			492			491			478			507			1,813			1,968
Other	10			11			11			10			4			5			4			15			42			28
Operating income (loss)	$	507		$	617		$	30		$	(110	)	$	651		$	655		$	613		$	703		$	1,044		$	2,622
GAAP Combined ratio (1) (2)
Loss and loss adjustment expense ratio	67.6		%	63.7		%	95.4		%	100.5		%	60.9		%	60.0		%	61.5		%	59.1		%	81.5		%	60.3		%
Underwriting expense ratio	28.7		%	27.5		%	29.6		%	29.9		%	29.8		%	30.1		%	30.5		%	31.8		%	28.9		%	30.6		%
Combined ratio	96.3		%	91.2		%	125.0		%	130.4		%	90.7		%	90.1		%	92.0		%	90.9		%	110.4		%	90.9		%
Impact of catastrophes on combined ratio	0.0		%	0.0		%	35.0		%	16.3		%	0.0		%	0.0		%	0.0		%	0.0		%	12.6		%	0.0		%
Impact of prior year reserve development on combined ratio	2.2		%	0.7		%	0.7		%	24.0		%	-0.7		%	-1.2		%	1.7		%	-0.5		%	6.8		%	-0.2		%

(1)Before policyholder dividends.

(2)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of other underwriting expenses. In addition, fee income is allocated as a reduction of losses and loss adjustment expenses and underwriting expenses as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	4	$	3	$	3	$	2	$	3	$	3	$	3	$	3	$	12	$	12
Fee income:
Loss and loss adjustment expenses	$	76	$	63	$	71	$	66	$	92	$	66	$	59	$	59	$	276	$	276
Underwriting expenses	95		102		97		93		58		87		91		79		387		315
Total fee income	$	171	$	165	$	168	$	159	$	150	$	153	$	150	$	138	$	663	$	591

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

9

The St. Paul Travelers Companies, Inc.
Selected Statistics - Business Insurance
($ in millions)

Historical results conform with current business segment definitions.

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Statutory underwriting
Gross written premiums	$	3,532		$	3,278		$	3,372		$	3,271		$	3,254		$	3,314		$	3,257		$	3,222		$	13,453		$	13,047
Net written premiums	$	2,809		$	2,710		$	2,622		$	2,858		$	2,687		$	2,872		$	2,644		$	2,843		$	10,999		$	11,046
Net earned premiums	$	2,845		$	2,819		$	2,707		$	2,745		$	2,643		$	2,715		$	2,737		$	2,781		$	11,116		$	10,876
Losses and loss adjustment expenses	1,909			1,794			2,610			2,846			1,621			1,640			1,686			1,648			9,159			6,595
Underwriting expenses	768			729			727			797			756			813			761			857			3,021			3,187
Statutory underwriting gain (loss)	168			296			(630		)	(898		)	266			262			290			276			(1,064		)	1,094
Policyholder dividends	11			4			(7		)	12			5			3			2			3			20			13
Statutory underwriting gain (loss) after policyholder dividends	$	157		$	292		$	(623	)	$	(910	)	$	261		$	259		$	288		$	273		$	(1,084	)	$	1,081
Other statistics
Effective tax rate on net investment income	23.5		%	22.5		%	22.4		%	21.8		%	22.8		%	22.6		%	21.6		%	22.8		%	22.6		%	22.5		%
Net investment income (after-tax)	$	436		$	457		$	458		$	462		$	492		$	491		$	478		$	507		$	1,813		$	1,968
Catastrophes, net of reinsurance:
Pre-tax	$	—		$	—		$	956		$	449		$	—		$	—		$	—		$	—		$	1,405		$	—
After-tax	$	—		$	—		$	621		$	293		$	—		$	—		$	—		$	—		$	914		$	—

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

10

The St. Paul Travelers Companies, Inc.
Net Written Premiums - Business Insurance
($ in millions)

Historical results conform with current business segment definitions.

																		YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q			4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006			2005		2006
Net written premiums by market
Select Accounts	$	684	$	719	$	653	$	666	$	679	$	705	$	625	$	654		$	2,722	$	2,663
Commercial Accounts	610		503		542		675		575		548		575		678			2,330		2,376
National Accounts	341		238		298		353		268		298		254		315			1,230		1,135
Industry-Focused Underwriting	499		553		483		545		521		560		548		567			2,080		2,196
Target Risk Underwriting	376		419		345		342		398		463		377		391			1,482		1,629
Specialized Distribution	223		242		221		222		245		280		255		242			908		1,022
Total core	2,733		2,674		2,542		2,803		2,686		2,854		2,634		2,847			10,752		11,021
Business Insurance other	76		36		80		55		1		18		10		(4		)	247		25
Total	$	2,809	$	2,710	$	2,622	$	2,858	$	2,687	$	2,872	$	2,644	$	2,843		$	10,999	$	11,046
Net written premiums by product line
Commercial multi-peril	$	770	$	692	$	725	$	813	$	804	$	776	$	708	$	795		$	3,000	$	3,083
Workers’ compensation	578		486		452		564		540		529		474		592			2,080		2,135
Commercial automobile	508		516		500		500		467		522		509		515			2,024		2,013
Property	500		484		445		498		467		521		469		482			1,927		1,939
General liability	441		520		483		478		407		512		476		462			1,922		1,857
Other	12		12		17		5		2		12		8		(3		)	46		19
Total	$	2,809	$	2,710	$	2,622	$	2,858	$	2,687	$	2,872	$	2,644	$	2,843		$	10,999	$	11,046
National accounts
Additions to claim volume under administration (1)	$	1,042	$	838	$	691	$	683	$	890	$	742	$	650	$	722		$	3,254	$	3,004
Written fees	$	173	$	148	$	130	$	123	$	144	$	134	$	121	$	113		$	574	$	512

(1)Includes new and renewal business.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

11

The St. Paul Travelers Companies, Inc.Operating Income - Financial, Professional & International Insurance
($ in millions)

Historical results conform with current business segment definitions.

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Revenues
Premiums	$	815	$	794	$	759	$	829	$	788	$	839	$	850	$	844	$	3,197	$		3,321
Net investment income	81		81		96		102		103		102		108		116		360		429
Fee income	—		—		1		—		—		—		—		—		1		—
Other revenues	11		4		2		3		5		6		5		10		20		26
Total revenues	907		879		858		934		896		947		963		970		3,578		3,776
Claims and expenses
Claims and claim adjustment expenses	449		409		438		522		421		445		462		466		1,818		1,794
Amortization of deferred acquisition costs	162		149		158		165		150		159		164		165		634		638
General and administrative expenses	132		129		126		122		126		142		134		134		509		536
Total claims and expenses	743		687		722		809		697		746		760		765		2,961		2,968
Operating income before federal income taxes	164		192		136		125		199		201		203		205		617		808
Income taxes	50		58		50		68		58		52		59		30		226		199
Operating income	$	114	$	134	$	86	$	57	$	141	$	149	$	144	$	175	$	391	$	609

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

12

The St. Paul Travelers Companies, Inc.Operating Income by Major Component and Combined Ratio - Financial, Professional & International Insurance
($ in millions, net of tax)

Historical results conform with current business segment definitions.

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Underwriting gain (loss)	$	44		$	70		$	12		$	(21	)	$	60		$	68		$	59		$	79		$	105		$		266
Net investment income	60			61			72			77			77			77			82			89			270			325
Other	10			3			2			1			4			4			3			7			16			18
Operating income	$	114		$	134		$	86		$	57		$	141		$	149		$	144		$	175		$	391		$	609
GAAP Combined ratio (1) (2)
Loss and loss adjustment expense ratio	55.5		%	51.3		%	57.4		%	62.7		%	53.0		%	52.6		%	54.1		%	54.9		%	56.8		%	53.7			%
Underwriting expense ratio	35.8		%	35.0		%	37.4		%	34.8		%	35.0		%	35.8		%	34.9		%	35.5		%	35.7		%	35.3			%
Combined ratio	91.3		%	86.3		%	94.8		%	97.5		%	88.0		%	88.4		%	89.0		%	90.4		%	92.5		%	89.0			%
Impact of catastrophes on combined ratio	2.3		%	0.0		%	10.1		%	11.1		%	0.0		%	0.0		%	0.0		%	0.0		%	5.9		%	0.0			%
Impact of prior year reserve development on combined ratio	-0.3		%	-1.9		%	-4.8		%	-2.1		%	0.0		%	-1.1		%	-0.2		%	-0.4		%	-2.3		%	-0.4			%

(1)Before policyholder dividends.

(2)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of other underwriting expenses. In addition, fee income is allocated as a reduction of losses and loss adjustment expenses and underwriting expenses as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	2	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	2	$	—
Fee income:
Loss and loss adjustment expenses	$	—	$	—	$	1	$	—	$	—	$	—	$	—	$	—	$	1	$	—
Underwriting expenses	—		—		—		—		—		—		—		—		—		—
Total fee income	$	—	$	—	$	1	$	—	$	—	$	—	$	—	$	—	$	1	$	—

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

13

The St. Paul Travelers Companies, Inc.Selected Statistics - Financial, Professional & International Insurance ($ in millions)
Historical results conform with current business segment definitions.

																									YTD				YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q				4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005				2006
Statutory underwriting
Gross written premiums	$	910		$	961		$	926		$	1,012		$	935		$	1,043		$	974		$	1,029		$		3,809		$		3,981
Net written premiums	$	537		$	882		$	847		$	893		$	515		$	1,002		$	912		$	964		$		3,159		$		3,393
Net earned premiums	$	815		$	794		$	759		$	829		$	788		$	839		$	850		$	844		$		3,197		$		3,321
Losses and loss adjustment expenses	453			410			449			560			415			442			461			462			1,872				1,780
Underwriting expenses	265			289			258			255			292			299			273			287			1,067				1,151
Statutory underwriting gain	97			95			52			14			81			98			116			95			258				390
Policyholder dividends	(4		)	2			2			2			4			3			3			3			2				13
Statutory underwriting gain after policyholder dividends	$	101		$	93		$	50		$	12		$	77		$	95		$	113		$	92		$		256		$		377
Other statistics
Effective tax rate on net investment income	25.3		%	25.0		%	24.6		%	24.6		%	24.7		%	24.3		%	24.2		%	24.4		%	24.8			%	24.4			%
Net investment income (after-tax)	$	60		$	61		$	72		$	77		$	77		$	77		$	82		$	89		$		270		$		325
Catastrophes, net of reinsurance:
Pre-tax	$	19		$	—		$	80		$	92		$	—		$	—		$	—		$	—		$		191		$		—
After-tax	$	13		$	—		$	71		$	89		$	—		$	—		$	—		$	—		$	173			$	—

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

14

The St. Paul Travelers Companies, Inc.Net Written Premiums - Financial, Professional & International Insurance
($ in millions)

Historical results conform with current business segment definitions.

																		YTD			YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q			4Q			4Q
	2005		2005		2005		2005		2006		2006		2006		2006			2005			2006
Net written premiums by market
Bond & Financial Products	$	283	$	600	$	638	$	596	$	293	$	660	$	664	$		638	$		2,117	$		2,255
International and Lloyd’s	254		282		209		297		222		342		248		326			1,042			1,138
Total	$	537	$	882	$	847	$	893	$	515	$	1,002	$	912	$		964	$		3,159	$		3,393
Net written premiums by product line
General liability	$	125	$	272	$	292	$	292	$	110	$	282	$	297	$		317	$		981	$		1,006
Fidelity & Surety	130		296		320		280		152		342		338		293			1,026			1,125
International	254		282		209		297		222		342		248		326			1,042			1,138
Other	28		32		26		24		31		36		29		28			110			124
Total	$	537	$	882	$	847	$	893	$	515	$	1,002	$	912	$	964		$	3,159		$	3,393

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

15

The St. Paul Travelers Companies, Inc.Operating Income - Personal Insurance
($ in millions)

																		YTD		YTD
	1Q		2Q		3Q			4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005			2005		2006		2006		2006		2006		2005		2006
Revenues
Premiums	$	1,459	$	1,496	$	1,511		$	1,562	$	1,560	$	1,627	$	1,673	$	1,703	$	6,028	$	6,563
Net investment income	109		116		112			120		134		137		140		137		457		548
Other revenues	24		23		24			25		24		22		23		25		96		94
Total revenues	1,592		1,635		1,647			1,707		1,718		1,786		1,836		1,865		6,581		7,205
Claims and expenses
Claims and claim adjustment expenses	765		829		1,276			881		915		1,013		839		830		3,751		3,597
Amortization of deferred acquisition costs	253		253		267			275		274		281		297		302		1,048		1,154
General and administrative expenses	154		162		162			187		183		197		200		224		665		804
Total claims and expenses	1,172		1,244		1,705			1,343		1,372		1,491		1,336		1,356		5,464		5,555
Operating income (loss) before federal income taxes	420		391		(58		)	364		346		295		500		509		1,117		1,650
Income taxes	135		125		(33		)	115		106		92		159		161		342		518
Operating income (loss)	$	285	$	266	$	(25	)	$	249	$	240	$	203	$	341	$	348	$	775	$	1,132

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

16

The St. Paul Travelers Companies, Inc.Operating Income by Major Component and Combined Ratio - Personal Insurance
($ in millions, net of tax)

																										YTD				YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q				4Q				4Q
	2005			2005			2005			2005			2006			2006			2006			2006				2005				2006
Underwriting gain (loss)	$	186		$	164		$	(127	)	$	140		$	122		$	84		$	217		$		226		$		363		$		649
Net investment income	83			88			86			92			102			105			108			106				349				421
Other	16			14			16			17			16			14			16			16				63				62
Operating income (loss)	$	285		$	266		$	(25	)	$	249		$	240		$	203		$	341		$	348			$	775			$	1,132
GAAP Combined ratio (1)
Loss and loss adjustment expense ratio	52.4		%	55.4		%	84.5		%	56.4		%	58.7		%	62.2		%	50.2		%	48.7			%	62.2			%	54.8			%
Underwriting expense ratio	26.3		%	26.2		%	26.8		%	28.1		%	27.7		%	27.9		%	28.2		%	29.4			%	26.9			%	28.3			%
Combined ratio	78.7		%	81.6		%	111.3		%	84.5		%	86.4		%	90.1		%	78.4		%	78.1			%	89.1			%	83.1			%
Impact of catastrophes on combined ratio	0.8		%	0.7		%	32.1		%	5.2		%	0.0		%	4.1		%	0.9		%	1.3			%	9.8			%	1.6			%
Impact of prior year reserve development on combined ratio	-7.8		%	-5.4		%	-5.5		%	-5.3		%	-1.9		%	-3.6		%	-7.9		%	-8.2			%	-6.0			%	-5.5			%

(1)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of underwriting expenses. Billing and policy fees are as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	23	$	23	$	23	$	23	$	25	$	23	$	25	$	25	$	92	$	98

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

17

The St. Paul Travelers Companies, Inc.Selected Statistics - Personal Insurance
($ in millions)

																									YTD				YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q				4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005				2006
Statutory underwriting
Gross written premiums	$	1,478		$	1,670		$	1,732		$	1,594		$	1,621		$	1,840		$	1,869		$	1,681		$		6,474		$		7,011
Net written premiums	$	1,434		$	1,624		$	1,627		$	1,543		$	1,572		$	1,781		$	1,728		$	1,630		$		6,228		$		6,711
Net earned premiums	$	1,459		$	1,496		$	1,511		$	1,562		$	1,560		$	1,627		$	1,673		$	1,703		$		6,028		$		6,563
Losses and loss adjustment expenses	765			829			1,275			882			915			1,013			840			829			3,751				3,597
Underwriting expenses	402			443			452			455			445			497			490			500			1,752				1,932
Statutory underwriting gain (loss)	$	292		$	224		$	(216	)	$	225		$	200		$	117		$	343		$	374		$		525		$		1,034
Other statistics
Effective tax rate on net investment income	24.2		%	24.0		%	22.9		%	22.8		%	23.6		%	23.5		%	23.0		%	22.6		%	23.5			%	23.2			%
Net investment income (after-tax)	$	83		$	88		$	86		$	92		$	102		$	105		$	108		$	106		$		349		$		421
Catastrophes, net of reinsurance:
Pre-tax	$	12		$	11		$	488		$	82		$	—		$	67		$	15		$	21		$		593		$		103
After-tax	$	7		$	8		$	317		$	53		$	—		$	44		$	10		$	13		$	385			$	67
Policies in force (in thousands)
Automobile	2,270			2,281			2,307			2,347			2,429			2,510			2,567			2,584			2,347				2,584
Homeowners and other	4,038			4,090			4,150			4,219			4,291			4,407			4,512			4,562			4,219				4,562

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

18

The St. Paul Travelers Companies, Inc.Selected Statistics - Personal Insurance (Automobile)
($ in millions)

																									YTD				YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q				4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005				2006
Statutory underwriting
Gross written premiums	$	870		$	888		$	910		$	858		$	942		$	960		$	943		$	886		$		3,526		$		3,731
Net written premiums	$	854		$	878		$	897		$	848		$	932		$	951		$	934		$	875		$		3,477		$		3,692
Net earned premiums	$	840		$	851		$	864		$	873		$	872		$	910		$	939		$	951		$		3,428		$		3,672
Losses and loss adjustment expenses	505			542			525			564			590			626			598			543			2,136				2,357
Underwriting expenses	213			222			224			217			239			259			240			252			876				990
Statutory underwriting gain	$	122		$	87		$	115		$	92		$	43		$	25		$	101		$	156		$		416		$		325
GAAP Combined ratio (1)
Loss and loss adjustment expense ratio	60.1		%	63.6		%	60.9		%	64.5		%	67.7		%	68.7		%	63.7		%	57.1		%	62.3			%	64.2			%
Underwriting expense ratio	23.5		%	24.0		%	23.9		%	24.0		%	25.3		%	26.8		%	26.0		%	26.8		%	23.8			%	26.2			%
Combined ratio	83.6		%	87.6		%	84.8		%	88.5		%	93.0		%	95.5		%	89.7		%	83.9		%	86.1			%	90.4			%
Impact of catastrophes on combined ratio	0.0		%	0.0		%	1.2		%	0.9		%	0.0		%	0.4		%	0.0		%	0.0		%	0.5			%	0.1			%
Catastrophe losses, net of reinsurance:
Pre-tax	$	—		$	—		$	11		$	7		$	—		$	3		$	—		$	—		$		18		$		3
After-tax	$	—		$	—		$	7		$	5		$	—		$	2		$	—		$	—		$	12			$	2
Policies in force (in thousands)	2,270			2,281			2,307			2,347			2,429			2,510			2,567			2,584
Change from prior year quarter	5.2		%	2.1		%	2.1		%	3.7		%	7.0		%	10.0		%	11.3		%	10.1		%
Change from prior quarter	0.3		%	0.5		%	1.1		%	1.7		%	3.5		%	3.3		%	2.3		%	0.7		%

(1)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of underwriting expenses. Billing and policy fees are as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	15	$	14	$	15	$	14	$	16	$	15	$	16	$	16	$	58	$	63

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

19

The St. Paul Travelers Companies, Inc.Selected Statistics - Personal Insurance (Homeowners and Other)
($ in millions)

																									YTD				YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q				4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005				2006
Statutory underwriting
Gross written premiums	$	608		$	782		$	822		$	736		$	679		$	880		$	926		$	795		$		2,948		$		3,280
Net written premiums	$	580		$	746		$	730		$	695		$	640		$	830		$	794		$	755		$		2,751		$		3,019
Net earned premiums	$	619		$	645		$	647		$	689		$	688		$	717		$	734		$	752		$		2,600		$		2,891
Losses and loss adjustment expenses	260			287			750			318			325			387			242			286			1,615				1,240
Underwriting expenses	189			221			228			238			206			238			250			248			876				942
Statutory underwriting gain (loss)	$	170		$	137		$	(331	)	$	133		$	157		$	92		$	242		$	218		$		109		$		709
GAAP Combined ratio (1)
Loss and loss adjustment expense ratio	42.0		%	44.5		%	115.8		%	46.2		%	47.3		%	54.0		%	33.0		%	38.0		%	62.1			%	42.9			%
Underwriting expense ratio	30.1		%	29.2		%	30.8		%	33.3		%	30.8		%	29.3		%	31.1		%	32.8		%	30.9			%	31.0			%
Combined ratio	72.1		%	73.7		%	146.6		%	79.5		%	78.1		%	83.3		%	64.1		%	70.8		%	93.0			%	73.9			%
Impact of catastrophes on combined ratio	1.9		%	1.7		%	73.8		%	10.7		%	0.0		%	8.9		%	2.1		%	2.8		%	22.1			%	3.5			%
Catastrophe losses, net of reinsurance:
Pre-tax	$	12		$	11		$	477		$	75		$	—		$	64		$	15		$	21		$		575		$		100
After-tax	$	7		$	8		$	310		$	48		$	—		$	42		$	10		$	13		$	373			$	65
Policies in force (in thousands)	4,038			4,090			4,150			4,219			4,291			4,407			4,512			4,562
Change from prior year quarter	11.6		%	8.3		%	6.0		%	5.2		%	6.3		%	7.8		%	8.7		%	8.1		%
Change from prior quarter	0.7		%	1.3		%	1.5		%	1.7		%	1.7		%	2.7		%	2.4		%	1.1		%

(1)Billing and policy fees, which are a component of other revenues, are allocated as a reduction of underwriting expenses. Billing and policy fees are as follows:

																	YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		3Q		4Q		4Q		4Q
	2005		2005		2005		2005		2006		2006		2006		2006		2005		2006
Billing and policy fees	$	8	$	9	$	8	$	9	$	9	$	9	$	9	$	8	$	34	$	35

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

20

The St. Paul Travelers Companies, Inc.Interest Expense and Other
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Revenues
Net investment income	$	6		$	(12	)	$	13		$	—		$	2		$	—		$	—		$	—		$	7		$	2
Other revenues (1)	(1		)	(1		)	—			—			4			—			—			43			(2		)	47
Total revenues	5			(13		)	13			—			6			—			—			43			5			49
Claims and expenses
Interest expense	71			69			70			74			75			75			88			81			284			319
General and administrative expenses	7			—			5			5			11			(6		)	4			5			17			14
Total claims and expenses	78			69			75			79			86			69			92			86			301			333
Operating loss before federal income tax benefit	(73		)	(82		)	(62		)	(79		)	(80		)	(69		)	(92		)	(43		)	(296		)	(284		)
Income taxes	(26		)	(31		)	(21		)	(34		)	(59		)	(21		)	(31		)	(10		)	(112		)	(121		)
Operating loss	$	(47	)	$	(51	)	$	(41	)	$	(45	)	$	(21	)	$	(48	)	$	(61	)	$	(33	)	$	(184	)	$	(163	)

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

(1)Other revenues in the fourth quarter of 2006 include a $42 million gain on the Company’s redemption of its 7.60%, $593 million subordinated debentures, representing the remaining unamortized fair value adjustment recorded at the merger date.

21

The St. Paul Travelers Companies, Inc.
Consolidated Balance Sheet (1)
(in millions)

	December 31,			December 31,
	2006 (1)			2005
Assets
Fixed maturities, available for sale at fair value (including $1,674 and $2,667 subject to securities lending) (amortized cost $62,244 and $58,616)	$		62,666	$		58,983
Equity securities, at fair value (cost $436 and $538)	473			579
Real estate	793			752
Short-term securities	4,938			4,802
Other investments	3,398			3,171
Total investments	72,268			68,287
Cash	459			337
Investment income accrued	827			761
Premiums receivable	6,181			6,124
Reinsurance recoverables	17,820			19,574
Ceded unearned premiums	1,243			1,322
Deferred acquisition costs	1,615			1,527
Deferred tax asset	1,536			2,062
Contractholder receivables	5,023			5,516
Goodwill	3,438			3,442
Intangible assets	764			917
Other assets	2,587			3,318
Total assets	$	113,761		$	113,187

	December 31,			December 31,
	2006 (1)			2005
Liabilities
Claims and claim adjustment expense reserves	$	59,288		$	61,090
Unearned premium reserves	11,228			10,927
Contractholder payables	5,023			5,516
Payables for reinsurance premiums	685			720
Debt	5,760			5,850
Other liabilities	6,642			6,781
Total liabilities	88,626			90,884
Shareholders’ equity
Preferred Stock Savings Plan - convertible preferred stock (0.4 and 0.5 shares issued and outstanding)	129			153
Common stock (1,750.0 shares authorized; 678.3 and 693.4 shares issued and outstanding)	18,530			18,096
Retained earnings	7,253			3,750
Accumulated other changes in equity from nonowner sources	452			351
Treasury stock, at cost (25.2 and 1.2 shares)	(1,229		)	(47		)
Total shareholders’ equity	25,135			22,303
Total liabilities and shareholders’ equity	$	113,761		$	113,187

(1)Preliminary

22

The St. Paul Travelers Companies, Inc.Investment Portfolio
(at carrying value, $ in millions)

	December 31,		Pre-tax Book		December 31,		Pre-tax Book
	2006		Yield (1)		2005		Yield (1)
Investment portfolio
Taxable fixed maturities (including redeemable preferred stock)	$	27,035	5.09	%	$	27,518	4.84	%
Tax-exempt fixed maturities	35,631		4.17	%	31,465		4.15	%
Total fixed maturities	62,666		4.57	%	58,983		4.48	%
Non-redeemable preferred stocks	358		6.38	%	422		6.79	%
Common stocks	115				157
Total equity securities	473				579
Real estate	793				752
Short-term securities	4,938		5.45	%	4,802		4.31	%
Private equities	1,592				1,506
Arbitrage funds	984				791
Real estate joint ventures & other	743				697
Mortgage loans	53		7.22	%	145		6.03	%
Trading securities	26				32
Total other investments	3,398				3,171
Total investments	$	72,268			$	68,287
Net unrealized gain (loss) on investment securities, net of tax, included in shareholders’ equity	$	453			$	327

(1)Yields are provided for those investments with an embedded book yield.

23

The St. Paul Travelers Companies, Inc.
Investment Portfolio - Fixed Maturities Data
(at carrying value, $ in millions)

	December 31,		December 31,
	2006		2005
Fixed maturities
Mortgage-backed securities - principally obligations of U.S. Government agencies	$	7,589	$	7,943
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	2,718		3,444
Corporates (including redeemable preferreds)	14,900		14,187
Obligations of states and political subdivisions	35,907		31,823
Debt securities issued by foreign governments	1,552		1,586
Subtotal - Available-for-sale securities	62,666		58,983
Trading securities	—		4
Total fixed maturities	$	62,666	$	58,987

Fixed Maturities
Quality Characteristics (1)

	December 31, 2006
	Amount		% of Total
Quality Ratings
Aaa	$	41,578	66.3	%
Aa	11,826		18.9
A	4,400		7.0
Baa	3,085		4.9
Total investment grade	60,889		97.1
Ba	792		1.3
B	749		1.2
Caa and lower	236		0.4
Total below investment grade	1,777		2.9
Total fixed maturities	$	62,666	100.0	%
Average weighted quality	AA1, AA+
Average duration of fixed maturities and short-term securities, net of securities lending activities and net receivables and payables on investment sales and purchases	4.0

(1)Rated using external rating agencies or by St. Paul Travelers when a public rating does not exist. Below investment grade assets refer to securities rated “Ba” or below.

24

The St. Paul Travelers Companies, Inc.
Investment Income
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Gross investment income
Fixed maturities	$	609		$	615		$	636		$	670		$	667		$	677		$	691		$	703		$	2,530		$	2,738
Short-term securities	30			37			56			59			60			60			81			84			182			285
Other	143			149			139			95			163			159			100			135			526			557
	782			801			831			824			890			896			872			922			3,238			3,580
Investment expenses	17			26			19			11			15			22			14			12			73			63
Net investment income, pre-tax	765			775			812			813			875			874			858			910			3,165			3,517
Income taxes	182			177			187			181			205			201			190			209			727			805
Net investment income, after-tax	$	583		$	598		$	625		$	632		$	670		$	673		$	668		$	701		$	2,438		$	2,712
Effective tax rate	23.9		%	22.8		%	23.0		%	22.3		%	23.5		%	23.0		%	22.1		%	23.0		%	23.0		%	22.9		%
Average invested assets (1)	$	64,218		$	65,765		$	67,630		$	69,135		$	69,701		$	70,491		$	72,050		$	72,808		$	66,695		$	71,252
Average yield pre-tax (1)	4.8		%	4.7		%	4.8		%	4.7		%	5.0		%	5.0		%	4.8		%	5.0		%	4.7		%	4.9		%
Average yield after-tax	3.6		%	3.6		%	3.7		%	3.7		%	3.8		%	3.8		%	3.7		%	3.9		%	3.7		%	3.8		%

(1)Excludes net unrealized investment gains and losses, and is adjusted for receivables related to investment sales and payables on investment purchases.

25

The St. Paul Travelers Companies, Inc.
Net Realized and Unrealized Investment Gains (Losses)
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Net realized investment gains (losses)
Fixed maturities	$	14		$	(17	)	$	2		$	1		$	—		$	(29	)	$	(6	)	$	2		$	—		$	(33	)
Equity securities	4			4			14			12			14			2			7			(2		)	34			21
Other	(18		)	(42		)	23			20			(20		)	37			11			(5		)	(17		)	23
Realized investment gains (losses) before tax	—			(55		)	39			33			(6		)	10			12			(5		)	17			11
Related taxes	(18		)	(20		)	14			6			(1		)	(1		)	6			(1		)	(18		)	3
Net realized investment gains (losses)	$	18		$	(35	)	$	25		$	27		$	(5	)	$	11		$	6		$	(4	)	$	35		$	8
Gross investment gains (1)	$	203		$	212		$	196		$	177		$	125		$	101		$	86		$	80		$	788		$	392
Gross investment losses before impairments (1)	(194		)	(225		)	(123		)	(120		)	(121		)	(88		)	(61		)	(63		)	(662		)	(333		)
Impairments	(9		)	(42		)	(34		)	(24		)	(10		)	(3		)	(13		)	(22		)	(109		)	(48		)
Realized investment gains (losses) before tax	—			(55		)	39			33			(6		)	10			12			(5		)	17			11
Related taxes	(18		)	(20		)	14			6			(1		)	(1		)	6			(1		)	(18		)	3
Net realized investment gains (losses)	$	18		$	(35	)	$	25		$	27		$	(5	)	$	11		$	6		$	(4	)	$	35		$	8

	March 31,		June 30,		September 30,		December 31,		March 31,			June 30,			September 30,		December 31,
	2005		2005		2005		2005		2006			2006			2006		2006
Net unrealized investment gains (losses), by asset type
Fixed maturities	$	429	$	1,420	$	587	$	367	$	(328	)	$	(917	)	$	440	$	422
Equity securities & other	21		65		117		118		217			174			173		258
Unrealized investment gains (losses) before tax	450		1,485		704		485		(111		)	(743		)	613		680
Related taxes	173		523		232		158		(50		)	(267		)	202		227
Balance, end of period	$	277	$	962	$	472	$	327	$	(61	)	$	(476	)	$	411	$	453

(1)Includes the following gross investment gains and gross investment losses related to U.S. Treasury futures, which are settled daily:

Gross investment Treasury future gains	$	85	$	78	$	114	$	75	$	71	$	34	$	14	$	25	$	352	$	144
Gross investment Treasury future losses	$	66	$	123	$	81	$	70	$	43	$	25	$	24	$	22	$	340	$	114

The Company entered into these arrangements as part of its strategy to shorten the duration of the fixed maturity portfolio. In a changing interest rate environment, the change in the value of the futures contracts can be expected to partially offset changes in the value of the fixed maturity portfolio.

26

The St. Paul Travelers Companies, Inc.
Reinsurance Recoverables
($ in millions)

	December 31,			December 31,
	2006			2005
Gross reinsurance recoverables on paid and unpaid claims and claim adjustment expenses	$	12,837		$	14,177
Allowance for uncollectible reinsurance	(773		)	(804		)
Net reinsurance recoverables	12,064			13,373
Mandatory pools and associations	1,998			2,211
Structured settlements	3,758			3,990
Total reinsurance recoverables	$	17,820		$	19,574

The Company’s top five reinsurer groups, including retroactive reinsurance, by reinsurance recoverable is as follows:

	December 31,		December 31,		A.M. Best Rating of Group’s
Reinsurer	2006		2005		Predominant Reinsurer
Swiss Re Group	$	1,478	$	1,690	A+ second highest of 16 ratings
Munich Re Group	1,125		1,304		A third highest of 16 ratings
Berkshire Hathaway Group	900		764		A++ highest of 16 ratings
American International Group	718		754		A+ second highest of 16 ratings
XL Capital Group	552		651		A+ second highest of 16 ratings

The gross reinsurance recoverables on paid and unpaid claims and claim adjustment expenses represent the current and estimated future amounts due from reinsurers on known and unasserted claims. The ceded reserves are estimated in a manner consistent with the underlying direct and assumed reserves. Although this total comprises recoverables due from nearly one thousand different reinsurance entities, about half is attributable to 10 reinsurer groups.

The net reinsurance recoverables reflect an allowance for uncollectible reinsurance that is recorded on the basis of periodic evaluations of balances due, reinsurer solvency, the Company’s experience and current economic conditions. Of the total net recoverables due from reinsurers at December 31, 2006, after deducting mandatory pool and structured settlement balances, $9.4 billion, or 78%, were rated by A.M. Best Company. Of the total rated by A.M. Best Company, 96% were rated A- or better. The remaining 22% net recoverables from reinsurers was comprised of the following: 6% related to the Company’s participation in voluntary pools, 6% related to recoverables from captive insurance companies and 10% were balances from other companies not rated by A.M. Best Company. In addition, $3.3 billion of the net recoverables were collateralized by letters of credit, funds held and trust agreements at December 31, 2006.

The allowance for uncollectible reinsurance is based upon the Company’s ongoing review of amounts outstanding, length of collection periods, changes in reinsurer credit standing, and other relevant factors.

The mandatory pools and associations represent various involuntary assigned risk pools that the Company is required to participate in. These pools principally involve workers’ compensation and automobile insurance, which provide various insurance coverages to insureds that otherwise are unable to purchase coverage in the open market. The costs of these mandatory pools in most states are usually charged back to the participating members in proportion to voluntary writings of related business in that state. In the event that a member of the pool becomes insolvent, the remaining members assume an additional pro rata share of the pool’s liabilities.

The structured settlements represent annuities that are purchased from life insurance companies to settle personal physical injury claims, with workers’ compensation claims comprising a significant proportion. The Company retains the ultimate liability to the claimant in the event that the assigned company fails to pay, so the amount is reflected as a liability and as a recoverable for GAAP purposes.

27

The St. Paul Travelers Companies, Inc.
Net Reserves for Losses and Loss Adjustment Expense
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Business Insurance
Beginning of period	$	34,542		$	34,389		$	34,054		$	34,821		$	35,312		$	35,158		$	34,776		$	34,650		$	34,542		$	35,312
Incurred	1,909			1,794			2,610			2,846			1,621			1,640			1,686			1,648			9,159			6,595
Paid	(2,092		)	(2,101		)	(1,822		)	(2,367		)	(2,147		)	(2,070		)	(1,815		)	(1,868		)	(8,382		)	(7,900		)
Acquired reserves, foreign exchange and other (1)	30			(28		)	(21		)	12			372			48			3			14			(7		)	437
End of period	$	34,389		$	34,054		$	34,821		$	35,312		$	35,158		$	34,776		$	34,650		$	34,444		$	35,312		$	34,444
Financial, Professional & International Insurance
Beginning of period	$	3,852		$	3,965		$	3,984		$	4,159		$	4,242		$	4,513		$	4,646		$	4,822		$	3,852		$	4,242
Incurred	453			410			449			560			415			442			461			462			1,872			1,780
Paid	(307		)	(334		)	(304		)	(374		)	(347		)	(366		)	(293		)	(318		)	(1,319		)	(1,324		)
Acquired reserves, foreign exchange and other (1)	(33		)	(57		)	30			(103		)	203			57			8			48			(163		)	316
End of period	$	3,965		$	3,984		$	4,159		$	4,242		$	4,513		$	4,646		$	4,822		$	5,014		$	4,242		$	5,014
Personal Insurance
Beginning of period	$	3,334		$	3,283		$	3,319		$	3,753		$	3,637		$	3,585		$	3,694		$	3,612		$	3,334		$	3,637
Incurred	765			829			1,275			882			915			1,013			840			829			3,751			3,597
Paid	(816		)	(793		)	(841		)	(998		)	(967		)	(904		)	(922		)	(951		)	(3,448		)	(3,744		)
End of period	$	3,283		$	3,319		$	3,753		$	3,637		$	3,585		$	3,694		$	3,612		$	3,490		$	3,637		$	3,490
Total
Beginning of period	$	41,728		$	41,637		$	41,357		$	42,733		$	43,191		$	43,256		$	43,116		$	43,084		$	41,728		$	43,191
Incurred	3,127			3,033			4,334			4,288			2,951			3,095			2,987			2,939			14,782			11,972
Paid	(3,215		)	(3,228		)	(2,967		)	(3,739		)	(3,461		)	(3,340		)	(3,030		)	(3,137		)	(13,149		)	(12,968		)
Acquired reserves, foreign exchange and other (1)	(3		)	(85		)	9			(91		)	575			105			11			62			(170		)	753
End of period	$	41,637		$	41,357		$	42,733		$	43,191		$	43,256		$	43,116		$	43,084		$	42,948		$	43,191		$	42,948
Prior Year Reserve Development: Unfavorable (Favorable)
Business Insurance
Asbestos	$	—		$	—		$	—		$	830		$	—		$	—		$	155		$	—		$	830		$	155
Environmental	—			—			—			30			—			—			120			—			30			120
All other	61			21			18			(203		)	(19		)	(34		)	(229		)	(14		)	(103		)	(296		)
Prior year development excluding accretion	61			21			18			657			(19		)	(34		)	46			(14		)	757			(21		)
Accretion of discount	15			14			14			16			16			15			16			15			59			62
Total Business Insurance	76			35			32			673			(3		)	(19		)	62			1			816			41
Financial, Professional & International Insurance	(2		)	(15		)	(37		)	(18		)	—			(9		)	(1		)	(4		)	(72		)	(14		)
Personal Insurance	(114		)	(81		)	(83		)	(82		)	(30		)	(58		)	(132		)	(139		)	(360		)	(359		)
Total	$	(40	)	$	(61	)	$	(88	)	$	573		$	(33	)	$	(86	)	$	(71	)	$	(142	)	$	384		$	(332	)

(1)Acquired reserves include a reinsurance to close transaction for Lloyd’s in 1Q 2006, increasing reserves by $358 million and $180 million in Business Insurance and Financial, Professional & International Insurance, respectively.

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

28

The St. Paul Travelers Companies, Inc.
Asbestos and Environmental Reserves
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Asbestos reserves
Beginning reserves:
Direct	$	4,775		$	4,675		$	4,527		$	4,412		$	5,103		$	5,000		$	4,838		$	4,925		$	4,775		$	5,103
Ceded	(843		)	(818		)	(785		)	(743		)	(739		)	(720		)	(716		)	(746		)	(843		)	(739		)
Net	3,932			3,857			3,742			3,669			4,364			4,280			4,122			4,179			3,932			4,364
Incurred losses and loss expenses:
Direct	—			—			—			833			—			—			196			—			833			196
Ceded	—			—			—			(3		)	—			—			(41		)	—			(3		)	(41		)
Accretion of discount:
Direct	—			1			—			—			—			—			1			—			1			1
Ceded	—			—			—			—			—			—			—			—			—			—
Losses paid:
Direct	100			149			115			142			103			162			110			148			506			523
Ceded	(25		)	(33		)	(42		)	(7		)	(19		)	(4		)	(11		)	(20		)	(107		)	(54		)
Ending reserves:
Direct	4,675			4,527			4,412			5,103			5,000			4,838			4,925			4,777			5,103			4,777
Ceded	(818		)	(785		)	(743		)	(739		)	(720		)	(716		)	(746		)	(726		)	(739		)	(726		)
Net	$	3,857		$	3,742		$	3,669		$	4,364		$	4,280		$	4,122		$	4,179		$	4,051		$	4,364		$	4,051
Environmental reserves
Beginning reserves:
Direct	$	725		$	624		$	547		$	517		$	494		$	406		$	379		$	460		$	725		$	494
Ceded	(84		)	(85		)	(79		)	(80		)	(69		)	(19		)	(7		)	6			(84		)	(69		)
Net	641			539			468			437			425			387			372			466			641			425
Incurred losses and loss expenses:
Direct	—			—			—			17			—			—			108			—			17			108
Ceded	—			—			—			13			—			—			12			—			13			12
Losses paid:
Direct	101			77			30			40			88			27			27			47			248			189
Ceded	1			(6		)	1			2			(50		)	(12		)	(1		)	1			(2		)	(62		)
Ending reserves:
Direct	624			547			517			494			406			379			460			413			494			413
Ceded	(85		)	(79		)	(80		)	(69		)	(19		)	(7		)	6			5			(69		)	5
Net	$	539		$	468		$	437		$	425		$	387		$	372		$	466		$	418		$	425		$	418

See Business Realignment on pages i and ii, and Glossary of Financial Measures and Description of Operating Segments on page 34.

29

The St. Paul Travelers Companies, Inc.
Capitalization
($ in millions)

	December 31,			December 31,
Debt	2006			2005
Short-term debt
Commercial paper	$	100		$	104
6.75% Senior notes due November 15, 2006	—			150
5.75% Senior notes due March 15, 2007	500			—
5.01% Senior notes due August 16, 2007	442			—
Medium-term notes maturing in the following 12 months	72			56
Total short-term debt	1,114			310
Long-term debt
Medium-term notes with various maturities through 2010	170			242
5.75% Senior notes due March 15, 2007	—			500
5.01% Senior notes due August 16, 2007	—			442
3.75% Senior notes due March 15, 2008 (2)	400			400
Zero coupon convertible notes due 2009, effective yield 4.17%, callable on March 3, 1999	128			122
8.125% Senior notes due April 15, 2010 (2)	250			250
7.81% Private placement notes due on various dates through 2011	12			16
5.00% Senior notes due March 15, 2013 (2)	500			500
5.50% Senior notes due December 1, 2015	400			400
6.25% Senior notes due June 20, 2016 (2)	400			—
7.75% Senior notes due April 15, 2026	200			200
7.625% Subordinated debentures due December 15, 2027	125			125
8.47% Subordinated debentures due January 10, 2027 (1)	81			81
4.50% Convertible junior subordinated notes due April 15, 2032, callable April 18, 2007	893			893
6.375% Senior notes due March 15, 2033 (2)	500			500
6.75% Senior notes due June 20, 2036 (2)	400			—
8.50% Subordinated debentures due December 15, 2045	56			56
8.312% Subordinated debentures due July 1, 2046	73			73
7.60% Subordinated debentures due October 15, 2050, redeemed November 18, 2006	—			593
Total long-term debt	4,588			5,393
Unamortized fair value adjustment	109			185
Unamortized debt issuance costs	(51		)	(38		)
	4,646			5,540
Total debt	5,760			5,850
Preferred equity	129			153
Common equity (excluding SFAS 115)	24,553			21,823
Total capital	$	30,442		$	27,826
Total debt to capital	18.9		%	21.0		%

(1)The Company redeemed the $81 million, 8.47% subordinated debentures on January 18, 2007.

(2)Redeemable anytime with “make-whole” premium.

30

The St. Paul Travelers Companies, Inc.
Statutory to GAAP Shareholders’ Equity Reconciliation (1)
($ in millions)

	December 31,			December 31,
	2006 (1)			2005
Statutory capital and surplus	$	20,945		$	17,812
GAAP adjustments
Goodwill and intangible assets	3,985			4,122
Investments	993			1,065
Noninsurance companies	(4,007		)	(3,815		)
Deferred acquisition costs	1,615			1,527
Deferred federal income tax	411			533
Reinsurance recoverables	587			602
Furniture, equipment & software	382			206
Employee benefits	74			105
Agents balances	83			166
Other	67			(20		)
Total GAAP adjustments	4,190			4,491
GAAP shareholders’ equity	$	25,135		$	22,303

(1)Estimated and Preliminary

31

The St. Paul Travelers Companies, Inc.
Statement of Cash Flows - Preliminary
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Cash flows from operating activities
Net income	$	212		$	1,069		$	162		$	179		$	1,006		$	970		$	1,043		$	1,189		$	1,622		$	4,208
Adjustments to reconcile net income to net cash provided by operating activities:
(Income) loss from discontinued operations, net of tax	665			(138		)	(87		)	(1		)	—			—			—			—			439			—
Net realized investment (gains) losses	—			55			(39		)	(33		)	6			(10		)	(12		)	5			(17		)	(11		)
Depreciation and amortization	150			236			113			192			197			197			213			201			691			808
Deferred federal income taxes (benefit)	110			625			(218		)	(17		)	159			44			150			168			500			521
Amortization of deferred policy acquisition costs	810			783			830			829			800			814			858			867			3,252			3,339
Premium balances receivable	92			(187		)	147			25			110			(358		)	154			37			77			(57		)
Reinsurance recoverables	228			433			(1,059		)	(122		)	636			370			434			558			(520		)	1,998
Deferred acquisition costs	(808		)	(793		)	(821		)	(798		)	(836		)	(874		)	(880		)	(837		)	(3,220		)	(3,427		)
Claim and claim adjustment expense reserves	(433		)	(523		)	2,484			504			(1,137		)	(509		)	(351		)	(568		)	2,032			(2,565		)
Unearned premium reserves	(148		)	(41		)	43			(237		)	103			272			87			(162		)	(383		)	300
Trading account activities	—			6			—			—			4			2			—			—			6			6
Excess tax benefits from share-based payment arrangements	—			—			—			—			(5		)	(1		)	(2		)	(8		)	—			(16		)
Gain on redemption of subordinated debentures	—			—			—			—			—			—			—			(42		)	—			(42		)
Other	150			(822		)	(174		)	(44		)	(481		)	(68		)	13			248			(890		)	(288		)
Net cash provided by operating activities of continuing operations	1,028			703			1,381			477			562			849			1,707			1,656			3,589			4,774
Net cash provided by operating activities of discontinued operations	24			—			—			—			—			—			—			—			24			—
Net cash provided by operating activities	1,052			703			1,381			477			562			849			1,707			1,656			3,613			4,774
Cash flows from investing activities
Proceeds from maturities of investments
Fixed maturities	1,073			1,348			1,393			1,138			1,571			1,079			1,758			1,402			4,952			5,810
Proceeds from sales of investments
Fixed maturities	1,052			1,659			722			1,759			1,320			1,854			452			775			5,192			4,401
Equity securities	39			73			169			122			94			32			98			61			403			285
Real estate	—			—			39			(2		)	—			—			—			—			37			—
Purchase of investments
Fixed maturities	(4,175		)	(4,391		)	(3,597		)	(3,883		)	(3,983		)	(4,066		)	(2,191		)	(3,605		)	(16,046		)	(13,845		)
Equity securities	(21		)	(1		)	(15		)	(26		)	(47		)	(17		)	(27		)	8			(63		)	(83		)
Real estate	(8		)	(14		)	(7		)	(20		)	(8		)	(6		)	(9		)	(52		)	(49		)	(75		)
Short-term securities, (purchases) sales, net	980			(855		)	(1,155		)	1,172			67			(160		)	(1,275		)	1,283			142			(85		)
Other investments, net	233			216			230			45			154			(5		)	149			108			724			406
Securities transactions in course of settlement	195			268			(260		)	(798		)	490			19			(159		)	97			(595		)	447
Other	—			(48		)	(25		)	(59		)	(38		)	(84		)	(93		)	(110		)	(132		)	(325		)
Net cash provided (used) by investing activities of continuing operations	(632		)	(1,745		)	(2,506		)	(552		)	(380		)	(1,354		)	(1,297		)	(33		)	(5,435		)	(3,064		)
Net cash used by investing activities of discontinued operations	(20		)	—			—			—			—			—			—			—			(20		)	—
Net cash provided (used) by investing activities	(652		)	(1,745		)	(2,506		)	(552		)	(380		)	(1,354		)	(1,297		)	(33		)	(5,455		)	(3,064		)

32

The St. Paul Travelers Companies, Inc.
Statement of Cash Flows - Preliminary (Continued)
($ in millions)

																									YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			3Q			4Q			4Q			4Q
	2005			2005			2005			2005			2006			2006			2006			2006			2005			2006
Cash flows from financing activities
Issuance of debt	—			—			—			400			—			786			—			—			400			786
Payment of debt	(2		)	(479		)	(41		)	(293		)	(4		)	—			(42		)	(760		)	(815		)	(806		)
Treasury stock acquired - net employee share-based compensation	(8		)	(6		)	(13		)	(6		)	(16		)	(1		)	—			—			(33		)	(17		)
Treasury stock acquired - share repurchase program	—			—			—			—			—			(230		)	(137		)	(736		)	—			(1,103		)
Issuance of common stock - employee stock options	32			29			68			35			32			26			31			127			164			216
Issuance of common stock - maturity of equity unit forward contracts	—			—			442			—			—			—			—			—			442			—
Dividends to shareholders	(150		)	(157		)	(160		)	(161		)	(161		)	(182		)	(181		)	(178		)	(628		)	(702		)
Other	13			(13		)	—			(3		)	3			4			1			25			(3		)	33
Net cash provided (used) by financing activities of continuing operations	(115		)	(626		)	296			(28		)	(146		)	403			(328		)	(1,522		)	(473		)	(1,593		)
Net cash provided by financing activities of discontinued operations	4			—			—			—			—			—			—			—			4			—
Net cash provided (used) by financing activities	(111		)	(626		)	296			(28		)	(146		)	403			(328		)	(1,522		)	(469		)	(1,593		)
Effect of exchange rate changes on cash	(2		)	(2		)	1			(2		)	—			3			1			1			(5		)	5
Elimination of cash provided by discontinued operations	(8		)	—			—			—			—			—			—			—			(8		)	—
Net proceeds from the sale of discontinued operations	—			1,867			532			—			—			—			—			—			2,399			—
Net increase (decrease) in cash	279			197			(296		)	(105		)	36			(99		)	83			102			75			122
Cash at beginning of period	262			541			738			442			337			373			274			357			262			337
Cash at end of period	$	541		$	738		$	442		$	337		$	373		$	274		$	357		$	459		$	337		$	459
Income taxes paid (received)	$	14		$	357		$	151		$	304		$	(5	)	$	258		$	338		$	270		$	826		$	861
Interest paid	$	93		$	86		$	88		$	70		$	85		$	79		$	86		$	108		$	337		$	358

33

The St. Paul Travelers Companies, Inc.
Financial Supplement - Fourth Quarter 2006
Glossary of Financial Measures and Description of Operating Segments

The following measures are used by the Company’s management to evaluate financial performance against historical results and establish targets on a consolidated basis. In some cases, these measures are considered non-GAAP financial measures under applicable SEC rules because they are not displayed as separate line items in the consolidated statement of income or required to be disclosed in the notes to financial statements, and in some cases, include or exclude certain items not ordinarily included or excluded in the most comparable GAAP financial measure. In the opinion of the Company’s management, a discussion of these measures provides investors with a better understanding of the significant factors that comprise the Company’s periodic results of operations and how management evaluates the Company’s financial performance.

Operating income (loss) is net income (loss) excluding the after-tax impact of net realized investment gains (losses) and discontinued operations. Operating income (loss) per share is operating income (loss) on a per share basis.

Return on equity is the ratio of net income to average equity. Continuing operations return on equity is the ratio of income from continuing operations to average equity. Operating return on equity is the ratio of operating income to average equity excluding net unrealized investment gains and losses and discontinued operations, net of tax.

In the opinion of the Company’s management, operating income, operating income per share and operating return on equity are meaningful indicators of underwriting and operating results. These measures exclude net realized investment gains or losses which can be significantly impacted by both discretionary and other economic factors and are not necessarily indicative of operating trends. Internally, the Company’s management uses operating income, operating income per share and operating return on equity to evaluate performance against historical results and establish financial targets on a consolidated basis.

Underwriting gain (loss) is net earned premiums and fee income less claims and claim adjustment expenses and insurance-related expenses.

A catastrophe is a severe loss, resulting from natural and manmade events, including risks such as fire, earthquake, windstorm, explosion, terrorism and other similar events. Each catastrophe has unique characteristics. Catastrophes are not predictable as to timing or amount in advance, and therefore their effects are not included in earnings or claims and claim adjustment expense reserves prior to occurrence. A catastrophe may also result in the payment of reinstatement premiums and assessments from various pools. In the opinion of the Company’s management, a discussion of the impact of catastrophes is meaningful for investors to understand the variability in periodic earnings.

Reinstatement premiums represent additional premiums payable to reinsurers to restore coverage limits that have been exhausted as a result of reinsured losses under certain excess of loss reinsurance treaties.

Loss reserve development is the increase or decrease in incurred claims and claim adjustment expenses as a result of the re-estimation of claims and claim adjustment expense reserves at successive valuation dates for a given group of claims. Loss reserve development may be related to prior year or current year development. In the opinion of the Company’s management, discussion of prior year loss reserve development is useful to investors as it allows them to assess the impact between prior year and current year development on current earnings and changes in claims and claim adjustment expense reserve levels from period to period.

GAAP combined ratio is the sum of the loss and loss adjustment expense ratio (loss and LAE ratio), the underwriting expense ratio and, where applicable, the ratio of dividends to policyholders to net premiums earned. For GAAP, the loss and LAE ratio is the ratio of incurred losses and loss adjustment expenses reduced by an allocation of fee income to net earned premiums. The underwriting expense ratio is the ratio of underwriting expenses incurred reduced by an allocation of fee income, and billing and policy fees to net earned premiums. A GAAP combined ratio under 100% generally indicates an underwriting profit. A GAAP combined ratio over 100% generally indicates an underwriting loss. The GAAP combined ratio is an operating statistic that includes GAAP measures in the numerator and the denominator.

Gross written premiums reflect the direct and assumed contractually determined amounts charged to the policyholders for the effective period of the contract based on the terms and conditions of the insurance contract. Gross written premiums are a measure of overall business volume.

Adjusted book value per share represents assets less liabilities and preferred shareholders’ equity excluding the after-tax impact of net unrealized investment gains and losses, divided by the number of shares outstanding. In the opinion of the Company’s management, adjusted book value is useful in an analysis of a property casualty company’s book value on a nominal basis as it removes the effect of changing prices on invested assets, which do not have an equivalent impact on unpaid claims and claim adjustment expense reserves.

St. Paul Travelers has organized its businesses into the following operating and reporting segments, beginning with the third quarter 2006:

Business Insurance - The Business Insurance segment offers a broad array of property and casualty insurance and insurance-related services in the United States. Business Insurance is organized into the following groups, which collectively comprise Business Insurance Core operations: Select Accounts; Commercial Accounts; National Accounts; Industry-Focused Underwriting including Construction, Technology, Public Sector Services, Oil & Gas, and Agribusiness; Target Risk Underwriting including National Property, Inland Marine, Ocean Marine, Excess Casualty, Boiler & Machinery, and Global Accounts; and Specialized Distribution including Northland, National Programs, and Underwriting Facilities. Business Insurance also includes the Special Liability Group and policies written by Gulf (primarily management and professional liability coverages), the Personal Catastrophe Risk operation (which was sold in 2005), and other runoff operations, which collectively are referred to as Business Insurance Other.

Financial, Professional & International Insurance - The Financial, Professional & International Insurance segment includes surety, crime, and financial liability businesses which primarily use credit-based underwriting processes, as well as property and casualty products that are predominantly marketed on an international basis. The businesses in Financial, Professional & International Insurance are Bond & Financial Products and International and Lloyd’s.

Personal Insurance writes virtually all types of property and casualty insurance covering personal risks. The primary coverages in this segment are personal automobile and homeowners insurance sold to individuals.

Discontinued Operations (Asset Management) comprises Nuveen Investments, whose core businesses are asset management and related research, as well as the development, marketing and distribution of investment products and services for the affluent, high net worth and institutional market segments. During the third quarter of 2005, the Company completed the divestiture of its ownership interest of Nuveen Investments.

Prior quarter segment results have been reclassified from the historical presentation to conform with current business segment definitions where applicable. The Company’s historical Commercial and Specialty segments have been realigned into two new segments: the Business Insurance segment and the Financial, Professional & International Insurance segment. As a result, prior quarter results of certain businesses have been disaggregated from the historical Specialty segment and are now reported in the Business Insurance segment. In addition, the Personal segment has been renamed Personal Insurance.

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