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): July 21, 2011

The 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)

485 Lexington Avenue New York, New York	10017
(Address of principal executive offices)	(Zip Code)

(917) 778-6000

(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):

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

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

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

oPre-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 July 21, 2011, The Travelers Companies, Inc. (the “Company”) issued a press release announcing the results of the Company’s operations for the quarter ended June 30, 2011, and the availability of the Company’s second 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 July 21, 2011, reporting results of operations (This exhibit is furnished and not filed.)
99.2	Second Quarter 2011 Financial Supplement of The 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: July 21, 2011	THE TRAVELERS COMPANIES, INC.
	By:	/s/ Matthew S. Furman
		Name: Matthew S. Furman Title: Senior Vice President

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated July 21, 2011, reporting results of operations (This exhibit is furnished and not filed.)
99.2	Second Quarter 2011 Financial Supplement of The Travelers Companies, Inc. (This exhibit is furnished and not filed.)

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EX-99.1

Exhibit 99.1

	The Travelers Companies, Inc.
	485 Lexington Avenue
	New York, NY 10017-2630
NYSE: TRV	www.travelers.com

Travelers Reports Second Quarter Net and Operating Loss of $364 Million ($0.88 per Diluted Share) and
$377 Million ($0.91 per Diluted Share) Due to Extraordinary Tornado Activity in April and May

·Catastrophe losses in the quarter of $1.09 billion after tax ($1.67 billion pre tax), or $2.56 per diluted share. The company previously disclosed a range of $1.00 billion to $1.05 billion after tax for estimated catastrophe losses in the months of April and May.

·Net written premiums up 2% reflecting pricing gains across all three business segments. Company achieved pricing gains in all Business Insurance product lines, led by gains in workers’ compensation.

·Book value per share up 2% from year-end 2010, and adjusted book value per share (excludes after-tax net unrealized investment gains) up slightly from year-end 2010. Capital remains generally unchanged from the end of first quarter 2011.

New York, July 21, 2011 — The Travelers Companies, Inc. today reported results for the second quarter 2011.

Consolidated Highlights

($ in millions, except for per share amounts, and after-tax,	Three Months Ended June 30,								Six Months Ended June 30,
except for premiums & revenues)	2011			2010			Change		2011			2010			Change
Net written premiums	$	5,817		$	5,688		2	%	$	11,254		$	10,939		3	%
Earned premiums	$	5,503		$	5,340		3		$	10,874		$	10,570		3
Net investment income	758			762			(1	)	1,537			1,515			1
Net realized investment gains (losses)	19			(31		)	NM		39			(6		)	NM
Fee income & other	108			108			—		216			219			(1	)
Total revenues	$	6,388		$	6,179		3		$	12,666		$	12,298		3
Operating income (loss)	$	(377	)	$	690		NM		$	449		$	1,321		(66	)
per diluted share	$	(0.91	)	$	1.39		NM		$	1.04		$	2.61		(60	)
Net income (loss)	$	(364	)	$	670		NM		$	475		$	1,317		(64	)
per diluted share	$	(0.88	)	$	1.35		NM		$	1.10		$	2.60		(58	)
Diluted weighted average shares outstanding	418.6			490.8			(15	)	429.1			502.6			(15	)
GAAP combined ratio	125.0		%	95.2		%	29.8	pts	110.1		%	95.8		%	14.3	pts
Operating return on equity	(6.6		)%	11.4		%	(18.0	)pts	3.9		%	10.7		%	(6.8	)pts
Return on equity	(5.8		)%	10.1		%	(15.9	)pts	3.8		%	9.9		%	(6.1	)pts
									As of June 30,
									2011			2010			Change
Book value per share									$	59.62		$	55.67		7	%
Adjusted book value per share									$	54.28		$	50.62		7

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

NM = Not Meaningful.

“Our second quarter loss was due to the extraordinary tornadoes and hail storms that caused devastation across significant portions of the United States,” commented Jay Fishman, Chairman and Chief Executive Officer. “To put this in perspective, these losses for us were larger than those we incurred from Hurricane Katrina in 2005 and the equivalent of losses we would expect from a 1-in-100 year hurricane. The human impact of these storms was extraordinary, including significant loss of life. Our thoughts are very much with those who have been affected personally. We were pleased that,

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notwithstanding the highly unusual frequency and severity of these events, the company’s capital remained generally unchanged, reflecting our underlying earnings strength and thoughtful capital management strategy.  We also appreciate the responsibility these events have placed on our entire claim organization and are proud of the speed and dedication with which they are responding.

“Pricing continued to improve across our diversified commercial insurance businesses. In particular, we were very pleased with the pricing gains we achieved in Business Insurance. All product lines within Business Insurance showed improved positive renewal rate change, most significantly in workers’ compensation. We were also encouraged that audit premiums, which turned positive in the first quarter, continued to increase.  In Personal Insurance the production and pricing trends remained generally consistent with first quarter trends.

“As has been our plan over the past year, we continue to seek rate gains on a measured basis, particularly where specific accounts require increased rate. We have been successful in this regard overall and our strategy remains unchanged,” concluded Mr. Fishman.

Second Quarter 2011 Consolidated Results

	Three Months Ended June 30,
	2011			2010			2011			2010
($ in millions)	Pre-tax						After-tax
Underwriting gain (loss)	$	(1,411	)	$	220		$	(924	)	$	119
Underwriting gain (loss) includes:
Net favorable prior year reserve development	168			384			111			251
Catastrophes, net of reinsurance	(1,668		)	(439		)	(1,085		)	(285		)
Net investment income	758			762			606			617
Other, including interest expense	(93		)	(70		)	(59		)	(46		)
Operating income (loss)	(746		)	912			(377		)	690
Net realized investment gains (losses)	19			(31		)	13			(20		)
Income (loss) before income taxes	$	(727	)	$	881
Net income (loss)							$	(364	)	$	670
GAAP combined ratio	125.0		%	95.2		%
GAAP combined ratio excluding incremental impact of direct to consumer initiative	124.1		%	94.6		%
Impact on GAAP combined ratio
Net favorable prior year reserve development	(3.1		)pts	(7.2		)pts
Catastrophes, net of reinsurance	30.3		pts	8.2		pts

After-tax operating results in the current quarter decreased $1.067 billion from the prior year quarter primarily due to a $1.043 billion after-tax decrease in underwriting results essentially attributable to the significantly higher catastrophe losses.

The underwriting results in the current quarter reflected a GAAP combined ratio of 125.0 percent, as compared to 95.2 percent in the prior year quarter. This increase of 29.8 points in the combined ratio was primarily driven by a $1.229 billion pre-tax increase in catastrophe losses (increase of 22.1 points) as well as, a $216 million pre-tax decrease in net favorable prior year reserve development (increase of 4.1 points) attributable to Business Insurance. Catastrophe losses in the current quarter resulted from an unusually high number of severe tornadoes and hail storms, primarily in the Midwest and Southeast regions of the United States. Net favorable prior year reserve development in the current quarter occurred in all three segments but particularly in Financial, Professional and International Insurance as a result of better than expected loss experience in both Bond & Financial Products and International.

The current quarter underwriting gain excluding net favorable prior year reserve development and catastrophe losses reflected a GAAP combined ratio of 97.8 percent, as compared to 94.2 percent in the prior year quarter.  This increase of 3.6 points was primarily due to the re-estimation of certain Business Insurance and Personal

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Insurance first quarter losses, reduced underwriting margins that reflected increases in underlying losses (excludes catastrophes and prior year development) that modestly outpaced earned rate increases in Business Insurance, and reduced underwriting margins in Personal Insurance resulting from increased non-catastrophe weather-related and fire-related losses.

Total revenues of $6.388 billion in the current quarter increased $209 million, or 3 percent, from the prior year quarter primarily due to a $163 million increase in earned premiums. After-tax net investment income in the current quarter decreased 2 percent from the prior year quarter due to lower reinvestment rates in the fixed income portfolio and lower average invested assets reflecting the impact of the company’s common share repurchases. The non-fixed income portfolio continued to generate strong results.

Net written premiums of $5.817 billion in the current quarter increased 2 percent from the prior year quarter, reflecting positive gains in pricing across all three business segments and renewing Business Insurance customers purchasing more insurance. Retention rates remained high while new business volumes decreased modestly from the prior year quarter in both Business Insurance and Personal Insurance. Retention rates and new business volumes remained generally consistent in Financial, Professional & International Insurance. Net written premiums in Business Insurance also benefited from positive audit premiums, compared to negative audit premiums in the prior year quarter.

Capital Management

“Our capital management strategy continues unchanged,” commented Jay S. Benet, Vice Chairman and Chief Financial Officer.  “Despite the very large catastrophe losses, there was no meaningful change in our balance sheet strength between the beginning and end of the quarter as we reduced our common share repurchases in line with our revised earnings expectations. As we announced in June, we expect repurchases in the second half of the year to approximate $400 million in excess of second half operating income.  Further, we successfully renewed our catastrophe reinsurance program on July 1 with essentially the same structure and coverage and only a modest increase in price.”

During the second quarter 2011, the company repurchased 3.9 million of its common shares under its existing Board of Directors’ share repurchase authorization at a total cost of $237 million and paid $174 million in common stock dividends. Shareholders’ equity at the end of the second quarter was $25.0 billion, a slight decrease from year-end 2010 resulting from common share repurchases in the first quarter. Included in shareholders’ equity at the end of the current quarter were after-tax net unrealized investment gains of $2.2 billion, compared to $1.9 billion at year-end 2010. Statutory surplus ended the current quarter at $20.2 billion up slightly from the beginning of the year, the company’s debt-to-capital ratio (excluding after-tax net unrealized investment gains) was 22.5 percent, well within its target range, and holding company liquidity was $2.4 billion, over two times its target level.

Business Insurance Segment Financial Results

“In addition to the high catastrophe losses and lower net favorable prior year reserve development, Business Insurance second quarter results continued to reflect increases in losses that modestly outpaced earned rate increases, including approximately $40 million after-tax related to the re-estimation of first quarter losses,” commented Brian MacLean, President and Chief Operating Officer. “Net written premiums once again grew quarter over quarter and included increases in pricing, existing customers purchasing more insurance and positive audit premiums. Retention rates and new business levels remained strong although modestly lower than recent quarters.”

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	Three Months Ended June 30,
	2011			2010			2011			2010
($ in millions)	Pre-tax						After-tax
Underwriting gain (loss)	$	(652	)	$	210		$	(429	)	$	127
Underwriting gain (loss) includes:
Net favorable prior year reserve development	27			303			18			196
Catastrophes, net of reinsurance	(697		)	(179		)	(453		)	(116		)
Net investment income	541			537			433			435
Other	10			7			7			5
Operating income (loss)	$	(101	)	$	754		$	11		$	567
GAAP combined ratio	122.9		%	91.8		%
Impact on GAAP combined ratio
Net favorable prior year reserve development	(1.0		)pts	(11.3		)pts
Catastrophes, net of reinsurance	24.9		pts	6.7		pts

Operating income in the current quarter of $11 million after tax decreased $556 million from the prior year quarter due to a $556 million after-tax decrease in underwriting results primarily attributable to the significantly higher catastrophe losses.

The underwriting results in the current quarter reflected a GAAP combined ratio of 122.9 percent, as compared to 91.8 percent in the prior year quarter. This increase of 31.1 points in the combined ratio was primarily due to a $518 million pre-tax increase in catastrophe losses (increase of 18.2 points) and a $276 million pre-tax decrease in net favorable prior year reserve development (increase of 10.3 points). Net favorable prior year reserve development in the current quarter primarily resulted from better than expected loss experience in the general liability product line which was concentrated in excess coverages for accident years 2008 and prior, partially offset by an increase of $49 million after-tax ($76 million pre-tax) to environmental reserves.

The current quarter underwriting gain excluding net favorable prior year reserve development and catastrophe losses reflected a GAAP combined ratio of 99.0 percent, as compared to 96.4 percent in the prior year quarter.  This increase of 2.6 points was primarily due to the re-estimation of certain first quarter losses as well as reduced underwriting margins that reflected increases in underlying losses that modestly outpaced earned rate increases.

Business Insurance net written premiums of $2.879 billion in the current quarter increased 3 percent from the prior year quarter. Net written premiums benefited from improved economic activity as evidenced by positive exposure change at renewal as well as positive audit premiums, compared to negative audit premiums in the prior year quarter. Retention rates remained strong, but modestly lower than recent quarters. The impact of renewal rate change was positive for the second consecutive quarter, compared to slightly negative or flat in each quarter of 2010. New business volumes remained solid, but decreased modestly from the prior year quarter.

Select Accounts

·Net written premiums of $738 million increased 3 percent from the prior year quarter.

·Retention rates remained strong and were generally consistent with recent quarters.

·Renewal premium change remained positive and increased from recent quarters.

·New business volumes decreased modestly from the prior year quarter due to lower volumes in larger accounts served by Select. New business volumes from TravelersExpressSM, the company’s enhanced quote-to-issue agency platform and multivariate pricing program for smaller businesses, remained strong and increased slightly from the prior year quarter.

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Commercial Accounts

·Net written premiums of $659 million increased 13 percent from the prior year quarter, partly due to the benefit of positive audit premiums in the current quarter, compared to negative audit premiums in the prior year quarter.

·Retention rates remained strong, but decreased from recent quarters.

·Renewal premium change was positive for the third consecutive quarter and increased from recent quarters.

·New business volumes were strong and increased from the prior year quarter.

National Accounts

·Net written premiums of $188 million decreased 3 percent from the prior year quarter primarily due to lower prior year retrospective premium adjustments, partially offset by strong retention rates.

Industry-Focused Underwriting

·Net written premiums of $579 million decreased 1 percent from the prior year quarter.

Target Risk Underwriting

·Net written premiums of $468 million approximated the prior year quarter.

Specialized Distribution

·Net written premiums of $246 million approximated the prior year quarter.

Financial, Professional & International Insurance Segment Financial Results

“Financial, Professional & International Insurance results were solid in the quarter and we are encouraged by the early results of the strategic investments we have been making within both Bond & Financial Products and International,” commented MacLean.  “In addition, we completed the acquisition of our joint venture interest in Brazil, which gives us an ownership position in the market leader of the Brazilian surety business.  We are pleased about the opportunity to leverage our leading U.S. surety franchise as well as our other franchises to expand beyond the surety business into the growing property and casualty market in Brazil.”

	Three Months Ended June 30,
	2011			2010			2011			2010
($ in millions)	Pre-tax						After-tax
Underwriting gain	$	120		$	140		$	78		$	79
Underwriting gain includes:
Net favorable prior year reserve development	96			72			64			49
Catastrophes, net of reinsurance	(14		)	(3		)	(10		)	(2		)
Net investment income	105			110			82			89
Other	6			7			4			4
Operating income	$	231		$	257		$	164		$	172
GAAP combined ratio	84.8		%	83.3		%
Impact on GAAP combined ratio
Net favorable prior year reserve development	(11.7		)pts	(8.4		)pts
Catastrophes, net of reinsurance	1.7		pts	0.4		pts

Operating income in the current quarter of $164 million after tax decreased $8 million from the prior year quarter due to a $7 million after-tax decrease in net investment income as well as a $1 million after-tax decrease in the underwriting gain.

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The underwriting gain in the current quarter reflected a GAAP combined ratio of 84.8 percent, as compared to 83.3 percent in the prior year quarter. This increase of 1.5 points in the combined ratio included an $11 million pre-tax increase in catastrophe losses (increase of 1.3 points) as well as a $24 million pre-tax increase in net favorable prior year reserve development (improvement of 3.3 points). Net favorable prior year reserve development in the current quarter primarily resulted from better than expected loss experience in accident years 2008 and prior for the contract surety business, and accident years 2007 and prior for the public company directors’ & officers’ line of business within Bond & Financial Products as well as in recent accident years across multiple lines of business in International.

The current quarter underwriting gain excluding net favorable prior year reserve development and catastrophes reflected a GAAP combined ratio of 94.8 percent, as compared to 91.3 percent in the prior year quarter. This increase of 3.5 points was primarily due to an increase in the expense ratio attributable to infrastructure investments within International and lower earned premium volume across the segment.

Financial, Professional & International Insurance net written premiums of $879 million decreased 1 percent from the prior year quarter. Adjusting for the impact of changes in foreign currency exchange rates, net written premiums decreased 3 percent.

Retention rates, renewal premium changes and new business volumes, as discussed below, exclude the surety line of business as surety products are sold on a non-recurring, project-specific basis.

Bond & Financial Products

·Net written premiums of $533 million decreased 5 percent from the prior year quarter partly due to lower business volumes in construction surety reflecting the continued slowdown in construction spending and disciplined underwriting. In addition, the prior year quarter benefited from a reduction in surety reinsurance costs associated with prior year reinsurance treaties.

·Retention rates remained very strong and increased from recent quarters.

·Renewal premium change was slightly positive compared to slightly negative in recent quarters.

·New business volumes increased from the prior year quarter primarily driven by the Private & Non-Profit line of business.

International

·Net written premiums of $346 million increased 5 percent from the prior year quarter. Adjusting for the impact of changes in foreign exchange rates, net written premiums decreased 1 percent due to the termination of an exclusive relationship with a distribution partner in Ireland during fourth quarter 2010.

·Retention rates were slightly improved from the most recent quarter, but continued to be impacted by the termination of the distribution relationship in Ireland.

·Renewal premium change was slightly positive as the impact of positive renewal rate change more than offset reduced insured exposures primarily resulting from intentional underwriting actions at the company’s operations at Lloyd’s.

·New business volumes increased slightly from the prior year quarter primarily due to enhanced products and marketing initiatives in the United Kingdom, mostly offset by the termination of the distribution relationship in Ireland.

Personal Insurance Segment Financial Results

“In addition to the significant catastrophe losses, results in both our Homeowners and Automobile lines of business were impacted by higher non-catastrophe weather-related and fire-related losses, which we believe were normal quarterly variations rather than a change in loss trend,” commented MacLean.  “Production results were generally consistent with recent quarters with high retention rates, positive renewal premium change and growth in policies in force.”

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	Three Months Ended June 30,
	2011			2010			2011			2010
($ in millions)	Pre-tax						After-tax
Underwriting loss	$	(879	)	$	(130	)	$	(573	)	$	(87	)
Underwriting loss includes:
Net favorable prior year reserve development	45			9			29			6
Catastrophes, net of reinsurance	(957		)	(257		)	(622		)	(167		)
Net investment income	112			115			91			93
Other	18			18			11			13
Operating income (loss)	$	(749	)	$	3		$	(471	)	$	19
GAAP combined ratio	145.5		%	105.9		%
GAAP combined ratio excluding incremental impact of direct to consumer initiative	143.2		%	104.0		%
Impact on GAAP combined ratio
Net favorable prior year reserve development	(2.4		)pts	(0.5		)pts
Catastrophes, net of reinsurance	50.7		pts	14.0		pts

After-tax operating results in the current quarter decreased $490 million from the prior year quarter due to a $486 million after-tax increase in the underwriting loss primarily attributable to the significantly higher catastrophe losses.

The underwriting loss in the current quarter reflected a GAAP combined ratio of 145.5 percent, as compared to 105.9 percent in the prior year quarter. This increase of 39.6 points in the combined ratio was primarily driven by a $700 million pre-tax increase in catastrophe losses (increase of 36.7 points), slightly offset by a $36 million pre-tax increase in net favorable prior year reserve development (improvement of 1.9 points).  The net favorable prior year reserve development in the current quarter primarily resulted from better than expected loss experience in the Homeowners and Other product line related to 2010 catastrophe losses and in the umbrella line of business for accident years 2006 to 2008.

The current quarter underwriting gain excluding net favorable prior year reserve development and catastrophe losses reflected a GAAP combined ratio of 97.2 percent, as compared to 92.4 percent in the prior year quarter. This increase of 4.8 points was primarily due to increases in non-catastrophe weather-related losses, some of which were related to first quarter storms, and fire-related losses.

Personal Insurance net written premiums of $2.059 billion increased 3 percent from the prior year quarter, including the company’s direct to consumer initiative, reflecting continued positive renewal premium change and strong retention rates.

Agency Automobile and Agency Homeowners and Other, as discussed below, represent business sold through agents, brokers and other intermediaries and exclude direct to consumer.

Agency Automobile

·Net written premiums of $948 million increased slightly from the prior year quarter.

·Policies in force continued to increase, up 1 percent from the prior year quarter.

·Retention rates were strong and renewal premium change remained positive.

·New business volumes decreased modestly from the prior year quarter.

Agency Homeowners and Other

·Net written premiums of $1.078 billion increased 4 percent from the prior year quarter.

·Policies in force continued to increase, up 2 percent from the prior year quarter.

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·Retention rates were strong and renewal premium change remained positive.

·New business volumes decreased modestly from the prior year quarter.

Year-to-Date 2011 Consolidated Results

	Six Months Ended June 30,
	2011			2010			2011			2010
($ in millions)	Pre-tax						After-tax
Underwriting gain (loss)	$	(1,164	)	$	375		$	(675	)	$	199
Underwriting gain (loss) includes:
Net favorable prior year reserve development	405			678			266			443
Catastrophes, net of reinsurance	(1,854		)	(910		)	(1,207		)	(597		)
Resolution of prior year tax matters							100			—
Net investment income	1,537			1,515			1,228			1,227
Other, including interest expense	(170		)	(146		)	(104		)	(105		)
Other also includes:
Resolution of prior year tax matters							4			—
Operating income	203			1,744			449			1,321
Net realized investment gains (losses)	39			(6		)	26			(4		)
Income before income taxes	$	242		$	1,738
Net income							$	475		$	1,317
GAAP combined ratio	110.1		%	95.8		%
GAAP combined ratio excluding incremental impact of direct to consumer initiative	109.1		%	95.2		%
Impact on GAAP combined ratio
Net favorable prior year reserve development	(3.7		)pts	(6.4		)pts
Catastrophes, net of reinsurance	17.1		pts	8.6		pts

Operating income in the current year of $449 million after tax decreased $872 million from the prior year due to an $874 million after-tax decrease in underwriting results primarily attributable to the significantly higher catastrophe losses.

The underwriting results in the current year reflected a GAAP combined ratio of 110.1 percent, as compared to 95.8 percent in the prior year. This increase of 14.3 points in the combined ratio was primarily due to a $944 million pre-tax increase in catastrophe losses (increase of 8.5 points) and a $273 million pre-tax decrease in net favorable prior year reserve development (increase of 2.7 points).

The current year underwriting gain excluding net favorable prior year reserve development and catastrophe losses reflected a GAAP combined ratio of 96.7 percent, as compared to 93.6 percent in the prior year. This increase of 3.1 points was primarily due to the impact of reduced underwriting margins that reflected increases in underlying losses that modestly outpaced earned rate increases in Business Insurance as well as higher non-catastrophe weather-related and fire-related losses in Personal Insurance.

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 website at www.travelers.com. Travelers management will discuss the contents of this release and other relevant topics via webcast at 9 a.m. Eastern (8 a.m. Central) on Thursday, July 21, 2011. Prior to the webcast, a slide presentation pertaining to the quarterly earnings will be available on the company’s website. Following the live event, an audio playback of the webcast and the slide presentation will be available on the company’s website.

To view the slides or to listen to the webcast or the playback, visit the “Webcasts & Presentations” section of the Travelers investor relations website at http://investor.travelers.com.

About Travelers

The Travelers Companies, Inc. (NYSE: TRV) is a leading provider of property casualty insurance for auto, home and business. The company’s diverse business lines offer its customers a wide range of coverage sold primarily

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through independent agents and brokers. A component of the Dow Jones Industrial Average, Travelers has more than 30,000 employees and operations in the U.S., Canada, U.K. and Ireland. For more information, visit www.travelers.com.

From time to time, Travelers may use its website as a channel of distribution of material company information. Financial and other material information regarding the company is routinely posted on and accessible at http://investor.travelers.com. In addition, you may automatically receive email alerts and other information about Travelers by enrolling your email by visiting the “Email Alert Service” section at http://investor.travelers.com.

Travelers has organized its businesses into the following reportable business segments:

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 six 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 Partner Services; and Specialized Distribution including Northland and National Programs. Business Insurance also includes the Special Liability Group (which manages the company’s asbestos and environmental liabilities) and the assumed reinsurance and certain international 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 and financial liability coverages, which primarily use credit-based underwriting processes, as well as property and casualty products that are primarily marketed on a domestic basis in the United Kingdom, Canada and the Republic of Ireland, and on an international basis as a corporate member of Lloyd’s. The businesses in Financial, Professional & International Insurance are Bond & Financial Products and International.

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 automobile and homeowners insurance sold to individuals.

* * * * *

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. Words such as “may”, “will”, “should”, “likely”, “anticipates”, “expects”, “intends”, “plans”, “projects”, “believes”, “estimates” and similar expressions are used to identify these forward-looking statements. Specifically, statements about the company’s share repurchase plans and statements about the potential impact of investment markets and other economic conditions on the company’s investment portfolio and underwriting results, among others, are forward looking, and the company may also make forward-looking statements about, among other things:

·its results of operations and financial condition (including, among other things, premium volume, premium rates, net and operating income, investment income and performance, return on equity, and expected current returns and combined ratios);

·the sufficiency of the company’s asbestos and other reserves;

·the impact of emerging claims issues as well as other insurance and non-insurance litigation;

·the cost and availability of reinsurance coverage;

·catastrophe losses;

·the impact of investment, economic and underwriting market conditions; and

·strategic initiatives.

The company cautions investors that such statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond the company’s control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements.

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Some of the factors that could cause actual results to differ include, but are not limited to, the following:

·catastrophe losses could materially and adversely affect the company’s results of operations, its financial position and/or liquidity, and could adversely impact the company’s ratings, the company’s ability to raise capital and the availability and cost of reinsurance;

·during or following a period of financial market disruption or economic downturn, the company’s business could be materially and adversely affected;

·if actual claims exceed the company’s loss reserves, or if changes in the estimated level of loss reserves are necessary, the company’s financial results could be materially and adversely affected;

·the company’s investment portfolio may suffer reduced returns or material realized or unrealized losses;

·the company’s business could be harmed because of its potential exposure to asbestos and environmental claims and related litigation;

·the company is exposed to, and may face adverse developments involving, mass tort claims such as those relating to exposure to potentially harmful products or substances;

·the effects of emerging claim and coverage issues on the company’s business are uncertain;

·the intense competition that the company faces could harm its ability to maintain or increase its business volumes and profitability;

·the company may not be able to collect all amounts due to it from reinsurers, and reinsurance coverage may not be available to the company in the future at commercially reasonable rates or at all;

·the company is exposed to credit risk in certain of its business operations;

·the company’s businesses are heavily regulated and changes in regulation may reduce the company’s profitability and limit its growth;

·a downgrade in the company’s claims-paying and financial strength ratings could adversely impact the company’s business volumes, adversely impact the company’s ability to access the capital markets and increase the company’s borrowing costs;

·the inability of the company’s insurance subsidiaries to pay dividends to the company’s holding company in sufficient amounts would harm the company’s ability to meet its obligations, pay future shareholder dividends or make future share repurchases;

·disruptions to the company’s relationships with its independent agents and brokers could adversely affect the company;

·the company’s efforts to develop new products or expand in targeted markets may not be successful and may create enhanced risks;

·the company’s net deferred tax assets could be adversely affected by a reduction in the U.S. Federal corporate income tax rate;

·the company may be adversely affected if its pricing and capital models are inaccurate;

·the company is subject to a number of risks associated with its business outside the United States;

·the company’s business success and profitability depend, in part, on effective information technology systems and on continuing to develop and implement improvements in technology;

·if the company experiences difficulties with technology, data security and/or outsourcing relationships the company’s ability to conduct its business could be negatively impacted;

·acquisitions and integration of acquired businesses may result in operating difficulties and other unintended consequences;

·the company could be adversely affected if its controls to ensure compliance with guidelines, policies and legal and regulatory standards are not effective;

·the company’s businesses may be adversely affected if it is unable to hire and retain qualified employees;

·loss of or significant restriction on the use of credit scoring in the pricing and underwriting of Personal Insurance products could reduce the company’s future profitability; and

·the company’s repurchase plans depend on a variety of factors, including the company’s financial position, earnings, capital requirements of the company’s operating subsidiaries, legal requirements, regulatory constraints, catastrophe losses, other investment opportunities (including mergers and acquisitions), market conditions and other factors.

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 captions “Risk Factors” and “Management’s Discussion and Analysis of

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Financial Condition and Results of Operations” in our most recent annual report on Form 10-K and our quarterly report on Form 10-Q filed with the Securities and Exchange Commission.

*****

GLOSSARY OF FINANCIAL MEASURES AND RECONCILIATIONS OF NON-GAAP MEASURES TO GAAP
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 financial statements or are not required to be disclosed in the notes to financial statements or, in some cases, include or exclude certain items not ordinarily included or excluded in the most comparable GAAP financial measure. Reconciliations of non-GAAP measures to their most directly comparable GAAP measures also follow.

In the opinion of the company’s management, a discussion of these measures provides investors, financial analysts, rating agencies and other financial statement users 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.  Internally, the company’s management uses these measures to evaluate performance against historical results, to establish financial targets on a consolidated basis and for other reasons, which are discussed below.

Some of these measures exclude net realized investment gains (losses), net of tax, and/or net unrealized investment gains (losses), net of tax, which can be significantly impacted by both discretionary and other economic factors and are not necessarily indicative of operating trends.

Other companies may calculate these measures differently, and, therefore, their measures may not be comparable to those used by the company’s management.

RECONCILIATION OF OPERATING INCOME (LOSS) AND CERTAIN OTHER NON-GAAP MEASURES TO NET INCOME (LOSS)

Operating income (loss) is net income (loss) excluding the after-tax impact of net realized investment gains (losses) and discontinued operations. Management uses operating income (loss) to analyze each segment’s performance and as a tool in making business decisions. Financial statement users also consider operating income when analyzing the results and trends of insurance companies. Operating earnings (loss) per share is operating income (loss) on a per common share basis.

Reconciliation of Operating Income (Loss) less Preferred Dividends and Net Income (Loss) less Preferred Dividends to Net Income (Loss)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions, after-tax)	2011			2010			2011		2010
Operating income (loss), less preferred dividends	$	(377	)	$	690		$	448	$	1,320
Preferred dividends	—			—			1		1
Operating income (loss)	(377		)	690			449		1,321
Net realized investment gains (losses)	13			(20		)	26		(4		)
Net income (loss)	$	(364	)	$	670		$	475	$	1,317
Net income (loss), less preferred dividends	$	(364	)	$	670		$	474	$	1,316
Preferred dividends	—			—			1		1
Net income (loss)	$	(364	)	$	670		$	475	$	1,317

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	Twelve Months Ended December 31,
($ in millions; after-tax)	2010		2009		2008			2007		2006		2005
Operating income, less preferred dividends	$	3,040	$	3,597	$	3,191		$	4,496	$	4,195	$	2,020
Preferred dividends	3		3		4			4		5		6
Operating income	3,043		3,600		3,195			4,500		4,200		2,026
Net realized investment gains (losses)	173		22		(271		)	101		8		35
Income from continuing operations	3,216		3,622		2,924			4,601		4,208		2,061
Discontinued operations	—		—		—			—		—		(439		)
Net income	$	3,216	$	3,622	$	2,924		$	4,601	$	4,208	$	1,622

Reconciliation of Operating Earnings (Loss) per Share to Net Income (Loss) per Share on a Basic and Diluted Basis

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011		2010
Basic earnings per share
Operating income (loss)	$	(0.91	)	$	1.41		$	1.05	$	2.64
Net realized investment gains (losses)	0.03			(0.04		)	0.06		(0.01		)
Net income (loss)	$	(0.88	)	$	1.37		$	1.11	$	2.63
Diluted earnings per share
Operating income (loss)	$	(0.91	)	$	1.39		$	1.04	$	2.61
Net realized investment gains (losses)	0.03			(0.04		)	0.06		(0.01		)
Net income (loss)	$	(0.88	)	$	1.35		$	1.10	$	2.60

Reconciliation of Operating Income (Loss) by Segment to Total Operating Income (Loss)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions, after-tax)	2011			2010			2011			2010
Business Insurance	$	11		$	567		$	615		$	1,134
Financial, Professional & International Insurance	164			172			284			258
Personal Insurance	(471		)	19			(301		)	78
Total segment operating income (loss)	(296		)	758			598			1,470
Interest Expense and Other	(81		)	(68		)	$	(149	)	$	(149	)
Total operating income (loss)	$	(377	)	$	690		$	449		$	1,321

RECONCILIATION OF ADJUSTED SHAREHOLDERS’ EQUITY TO SHAREHOLDERS’ EQUITY AND OPERATING RETURN ON EQUITY TO RETURN ON EQUITY

Average shareholders’ equity is (a) the sum of total shareholders’ equity excluding preferred stock at the beginning and end of each of the quarters for the period presented divided by (b) the number of quarters in the period presented times two. Adjusted shareholders’ equity is shareholders’ equity excluding net unrealized investment gains (losses), net of tax, net realized investment gains (losses), net of tax, for the period presented, preferred stock and discontinued operations. Adjusted average shareholders’ equity is average shareholders’ equity excluding net unrealized investment gains (losses), net of tax, for all quarters included in the calculation and, for each quarterly period included in the calculation, that quarter’s net realized investment gains (losses), net of tax.

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Reconciliation of Adjusted Shareholders’ Equity to Shareholders’ Equity

	As of June 30,
($ in millions)	2011		2010
Adjusted shareholders’ equity	$	22,743	$	23,837
Net unrealized investment gains, net of tax	2,239		2,381
Net realized investment gains (losses), net of tax	26		(4		)
Preferred stock	—		72
Shareholders’ equity	$	25,008	$	26,286
	As of December 31,
($ in millions)	2010		2009			2008			2007		2006		2005			2004
Adjusted shareholders’ equity	$	23,376	$	25,453		$	25,645		$	25,783	$	24,545	$	22,227		$	20,087
Net unrealized investment gains (losses), net of tax	1,858		1,861			(144		)	620		453		327			866
Net realized investment gains (losses), net of tax	173		22			(271		)	101		8		35			(28		)
Preferred stock	68		79			89			112		129		153			188
Discontinued operations	—		—			—			—		—		(439		)	88
Shareholders’ equity	$	25,475	$	27,415		$	25,319		$	26,616	$	25,135	$	22,303		$	21,201

Return on equity is the ratio of annualized net income (loss) less preferred dividends to average shareholders’ equity for the periods presented. Operating return on equity is the ratio of annualized operating income (loss) less preferred dividends to adjusted average shareholders’ equity for the periods presented. In the opinion of the company’s management, these are important indicators of how well management creates value for its shareholders through its operating activities and its capital management.

Calculation of Operating Return on Equity and Return on Equity

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions, after-tax)	2011			2010			2011			2010
Annualized operating income (loss), less preferred dividends	$	(1,511	)	$	2,757		$	896		$	2,640
Adjusted average shareholders’ equity	23,059			24,254			23,254			24,656
Operating return on equity	(6.6		)%	11.4		%	3.9		%	10.7		%
Annualized net income (loss), less preferred dividends	$	(1,460	)	$	2,677		$	947		$	2,632
Average shareholders’ equity	25,093			26,404			25,193			26,685
Return on equity	(5.8		)%	10.1		%	3.8		%	9.9		%

Average annual operating return on equity over a period is the ratio of:

a) the sum of operating income (loss) less preferred dividends for the periods presented to

b) the sum of: 1) the sum of the adjusted average shareholders’ equity for all full years in the period presented, and 2) for partial years in the period presented, the number of quarters in that partial year divided by four, multiplied by the adjusted average shareholders’ equity of the partial year.

Calculation of Average Annual Operating Return on Equity from January 1, 2005 through June 30, 2011

			Six Months Ended
			June 30,						Twelve Months Ended December 31,
($ in millions)			2011			2010			2010			2009			2008			2007			2006			2005
Operating income, less preferred dividends			$	448		$	1,320		$	3,040		$	3,597		$	3,191		$	4,496		$	4,195		$	2,020
Operating income, less preferred dividends - annualized			896			2,640
Adjusted average shareholders’ equity			23,254			24,656			24,287			25,774			25,668			25,350			23,381			21,118
Operating return on equity			3.9		%	10.7		%	12.5		%	14.0		%	12.4		%	17.7		%	17.9		%	9.6		%
Average annual operating return on equity for the period January 1, 2005 through June 30, 2011	13.4	%

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RECONCILIATION OF PRE-TAX UNDERWRITING GAIN EXCLUDING CERTAIN ITEMS TO NET INCOME (LOSS)

Underwriting gain (loss) is net earned premiums and fee income less claims and claim adjustment expenses and insurance-related expenses. In the opinion of the company’s management, it is important to measure the profitability of each segment excluding the results of investing activities, which are managed separately from the insurance business. This measure is used to assess each segment’s business performance and as a tool in making business decisions.  Pre-tax underwriting gain, excluding the impact of catastrophes and net favorable (unfavorable) prior year loss reserve development, is the underwriting gain (loss) adjusted to exclude claims, claim adjustment expenses, and reinstatement premiums and assessments related to catastrophes and loss reserve development related to time periods prior to the current year. In the opinion of the company’s management, this measure is meaningful to users of the financial statements to understand the company’s periodic earnings and the variability of earnings caused by the unpredictable nature (i.e., the timing and amount) of catastrophes and loss reserve development.

A catastrophe is a severe loss, resulting from natural and man-made events, including risks such as fire, earthquake, windstorm, explosion, terrorism and other similar events. Each catastrophe has unique characteristics, and catastrophes are not predictable as to timing or amount. Their effects are included in net and operating income (loss) and claims and claim adjustment expense reserves upon occurrence. A catastrophe may result in the payment of reinsurance reinstatement premiums and assessments from various pools. In the opinion of the company’s management, a discussion of the impact of catastrophes is meaningful to users of the financial statements to understand the company’s periodic earnings and the variability in periodic earnings caused by the unpredictable nature of catastrophes.

Net favorable (unfavorable) prior year 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, which may be related to one or more prior years. In the opinion of the company’s management, a discussion of loss reserve development is meaningful to users of the financial statements as it allows them to assess the impact between prior and current year development on incurred claims and claim adjustment expenses, net and operating income (loss), and changes in claims and claim adjustment expense reserve levels from period to period.

Reconciliation of Pre-tax Underwriting Gain (Excluding the Impact of Catastrophes and Net Favorable Prior Year Loss Reserve Development) to Net Income (Loss)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions; after-tax except as noted)	2011			2010			2011			2010
Pre-tax underwriting gain excluding the impact of catastrophes, and net favorable prior year loss reserve development	$	89		$	275		$	285		$	607
Pre-tax impact of catastrophes	(1,668		)	(439		)	(1,854		)	(910		)
Pre-tax impact of net favorable prior year loss reserve development	168			384			405			678
Pre-tax underwriting gain (loss)	(1,411		)	220			(1,164		)	375
Income tax expense (benefit) on underwriting results	(487		)	101			(489		)	176
Underwriting gain (loss)	(924		)	119			(675		)	199
Net investment income	606			617			1,228			1,227
Other, including interest expense	(59		)	(46		)	(104		)	(105		)
Operating income (loss)	(377		)	690			449			1,321
Net realized investment gains (losses)	13			(20		)	26			(4		)
Net income (loss)	$	(364	)	$	670		$	475		$	1,317

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Reconciliation of Net Income (Loss) per Diluted Share Excluding the Impact of Catastrophes to Net Income (Loss) per Diluted Share

	Three Months
	Ended
	June 30, 2011
Net income per diluted share, excluding the impact of catastrophes	$	1.68
Impact of catastrophes	(2.56		)
Net loss per diluted share	$	(0.88	)

ADJUSTMENT TO THE GAAP COMBINED RATIO FOR THE INCREMENTAL IMPACT OF THE DIRECT TO CONSUMER INITIATIVE

GAAP combined ratio is the sum of the loss and loss adjustment expense ratio (loss and LAE ratio) and the underwriting expense ratio. 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.

Calculation of the GAAP Combined Ratio

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions, pre-tax)	2011			2010			2011			2010
Loss and loss adjustment expense ratio
Claims and claim adjustment expenses	$	5,141		$	3,419		$	8,523		$	6,807
Less:
Policyholder dividends	8			7			18			15
Allocated fee income	34			31			67			67
Loss ratio numerator	$	5,099		$	3,381		$	8,438		$	6,725
Underwriting expense ratio
Amortization of deferred acquisition costs	$	970		$	950		$	1,918		$	1,879
General and administrative expenses	907			832			1,790			1,679
Less:
G&A included in Interest Expense and Other	30			5			45			15
Allocated fee income	40			45			81			88
Billing and policy fees	25			25			51			52
Expense ratio numerator	$	1,782		$	1,707		$	3,531		$	3,403
Earned premium	$	5,503		$	5,340		$	10,874		$	10,570
GAAP combined ratio (1)
Loss and loss adjustment expense ratio	92.6		%	63.3		%	77.6		%	63.6		%
Underwriting expense ratio	32.4		%	31.9		%	32.5		%	32.2		%
Combined ratio	125.0		%	95.2		%	110.1		%	95.8		%

(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.

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GAAP combined ratio excluding the incremental impact of the direct to consumer initiative is the GAAP combined ratio adjusted to exclude the direct, variable impact of the company’s direct-to-consumer initiative in Personal Insurance. In the opinion of the company’s management, this is useful in an analysis of the profitability of the company’s ongoing agency business.

Reconciliation of the Consolidated and Personal Insurance GAAP Combined Ratios (Excluding the Incremental Impact of the Direct to Consumer Initiative) to the Consolidated and Personal Insurance GAAP Combined Ratios

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2011		2010		2011		2010
Personal Insurance
Combined ratio excluding incremental impact of direct to consumer initiative	143.2	%	104.0	%	117.5	%	102.5	%
Incremental impact of direct to consumer initiative	2.3	%	1.9	%	2.6	%	1.8	%
Combined ratio	145.5	%	105.9	%	120.1	%	104.3	%
Consolidated
Combined ratio excluding incremental impact of direct to consumer initiative	124.1	%	94.6	%	109.1	%	95.2	%
Incremental impact of direct to consumer initiative	0.9	%	0.6	%	1.0	%	0.6	%
Combined ratio	125.0	%	95.2	%	110.1	%	95.8	%

ADJUSTMENT TO NET WRITTEN PREMIUMS FOR THE IMPACT OF CHANGES IN FOREIGN EXCHANGE RATES

Adjusting for the impact of changes in foreign exchange rates allows the effect of foreign exchange rate differences to be isolated in the analysis of changes in various financial statement line items that are translated from a local currency to the company’s reporting currency, U.S. dollars. The impact is determined by assuming constant foreign exchange rates between periods as illustrated in the reconciliation below. In the opinion of the company’s management, this is useful in an analysis of the results of the FP&II segment.

Reconciliation of the Impact of Changes in Foreign Exchange Rates on FP&II Net Written Premiums to FP&II Net Written Premiums

	Three Months Ended						Six Months Ended
	June 30,						June 30,
($ in millions)	2011		2010		Change		2011		2010		Change
Net written premium - holding foreign exchange rates constant	$	862	$	889	(3	)%	$	1,480	$	1,570	(6	)%
Impact of changes in foreign exchange rates	17						23
Net written premium	$	879	$	889	(1	)%	$	1,503	$	1,570	(4	)%

RECONCILIATION OF CERTAIN NON-GAAP MEASURES TO BOOK VALUE PER SHARE AND SHAREHOLDERS’ EQUITY

Book value per share is total common shareholders’ equity divided by the number of common shares outstanding. Adjusted book value per share is total common shareholders’ equity excluding the after-tax impact of net unrealized investment gains and losses divided by the number of common 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 as it removes the effect of changing prices on invested assets (i.e., net unrealized investment gains (losses), net of tax), which do not have an equivalent impact on unpaid claims and claim adjustment expense reserves. Tangible book value per share is adjusted book value per share excluding the after-tax value of goodwill and other intangible assets divided by the number of common shares outstanding. In

16

the opinion of the company’s management, tangible book value per share is useful in an analysis of a property casualty company’s book value on a nominal basis as it removes certain effects of purchase accounting (i.e., goodwill and other intangible assets), in addition to the effect of changing prices on invested assets.

Reconciliation of Tangible and Adjusted Common Shareholders’ Equity to Shareholders’ Equity

	As of
	June 30,			December 31,			June 30,
($ in millions; except per share amounts)	2011			2010			2010
Tangible common shareholders’ equity	$	18,989		$	19,737		$	19,983
Goodwill	3,365			3,365			3,365
Other intangible assets	465			502			543
Less: Impact of deferred tax on other intangible assets	(50		)	(55		)	(58		)
Adjusted common shareholders’ equity	22,769			23,549			23,833
Net unrealized investment gains, net of tax	2,239			1,858			2,381
Common shareholders’ equity	25,008			25,407			26,214
Preferred stock	—			68			72
Shareholders’ equity	$	25,008		$	25,475		$	26,286
Common shares outstanding	419.5			434.6			470.8
Tangible book value per share	$	45.27		$	45.42		$	42.44
Adjusted book value per share	54.28			54.19			50.62
Book value per share	59.62			58.47			55.67

RECONCILIATION OF CERTAIN NON-GAAP MEASURES TO TOTAL CAPITALIZATION

Total capitalization is the sum of total shareholders’ equity and debt. Debt-to-capital ratio excluding net unrealized gain on investments is the ratio of debt to total capitalization excluding the after-tax impact of net unrealized investment gains and losses. In the opinion of the company’s management, the debt to capital ratio is useful in an analysis of the company’s financial leverage.

Reconciliation of Total Debt and Equity Excluding Net Unrealized Investment Gain to Total Capital

	As of
	June 30,			December 31,			June 30,
($ in millions)	2011			2010			2010
Debt	$	6,604		$	6,611		$	6,276
Shareholders’ equity	25,008			25,475			26,286
Total capitalization	31,612			32,086			32,562
Net unrealized investment gains, net of tax	2,239			1,858			2,381
Total capitalization excluding net unrealized gain on investments	$	29,373		$	30,228		$	30,181
Debt-to-capital ratio	20.9		%	20.6		%	19.3		%
Debt-to-capital ratio excluding net unrealized investment gains, net of tax	22.5		%	21.9		%	20.8		%

OTHER DEFINITIONS

Gross written premiums reflect the direct and assumed contractually determined amounts charged to policyholders for the effective period of the contract based on the terms and conditions of the insurance contract. Net written premiums reflect gross written premiums less premiums ceded to reinsurers. These are GAAP measures.

For the Business Insurance and Financial, Professional and International Insurance segments, retention is the amount of premium available for renewal that was retained, excluding rate and exposure changes. For the Personal Insurance segment, retention is the ratio of the expected number of renewal policies that will be retained throughout the annual policy period to the number of available renewal base policies. For all of the segments, renewal rate change represents the estimated change in average premium on policies that renew,

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excluding exposure changes. Exposure is the measure of risk used in the pricing of an insurance product. The change in exposure is the amount of change in premium on policies that renew attributable to the change in portfolio risk. Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes. New business volume is the amount of written premium related to new policyholders and additional products to existing policyholders.  These are operating statistics, which are subject to change based upon a number of factors, including changes in actuarial estimates.

An insurance company’s statutory surplus represents the excess of its assets over its liabilities in accordance with the statutory accounting practices required by state laws and regulations.

Holding company liquidity is the total cash, short-term invested assets and other readily marketable securities held by the holding company. Holding company liquidity requirements primarily include shareholder dividends and debt service.

For a glossary of other financial terms used in this press release, we refer you to the company’s most recent annual report on Form 10-K filed with the Securities and Exchange Commission.

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Contacts

Media:	Institutional Investors:	Individual Investors:
Shane Boyd	Gabriella Nawi	Marc Parr
917.778.6267, or	917.778.6844, or	860.277.0779
Jennifer Wislocki	Andrew Hersom
860.277.7458	860.277.0902

18

EX-99.2

Exhibit 99.2

The Travelers Companies, Inc. Financial Supplement - Second Quarter 2011

	Page Number
Consolidated Results
Financial Highlights	1
Reconciliation to Net Income (Loss) and Earnings Per Share	2
Statement of Income (Loss)	3
Net Income (Loss) by Major Component and Combined Ratio	4
Operating Income (Loss)	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 (Loss)	16
Operating Income (Loss) by Major Component and Combined Ratio	17
Selected Statistics	18
Selected Statistics - Agency Automobile	19
Selected Statistics - Agency 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 Reportable Business Segments	34

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

Index

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Net income (loss)	$	647		$	670		$	1,005		$	894		$	839		$	(364	)	$	1,317		$	475
Net income (loss) per share:
Basic	$	1.26		$	1.37		$	2.14		$	1.98		$	1.94		$	(0.88	)	$	2.63		$	1.11
Diluted	$	1.25		$	1.35		$	2.11		$	1.95		$	1.92		$	(0.88	)	$	2.60		$	1.10
Operating income (loss)	$	631		$	690		$	858		$	864		$	826		$	(377	)	$	1,321		$	449
Operating income (loss) per share:
Basic	$	1.23		$	1.41		$	1.83		$	1.91		$	1.91		$	(0.91	)	$	2.64		$	1.05
Diluted	$	1.22		$	1.39		$	1.81		$	1.89		$	1.89		$	(0.91	)	$	2.61		$	1.04
Return on equity	9.6		%	10.1		%	15.0		%	13.6		%	13.3		%	(5.8		)%	9.9		%	3.8		%
Operating return on equity	10.1		%	11.4		%	14.3		%	14.5		%	14.1		%	(6.6		)%	10.7		%	3.9		%
Total assets, at period end (1)	$	109,171		$	107,498		$	108,629		$	105,656		$	105,252		$	106,468		$	107,498		$	106,468
Total equity, at period end	$	26,671		$	26,286		$	27,295		$	25,475		$	25,243		$	25,008		$	26,286		$	25,008
Book value per share, at period end	$	53.50		$	55.67		$	59.11		$	58.47		$	59.91		$	59.62		$	55.67		$	59.62
Less: Net unrealized investment gains, net of tax	3.90			5.05			6.49			4.28			4.32			5.34			5.05			5.34
Adjusted book value per share, at period end	$	49.60		$	50.62		$	52.62		$	54.19		$	55.59		$	54.28		$	50.62		$	54.28
Weighted average number of common shares outstanding (basic)	508.4			484.5			465.9			447.9			428.2			418.6			496.3			423.3
Weighted average number of common shares outstanding and common stock equivalents (diluted)	515.1			490.8			472.0			454.7			434.4			418.6			502.6			429.1
Common shares outstanding at period end	497.0			470.8			460.5			434.6			420.3			419.5			470.8			419.5
Common stock dividends declared	$	168		$	173		$	169		$	160		$	155		$	175		$	341		$	330
Common stock repurchased:
Under Board of Director authorization
Shares	27.0			28.0			11.8			28.9			18.9			3.9			55.0			22.8
Cost	$	1,400		$	1,400		$	600		$	1,600		$	1,100		$	237		$	2,800		$	1,337
Other
Shares	0.8			0.2			—			0.3			0.8			0.6			1.0			1.4
Cost	$	40		$	14		$	—		$	12		$	46		$	36		$	54		$	82

(1)  Includes impact from certain reclassifications made to 2010 amounts to conform to 2011 presentation.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

1

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

															YTD			YTD
	1Q		2Q			3Q		4Q		1Q		2Q			2Q			2Q
	2010		2010			2010		2010		2011		2011			2010			2011
Net income (loss)
Operating income (loss)	$	631	$	690		$	858	$	864	$	826	$	(377	)	$	1,321		$	449
Net realized investment gains (losses)	16		(20		)	147		30		13		13			(4		)	26
Net income (loss)	$	647	$	670		$	1,005	$	894	$	839	$	(364	)	$	1,317		$	475
Basic earnings per share
Operating income (loss)	$	1.23	$	1.41		$	1.83	$	1.91	$	1.91	$	(0.91	)	$	2.64		$	1.05
Net realized investment gains (losses)	0.03		(0.04		)	0.31		0.07		0.03		0.03			(0.01		)	0.06
Net income (loss)	$	1.26	$	1.37		$	2.14	$	1.98	$	1.94	$	(0.88	)	$	2.63		$	1.11
Diluted earnings per share
Operating income (loss)	$	1.22	$	1.39		$	1.81	$	1.89	$	1.89	$	(0.91	)	$	2.61		$	1.04
Net realized investment gains (losses)	0.03		(0.04		)	0.30		0.06		0.03		0.03			(0.01		)	0.06
Net income (loss)	$	1.25	$	1.35		$	2.11	$	1.95	$	1.92	$	(0.88	)	$	2.60		$	1.10

Adjustments to net income (loss) and weighted average shares for net income (loss) EPS calculations: (1)

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Basic
Net income (loss), as reported	$	647		$	670		$	1,005		$	894		$	839		$	(364	)	$	1,317		$	475
Preferred stock dividends	(1		)	—			(1		)	(1		)	(1		)	—			(1		)	(1		)
Participating share-based awards - allocated income	(5		)	(5		)	(8		)	(7		)	(7		)	(2		)	(10		)	(4		)
Net income (loss) available to common shareholders - basic	$	641		$	665		$	996		$	886		$	831		$	(366	)	$	1,306		$	470
Diluted
Net income (loss) available to common shareholders - basic	$	641		$	665		$	996		$	886		$	831		$	(366	)	$	1,306		$	470
Effect of dilutive securities:
Convertible preferred stock	1			—			1			1			1			—			1			1
Performance shares	—			—			1			1			—			—			—			—
Net income (loss) available to common shareholders - diluted	$	642		$	665		$	998		$	888		$	832		$	(366	)	$	1,307		$	471
Common Shares
Basic
Weighted average shares outstanding	508.4			484.5			465.9			447.9			428.2			418.6			496.3			423.3
Diluted
Weighted average shares outstanding	508.4			484.5			465.9			447.9			428.2			418.6			496.3			423.3
Weighted average effects of dilutive securities:
Convertible preferred stock	1.9			1.8			1.7			1.7			1.6			—			1.8			1.4
Stock options and performance shares	4.8			4.5			4.4			5.1			4.6			—			4.5			4.4
Diluted weighted average shares outstanding	515.1			490.8			472.0			454.7			434.4			418.6			502.6			429.1

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

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

2

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Premiums	$	5,230		$	5,340		$	5,422		$	5,440		$	5,371		$	5,503		$	10,570		$	10,874
Net investment income	753			762			735			809			779			758			1,515			1,537
Fee income	79			76			64			68			74			74			155			148
Net realized investment gains (losses)	25			(31		)	226			44			20			19			(6		)	39
Other revenues (1)	32			32			35			(29		)	34			34			64			68
Total revenues	6,119			6,179			6,482			6,332			6,278			6,388			12,298			12,666
Claims and expenses
Claims and claim adjustment expenses	3,388			3,419			3,213			3,190			3,382			5,141			6,807			8,523
Amortization of deferred acquisition costs	929			950			966			957			948			970			1,879			1,918
General and administrative expenses	847			832			837			890			883			907			1,679			1,790
Interest expense	98			97			95			98			96			97			195			193
Total claims and expenses	5,262			5,298			5,111			5,135			5,309			7,115			10,560			12,424
Income (loss) before income taxes	857			881			1,371			1,197			969			(727		)	1,738			242
Income tax expense (benefit)	210			211			366			303			130			(363		)	421			(233		)
Net income (loss)	$	647		$	670		$	1,005		$	894		$	839		$	(364	)	$	1,317		$	475
Net realized investment gains (losses)
Other-than-temporary impairment losses:
Total gains (losses)	$	(1	)	$	2		$	8		$	(2	)	$	2		$	5		$	1		$	7
Non-credit component of impairments recognized in accumulated other changes in equity from nonowner sources	(9		)	(6		)	(14		)	(4		)	(6		)	(9		)	(15		)	(15		)
Other-than-temporary impairment losses	(10		)	(4		)	(6		)	(6		)	(4		)	(4		)	(14		)	(8		)
Other net realized investment gains (losses)	35			(27		)	232			50			24			23			8			47
Net realized investment gains (losses)	$	25		$	(31	)	$	226		$	44		$	20		$	19		$	(6	)	$	39
Other statistics
Effective tax rate on net investment income	18.9		%	19.1		%	18.8		%	20.3		%	20.2		%	20.1		%	19.0		%	20.1		%
Net investment income (after-tax)	$	610		$	617		$	597		$	644		$	622		$	606		$	1,227		$	1,228
Catastrophes, net of reinsurance:
Pre-tax	$	471		$	439		$	117		$	86		$	186		$	1,668		$	910		$	1,854
After-tax	$	312		$	285		$	77		$	55		$	122		$	1,085		$	597		$	1,207

(1)  In 4Q 2010, “Other revenues” include $(60) million of expenses related to the Company’s purchase and retirement of $885 million of its $1 billion 6.25% fixed-to-floating rate junior subordinated debentures.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

3

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Underwriting gain (loss)	$	80		$	119		$	302		$	303		$	249		$	(924	)	$	199		$	(675	)
Net investment income	610			617			597			644			622			606			1,227			1,228
Other, including interest expense (1)	(59		)	(46		)	(41		)	(83		)	(45		)	(59		)	(105		)	(104		)
Operating income (loss)	631			690			858			864			826			(377		)	1,321			449
Net realized investment gains (losses)	16			(20		)	147			30			13			13			(4		)	26
Net income (loss)	$	647		$	670		$	1,005		$	894		$	839		$	(364	)	$	1,317		$	475
GAAP Combined ratio (2) (3)
Loss and loss adjustment expense ratio	64.0		%	63.3		%	58.7		%	58.0		%	62.1		%	92.6		%	63.6		%	77.6		%
Underwriting expense ratio	32.4		%	31.9		%	31.9		%	32.6		%	32.6		%	32.4		%	32.2		%	32.5		%
Combined ratio	96.4		%	95.2		%	90.6		%	90.6		%	94.7		%	125.0		%	95.8		%	110.1		%
GAAP combined ratio excluding incremental impact of direct to consumer initiative	95.8		%	94.6		%	89.7		%	89.6		%	93.8		%	124.1		%	95.2		%	109.1		%
Impact of catastrophes on combined ratio	9.0		%	8.2		%	2.2		%	1.5		%	3.4		%	30.3		%	8.6		%	17.1		%
Impact of prior year reserve development on combined ratio	-5.6		%	-7.2		%	-4.1		%	-6.4		%	-4.4		%	-3.1		%	-6.4		%	-3.7		%

(1)  In 4Q 2010, “Other, including interest expense” includes $(39) million, net of tax, of expenses related to the Company’s purchase and retirement of $885 million of its $1 billion 6.25% fixed-to-floating rate junior subordinated debentures.

(2)  Before policyholder dividends.

(3)  Billing and policy fees, which are a component of other revenues, are allocated as a reduction of 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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Billing and policy fees	$	27	$	25	$	27	$	25	$	26	$	25	$	52	$	51
Fee income:
Loss and loss adjustment expenses	$	36	$	31	$	23	$	30	$	33	$	34	$	67	$	67
Underwriting expenses	43		45		41		38		41		40		88		81
Total fee income	$	79	$	76	$	64	$	68	$	74	$	74	$	155	$	148

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

4

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Premiums	$	5,230		$	5,340		$	5,422		$	5,440		$	5,371		$	5,503		$	10,570		$	10,874
Net investment income	753			762			735			809			779			758			1,515			1,537
Fee income	79			76			64			68			74			74			155			148
Other revenues (1)	32			32			35			(29		)	34			34			64			68
Total revenues	6,094			6,210			6,256			6,288			6,258			6,369			12,304			12,627
Claims and expenses
Claims and claim adjustment expenses	3,388			3,419			3,213			3,190			3,382			5,141			6,807			8,523
Amortization of deferred acquisition costs	929			950			966			957			948			970			1,879			1,918
General and administrative expenses	847			832			837			890			883			907			1,679			1,790
Interest expense	98			97			95			98			96			97			195			193
Total claims and expenses	5,262			5,298			5,111			5,135			5,309			7,115			10,560			12,424
Operating income (loss) before income taxes	832			912			1,145			1,153			949			(746		)	1,744			203
Income tax expense (benefit)	201			222			287			289			123			(369		)	423			(246		)
Operating income (loss)	$	631		$	690		$	858		$	864		$	826		$	(377	)	$	1,321		$	449
Other statistics
Effective tax rate on net investment income	18.9		%	19.1		%	18.8		%	20.3		%	20.2		%	20.1		%	19.0		%	20.1		%
Net investment income (after-tax)	$	610		$	617		$	597		$	644		$	622		$	606		$	1,227		$	1,228
Catastrophes, net of reinsurance:
Pre-tax	$	471		$	439		$	117		$	86		$	186		$	1,668		$	910		$	1,854
After-tax	$	312		$	285		$	77		$	55		$	122		$	1,085		$	597		$	1,207

(1)  In 4Q 2010, “Other revenues” include $(60) million of expenses related to the Company’s purchase and retirement of $885 million of its $1 billion 6.25% fixed-to-floating rate junior subordinated debentures.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

5

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

																		YTD			YTD
	1Q			2Q			3Q			4Q			1Q		2Q			2Q			2Q
	2010			2010			2010			2010			2011		2011			2010			2011
Statutory underwriting
Gross written premiums	$	5,803		$	5,974		$	6,004		$	5,521		$	5,961	$	6,124		$	11,777		$	12,085
Net written premiums	$	5,251		$	5,688		$	5,462		$	5,234		$	5,437	$	5,817		$	10,939		$	11,254
Net earned premiums	$	5,230		$	5,340		$	5,422		$	5,440		$	5,371	$	5,503		$	10,570		$	10,874
Losses and loss adjustment expenses	3,349			3,382			3,185			3,156			3,342		5,100			6,731			8,442
Underwriting expenses	1,708			1,757			1,766			1,725			1,772		1,837			3,465			3,609
Statutory underwriting gain (loss)	173			201			471			559			257		(1,434		)	374			(1,177		)
Policyholder dividends	8			7			9			6			10		8			15			18
Statutory underwriting gain (loss) after policyholder dividends	$	165		$	194		$	462		$	553		$	247	$	(1,442	)	$	359		$	(1,195	)
Other statutory statistics
Reserves for losses and loss adjustment expenses	$	40,849		$	40,766		$	40,640		$	40,235		$	40,301	$	41,482		$	40,766		$	41,482
Increase (decrease) in reserves	$	(74	)	$	(83	)	$	(126	)	$	(405	)	$	66	$	1,181		$	(157	)	$	1,247
Statutory surplus	$	21,607		$	21,077		$	20,868		$	20,066		$	20,588	$	20,224		$	21,077		$	20,224
Net written premiums/surplus (1)	0.99:1			1.02:1			1.03:1			1.08:1			1.06:1		1.09:1			1.02:1			1.09:1

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

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

6

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Written premiums
Gross	$	5,803		$	5,974		$	6,004		$	5,521		$	5,961		$	6,124		$	11,777		$	12,085
Ceded	(552		)	(286		)	(542		)	(287		)	(524		)	(307		)	(838		)	(831		)
Net	$	5,251		$	5,688		$	5,462		$	5,234		$	5,437		$	5,817		$	10,939		$	11,254
Earned premiums
Gross	$	5,697		$	5,770		$	5,864		$	5,866		$	5,804		$	5,920		$	11,467		$	11,724
Ceded	(467		)	(430		)	(442		)	(426		)	(433		)	(417		)	(897		)	(850		)
Net	$	5,230		$	5,340		$	5,422		$	5,440		$	5,371		$	5,503		$	10,570		$	10,874

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

7

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Premiums	$	2,628		$	2,663		$	2,736		$	2,739		$	2,745		$	2,802		$	5,291		$	5,547
Net investment income	528			537			514			577			556			541			1,065			1,097
Fee income	79			76			64			66			74			74			155			148
Other revenues	6			7			10			5			9			10			13			19
Total revenues	3,241			3,283			3,324			3,387			3,384			3,427			6,524			6,811
Claims and expenses
Claims and claim adjustment expenses	1,583			1,621			1,683			1,617			1,773			2,579			3,204			4,352
Amortization of deferred acquisition costs	425			439			448			437			444			457			864			901
General and administrative expenses	481			469			463			491			473			492			950			965
Total claims and expenses	2,489			2,529			2,594			2,545			2,690			3,528			5,018			6,218
Operating income (loss) before federal income taxes	752			754			730			842			694			(101		)	1,506			593
Income tax expense (benefit)	185			187			187			218			90			(112		)	372			(22		)
Operating income	$	567		$	567		$	543		$	624		$	604		$	11		$	1,134		$	615
Other statistics
Effective tax rate on net investment income	18.6		%	18.8		%	18.5		%	20.3		%	20.0		%	19.9		%	18.7		%	20.0		%
Net investment income (after-tax)	$	430		$	435		$	420		$	459		$	445		$	433		$	865		$	878
Catastrophes, net of reinsurance:
Pre-tax	$	135		$	179		$	53		$	70		$	112		$	697		$	314		$	809
After-tax	$	88		$	116		$	35		$	45		$	73		$	453		$	204		$	526

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

8

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Underwriting gain (loss)	$	132		$	127		$	116		$	161		$	153		$	(429	)	$	259		$	(276	)
Net investment income	430			435			420			459			445			433			865			878
Other	5			5			7			4			6			7			10			13
Operating income	$	567		$	567		$	543		$	624		$	604		$	11		$	1,134		$	615
GAAP Combined ratio (1) (2)
Loss and loss adjustment expense ratio	58.7		%	59.5		%	60.5		%	57.8		%	63.1		%	90.6		%	59.1		%	77.0		%
Underwriting expense ratio	32.7		%	32.3		%	31.6		%	32.3		%	31.8		%	32.3		%	32.5		%	32.0		%
Combined ratio	91.4		%	91.8		%	92.1		%	90.1		%	94.9		%	122.9		%	91.6		%	109.0		%
Impact of catastrophes on combined ratio	5.1		%	6.7		%	2.0		%	2.6		%	4.1		%	24.9		%	6.0		%	14.6		%
Impact of prior year reserve development on combined ratio	-9.2		%	-11.3		%	-3.8		%	-9.3		%	-5.2		%	-1.0		%	-10.3		%	-3.1		%

(1)  Before policyholder dividends.

(2)  Billing and policy fees, which are a component of other revenues, are allocated as a reduction of 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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Billing and policy fees	$	4	$	4	$	5	$	4	$	5	$	4	$	8	$	9
Fee income:
Loss and loss adjustment expenses	$	36	$	31	$	23	$	28	$	33	$	34	$	67	$	67
Underwriting expenses	43		45		41		38		41		40		88		81
Total fee income	$	79	$	76	$	64	$	66	$	74	$	74	$	155	$	148

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

9

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

														YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q			2Q		2Q
	2010		2010		2010		2010		2011		2011			2010		2011
Statutory underwriting
Gross written premiums	$	3,118	$	2,996	$	3,027	$	2,750	$	3,306	$	3,094		$	6,114	$	6,400
Net written premiums	$	2,834	$	2,795	$	2,651	$	2,577	$	3,020	$	2,879		$	5,629	$	5,899
Net earned premiums	$	2,628	$	2,663	$	2,736	$	2,739	$	2,745	$	2,802		$	5,291	$	5,547
Losses and loss adjustment expenses	1,547		1,586		1,659		1,583		1,736		2,540			3,133		4,276
Underwriting expenses	866		869		867		854		899		918			1,735		1,817
Statutory underwriting gain (loss)	215		208		210		302		110		(656		)	423		(546		)
Policyholder dividends	4		6		5		6		7		5			10		12
Statutory underwriting gain (loss) after policyholder dividends	$	211	$	202	$	205	$	296	$	103	$	(661	)	$	413	$	(558	)

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

10

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

														YTD		YTD
	1Q		2Q		3Q		4Q			1Q		2Q		2Q		2Q
	2010		2010		2010		2010			2011		2011		2010		2011
Net written premiums by market
Select Accounts	$	702	$	716	$	664	$	636		$	732	$	738	$	1,418	$	1,470
Commercial Accounts	706		581		655		634			822		659		1,287		1,481
National Accounts	226		194		173		213			211		188		420		399
Industry-Focused Underwriting	569		584		590		556			628		579		1,153		1,207
Target Risk Underwriting	412		469		342		350			413		468		881		881
Specialized Distribution	215		247		222		188			209		246		462		455
Total core	2,830		2,791		2,646		2,577			3,015		2,878		5,621		5,893
Business Insurance other	4		4		5		—			5		1		8		6
Total	$	2,834	$	2,795	$	2,651	$	2,577		$	3,020	$	2,879	$	5,629	$	5,899
Net written premiums by product line
Commercial multi-peril	$	784	$	752	$	728	$	731		$	841	$	780	$	1,536	$	1,621
Workers’ compensation	725		600		635		626			854		678		1,325		1,532
Commercial automobile	483		492		494		441			493		505		975		998
Property	430		493		360		358			414		468		923		882
General liability	412		458		434		422			415		442		870		857
Other	—		—		—		(1		)	3		6		—		9
Total	$	2,834	$	2,795	$	2,651	$	2,577		$	3,020	$	2,879	$	5,629	$	5,899
National accounts
Additions to claim volume under administration (1)	$	536	$	399	$	348	$	496		$	540	$	416	$	935	$	956
Written fees	$	74	$	64	$	57	$	62		$	73	$	63	$	138	$	136

(1)  Includes new and renewal business.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

11

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Premiums	$	824		$	855		$	820		$	818		$	773		$	810		$	1,679		$	1,583
Net investment income	111			110			110			108			106			105			221			211
Fee income	—			—			—			2			—			—			—			—
Other revenues	6			7			7			7			7			6			13			13
Total revenues	941			972			937			935			886			921			1,913			1,807
Claims and expenses
Claims and claim adjustment expenses	516			414			350			420			433			378			930			811
Amortization of deferred acquisition costs	153			153			154			152			147			152			306			299
General and administrative expenses	149			148			153			158			160			160			297			320
Total claims and expenses	818			715			657			730			740			690			1,533			1,430
Operating income before federal income taxes	123			257			280			205			146			231			380			377
Income tax expense	37			85			68			55			26			67			122			93
Operating income	$	86		$	172		$	212		$	150		$	120		$	164		$	258		$	284
Other statistics
Effective tax rate on net investment income	21.0		%	20.7		%	20.6		%	20.5		%	21.2		%	21.2		%	20.9		%	21.2		%
Net investment income (after-tax)	$	87		$	89		$	86		$	86		$	84		$	82		$	176		$	166
Catastrophes, net of reinsurance (1):
Pre-tax	$	86		$	3		$	(2	)	$	(5	)	$	21		$	14		$	89		$	35
After-tax	$	62		$	2		$	(2	)	$	(3	)	$	15		$	10		$	64		$	25

(1)  In 3Q 2010 and 4Q 2010 “Catastrophes, net of reinsurance” includes a net benefit from re-estimation of current year catastrophe losses.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

12

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Underwriting gain (loss)	$	(5	)	$	79		$	121		$	59		$	32		$	78		$	74		$	110
Net investment income	87			89			86			86			84			82			176			166
Other	4			4			5			5			4			4			8			8
Operating income	$	86		$	172		$	212		$	150		$	120		$	164		$	258		$	284
GAAP Combined ratio (1) (2)
Loss and loss adjustment expense ratio	62.3		%	48.1		%	42.2		%	51.2		%	55.6		%	46.2		%	55.1		%	50.8		%
Underwriting expense ratio	36.6		%	35.2		%	37.4		%	38.0		%	39.7		%	38.6		%	35.9		%	39.1		%
Combined ratio	98.9		%	83.3		%	79.6		%	89.2		%	95.3		%	84.8		%	91.0		%	89.9		%
Impact of catastrophes on combined ratio	10.4		%	0.4		%	-0.3		%	-0.6		%	2.7		%	1.7		%	5.3		%	2.2		%
Impact of prior year reserve development on combined ratio	-4.2		%	-8.4		%	-11.8		%	-6.8		%	-5.1		%	-11.7		%	-6.3		%	-8.6		%

(1)  Before policyholder dividends.

(2)  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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Fee income:
Loss and loss adjustment expenses	$	—	$	—	$	—	$	2	$	—	$	—	$	—	$	—
Underwriting expenses	—		—		—		—		—		—		—		—
Total fee income	$	—	$	—	$	—	$	2	$	—	$	—	$	—	$	—

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

13

The Travelers Companies, Inc.
Selected Statistics - Financial, Professional & International Insurance
($ in millions)

														YTD		YTD
	1Q			2Q		3Q		4Q		1Q		2Q		2Q		2Q
	2010			2010		2010		2010		2011		2011		2010		2011
Statutory underwriting
Gross written premiums	$	898		$	915	$	852	$	869	$	810	$	910	$	1,813	$	1,720
Net written premiums	$	681		$	889	$	808	$	833	$	624	$	879	$	1,570	$	1,503
Net earned premiums	$	824		$	855	$	820	$	818	$	773	$	810	$	1,679	$	1,583
Losses and loss adjustment expenses	513			412		346		420		430		375		925		805
Underwriting expenses	308			303		291		290		309		312		611		621
Statutory underwriting gain	3			140		183		108		34		123		143		157
Policyholder dividends	4			1		4		—		3		3		5		6
Statutory underwriting gain (loss) after policyholder dividends	$	(1	)	$	139	$	179	$	108	$	31	$	120	$	138	$	151

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

14

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

													YTD		YTD
	1Q		2Q		3Q		4Q		1Q		2Q		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Net written premiums by market
Bond & Financial Products	$	362	$	559	$	547	$	513	$	369	$	533	$	921	$	902
International	319		330		261		320		255		346		649		601
Total	$	681	$	889	$	808	$	833	$	624	$	879	$	1,570	$	1,503
Net written premiums by product line
General liability	$	132	$	232	$	242	$	246	$	138	$	235	$	364	$	373
Fidelity & surety	194		292		273		236		196		265		486		461
International	319		330		261		320		255		346		649		601
Other	36		35		32		31		35		33		71		68
Total	$	681	$	889	$	808	$	833	$	624	$	879	$	1,570	$	1,503

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

15

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Premiums	$	1,778		$	1,822		$	1,866		$	1,883		$	1,853		$	1,891		$	3,600		$	3,744
Net investment income	114			115			111			124			117			112			229			229
Other revenues	20			18			18			19			18			18			38			36
Total revenues	1,912			1,955			1,995			2,026			1,988			2,021			3,867			4,009
Claims and expenses
Claims and claim adjustment expenses	1,289			1,384			1,180			1,153			1,176			2,184			2,673			3,360
Amortization of deferred acquisition costs	351			358			364			368			357			361			709			718
General and administrative expenses	207			210			215			235			235			225			417			460
Total claims and expenses	1,847			1,952			1,759			1,756			1,768			2,770			3,799			4,538
Operating income (loss) before federal income taxes	65			3			236			270			220			(749		)	68			(529		)
Income tax expense (benefit)	6			(16		)	68			76			50			(278		)	(10		)	(228		)
Operating income (loss)	$	59		$	19		$	168		$	194		$	170		$	(471	)	$	78		$	(301	)
Other statistics
Effective tax rate on net investment income	18.6		%	18.7		%	18.5		%	20.0		%	20.0		%	19.9		%	18.6		%	19.9		%
Net investment income (after-tax)	$	93		$	93		$	91		$	99		$	93		$	91		$	186		$	184
Catastrophes, net of reinsurance:
Pre-tax	$	250		$	257		$	66		$	21		$	53		$	957		$	507		$	1,010
After-tax	$	162		$	167		$	44		$	13		$	34		$	622		$	329		$	656

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

16

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Underwriting gain (loss)	$	(47	)	$	(87	)	$	65		$	83		$	64		$	(573	)	$	(134	)	$	(509	)
Net investment income	93			93			91			99			93			91			186			184
Other	13			13			12			12			13			11			26			24
Operating income (loss)	$	59		$	19		$	168		$	194		$	170		$	(471	)	$	78		$	(301	)
GAAP Combined ratio (1)
Loss and loss adjustment expense ratio	72.5		%	76.0		%	63.2		%	61.2		%	63.4		%	115.6		%	74.3		%	89.8		%
Underwriting expense ratio	30.1		%	29.9		%	29.9		%	30.9		%	30.8		%	29.9		%	30.0		%	30.3		%
Combined ratio	102.6		%	105.9		%	93.1		%	92.1		%	94.2		%	145.5		%	104.3		%	120.1		%
GAAP combined ratio excluding incremental impact of direct to consumer initiative	100.9		%	104.0		%	90.6		%	89.1		%	91.4		%	143.2		%	102.5		%	117.5		%
Impact of catastrophes on combined ratio	14.0		%	14.0		%	3.6		%	1.1		%	2.8		%	50.7		%	14.1		%	27.0		%
Impact of prior year reserve development on combined ratio	-1.0		%	-0.5		%	-1.2		%	-2.0		%	-3.0		%	-2.4		%	-0.8		%	-2.7		%

(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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Billing and policy fees	$	23	$	21	$	22	$	21	$	21	$	21	$	44	$	42

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

17

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

																YTD			YTD
	1Q			2Q			3Q		4Q		1Q		2Q			2Q			2Q
	2010			2010			2010		2010		2011		2011			2010			2011
Statutory underwriting
Gross written premiums	$	1,787		$	2,063		$	2,125	$	1,902	$	1,845	$	2,120		$	3,850		$	3,965
Net written premiums	$	1,736		$	2,004		$	2,003	$	1,824	$	1,793	$	2,059		$	3,740		$	3,852
Net earned premiums	$	1,778		$	1,822		$	1,866	$	1,883	$	1,853	$	1,891		$	3,600		$	3,744
Losses and loss adjustment expenses	1,289			1,384			1,180		1,153		1,176		2,185			2,673			3,361
Underwriting expenses	534			585			608		581		564		607			1,119			1,171
Statutory underwriting gain (loss)	$	(45	)	$	(147	)	$	78	$	149	$	113	$	(901	)	$	(192	)	$	(788	)
Policies in force (in thousands)
Automobile	2,489			2,516			2,536		2,547		2,559		2,570			2,516			2,570
Homeowners and other	5,030			5,100			5,143		5,165		5,183		5,210			5,100			5,210

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

18

The Travelers Companies, Inc.
Selected Statistics - Personal Insurance (Agency Automobile) (1)
($ in millions)

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Statutory underwriting
Gross written premiums	$	917		$	951		$	958		$	894		$	923		$	952		$	1,868		$	1,875
Net written premiums	$	913		$	945		$	952		$	888		$	918		$	948		$	1,858		$	1,866
Net earned premiums	$	892		$	905		$	914		$	918		$	896		$	908		$	1,797		$	1,804
Losses and loss adjustment expenses	613			638			628			674			620			722			1,251			1,342
Underwriting expenses	249			254			254			250			249			249			503			498
Statutory underwriting gain (loss)	$	30		$	13		$	32		$	(6	)	$	27		$	(63	)	$	43		$	(36	)
Other statistics
GAAP Combined ratio (2):
Loss and loss adjustment expense ratio	68.7		%	70.5		%	68.7		%	73.4		%	69.2		%	79.5		%	69.6		%	74.3		%
Underwriting expense ratio	26.7		%	26.9		%	26.2		%	26.9		%	26.6		%	26.2		%	26.8		%	26.4		%
Combined ratio	95.4		%	97.4		%	94.9		%	100.3		%	95.8		%	105.7		%	96.4		%	100.7		%
Impact of catastrophes on combined ratio	0.8		%	1.6		%	0.3		%	0.5		%	0.1		%	6.8		%	1.2		%	3.5		%
Catastrophe losses, net of reinsurance:
Pre-tax	$	7		$	14		$	3		$	4		$	1		$	61		$	21		$	62
After-tax	$	4		$	10		$	2		$	2		$	—		$	41		$	14		$	41
Policies in force (in thousands)	2,447			2,468			2,482			2,490			2,497			2,502
Change from prior year quarter	-1.7		%	0.1		%	1.3		%	1.9		%	2.0		%	1.4		%
Change from prior quarter	0.2		%	0.9		%	0.6		%	0.3		%	0.3		%	0.2		%

(1)  Represents Automobile policies sold through agents, brokers and other intermediaries, and excludes direct to consumer.

(2)  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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Billing and policy fees	$	13	$	11	$	12	$	12	$	12	$	11	$	24	$	23

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

19

The Travelers Companies, Inc.
Selected Statistics - Personal Insurance (Agency Homeowners and Other) (1)
($ in millions)

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Statutory underwriting
Gross written premiums	$	849		$	1,089		$	1,140		$	982		$	891		$	1,136		$	1,938		$	2,027
Net written premiums	$	803		$	1,035		$	1,024		$	910		$	845		$	1,078		$	1,838		$	1,923
Net earned premiums	$	870		$	897		$	930		$	942		$	932		$	954		$	1,767		$	1,886
Losses and loss adjustment expenses	662			729			534			459			532			1,428			1,391			1,960
Underwriting expenses	252			292			305			276			263			308			544			571
Statutory underwriting gain (loss)	$	(44	)	$	(124	)	$	91		$	207		$	137		$	(782	)	$	(168	)	$	(645	)
Other statistics
GAAP Combined ratio (2):
Loss and loss adjustment expense ratio	76.1		%	81.3		%	57.4		%	48.7		%	57.1		%	149.7		%	78.7		%	104.0		%
Underwriting expense ratio	30.6		%	29.4		%	28.9		%	29.5		%	30.0		%	29.3		%	30.0		%	29.6		%
Combined ratio	106.7		%	110.7		%	86.3		%	78.2		%	87.1		%	179.0		%	108.7		%	133.6		%
Impact of catastrophes on combined ratio	27.9		%	26.8		%	6.9		%	1.6		%	5.6		%	92.9		%	27.3		%	49.8		%
Catastrophe losses, net of reinsurance:
Pre-tax	$	242		$	241		$	64		$	15		$	52		$	887		$	483		$	939
After-tax	$	158		$	156		$	41		$	10		$	34		$	576		$	314		$	610
Policies in force (in thousands)	5,000			5,064			5,103			5,121			5,135			5,157
Change from prior year quarter	3.1		%	3.6		%	3.6		%	3.3		%	2.7		%	1.8		%
Change from prior quarter	0.8		%	1.3		%	0.8		%	0.4		%	0.3		%	0.4		%

(1)  Represents Homeowners and Other Lines sold through agents, brokers and other intermediaries, and excludes direct to consumer.

(2)  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		2Q		2Q
	2010		2010		2010		2010		2011		2011		2010		2011
Billing and policy fees	$	10	$	9	$	10	$	9	$	9	$	9	$	19	$	18

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

20

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Revenues
Other revenues (1)	$	—		$	—		$	—		$	(60	)	$	—		$	—		$	—		$	—
Claims and expenses
Interest expense	98			97			95			98			96			97			195			193
General and administrative expenses	10			5			6			6			15			30			15			45
Total claims and expenses	108			102			101			104			111			127			210			238
Operating loss before federal income tax benefit	(108		)	(102		)	(101		)	(164		)	(111		)	(127		)	(210		)	(238		)
Income taxes	(27		)	(34		)	(36		)	(60		)	(43		)	(46		)	(61		)	(89		)
Operating loss	$	(81	)	$	(68	)	$	(65	)	$	(104	)	$	(68	)	$	(81	)	$	(149	)	$	(149	)

(1)  In 4Q 2010, “Other revenues” include $(60) million of expenses related to the Company’s purchase and retirement of $885 million of its $1 billion 6.25% fixed-to-floating rate junior subordinated debentures.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

21

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

	June 30,			December 31,
	2011 (1)			2010
Assets
Fixed maturities, available for sale, at fair value (including $94 and $186 subject to securities lending) (amortized cost $59,767 and $60,170)	$	62,976		$	62,820
Equity securities, available for sale, at fair value (cost $461 and $372)	600			519
Real estate	854			838
Short-term securities	5,024			5,616
Other investments	3,539			2,929
Total investments	72,993			72,722
Cash	273			200
Investment income accrued	768			791
Premiums receivable	6,043			5,497
Reinsurance recoverables	11,780			11,994
Ceded unearned premiums	802			813
Deferred acquisition costs	1,840			1,782
Deferred tax asset	128			493
Contractholder receivables	5,370			5,343
Goodwill	3,365			3,365
Other intangible assets	465			502
Other assets	2,641			2,154
Total assets	$	106,468		$	105,656
Liabilities
Claims and claim adjustment expense reserves	$	52,596		$	51,606
Unearned premium reserves	11,339			10,921
Contractholder payables	5,370			5,343
Payables for reinsurance premiums	409			407
Debt	6,604			6,611
Other liabilities	5,142			5,293
Total liabilities	81,460			80,181
Shareholders’ equity
Preferred Stock Savings Plan - convertible preferred stock (0.0 and 0.2 shares issued and outstanding)	—			68
Common stock (1,748.6 shares authorized; 419.5 and 434.6 shares issued and outstanding)	20,607			20,162
Retained earnings	18,966			18,847
Accumulated other changes in equity from nonowner sources	1,711			1,255
Treasury stock, at cost (320.8 and 296.6 shares)	(16,276		)	(14,857		)
Total shareholders’ equity	25,008			25,475
Total liabilities and shareholders’ equity	$	106,468		$	105,656

(1)  Preliminary.

Note:  Certain reclassifications have been made to the 2010 consolidated balance sheet to conform to the 2011 presentation.

22

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

	June 30,		Pre-tax Book		December 31,		Pre-tax Book
	2011		Yield (1)		2010		Yield (1)
Investment portfolio
Taxable fixed maturities (including redeemable preferred stock)	$	24,286	4.60	%	$	23,790	4.80	%
Tax-exempt fixed maturities	38,690		4.04	%	39,030		4.03	%
Total fixed maturities	62,976		4.26	%	62,820		4.32	%
Non-redeemable preferred stocks	202		6.36	%	215		6.47	%
Common stocks	398				304
Total equity securities	600				519
Real estate	854				838
Short-term securities	5,024		0.14	%	5,616		0.19	%
Private equities	1,859				1,725
Hedge funds	548				512
Real estate partnerships	596				580
Mortgage loans	36		6.23	%	34		6.28	%
Trading securities	24				23
Other investments	476				55
Total other investments	3,539				2,929
Total investments	$	72,993			$	72,722
Net unrealized investment gains, net of tax, included in shareholders’ equity	$	2,239			$	1,858

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

23

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

	June 30,		December 31,
	2011		2010
Fixed maturities
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	2,146	$	2,008
Obligations of states and political subdivisions:
Pre-refunded	7,119		7,291
All other	32,061		32,244
Total	39,180		39,535
Debt securities issued by foreign governments	2,031		2,202
Mortgage-backed securities - principally obligations of U.S. Government agencies	3,772		4,164
Corporates (including redeemable preferreds)	15,847		14,911
Total fixed maturities	$	62,976	$	62,820

Fixed Maturities

Quality Characteristics (1)

	June 30, 2011
	Amount		% of Total
Quality Ratings
Aaa	$	29,285	46.5	%
Aa	20,135		32.0
A	6,996		11.1
Baa	4,681		7.4
Total investment grade	61,097		97.0
Ba	872		1.4
B	579		0.9
Caa and lower	428		0.7
Total below investment grade	1,879		3.0
Total fixed maturities	$	62,976	100.0	%
Average weighted quality	Aa2, 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	3.6

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

24

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Gross investment income
Fixed maturities	$	691		$	678		$	674		$	667		$	642		$	634		$	1,369		$	1,276
Short-term securities	3			3			3			4			4			3			6			7
Other	66			89			65			150			140			129			155			269
	760			770			742			821			786			766			1,530			1,552
Investment expenses	7			8			7			12			7			8			15			15
Net investment income, pre-tax	753			762			735			809			779			758			1,515			1,537
Income taxes	143			145			138			165			157			152			288			309
Net investment income, after-tax	$	610		$	617		$	597		$	644		$	622		$	606		$	1,227		$	1,228
Effective tax rate	18.9		%	19.1		%	18.8		%	20.3		%	20.2		%	20.1		%	19.0		%	20.1		%
Average invested assets (1)	$	72,659		$	71,294		$	70,929		$	71,359		$	70,771		$	70,476		$	71,987		$	70,659
Average yield pre-tax (1)	4.1		%	4.3		%	4.1		%	4.5		%	4.4		%	4.3		%	4.2		%	4.4		%
Average yield after-tax	3.4		%	3.5		%	3.4		%	3.6		%	3.5		%	3.4		%	3.4		%	3.5		%

(1)  Excludes net unrealized investment gains (losses), net of tax, and is adjusted for cash, receivables for investment sales, payables on investment purchases and accrued investment income.

25

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Net realized investment gains (losses)
Fixed maturities	$	22		$	17		$	25		$	18		$	10		$	14		$	39		$	24
Equity securities (1)	8			3			104			10			1			26			11			27
Other (1) (2)	(5		)	(51		)	97			16			9			(21		)	(56		)	(12		)
Realized investment gains (losses) before tax	25			(31		)	226			44			20			19			(6		)	39
Related taxes	9			(11		)	79			14			7			6			(2		)	13
Net realized investment gains (losses)	$	16		$	(20	)	$	147		$	30		$	13		$	13		$	(4	)	$	26
Gross investment gains (2)	$	89		$	75		$	322		$	108		$	109		$	102		$	164		$	211
Gross investment losses before impairments (2)	(54		)	(102		)	(90		)	(58		)	(85		)	(79		)	(156		)	(164		)
Net investment gains (losses) before impairments	35			(27		)	232			50			24			23			8			47
Other-than-temporary impairment losses:
Total gains (losses)	(1		)	2			8			(2		)	2			5			1			7
Non-credit component of impairments recognized in accumulated other changes in equity from nonowner sources	(9		)	(6		)	(14		)	(4		)	(6		)	(9		)	(15		)	(15		)
Other-than-temporary impairment losses	(10		)	(4		)	(6		)	(6		)	(4		)	(4		)	(14		)	(8		)
Net realized investment gains (losses) before tax	25			(31		)	226			44			20			19			(6		)	39
Related taxes	9			(11		)	79			14			7			6			(2		)	13
Net realized investment gains (losses)	$	16		$	(20	)	$	147		$	30		$	13		$	13		$	(4	)	$	26
	March 31,			June 30,			September 30,			December 31,			March 31,			June 30,
	2010			2010			2010			2010			2011			2011
Net unrealized investment gains, net of tax, by asset type
Fixed maturities	$	2,653		$	3,330		$	4,399		$	2,650		$	2,556		$	3,209
Equity securities & other	296			296			160			175			208			202
Unrealized investment gains before tax	2,949			3,626			4,559			2,825			2,764			3,411
Related taxes	1,011			1,245			1,569			967			948			1,172
Balance, end of period	$	1,938		$	2,381		$	2,990		$	1,858		$	1,816		$	2,239

(1)  In 3Q 2010, the Company sold most of its remaining common stock holdings in Verisk Analytics, Inc. (Verisk) for total proceeds of approximately $230 million as part of the secondary public offering of Verisk.  The Company recorded a pretax realized investment gain of $205 million on this sale in 3Q 2010 ($102 million included in the “Equity securities” and $103 million included in the “Other investments” categories above).

(2)  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	$	26	$	37	$	52	$	73	$	47	$	32	$	63	$	79
Gross investment Treasury future losses	$	33	$	63	$	71	$	51	$	47	$	53	$	96	$	100

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

	June 30,			December 31,
	2011			2010
Gross reinsurance recoverables on paid and unpaid claims and claim adjustment expenses	$	6,761		$	6,934
Allowance for uncollectible reinsurance	(359		)	(363		)
Net reinsurance recoverables	6,402			6,571
Mandatory pools and associations (1)	2,048			2,043
Structured settlements	3,330			3,380
Total reinsurance recoverables	$	11,780		$	11,994

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

	A.M. Best Rating of Group’s	June 30,		December 31,
Reinsurer	Predominant Reinsurer	2011		2010
Munich Re Group	A+ second highest of 16 ratings	$	767	$	744
Swiss Re Group	A third highest of 16 ratings	699		707
Transatlantic Holdings, Inc. (2)	A third highest of 16 ratings	380		385
XL Capital Group	A third highest of 16 ratings	322		320
Berkshire Hathaway Group	A++ highest of 16 ratings	309		319

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 based upon the Company’s ongoing review of amounts outstanding, reinsurer solvency, the Company’s experience, current economic conditions, and other relevant factors.  Of the total net recoverables due from reinsurers at June 30, 2011, after deducting mandatory pools and associations and structured settlement balances, $5.1 billion, or 80%, were rated by A.M. Best Company.  Of the total rated by A.M. Best Company, 99% were rated A- or better.  The remaining 20% net recoverables from reinsurers were comprised of the following:  5% related to the Company’s participation in voluntary pools, 10% related to recoverables from captive insurance companies and 5% were balances from other companies not rated by A.M. Best Company.  In addition, $1.9 billion of the net recoverables were collateralized by letters of credit, funds held and trust agreements at June 30, 2011.

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 recoverables from annuities that were purchased from life insurance companies to settle personal physical injury claims, with workers’ compensation claims comprising a significant proportion.  In cases where the Company did not receive a release from the claimant, the Company retains the liability to the claimant in the event that the life insurance company fails to pay; accordingly, the Company continues to report the amount due from the life insurance company as a liability and as a recoverable for GAAP purposes. The Company’s top five groups by structured settlement is as follows:

	A.M. Best Rating of Group’s	June 30,		December 31,
Group	Predominant Insurer	2011		2010
Fidelity and Guaranty Life (3)	B++ fifth highest of 16 ratings	$	1,008	$	1,028
Metlife	A+ second highest of 16 ratings	499		508
Genworth	A third highest of 16 ratings	452		458
Symetra	A third highest of 16 ratings	269		272
ING Group	A third highest of 16 ratings	226		229

(1)  Includes impact from certain reclassifications made to 2010 amounts to conform to 2011 presentation.

(2)  Transatlantic Holdings, Inc. and Allied World Assurance Co. Holdings, AG recently signed a definitive merger agreement, expected to be finalized during the fourth quarter of 2011, which would create a combined entity called TransAllied Group Holdings, AG.  At June 30, 2011, the Company had gross reinsurance recoverables of $114 million from Allied World Assurance Co. Holdings, AG, which is rated ‘A’ by A.M. Best.

(3)  Sale of Old Mutual U.S. Life Holdings Inc. to Harbinger Capital Partners LLC was completed on April 7, 2011.  Harbinger Group has reverted the Old Mutual businesses to their former names, Fidelity & Guaranty Life Insurance Company and Fidelity & Guaranty Life Insurance Company of New York.

27

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Business Insurance
Beginning of period	$	31,289		$	31,079		$	30,900		$	30,752		$	30,505		$	30,489		$	31,289		$	30,505
Incurred	1,547			1,586			1,659			1,583			1,736			2,540			3,133			4,276
Paid	(1,747		)	(1,751		)	(1,822		)	(1,832		)	(1,759		)	(1,874		)	(3,498		)	(3,633		)
Foreign exchange and other	(10		)	(14		)	15			2			7			3			(24		)	10
End of period	$	31,079		$	30,900		$	30,752		$	30,505		$	30,489		$	31,158		$	30,900		$	31,158
Financial, Professional & International Insurance
Beginning of period	$	6,003		$	6,022		$	5,995		$	6,125		$	6,068		$	6,267		$	6,003		$	6,068
Incurred	513			412			346			420			430			375			925			805
Paid	(443		)	(363		)	(312		)	(478		)	(294		)	(357		)	(806		)	(651		)
Foreign exchange and other	(51		)	(76		)	96			1			63			12			(127		)	75
End of period	$	6,022		$	5,995		$	6,125		$	6,068		$	6,267		$	6,297		$	5,995		$	6,297
Personal Insurance
Beginning of period	$	3,631		$	3,748		$	3,871		$	3,763		$	3,662		$	3,545		$	3,631		$	3,662
Incurred	1,289			1,384			1,180			1,153			1,176			2,185			2,673			3,361
Paid	(1,172		)	(1,261		)	(1,288		)	(1,254		)	(1,293		)	(1,703		)	(2,433		)	(2,996		)
End of period	$	3,748		$	3,871		$	3,763		$	3,662		$	3,545		$	4,027		$	3,871		$	4,027
Total
Beginning of period	$	40,923		$	40,849		$	40,766		$	40,640		$	40,235		$	40,301		$	40,923		$	40,235
Incurred	3,349			3,382			3,185			3,156			3,342			5,100			6,731			8,442
Paid	(3,362		)	(3,375		)	(3,422		)	(3,564		)	(3,346		)	(3,934		)	(6,737		)	(7,280		)
Foreign exchange and other	(61		)	(90		)	111			3			70			15			(151		)	85
End of period	$	40,849		$	40,766		$	40,640		$	40,235		$	40,301		$	41,482		$	40,766		$	41,482
Prior Year Reserve Development: Unfavorable (Favorable)
Business Insurance
Asbestos	$	—		$	—		$	140		$	—		$	—		$	—		$	—		$	—
Environmental	—			35			—			—			—			76			35			76
All other	(242		)	(338		)	(242		)	(254		)	(143		)	(103		)	(580		)	(246		)
Prior year development excluding accretion of discount	(242		)	(303		)	(102		)	(254		)	(143		)	(27		)	(545		)	(170		)
Accretion of discount	11			12			11			11			11			12			23			23
Total Business Insurance	(231		)	(291		)	(91		)	(243		)	(132		)	(15		)	(522		)	(147		)
Financial, Professional & International Insurance	(34		)	(72		)	(97		)	(56		)	(39		)	(96		)	(106		)	(135		)
Personal Insurance	(18		)	(9		)	(23		)	(37		)	(55		)	(45		)	(27		)	(100		)
Total	$	(283	)	$	(372	)	$	(211	)	$	(336	)	$	(226	)	$	(156	)	$	(655	)	$	(382	)

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

28

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Asbestos reserves
Beginning reserves:
Direct	$	3,097		$	3,004		$	2,867		$	3,058		$	2,941		$	2,876		$	3,097		$	2,941
Ceded	(339		)	(320		)	(274		)	(400		)	(393		)	(374		)	(339		)	(393		)
Net	2,758			2,684			2,593			2,658			2,548			2,502			2,758			2,548
Incurred losses and loss expenses:
Direct	—			—			262			—			—			—			—			—
Ceded	—			—			(122		)	—			—			—			—			—
Losses paid:
Direct	93			137			71			117			65			68			230			133
Ceded	(19		)	(46		)	4			(7		)	(19		)	(4		)	(65		)	(23		)
Ending reserves:
Direct	3,004			2,867			3,058			2,941			2,876			2,808			2,867			2,808
Ceded	(320		)	(274		)	(400		)	(393		)	(374		)	(370		)	(274		)	(370		)
Net	$	2,684		$	2,593		$	2,658		$	2,548		$	2,502		$	2,438		$	2,593		$	2,438
Environmental reserves
Beginning reserves:
Direct	$	389		$	373		$	399		$	383		$	354		$	339		$	389		$	354
Ceded	4			4			(6		)	(6		)	(3		)	(3		)	4			(3		)
Net	393			377			393			377			351			336			393			351
Incurred losses and loss expenses:
Direct	—			45			—			—			—			80			45			80
Ceded	—			(10		)	—			—			—			(4		)	(10		)	(4		)
Losses paid:
Direct	16			19			16			29			15			25			35			40
Ceded	—			—			—			(3		)	—			(1		)	—			(1		)
Ending reserves:
Direct	373			399			383			354			339			394			399			394
Ceded	4			(6		)	(6		)	(3		)	(3		)	(6		)	(6		)	(6		)
Net	$	377		$	393		$	377		$	351		$	336		$	388		$	393		$	388

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

29

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

	June 30,			December 31,
Debt	2011			2010
Short-term debt
Commercial paper	$	100		$	100
5.375% Senior notes due June 15, 2012 (1)	250			—
7.22% Real estate non-recourse debt due September 1, 2011	—			9
Total short-term debt	350			109
Long-term debt
5.375% Senior notes due June 15, 2012 (1)	—			250
5.00% Senior notes due March 15, 2013 (1)	500			500
5.50% Senior notes due December 1, 2015 (1)	400			400
6.25% Senior notes due June 20, 2016 (1)	400			400
5.75% Senior notes due December 15, 2017 (1)	450			450
5.80% Senior notes due May 15, 2018 (1)	500			500
5.90% Senior notes due June 2, 2019 (1)	500			500
3.90% Senior notes due November 1, 2020 (1)	500			500
7.75% Senior notes due April 15, 2026	200			200
7.625% Junior subordinated debentures due December 15, 2027	125			125
6.375% Senior notes due March 15, 2033 (1)	500			500
6.75% Senior notes due June 20, 2036 (1)	400			400
6.25% Senior notes due June 15, 2037 (1)	800			800
5.35% Senior notes due November 1, 2040 (1)	750			750
8.50% Junior subordinated debentures due December 15, 2045	56			56
8.312% Junior subordinated debentures due July 1, 2046	73			73
6.25% Fixed-to-floating rate junior subordinated debentures due March 15, 2067 (1)	115			115
Total long-term debt	6,269			6,519
Unamortized fair value adjustment	54			54
Unamortized debt issuance costs	(69		)	(71		)
	6,254			6,502
Total debt	6,604			6,611
Preferred equity (2)	—			68
Common equity (excluding net unrealized investment gains, net of tax)	22,769			23,549
Total capital (excluding net unrealized investment gains, net of tax)	$	29,373		$	30,228
Total debt to capital (excluding net unrealized investment gains, net of tax)	22.5		%	21.9		%

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

(2)  In 2Q 2011, the Company’s board of directors authorized the redemption of the Company’s preferred stock held by The Travelers 401(k) Savings Plan Trust (the Trust) and gave notice of that redemption to the appropriate fiduciaries of the Trust.  The Trust, following a fiduciary review, exercised its right to convert each preferred share into eight common shares of the Company.

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

30

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

	June 30,			December 31,
	2011 (1)			2010
Statutory surplus	$	20,224		$	20,066
GAAP adjustments
Goodwill and intangible assets	3,649			3,679
Investments	3,835			3,179
Noninsurance companies	(4,072		)	(2,963		)
Deferred acquisition costs	1,840			1,782
Deferred federal income tax	(1,507		)	(1,238		)
Current federal income tax	(10		)	(100		)
Reinsurance recoverables	244			244
Furniture, equipment & software	696			690
Employee benefits	—			(11		)
Agents balances	122			110
Other	(13		)	37
Total GAAP adjustments	4,784			5,409
GAAP shareholders’ equity	$	25,008		$	25,475

(1) Estimated and Preliminary

See Glossary of Financial Measures and Description of Reportable Business Segments on page 34.

31

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Cash flows from operating activities
Net income (loss)	$	647		$	670		$	1,005		$	894		$	839		$	(364	)	$	1,317		$	475
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Net realized investment (gains) losses	(25		)	31			(226		)	(44		)	(20		)	(19		)	6			(39		)
Depreciation and amortization	216			195			197			204			208			197			411			405
Deferred federal income tax expense (benefit)	76			(25		)	98			29			153			(16		)	51			137
Amortization of deferred acquisition costs	929			950			966			957			948			970			1,879			1,918
Equity in income from other investments	(45		)	(71		)	(45		)	(122		)	(122		)	(109		)	(116		)	(231		)
Premiums receivable	(97		)	(285		)	154			199			(167		)	(375		)	(382		)	(542		)
Reinsurance recoverables	86			442			226			546			218			7			528			225
Deferred acquisition costs	(939		)	(991		)	(998		)	(898		)	(964		)	(1,009		)	(1,930		)	(1,973		)
Claims and claim adjustment expense reserves	(224		)	(468		)	(420		)	(856		)	(251		)	1,140			(692		)	889
Unearned premium reserves	86			184			148			(355		)	175			220			270			395
Other	(179		)	(112		)	236			108			(384		)	(374		)	(291		)	(758		)
Net cash provided by operating activities	531			520			1,341			662			633			268			1,051			901
Cash flows from investing activities
Proceeds from maturities of fixed maturities	1,229			1,249			1,403			2,015			1,849			1,385			2,478			3,234
Proceeds from sales of investments:
Fixed maturities	1,646			1,135			500			432			490			246			2,781			736
Equity securities	19			8			130			44			8			39			27			47
Real estate	9			1			—			—			—			—			10			—
Other investments	114			75			237			291			161			124			189			285
Purchases of investments:
Fixed maturities	(2,175		)	(1,765		)	(1,227		)	(1,618		)	(1,824		)	(1,723		)	(3,940		)	(3,547		)
Equity securities	(5		)	(14		)	(10		)	(32		)	(51		)	(52		)	(19		)	(103		)
Real estate	(3		)	(5		)	(7		)	(6		)	(30		)	(5		)	(8		)	(35		)
Other investments	(104		)	(123		)	(146		)	(141		)	(107		)	(522		)	(227		)	(629		)
Net (purchases) sales of short-term securities	202			848			(1,116		)	(633		)	(31		)	628			1,050			597
Securities transactions in course of settlement	95			(93		)	(242		)	210			134			79			2			213
Other	(75		)	(70		)	(75		)	(98		)	(69		)	(74		)	(145		)	(143		)
Net cash provided by (used in) investing activities	952			1,246			(553		)	464			530			125			2,198			655

32

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

																			YTD			YTD
	1Q			2Q			3Q			4Q			1Q			2Q			2Q			2Q
	2010			2010			2010			2010			2011			2011			2010			2011
Cash flows from financing activities
Payment of debt	—			(250		)	(25		)	(885		)	—			(8		)	(250		)	(8		)
Issuance of debt	—			—			—			1,234			—			—			—			—
Dividends paid to shareholders	(168		)	(175		)	(169		)	(161		)	(155		)	(174		)	(343		)	(329		)
Issuance of common stock - employee share options	123			76			68			141			168			77			199			245
Treasury stock acquired - share repurchase authorization	(1,407		)	(1,397		)	(637		)	(1,557		)	(1,104		)	(256		)	(2,804		)	(1,360		)
Treasury stock acquired - net employee share-based compensation	(38		)	(2		)	—			—			(44		)	(2		)	(40		)	(46		)
Excess tax benefits from share-based payment arrangements	4			1			1			2			7			4			5			11
Net cash used in financing activities	(1,486		)	(1,747		)	(762		)	(1,226		)	(1,128		)	(359		)	(3,233		)	(1,487		)
Effect of exchange rate changes on cash	(1		)	(4		)	6			2			4			—			(5		)	4
Net increase (decrease) in cash	(4		)	15			32			(98		)	39			34			11			73
Cash at beginning of period	255			251			266			298			200			239			255			200
Cash at end of period	$	251		$	266		$	298		$	200		$	239		$	273		$	266		$	273
Income taxes paid	$	44		$	265		$	202		$	273		$	112		$	179		$	309		$	291
Interest paid	$	63		$	137		$	63		$	134		$	35		$	156		$	200		$	191

33

The Travelers Companies, Inc. Financial Supplement - Second Quarter 2011 Glossary of Financial Measures and Description of Reportable Business 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 financial statements or are not required to be disclosed in the notes to financial statements or, 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, financial analysts, rating agencies and other financial statement users 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.  Internally, the Company’s management uses these measures to evaluate performance against historical results and establish financial targets on a consolidated basis.

Some of these measures exclude net realized gains (losses), net of tax, and/or net unrealized investment gains (losses), net of tax, which can be significantly impacted by both discretionary and other economic factors and are not necessarily indicative of operating trends.

Other companies may calculate these measures differently, and, therefore, their measures may not be comparable to those used by the Company’s management.

Operating income (loss) is net income (loss) excluding the after-tax impact of net realized investment gains (losses).  Management uses operating income to analyze each segment’s performance and as a tool in making business decisions.  Financial statement users also consider operating income when analyzing the results and trends of insurance companies.  Operating earnings (loss) per share is operating income (loss) on a per common share basis.

Average shareholders’ equity is (a) the sum of total shareholders’ equity excluding preferred stock at the beginning and end of each of the quarters for the period presented divided by (b) the number of quarters in the period presented times two.  Adjusted shareholders’ equity is shareholders’ equity excluding net unrealized investment gains (losses), net of tax, net realized investment gains (losses), net of tax, for the period presented and preferred stock.  Adjusted average shareholders’ equity is average shareholders’ equity excluding net unrealized investment gains (losses), net of tax, for all quarters included in the calculation and, for each quarterly period included in the calculation that quarter’s net realized investment gains (losses), net of tax.

Return on equity is the ratio of annualized net income (loss) less preferred dividends to average shareholders’ equity for the periods presented.  Operating return on equity is the ratio of annualized operating income (loss) less preferred dividends to adjusted average shareholders’ equity for the periods presented.  In the opinion of the Company’s management, these are important indicators of how well management creates value for its shareholders through its operating activities and its capital management.

Underwriting gain (loss) is net earned premiums and fee income less claims and claim adjustment expenses and insurance-related expenses.  In the opinion of the Company’s management, it is important to measure the profitability of each segment excluding the results of investing activities, which are managed separately from the insurance business.  This measure is used to assess each segment’s business performance and as a tool in making business decisions.

A catastrophe is a severe loss, resulting from natural and man-made events, including risks such as fire, earthquake, windstorm, explosion, terrorism and other similar events.  Each catastrophe has unique characteristics, and catastrophes are not predictable as to timing or amount.  Their effects are included in net and operating income and claims and claim adjustment expense reserves upon occurrence.  A catastrophe may result in the payment of reinsurance reinstatement premiums and assessments from various pools.  In the opinion of the Company’s management, a discussion of the impact of catastrophes is meaningful to users of the financial statements to understand the Company’s periodic earnings and the variability in periodic earnings caused by the unpredictable nature of catastrophes.

Net favorable (unfavorable) prior year 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 one or more prior years or the current year.  In the opinion of the Company’s management, a discussion of loss reserve development is meaningful to users of the financial statements as it allows them to assess the impact between prior and current year development on incurred claims and claim adjustment expenses, net and operating income, 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) and the underwriting expense ratio.  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.

GAAP combined ratio excluding the incremental impact of the direct to consumer initiative is the GAAP combined ratio adjusted to exclude the direct, variable impact of the company’s direct-to-consumer initiative in Personal Insurance.  In the opinion of the company’s management, this is useful in an analysis of the profitability of the company’s ongoing agency business.

Gross written premiums reflect the direct and assumed contractually determined amounts charged to 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.  Net written premiums reflect gross written premiums less premiums ceded to reinsurers.

Book value per share is total common shareholders’ equity divided by the number of common shares outstanding.  Adjusted book value per share is total common shareholders’ equity excluding the after-tax impact of net unrealized investment gains and losses, divided by the number of common 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 as it removes the effect of changing prices on invested assets, (i.e., net unrealized investment gains (losses), net of tax) which do not have an equivalent impact on unpaid claims and claim adjustment expense reserves.

Total capital is the sum of total shareholders’ equity and debt.  Debt-to-capital ratio excluding net unrealized gain (loss) on investments is the ratio of debt to total capital excluding the after-tax impact of net unrealized investment gains and losses.  In the opinion of the company’s management, the debt to capital ratio is useful in an analysis of the company’s financial leverage.

Statutory surplus represents the excess of an insurance company’s assets over its liabilities in accordance with the statutory accounting practices required by state laws and regulations.

Travelers has organized its businesses into the following reportable business segments:

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 six 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 Partner Services; and Specialized Distribution including Northland and National Programs.  Business Insurance also includes the Special Liability Group (which manages the Company’s asbestos and environmental liabilities) and the assumed reinsurance, and certain international 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 and management liability coverages, which require a primarily credit-based underwriting process, as well as property and casualty products that are primarily marketed on a domestic basis in the United Kingdom, Ireland and Canada, and on an international basis through Lloyd’s.  The businesses in Financial, Professional & International Insurance are Bond & Financial Products and International.

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.

34