Travelers 2003 Annual Report Download - page 105

103
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
Nature of Operations
Travelers comprises two business segments: Commercial Lines and Personal Lines.
Commercial Lines
Commercial Lines offers a broad array of property and casualty insurance and insurance-related services.
Protection is afforded to customers of Commercial Lines for the risks of property loss such as fire and
windstorm, financial loss such as business interruption from property damage, liability claims arising from
operations and workers’ compensation benefits through insurance products where risk is transferred from the
customer to Commercial Lines. Coverages include workers’ compensation, general liability, commercial multi-
peril, commercial automobile, property, fidelity and surety, professional liability, and several miscellaneous
coverages.
Commercial Lines is organized into five marketing and underwriting groups, each of which focuses on a
particular client base or product grouping to provide products and services that specifically address customers’
needs. The Core marketing and underwriting groups include National Accounts, Commercial Accounts and
Select Accounts, and Specialty includes Bond and Gulf.
National Accounts provides casualty products to large companies, with particular emphasis on workers’
compensation, general liability and automobile liability. Products are marketed through national and regional
brokers. Programs offered by National Accounts include risk management services, such as claims settlement,
loss control and risk management information services, which are generally offered in connection with a large
deductible or self-insured program, and risk transfer, which is typically provided through a guaranteed cost or
retrospectively rated insurance policy. National Accounts also includes Travelers residual market business,
which primarily offers workers’ compensation products and services to the involuntary market.
Commercial Accounts serves primarily mid-sized businesses for casualty products and large, mid-sized and
small businesses for property products. Commercial Accounts sells a broad range of property and casualty
insurance products, with an emphasis on guaranteed cost products, through a large network of independent
agents and brokers. Within Commercial Accounts Travelers has a specialty unit which primarily writes
coverages for the transportation industry and has dedicated operations that exclusively target the construction
industry, providing insurance and risk management services for virtually all areas of construction. These
dedicated operations reflect Travelers focus on industry specialization.
Select Accounts serves small businesses. Select Accounts’ products are generally guaranteed cost policies, often
a packaged product covering property and liability exposures. The products are sold through independent
agents.
Bond markets its products to national, mid-sized and small customers as well as individuals, and distributes them
through both national and wholesale brokers, and retail agents and regional brokers. Bond’s range of products
includes fidelity and surety bonds, directors’ and officers’ liability insurance, errors and omissions insurance,
professional liability insurance, employment practices liability insurance, fiduciary liability insurance, and other
related coverages.
Gulf markets products to national, mid-sized and small customers, and distributes them through both wholesale
brokers and retail agents. Gulf provides a broad range of specialty coverages, including management and
professional liability, excess and surplus lines, environmental, umbrella and fidelity. Gulf also provides
insurance products specifically designed for financial institutions, the entertainment industry and sports
organizations.