Travelers 2005 Annual Report Download - page 19

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Property provides coverage for loss or damage to buildings, inventory and equipment from natural
disasters, including hurricanes, windstorms, earthquakes, hail, and severe winter weather. Also covered are
manmade events such as theft, vandalism, fires, explosions, terrorism and financial loss due tobusiness
interruption resulting from covered property damage. For additional information on terrorism coverages,
see “—Terrorism Risk Insurance Act of 2002 and Terrorism Risk Insurance Extension Act of 2005.”
Property also includes specialized equipment insurance, which provides coverage for loss or damage
resulting from the mechanical breakdown of boilers and machinery, and ocean and inland marine, which
provides coverage for goods in transit and unique, one-of-a-kind exposures.
General Liability provides coverage for liability exposures including bodily injury and property
damage arising from products sold and general business operations. Specialized liability policies may also
include coverage for directors’ and officers’ liability arising in their official capacities, employment
practices liability insurance, fiduciary liability for trustees and sponsors of pension, health and welfare, and
other employee benefit plans, errors and omissions insurance for employees, agents, professionals and
others arising from acts or failures to act under specified circumstances, as well as umbrella and excess
insurance. Errors and omissions insurance for professionals (such as lawyers, accountants, doctors and
other health care providers) issometimes also known as professional liability insurance.
Geographic Distribution
The following table shows the distribution of Commercials’ direct written premiums for the states that
accounted for the majority of premium volume for the year ended December 31, 2005:
State
% of
Total
California ........................................................... 13.5%
New York........................................................... 8.0
Texas. .............................................................. 6.3
Florida ............................................................. 5.3
Illinois.............................................................. 4.8
Massachusetts ....................................................... 4.6
New Jersey.......................................................... 4.5
Pennsylvania ........................................................ 3.7
All Others(1)........................................................ 49.3
Total............................................................. 100.0%
(1) No other single state accounted for 3.0% or more of the total direct written premiums written in2005
by the Company.
SPECIALTY
The Specialty segment was created upon the merger of TPC and SPC. It combined SPC’s specialty
operations, including SPC’s Bond and Constructionoperations, withTPC’s Bond and Construction
operations, which were included in TPC’s Commercial segment prior to the merger. The Specialty segment
provides a full range of standard and specialized insurance coverages and services through dedicated
underwriting, claims handling and risk management groups. In many of its businesses, Specialty competes
through the use of proprietary rates and policy forms. The segment comprises two primary groups:
Domestic Specialty and International Specialty.