Travelers 2005 Annual Report Download - page 42

30
policy issuance and claim and loss prevention services. Additionally, improved efficiency through
automation and response time to customer needs are key to success in this market. Commercial Accounts
also utilizes dedicated units to tailor insurance programs to unique insurance needs. These units are
national property, transportation, boiler and machinery, inland marine, agribusiness, excess and surplus
and national programs.
Select Accounts business is typically written through independent agents and, to a lesser extent,
regional brokers. Bothnational and regional property casualty insurance companies compete in the Select
Accounts market which generally comprises lower hazard, “main street” business customers. Risks are
underwritten and priced using standard industry practices and a combination of proprietary and standard
industry product offerings. Competition in this market is primarily based on price, product offerings and
response time in policy services. Select Accounts has established a strong marketing relationship withits
distribution network and has provided it with defined underwriting policies, a broad array of products,
competitive prices and one of the most efficient automated environments in the industry. In addition, the
Company has established centralized service centers to help agents perform many service functions, in
return for a fee. Select Accounts’ overall service platform is one of the strongest in the small business
commercial market.
National Accounts business is typically written through national brokers and, to a lesser extent,
regional brokers. Insurance companies compete in this market based on price, product offerings, claim and
loss prevention services, managed care cost containment and risk management information systems.
National Accounts also offers a large nationwide network of localized claim service centers which provide
greater flexibility in claims adjusting and allows National Accounts to more quickly respond to the needs of
its customers. National Accounts’ residual market business also competes for state contracts to provide
claims and policy management services. These contracts, which generally have three-year terms, are
selected by state agencies through a bid process based on the quality of service and price. National
Accounts services approximately 36% of the total workers’ compensation assigned risk market, making the
Company one of the largest servicing insurers in the industry.
Discover Re competes with traditional providers of commercial insurance coverages, as well as other
underwriters of property and casualty insurance in the alternative risk transfer market that offer coverages
both on a bundled and unbundled basis, risk retention groups, self-insurance plans,captives managed by
others, and a variety of other risk-financing vehicles and mechanisms.
The market in which Gulf competed included small to mid-size niche companies that target specific
lines of insurance and larger, multi-line companies that focus on various segments of the specialty accounts
market. Prior to being placed in runoff in2004, Gulf’s business was generally written through retail and
wholesale agents and brokers throughout the United States.
Specialty. The competitive landscape in which the Specialty segment operates is affected by many of
the same factors described previously for the Commercial segment. The Company’s domestic and
international insurance subsidiaries compete with other stock companies, mutual companies, alternative
risk sharing groups and other underwriting organizations. Competitors in this market are primarily
national property-casualty insurance companies willing to write most classes of business using traditional
products and pricing and, to a lesser extent, regional insurance companies and companies that have
developed niche programs for specific industry segments. In addition, many large commercial customers
self-insure their risks or utilize large deductibles on purchased insurance.
Bond underwrites and markets its products to national, mid-sized and small businesses and
organizations as well as individuals, and distributes them through both national and wholesale brokers, and
retail agents and regional brokers. Bond competes in the highly competitive surety and executive liability
marketplaces. Both national and regional property casualty insurance companies compete with Bond.
Bond’s reputation for timely and consistent decision-making, a nationwide network of local underwriting,