Travelers 2006 Annual Report Download - page 42

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•On May 3, 2006, Moody’s affirmed the long-term debt ratings (senior unsecureddebt at A3) of the
Company and the IFS ratings on members of the Travelers Reinsurance Pool (Aa3). The outlook
for these ratings was changed to stable from negative.
•On May 30, 2006, A.M. Best affirmed thefinancial strength rating (FSR) of “A+” (Superior) and
issuer credit ratings (ICR) of “aa-” of Travelers Insurance Companies and its property/casualty
members. Concurrently, A.M. Best affirmed the debt ratings of “a-” on senior debt, “bbb+” on
subordinateddebt, “bbb” on trust preferred securities, “bbb” on preferred stock and “AMB-1” on
commercial paper of The Travelers Companies, Inc. Additionally, A.M. B est downgraded the FSR
to “A-” (Excellent) from “A” (Excellent) and assigned an ICR of “a-” to First Floridian Auto and
Home Insurance Company.
•On June 14, 2006, S&P raised its FSR ratings on the Travelers Reinsurance Pool to “AA-” from
“A+” and raised its counterparty credit rating on The Travelers Companies, Inc. to “A-” from
“BBB+.” The ratings outlooks are stable.
•On June 15, 2006, S&P assigned its “A-” senior debt rating to the $800 million senior unsecured
notesdue in 2016 and 2036 issued by the Company in June 2006.
•On June 15, 2006, A.M. Best assigned a debt rating of “a-” to the $800 million senior unsecured
notesdue in 2016 and 2036 issued by the Company in June 2006.
•On June 15, 2006, Fitch announced that it expectedto assign an “A-” debt rating to the $800 million
senior unsecured notes due in 2016 and 2036 planned to be issued by the Company in June 2006.
Subsequently, on June 19, 2006, Fitch assigned the “A-” debt rating to these senior notes.
•On June 16, 2006, Moody’s assigned an “A3” debt rating to the $800 million senior unsecured notes
due in 2016 and 2036 issued by the Company in June 2006, and affirmed the stable outlook it had
announced on May 3, 2006.
•On July 28, 2006, Fitch affirmed all ratings of The Travelers Companies, Inc., including the issuer
default rating of “A,” the “A-” ratings on senior unsecured notes and the “BBB+” ratings on
subordinated notes and capital securities. In addition, the “AA-” insurer financial strength ratings
on members of the Travelers Inter-Company Pool was affirmed. The ratings outlooks are stable.
•On December 18, 2006, A.M. Best reaffirmed the FSR of “A-” (Excellent) of Afianzadora
Insurgentes, S.A. de C.V., the Company’s Mexican subsidiary.
•On January 18,2007, A.M. Best placed the FSR of “A-” (Excellent) of Afianzadora Insurgentes,
S.A. de C.V., the Company’s Mexican subsidiary, under review with negative implications. This
rating action was a result of the Company having reached a definitive agreement to sell this surety
company. The rating will remain under review until the sale is finalized.
•On January 24,2007, A.M. Best placed the FSR of “A” (Excellent) andthe ICR of “a” of Mendota
Insurance Company and its wholly-owned subsidiary, Mendakota Insurance Company, under review
with negative implications. These ratings actions were the result of the Company having reached a
definitive agreement to sell these subsidiaries. The ratings will remain under review pending
regulatory approval and completion of the transaction. The ratings of the Northland Pool were
unchanged.
INVESTMENT OPERATIONS
A significant majority of funds available for investment are deployed in a widely diversified portfolio
of high quality, liquid intermediate-term taxable U.S. government, corporate and mortgage backed bonds
and tax-exempt U.S. municipal bonds. The Company closely monitors the duration of its fixed maturity