Travelers 2007 Annual Report Download - page 213

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
8. SHAREHOLDERS’ EQUITY AND DIVIDEND AVAILABILITY (Continued)
requirements, price, catastrophe losses and other market conditions. The following table summarizes
repurchase activity in 2007 and remaining repurchase capacity at December 31, 2007.
Number of Remaining capacity
shares Cost of shares Average price paid under share repurchase
Quarterly Period Ending purchased repurchased per share program
March 31, 2007 .............. 13,889,773 $ 725,070,439 $52.20 $3,153,874,729
June 30, 2007 ............... 11,390,800 621,499,960 54.56 2,532,374,769
September 30, 2007 ........... 11,751,435 600,233,261 51.08 1,932,141,508
December 31, 2007 ........... 19,008,213 999,954,837 52.61 932,186,671
Total .................... 56,040,221 $2,946,758,497 $52.58 $ 932,186,671
Since the inception of the program in May 2006 through December 31, 2007, the Company has
repurchased a cumulative total of 78.8 million shares for a total cost of $4.07 billion, or $51.61 per
share.
In January 2008, the Company’s board of directors approved a $5 billion increase to the share
repurchase authorization.
The Company’s 2004 Incentive Plan, the legacy SPC 1994 Stock Incentives Plan and the legacy
TPC 2002 Incentive Plan provide settlement alternatives to employees in which the Company
repurchases shares to cover tax withholding costs and exercise costs. During the years ended
December 31, 2007 and 2006, the Company purchased $90 million and $61 million, respectively, of its
common stock under these plans.
Common shares acquired are reported as treasury stock in the consolidated balance sheet.
Dividends
The Company’s insurance subsidiaries are subject to various regulatory restrictions that limit the
maximum amount of dividends available to be paid to their parent without prior approval of insurance
regulatory authorities. A maximum of $4.02 billion is available in 2008 for such dividends without prior
approval of the Connecticut Insurance Department for Connecticut-domiciled subsidiaries and the
Minnesota Department of Commerce for Minnesota-domiciled subsidiaries. The Company received
$2.73 billion of dividends from its insurance subsidiaries in 2007.
Statutory Net Income and Surplus
Statutory net income of the Company’s insurance subsidiaries was $4.86 billion, $4.27 billion, and
$2.92 billion for the years ended December 31, 2007, 2006 and 2005, respectively. Statutory capital and
surplus of the Company’s insurance subsidiaries was $22.88 billion and $20.94 billion at December 31,
2007 and 2006, respectively.
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