Travelers 2007 Annual Report Download - page 242

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
18. CONSOLIDATING FINANCIAL STATEMENTS OF THE TRAVELERS COMPANIES, INC. AND
SUBSIDIARIES
The following consolidating financial statements of the Company have been prepared pursuant to
Rule 3-10 of Regulation S-X. These consolidating financial statements have been prepared from the
Company’s financial information on the same basis of accounting as the consolidated financial
statements. The Travelers Companies, Inc. has fully and unconditionally guaranteed certain debt
obligations of TPC, its wholly-owned subsidiary, which totaled $1.60 billion as of December 31, 2007.
Prior to the merger, TPC fully and unconditionally guaranteed the payment of all principal,
premiums, if any, and interest on certain debt obligations of its wholly-owned subsidiary TIGHI. The
Travelers Companies, Inc. has fully and unconditionally guaranteed such guarantee obligations of TPC.
TPC is deemed to have no assets or operations independent of TIGHI. Consolidating financial
information for TIGHI has not been presented herein because such financial information would be
substantially the same as the financial information provided for TPC.
CONSOLIDATING STATEMENT OF INCOME (Unaudited)
For the year ended December 31, 2007
Other
(in millions) TPC Subsidiaries Travelers(1) Eliminations Consolidated
Revenues
Premiums ........................ $14,507 $6,963 $ — $ — $21,470
Net investment income .............. 2,553 1,130 78 — 3,761
Fee income ....................... 506 2 — — 508
Net realized investment gains .......... 67 70 17 — 154
Other revenues .................... 42 81 12 (11) 124
Total revenues ................... 17,675 8,246 107 (11) 26,017
Claims and expenses
Claims and claim adjustment expenses . . . 8,375 4,022 — — 12,397
Amortization of deferred acquisition costs . . 2,437 1,269 — — 3,706
General and administrative expenses ..... 2,250 1,048 65 (11) 3,352
Interest expense ................... 101 — 245 — 346
Total claims and expenses .......... 13,163 6,339 310 (11) 19,801
Income (loss) before income taxes ...... 4,512 1,907 (203) — 6,216
Income tax expense (benefit) .......... 1,207 455 (47) — 1,615
Equity in net income of subsidiaries ..... — — 4,757 (4,757) —
Net income ....................... $ 3,305 $1,452 $4,601 $(4,757) $ 4,601
(1) The Travelers Companies, Inc., excluding its subsidiaries.
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