Travelers 2008 Annual Report Download - page 228

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. SHAREHOLDERS’ EQUITY AND DIVIDEND AVAILABILITY (Continued)
Since the inception of the authorization in May 2006 through December 31, 2008, the Company
has repurchased a cumulative total of 123.9 million shares for a total cost of $6.19 billion, or $49.98 per
share.
The Company’s Amended and Restated 2004 Stock 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, 2008 and 2007, the Company purchased $38 million and $90 million,
respectively, of its common stock under these plans.
Common shares acquired are reported as treasury stock in the consolidated balance sheet.
Dividend Availability
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 $3.07 billion is available in 2009 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 holding company
received $3.70 billion of dividends from its domestic insurance subsidiaries in 2008.
Statutory Net Income and Surplus
Statutory net income of the Company’s insurance subsidiaries was $4.10 billion, $4.86 billion, and
$4.27 billion for the years ended December 31, 2008, 2007 and 2006, respectively. Statutory capital and
surplus of the Company’s insurance subsidiaries was $21.49 billion and $22.88 billion at December 31,
2008 and 2007, respectively.
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