Travelers 2008 Annual Report Download - page 245

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. PENSION PLANS, RETIREMENT BENEFITS AND SAVINGS PLANS (Continued)
The Company’s other postretirement benefit plan weighted-average asset allocations at
December 31, 2008 and 2007 by asset category were as follows:
Asset Category 2008 2007
Fixed maturities ........................................ 48% 62%
Cash ................................................. 50% 34%
Equity securities ........................................ 2% 4%
Estimated Future Benefit Payments
Benefits expected to be paid, which reflect estimated future employee service, are estimated to be:
Postretirement Prescription
Expected payments by period (in millions) Pension Plans Benefit Plans Drug Subsidy
2009 ............................ $ 142 $ 20 $ 2
2010 ............................ 150 21 2
2011 ............................ 159 22 2
2012 ............................ 171 23 2
2013 ............................ 179 23 2
2014 through 2018 .................. 1,022 119 14
Savings Plan
The Company has a savings plan, The Travelers 401(k) Savings Plan (the Savings Plan), in which
substantially all Company employees are eligible to participate. Under the Savings Plan, the Company
matched employee contributions up to 5% of eligible pay, with a maximum annual match of $5,000
which becomes 100% vested after three years of service. The Company match contributed to accounts
in 2006 was primarily in the form of the Company’s common stock. Beginning with the 2006 match that
was contributed in 2007, the Company matching contribution is made in cash and invested according to
the employee’s current investment elections. The Company matching contribution can be reinvested at
any time into any other investment option. The expense related to this plan was $94 million and
$78 million for the years ended December 31, 2008 and 2007, respectively.
Included in the Savings Plan are a legacy Savings Plus Plan (SPP) and a Stock Ownership Plan
(SOP) in which substantially all employees who were hired by legacy SPC before April 1, 2004 were
eligible to participate. In 2004 under the SPP, the Company matched 100% of employees’ contributions
up to a maximum of 6% of their salary. The match was in the form of preferred shares, to the extent
available in the SOP, or in the Company’s common shares. Also allocated to participants were
preferred shares equal to the value of dividends on previously allocated shares. Each share of preferred
stock pays a dividend of $11.72 annually and is currently convertible into eight shares of the Company’s
common stock. The SOP has no preferred shares available for future allocations.
All common shares and the common stock equivalent of all preferred shares held by the Savings
Plan are considered outstanding for diluted EPS computations and dividends paid on all shares are
charged to retained earnings.
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