Travelers 2009 Annual Report Download - page 232

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. SHAREHOLDERS’ EQUITY AND DIVIDEND AVAILABILITY (Continued)
From the inception of the authorization in May 2006 through December 31, 2009, the Company
repurchased a cumulative total of 193.2 million shares for a total cost of $9.49 billion, or $49.12 per
share.
The Company’s Amended and Restated 2004 Stock Incentive Plan provides settlement alternatives
to employees in which the Company repurchases shares to cover tax withholding costs and exercise
costs. During the years ended December 31, 2009 and 2008, the Company purchased $65 million and
$38 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 $3.49 billion is available by the end of 2010 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 may
choose to accelerate the timing within 2010 and/or increase the amount of dividends from its insurance
subsidiaries in 2010, which could result in certain dividends being subject to approval by those
Insurance Departments. The holding company received $3.54 billion of dividends from its domestic
insurance subsidiaries in 2009, including a $500 million dividend that received regulatory approval.
Statutory Net Income and Surplus
Statutory net income of the Company’s insurance subsidiaries was $3.90 billion, $4.10 billion and
$4.86 billion for the years ended December 31, 2009, 2008 and 2007, respectively. Statutory capital and
surplus of the Company’s insurance subsidiaries was $23.20 billion and $21.49 billion at December 31,
2009 and 2008, respectively.
220