Travelers 2009 Annual Report Download - page 99

2008, driven by the continued success of the Company’s quote-to-issue agency platform and multivariate
pricing program for smaller businesses, partially offset by lower business volumes in larger, more
complex accounts served by this market.
Net written premiums of $2.76 billion in 2008 increased 2% over 2007. Business retention rates in
2008 remained strong and were consistent with 2007. Renewal price changes remained positive and
were comparable to 2007. In the aggregate, new business volume in 2008 increased over 2007. The
Company experienced a favorable impact on its new business volume from its enhanced quote-to-issue
agency platform and multivariate pricing program for smaller businesses served by Select Accounts.
However, new business volume for larger accounts in 2008 declined from 2007 primarily due to
competitive market conditions.
Commercial Accounts. In 2009, net written premiums of $2.49 billion were 1% lower than in
2008. Business retention rates in 2009 remained strong but declined slightly from the prior year.
Renewal premium changes were slightly negative in 2009 but were improved over 2008, as the impact
of a continued improving rate trend was partially offset by the impact on written premiums of lower
coverage demands from existing policyholders due to general economic conditions. New business levels
increased when compared with 2008 due to various product and customer initiatives.
Net written premiums of $2.52 billion in 2008 were virtually level with the 2007 total. Business
retention rates in 2008 remained strong and were higher than in 2007. Renewal price changes were
slightly negative in 2008, and were lower than in 2007. New business levels also declined when
compared with 2007, reflecting competitive market conditions in this market.
National Accounts. In 2009, net written premiums of $902 million were 9% lower than in 2008.
The decline in net written premiums in 2009 was driven by the loss of a large account, negative renewal
premium changes resulting from lower coverage demands from existing policyholders due to general
economic conditions, and lower premium volume from property and workers’ compensation involuntary
residual markets. Despite the impact of the loss of a large account, business retention rates remained
high in 2009.
Net written premiums of $1.00 billion in 2008 decreased 6% from 2007. The decline primarily
reflected a significant decline in renewal price changes, as prices charged for National Accounts’
products are adjusted for actual loss performance, which continued to be favorable due to workers’
compensation reforms. Overall new business volume increased slightly over 2007. Business retention
rates in 2008 remained strong and increased over 2007.
Industry-Focused Underwriting. In 2009, net written premiums of $2.28 billion declined 5% from
2008. Premium declines were concentrated in the Construction and Oil & Gas business units, reflecting
economic conditions in these industries. In addition, premium volume in the Technology and Public
Sector business units declined, reflecting economic conditions and competitive market pressures. These
declines were partially offset by premium growth in the Agribusiness business unit in 2009.
Net written premiums of $2.40 billion in 2008 increased 4% over 2007. All business units in this
market recorded net written premium growth in 2008. Growth in Construction net written premiums in
2008 was driven by strong business retention levels coupled with continued strong new business volume.
An increase in new business volume was the primary factor in the growth in net written premiums in
the Oil & Gas business unit. In Agribusiness, net written premium growth was driven by increases in
business retention rates and renewal price changes. In the Public Sector business unit, the increase in
net written premiums was driven by higher new business volume coupled with continued strong
business retention rates.
Target Risk Underwriting. In 2009, net written premiums of $1.57 billion were 2% lower than in
2008, primarily due to the Inland Marine and Ocean Marine business units, reflecting the impact of
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