Travelers 2010 Annual Report Download - page 236

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. PENSION PLANS, RETIREMENT BENEFITS AND SAVINGS PLANS (Continued)
Postretirement
Benefit Plans
(at and for the year ended December 31, in millions) 2010 2009
Change in projected benefit obligation:
Benefit obligation at beginning of year .................................... $ 264 $ 269
Benefits earned .................................................... 11
Interest cost on benefit obligation ....................................... 14 17
Actuarial gain ...................................................... (8) (5)
Benefits paid ...................................................... (17) (18)
Benefit obligation at end of year ...................................... $ 254 $ 264
Change in plan assets:
Fair value of plan assets at beginning of year ............................... $20 $21
Actual return on plan assets ........................................... 11
Company contributions ............................................... 16 16
Benefits paid ...................................................... (17) (18)
Fair value of plan assets at end of year .................................. 20 20
Funded status of plan at end of year ................................... $(234) $(244)
Amounts recognized in the statement of financial position consist of:
Accrued under-funded benefit plan liability ............................... $(234) $(244)
Amounts recognized in accumulated other changes in equity from nonowner sources
consist of:
Net actuarial gain ................................................. $ (27) $ (19)
The total accumulated benefit obligation for the Company’s defined benefit pension plans was
$2.54 billion and $2.36 billion at December 31, 2010 and 2009, respectively. The Qualified Domestic
Plan accounted for $2.37 billion and $2.19 billion of the total accumulated benefit obligation at
December 31, 2010 and 2009, respectively, whereas the Nonqualified and Foreign Plans accounted for
$0.17 billion of the total accumulated benefit obligation at both December 31, 2010 and 2009.
For pension plans with an accumulated benefit obligation in excess of plan assets, the aggregate
projected benefit obligation was $2.56 billion and the aggregate accumulated benefit obligation was
$2.53 billion at December 31, 2010. The fair value of plan assets for the above plans was $2.42 billion
and $2.25 billion at December 31, 2010 and 2009, respectively.
The Company has discretion regarding whether to provide additional funding and when to provide
such funding to its qualified pension plan. During 2010 and 2009, the Company voluntarily made
contributions totaling $35 million and $260 million, respectively, to the qualified pension plan. The
Company has not determined whether or not additional funding will be made during 2011. There is no
required contribution to the qualified pension plan during 2011.
224