Travelers 2012 Annual Report Download - page 136

related to claims and claim-related payments is generally reliable only in the aggregate with some
unavoidable estimation uncertainty.
The contractual obligations related to debt, operating leases, purchase obligations, long-term
unfunded investment commitments, estimated claims and claim-related payments (gross of the
estimated reinsurance recoveries) and liabilities related to unrecognized tax benefits, at December 31,
2012 were as follows:
Payments Due by Period Less than After
(in millions) Total 1 Year 1-3 Years 3-5 Years 5 Years
Debt
Senior notes ............................ $ 5,900 $ 500 $ 400 $ 850 $ 4,150
Junior subordinated debentures .............. 361 — — — 361
Total debt principal ...................... 6,261 500 400 850 4,511
Interest ............................... 5,243 355 685 601 3,602
Total long-term debt obligations(1) .......... 11,504 855 1,085 1,451 8,113
Operating leases(2) ........................ 666 164 259 154 89
Purchase obligations
Information systems administration and
maintenance commitments(3) .............. 146 59 50 37 —
Other purchase commitments(4) ............. 99 76 18 3 2
Total purchase obligations .................. 245 135 68 40 2
Long-term unfunded investment commitments(5) ... 1,270 268 370 428 204
Estimated claims and claim-related payments
Claims and claim adjustment expenses(6) ....... 48,845 11,505 11,894 6,727 18,719
Claims from large deductible policies(7) ........ ———— —
Loss-based assessments(8) .................. 196 38 45 19 94
Reinsurance contracts accounted for as
deposits(9) ........................... 11———
Payout from ceded funds withheld(10) ......... 221 28 59 30 104
Total estimated claims and claim-related
payments ............................ 49,263 11,572 11,998 6,776 18,917
Liabilities related to unrecognized tax benefits(11) .. 657 657 — — —
Total ................................ $63,605 $13,651 $13,780 $8,849 $27,325
(1) The Company’s $107 million remaining aggregate principal amount of 6.25% fixed-to-floating rate
debentures bear interest at an annual rate of 6.25% from the date of issuance to, but excluding,
March 15, 2017 and at a rate of three-month LIBOR plus 2.215% thereafter. The table above
includes interest payments through the scheduled maturity date of March 15, 2037. Interest
payments beginning March 15, 2017 through March 15, 2037 were calculated using the three-
month LIBOR rate as of December 31, 2012.
See note 8 of notes to the Company’s consolidated financial statements for a further discussion of
outstanding indebtedness. Because the amounts reported in the foregoing table include principal
and interest, the total long-term debt obligations will not agree with the amounts reported in
note 8.
(2) Represents agreements entered into in the ordinary course of business to lease office space,
equipment and furniture.
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