Travelers 2012 Annual Report Download - page 189

THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Business Insurance also includes the Special Liability Group (which manages the Company’s
asbestos and environmental liabilities) and the assumed reinsurance and certain other runoff
operations, which collectively are referred to as Business Insurance Other.
Financial, Professional & International Insurance
The Financial, Professional & International Insurance segment includes surety and financial
liability coverages, which primarily use credit-based underwriting processes, as well as property and
casualty products that are primarily marketed on a domestic basis in the United Kingdom, Canada and
the Republic of Ireland, and on an international basis through Lloyd’s. The segment includes the
following groups:
•Bond & Financial Products provides a wide range of customers with bond and insurance products
and risk management services. The range of coverages includes performance, payment and
commercial surety and fidelity bonds for construction and general commercial enterprises;
management liability coverages for losses caused by the actual or alleged negligence or
misconduct of directors and officers or employee dishonesty; employment practices liability
coverages and fiduciary coverages for public corporations, private companies and not-for-profit
organizations; professional liability coverage for actual or alleged errors and omissions
committed in the course of professional conduct or practice for a variety of professionals
including, among others, lawyers, design professionals and real estate agents; and professional
and management liability, property, workers’ compensation, auto and general liability and fidelity
insurance for financial institutions.
•International, through its operations in the United Kingdom, Canada and the Republic of
Ireland, offers specialized insurance and risk management services to several customer groups,
including, among others, those in the technology, public services, and financial and professional
services industry sectors. International, through its Lloyd’s syndicate (Syndicate 5000), for which
the Company provides 100% of the capital, underwrites through five principal business units—
marine, global property, accident & special risks, power & utilities and aviation.
In addition, the Company owns 49.5% of the common stock of J. Malucelli Participa¸c˜ oes em
Seguros e Resseguros S.A. (JMalucelli), its joint venture in Brazil. JMalucelli is currently the market
leader in surety in Brazil based on market share, and commenced writing other property and casualty
insurance business in 2012. The Company’s investment in JMalucelli is accounted for using the equity
method and is included in ‘‘other investments’’ on the consolidated balance sheet.
Personal Insurance
The Personal Insurance segment writes a broad range of property and casualty insurance covering
individuals’ personal risks. The primary products of automobile and homeowners insurance are
complemented by a broad suite of related coverages.
Automobile policies provide coverage for liability to others for both bodily injury and property
damage, uninsured motorist protection, and for physical damage to an insured’s own vehicle from
collision, fire, flood, hail and theft. In addition, many states require policies to provide first-party
personal injury protection, frequently referred to as no-fault coverage.
177