Travelers 2013 Annual Report Download - page 22

There are several other business groups in Business Insurance that compete in focused target
markets. Each of these markets is different and requires unique combinations of industry knowledge,
customized coverage, specialized risk control and loss handling services, along with partnerships with
agents and brokers that also focus on these markets. Some of these business groups compete with
national carriers with similarly dedicated underwriting and marketing groups, whereas others compete
with smaller regional companies. Each of these business groups has regional structures that allow them
to deliver personalized service and local knowledge to their customer base. Specialized agents and
brokers, including wholesale agents and program managers, supplement this strategy. In all of these
business groups, the competitive strategy typically is the application of focused industry knowledge to
insurance and risk needs.
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 Canada, the United Kingdom and
the Republic of Ireland, and on an international basis as a corporate member of 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 and design professionals; and professional and management
liability, property, workers’ compensation, auto and general liability and fidelity insurance for
financial institutions.
•International, through its operations in Canada, the United Kingdom 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. In addition, International markets personal lines and small commercial
insurance business in Canada through The Dominion of Canada General Insurance Company
(Dominion), which the Company acquired on November 1, 2013. 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.
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.
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