Travelers 2014 Annual Report Download - page 19

Table of Contents
Geographic Distribution
The following table shows the geographic distribution of Personal Insurance's direct written premiums for the year ended December 31, 2014:
Competition
Although national companies write the majority of this business, Personal Insurance also faces competition from many regional and hundreds
of local companies. Personal Insurance primarily competes based on breadth of product offerings, price, service (including claims handling), ease of
doing business, stability of the insurer and name recognition. Personal Insurance competes for business within each independent agency since
these agencies also offer policies of competing companies. At the agency level, competition is primarily based on price, service (including claims
handling), the level of automation and the development of long
- term relationships with individual agents. In recent years, most independent
personal insurance agents have begun utilizing price comparison rating technology, sometimes referred to as "comparative raters," as a cost
-
efficient means of obtaining quotes from multiple companies. Because the use of this technology facilitates the process of generating multiple
quotes, the technology has increased price comparison on new business and, increasingly, on renewal business. Personal Insurance also competes
with insurance companies that use exclusive agents or salaried employees to sell their products, as well as those that employ direct marketing
strategies. See "Item 1A—Risk Factors—The intense competition that we face could harm our ability to maintain or increase our business volumes
and our profitability."
The Agency Automobile line of business has been negatively impacted by various factors, including the use of price comparison technology
by agents and brokers as discussed above. The Company's actions in response to these factors have included, among other things, the reduction
of claim adjustment and other insurance expenses, with the majority of the impact in the Agency Automobile line of business. At December 31,
2014, these actions to reduce costs have resulted in an expected annual decrease of $140 million in pre
- tax expenses in 2015 when compared with
expense levels prior to their implementation. Additionally, in the fourth quarter of 2013, the Company launched its newest private passenger
automobile product, Quantum Auto 2.0. This product, in addition to incorporating
18
State
% of
Total
New York
15.0
%
Texas(1)
8.2
Pennsylvania
7.3
California
6.1
New Jersey
5.1
Georgia
4.7
Florida
4.5
Connecticut
4.4
Virginia
4.3
Maryland
3.4
Massachusetts
3.1
All others(2)
33.9
Total
100.0
%
(1) The percentage for Texas includes business written by the Company through a fronting agreement with another
insurer.
(2) No other single state accounted for 3.0% or more of the Personal Insurance segment's direct written premiums in 2014.