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Insurance industry

A.M. Best Upgrades Travelers Property Casualty Pool to A+

Strategic Insights

— 1 min read

Travelers Property Casualty Pool, a 20-member group led by the Travelers Indemnity Co., has received a rating upgrade from A to A+ by A.M. Best Co. This upgrade comes as a result of Travelers' outstanding financial performance, conservative balance sheet, and excellent capitalization. The company's strong management, successful integration of Aetna's property casualty business, and beneficial partnerships with Citigroup and Winterthur Swiss have contributed to its growth and market position.

Key Takeaways:

  • Travelers' outstanding financial performance, conservative balance sheet, and excellent capitalization led to the rating upgrade from A to A+.
  • The company's successful integration of Aetna's property casualty business has provided substantial economies of scale and enhanced diversification.
  • Travelers benefits from its strong brand-name recognition, distinguishing trademark, and commanding commercial market position.
  • The company has strong business persistency, despite intense price competition, due to its broad product offerings and extensive claims- and risk-management capabilities.
  • Travelers' recent merger with Citicorp has provided cross-selling opportunities to credit cardholders and enhanced market penetration of Fortune 1000 companies.
  • The group ranks among the top 10 personal insurers and maintains one of the largest independent agency networks in the country.
  • Travelers has augmented its agency distribution with various channels, including affinity group marketing, the Internet, and Primerica Financial Services sales representatives.
  • The company's strong core reserves and substantial business diversification provide substantial operating flexibility over many of its competitors.

Statistics:

  • Net premiums: nearly $8 billion
  • Business persistency: strong, despite intense price competition
  • Average earnings drag due to asbestos and environmental exposure: roughly two points
  • Pretax operating returns: expected to sustain double-digit growth in the near future

Sources:

  • A.M. Best Co.
  • A.M. Best Company, Inc.
  • A.M. Best Upgrades Travelers Property Casualty Pool to A+, News Provided by COMTEX (http://www.comtexnews.com)
  • COMTEX (http://www.comtexnews.com)

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