Travelers Announces Catastrophe Reinsurance Transaction With Longpoint Re II Ltd.

The Travelers Companies, Inc. (NYSE:TRV) today announced that it has entered into two reinsurance agreements with Longpoint Re II Ltd. (“Longpoint Re II”), a newly formed Cayman Islands insurance company, each providing up to $250 million of reinsurance from losses resulting from certain hurricane events in the northeastern United States. The reinsurance agreements, entered into on December 18, 2009, provide protection for covered events occurring before or on December 18, 2012 and December 18, 2013, respectively. In connection with entering into the reinsurance agreements, Longpoint Re II successfully completed a $500 million catastrophe bond offering comprised of $250 million of Series 2009-1 Class A Principal At-Risk Variable Rate Notes due December 24, 2012 and $250 million of Series 2009-1 Class B Principal At-Risk Variable Rate Notes due December 24, 2013.

The catastrophe bond program with Longpoint Re II will replace Travelers’ existing catastrophe bond program with Longpoint Re Ltd., which will expire in May 2010. The reinsurance purchased from Longpoint Re II is intended to work in conjunction with Travelers’ traditional reinsurance to provide $1 billion of protection for Northeast hurricane events in excess of $2.25 billion of losses.

Amounts payable under the two new reinsurance agreements with Longpoint Re II will be based on an index created by applying predetermined percentages to insured industry losses in each state in the covered area as reported by Property Claim Services (“PCS”) a division of Insurance Services Office, Inc., owned by Verisk Analytics, Inc. The calculation of index losses is designed to approximate Travelers’ actual losses from any covered event. The amount of actual losses and index losses from any covered event may differ; however, in no event can Travelers recover more than its actual losses. The principal amount of each catastrophe bond will be reduced by any amounts paid to Travelers under the respective reinsurance agreement.

In the event of a covered loss, Travelers will be entitled to recover amounts under the reinsurance agreements if the index losses for a single occurrence reach an initial attachment amount of $2.25 billion. The full $250 million coverage of each agreement is available on a proportional basis until index losses reach an initial exhaustion amount of $2.85 billion. The attachment and exhaustion amounts will be reset annually to maintain modeled probabilities of attachment and expected loss on the catastrophe bonds equal to the initial modeled probabilities of attachment and expected loss.

About Travelers

Travelers is a leading provider of property casualty insurance for auto, home and business. A Fortune 100 company, Travelers has more than 30,000 employees and generated revenues of approximately $24 billion in 2008. Travelers stock is traded on the New York Stock Exchange (NYSE:TRV) and is a component of the Dow Jones Industrial Average. For more information, visit www.travelers.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful. The Series 2009-1 Notes issued by Longpoint Re II have not been and will not be registered under the United States Securities Act of 1933, as amended ("Securities Act"), or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws, and in any case only if certain additional requirements are satisfied.