Standard & Poor’s Ratings Services said Hartford, Conn.-based Travelers Property Casualty Corp.’s recently announced purchase of renewal rights to select commercial and personal lines businesses of Royal & SunAlliance USA will not affect the ratings on the company.
The transaction is expected to provide Travelers with additional presence in the U.S. commercial lines market and to increase its scale in personal lines through an expanded distribution network. The outlook remains negative while Travelers rebuilds capital strength post-asbestos reserve strengthening at year-end 2002.
Although the announced renewal rights transaction will require capital, Standard & Poor’s is comfortable with Travelers’ operating earnings and pace of capital growth year-to-date. For the first six months of 2003, Travelers reported GAAP net income of $781 million and an increase in statutory surplus exceeding $800 million.
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