The Insurance-to-Value (ITV) Program July, 2007

What is ITV? The Insurance to Value (ITV) program was developed to make sure our customers have enough coverage to rebuild their home in the event of a total loss.

Why do homeowners need ITV? If a customer lost their home due to catastrophic events like fires and/or hurricanes, they may not have enough coverage within their home policy to rebuild because of increased replacement costs.

The Market Opportunity Many customers are unaware that they may be underinsured to rebuild. The ITV program grants agents the opportunity to strengthen their long-term relationships. Travelers data show that on average 43% of homes insured with us are underinsured by 21%. The 2007 ITV program is specifically targeted to homeowner policyholders who: Were written with Travelers prior to 1/1/04 Have a current Coverage A of $600,000 or less Own a home that is at least three years old.

Recent Excerpt from the LA Times: "One of the things we discovered in the 2003 San Diego fire was how many people were underinsured," said Larry Arnold, a partner at the Newport Beach law firm of Cummins & White. "What so many people don't realize is how dramatically the cost of rebuilding rises when an entire neighborhood goes up. What might normally cost $100 or $200 a square foot to rebuild could cost $300 because there just aren't enough contractors to go around." -LA Times, 7/15/07

What are Replacement Costs? This is the cost to rebuild a home today with similar materials and craftsmanship, used during its original construction.

Why is the Replacement Cost of a House, not the Same as the Sales Price? The calculation method that we use to determine replacement of a home is based on Reconstruction costs not Market Value or the cost of New Construction.

Average Home Replacement Cost Increases: The average home replacement cost increase for: Renovating a bathroom is $9,009 Renovating a kitchen is $9,690 Adding a deck & french doors is $14,050

How Does ITV work? The program begins with a letter to customers asking them to submit a worksheet with all updated information on their homes. The customer can do this either online at www.travelersvaluation.com or send paper forms via mail. All updated information will be entered into the MSB replacement cost tool and an updated replacement cost estimate will be calculated. The agent will have full access to the estimator through the MSB link on Agent HQ. An Agent Summary Report will be available through the MSB link on Agent HQ via a link displayed on the main page (ITV Delivery Report). This report outlines whether or not the customer’s current coverage would need to be increased.

The ITV program is designed to minimize the workload on agencies. Travelers will process all changes. All surveys are directed to MSB. A help line directly to MSB for questions is offered in our communications to the insured.

Inform customers about ITV Consumer Brochure: Provides consumers clarity on replacement costs. Offers consumers peace of mind that we are ensuring their house is fully covered in the event of a total loss.

When will the 2007 ITV program launch? Agent reports will begin in July 2007 The first renewals will begin in November 2007. Strengthen customer loyalty and talk to your customers about ITV today.