Press Release - JULY 13, 2005

A.M. Best Assigns Ratings to Newly Formed Pool - St. Paul Travelers Insurance Companies


CONTACTS:
 Analyst(s)
Daniel J. Ryan
(908) 439-2200, ext. 5325
daniel.ryan@ambest.com

W. Dolson Smith
(908) 439-2200, ext. 5379
w.dolson.smith@ambest.com
Public Relations
Jim Peavy
(908) 439-2200, ext. 5644
james.peavy@ambest.com

Rachelle Striegel
(908) 439-2200, ext. 5378
rachelle.striegel@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK, N.J. - JULY 13, 2005
A.M. Best Co. has assigned a financial strength rating (FSR) of A+ (Superior) and an issuer credit rating (ICR) of "aa-" to the members of the newly formed pool, St. Paul Travelers Insurance Companies (St. Paul, MN). This rating action follows The St. Paul Travelers Companies, Inc.'s [NYSE:STA] (St. Paul Travelers) (St. Paul MN) announcement today that it has combined the St. Paul and Travelers pools, forming a new pool effective July 1, 2005, retroactive to January 1, 2005, and merged Gulf Insurance Company, the lead company of the former Gulf Insurance Group (Gulf) (New York), with and into Travelers Indemnity Company, the lead company of the new pool, effective July 1, 2005. The 28 participants in the new pool, 17 reinsured affiliates and Travelers Casualty and Surety of America constitute the 46 members of A.M. Best's new rating unit, St. Paul Travelers Insurance Companies.

As a result of the new pooling agreement, A.M. Best has upgraded the FSRs to A+ (Superior) from A (Excellent) and the ICRs to "aa-" from "a" of the 18 members of the former St. Paul Companies (St. Paul) (St. Paul, MN); affirmed the FSRs of A+ (Superior) and ICRs of "aa-" of the 24 members of the former Travelers Property Casualty Pool (Travelers) (Hartford, CT); and upgraded the FSRs to A+ (Superior) from A- (Excellent) and ICRs to "aa-" from "a-" of four members of the former Gulf.

In addition, A.M. Best has affirmed the debt ratings of "a-" on senior debt, "bbb+" on subordinated debt, "bbb" on trust preferred securities, "bbb" on preferred stock and AMB-1 on commercial paper of St. Paul Travelers and its subsidiaries. The outlook for all ratings remains stable. (See link below for a complete list of the ratings.)

The upgraded ratings of the members of the former St. Paul and Gulf groups reflect their combining with the larger, higher-rated and more strongly capitalized group of companies, the former Travelers. The St. Paul Travelers Insurance Companies' rating reflects the combined groups' strong capitalization, superior earnings power and dominant market profile in commercial, specialty and personal lines. In addition, the rating recognizes that approximately $1.7 billion of proceeds from St. Paul Travelers' divestiture of Nuveen Investments, Inc. will be contributed to its insurance subsidiaries in the third quarter of 2005. These contributions are expected to provide St. Paul Travelers Insurance Companies with a sizable capital cushion in the event of further adverse loss reserve development.

St. Paul Travelers' debt to total capital was moderate at 24.5% at December 31, 2004. As a result of an anticipated $2.0 billion of cash proceeds ($1.5 billion of which has already been received) from the Nuveen divestiture and anticipated strong earnings, A.M. Best expects the holding company's financial leverage will be lowered to near 20% by year-end 2005. St. Paul Travelers' divestiture of Nuveen has already resulted in a substantial improvement in holding company liquidity and tangible net worth through a significant increase in cash and a significant reduction in goodwill. Barring substantial catastrophe losses or reserve strengthening, A.M. Best is expecting cash at the holding company to increase to well in excess of $1.0 billion at year-end 2005 from $223 million at year-end 2004.

For a complete list of The St. Paul Travelers Companies, Inc.'s financial strength, issuer credit and debt ratings, please visit St. Paul Travelers.

For Best's Debt Ratings, all other Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.

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