Factory Mutual 2012 Annual Report

1
P13000 Printed in USA

2013 FM Global
All rights reserved. www.fmglobal.com
In the United Kingdom:
FM Insurance Company Limited
1 Windsor Dials, Windsor, Berkshire, SL4 1RS
Regulated by the Financial Services Authority.
Annual Repor t 2012
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FM Global Annual Report 2012 3
Report Contents
Executive Message . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 5
About Our Featured Clients. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 10
SKF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 12
Celestica . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 14
The Cooper Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 16
FedEx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 18
FM Global Around the World . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 20
FM Global Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 21
Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 25
Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . page 57
Industry Ratings
Rating Agency Financial Strength Rating Outlook
A.M. Best A+ (Superior) Stable
Fitch AA (Very Strong) Stable
For additional ratings information, view Industry Ratings at www.fmglobal.com.
FM Global is a leading commercial property insurance company that forms long-term
partnerships with its clients to support risk management objectives through a unique
combination of engineering, underwriting and claims services. We work to ensure our
clients business continuity by safeguarding their properties with seamless, worldwide
coverage and property loss prevention engineering solutions.
B
y all key measures, 2012 was a very
successful year. Financially, we
achieved all our objectives, both
in our insurance operations and in the
performance of our investments. Client
retention remained very high, and 2012
was one of our best years yet for attract-
ing new business. We accomplished all
of this despite the impact of Superstorm
Sandyour single largest net aggregate
natural disaster loss to date.
In simple terms, our in-force premium
grew by 8.6 percent, our combined ratio
was below 86 percent and our surplus
grew 14.9 percent to US$7.9 billion.
These outstanding results reinforce the
strength of our mutual business model,
our balance sheet and our unique focus
on working with our clients to ensure the
resiliency of their businesses.
Review of 2012
We continued to enhance our products and
services to better serve our clients evolv-
ing property risk management needs. At
the same time, we focused on being more
effective with our time and resources.
We achieved signifcant risk improve-
ment, a key to our long-term success. In
cooperation with our policyholders, we
exceeded our plans to implement human
element and overall physical improve-
ments. Most importantly, our policyhold-
ers will have installed sprinklers in an
additional 46 million square feet (4.3 mil-
lion square meters) of existing facilities.
Our response to Superstorm Sandy re-
inforced the strength of our natural
catastrophe readiness. In this single event,
we responded to approximately 2,200
claims. Our claims and engineering
teams acted quickly and effciently to get
our clients back into operation despite
the extreme challenges associated with
weather, lack of electrical power, trans-
portation disruption and fuel shortage.
We continued to perform well in the
timely delivery of our insurance prod-
uct. Despite the complexity of property
insurance policies, 71 percent of our poli-
cies were delivered before the effective
date of the contract, and 95 percent within
40 days.
A major achievement was the develop-
ment of Affliated FM Online, which will
be introduced to our middle-market clients
in 2013. This new extranet technology
platform will strengthen our relationship
with broker partners and clients, and it will
serve as the foundation for the next genera-
tion of FM Globals extranet, MyRisk
.
In another key initiative, we expanded the
scope and use of the SimZone, our state-
of-the-art training facility in Norwood,
Mass., USA. In this unique setting, our en-
gineers gain hands-on experience in a vari-
ety of learning areas that simulate property
hazards and real-world scenarios. In 2013,
we plan to open the SimZone to our clients
so that they also may take advantage of this
powerful learn-by-doing method.
Lastly, we have taken our knowledge,
data and research expertise and combined
it with current technologies, models and
analytics. The results have led to major
strides in risk assessment, risk improve-
ment and client services. We believe this
combination has tremendous potential for
process improvement in the future.
Executive Message
Overall, our consolidated in-force premium grew by 8.6 percent
to US$5.5 billion, the most growth weve attained since 2006.
6 FM Global Annual Report 2012
We also continued to receive third-party
recognition of our products and services.
The readers of Business Insurance maga-
zine named FM Global the top commer-
cial property insurer for service, expertise
and overall performance. For the second
consecutive year, Greenwich Associates
ranked us number one for underwriting
expertise, customer service and claims
processing responsiveness. And, Global
Finance magazine named us the worlds
best supply chain risk insurance provider.
2012 Premium Trends
From an industry perspective, after a
string of extreme worldwide natural
disasters, coupled with subpar investment
returns in 2011, the insurance market-
place fully expected pricing, terms and
conditions of the commercial insurance
marketplace to improve in 2012. How-
ever, the lack of signifcant insured
natural disasters and improved equity
markets in the frst half of the year damp-
ened those expectations. Superstorm
Sandy, which seemed to surprise the
markets with the scope and breadth of
its impact, caused the marketplace to re-
vert to the environment that existed at the
beginning of the year.
Our consolidated gross in-force premium
(excluding new business and net of lost
business) grew by 2.1 percent, a favor-
able result refecting the strength of our
client relationships. Given the relatively
challenging economic conditions in
Europe, premium growth from existing
clients was greater in North America.
The strength of our product offerings
was refected in our success with new
business acquisitions. Premium in force
from new client relationships grew by 6.5
percent, making this a standout year for
new business. These results, too, were
more successful in North America than in
Europe. Overall, our consolidated in-
force premium grew by 8.6 percent to
US$5.5 billion, the most growth weve
attained since 2006.
Affliated FM, positioned in the com-
mercial property middle market, grew 9.7
percent to US$976 million. Correspond-
ingly, our large commercial property
business grew at a slightly slower rate,
climbing 8.2 percent to US$4.3 billion.
Combined, our middle market and large
property lines represent 97 percent of
our overall consolidated premium, with
Mutual Boiler Re and FM Global Cargo
representing the balance.
Consolidated net premium earned grew
to US$3.6 billion, or 5.2 percent, when
compared with 2011 results that exclude
the effect of the 2011 membership credit.
Loss Trends
Our loss ratio for 2012 was 60.6 percent,
signifcantly lower than our 95.9 percent
loss ratio in 2011, but higher than in 2010
and 2009.
The loss ratio from natural disasters and
aggregations was 29.3 percent versus 52.3
percent in 2011, when we incurred one
of the highest totals for both frequency
and severity of insured losses from natu-
ral disasters in our history. Nevertheless,
Superstorm Sandy, accounting for 12.3
loss ratio points, has become our single
largest aggregate net lossgreater than
Hurricane Katrina in 2005 and the World
Trade Center disaster on Sept. 11, 2001.
More signifcantly, three of our largest
net aggregate natural disasters occurred
in 2011 and 2012. Superstorm Sandy was
predominantly a food event for our clients
affected by the powerful storm, and it oc-
curred in known food-prone areas. Based
on a review of our losses, our food assess-
ment, mitigation and risk-transfer process-
es remain the same.
Our risk loss ratio compared very favor-
ably with last year at 27.7 percent versus
39.6 percent. Risk losses are predomi-
nantly from fre and explosion. The fre-
quency of large losses stayed the same,
but the average size of the loss was less
severe. The majority of risk losses con-
tinue to occur at unsprinklered locations
and disproportionately outside of North
America. Working cooperatively with our
clients to achieve risk improvement re-
mains a top priority. This is matched by
our long-term goal of greater regulatory
recognition of the benefts of property
conservation and the role of fre sprin-
klers in building codes and standards.
Expense Trends
As a provider of knowledge-based ser-
vices in a commodity marketplace, we
make it a priority to deliver high-quality
services while carefully managing our
expense ratio. Our expense ratio of 25.1
percent remained fat from 2011 and was
slightly higher when 2011 is adjusted for
the membership credit issued that year.
2012 was the frst full year of our for-
mal companywide process improvement
effort, led by a dedicated business pro-
cess improvement team. The team was
successful in establishing a systematic
approach to evaluating and improving
important processes in the company. One
of the keys to this success was the active
involvement of all the key stakeholders
of the process under review. We are very
optimistic that this will result in tangible,
permanent productivity gains while im-
proving our effectiveness.
Employee Trends
In 2012, we conducted an all-employee
survey with a response rate of 88 percent,
up from 82 percent in 2007, and an ex-
cellent participation rate by any measure.
Most gratifying was the level of conf-
dence and optimism our employees have
about the future of FM Global, our busi-
ness environment and our approach with
our customers. As with the 2007 survey,
we will develop action plans to address
the issues raised in the survey.
Our strong employee survey participation
rate refected our low, stable turnover rate
of 6 percent, coupled with average em-
ployee tenure of 14 years. The key to our
success is a combination of a stable group
of motivated employees and the avail-
ability of specifc training programs. In
2012, employees completed 9,000 days
of classroom training at an average cost
of US$1,500 per employee. In addition,
employees completed more than 38,000
hours of online training.
Shivan S. Subramaniam
Chairman and Chief Executive Ofcer
Investments and Surplus
Our investment portfolio performed very
well. Both our equity and fxed income
portfolios exceeded their respective
benchmarks. The total portfolio returned
10.11 percent versus the benchmark
of 9.45 percent. Asset allocation was
stable, with an emphasis on liquidity.
These investment results, coupled with
our underwriting results, helped to in-
crease the surplus by 14.9 percent to
US$7.9 billion. Both A.M. Best and
Fitch reaffrmed our ratings at A+
and AA, respectively.
Governance
As a mutual company owned by our
policyholders, we value the governance
by our directors, eight advisory boards
and fve risk management executive
councils. We are thankful for their loyal
support. Graham Spanier, retired presi-
dent of the Pennsylvania State University,
resigned from our board in July 2012. We
thank him for his contributions.
Looking Ahead
The majority of our mutual policyhold-
ers are growing largely in locations out-
side their home countries and espe-
cially in the Asia/Pacifc region. Since
2008, insured locations measured by
their insured values grew 30 percent in
that region versus less than 3 percent in
the rest of the world. To better support
this growth rate and the needs of our
policyholders, we have created an Asia/
Pacifc division based in Singapore,
similar to our operating structure in
Europe and North America. We will be
building on our capabilities and expertise
in that region.
Our focus continues to be on develop-
ing and delivering effcient and effective
risk improvement solutions to our
policyholders across the world, while
providing stable risk-transfer solutions
that are compliant with local regulatory
requirements.
The dedication of our employees and
their commitment to our policyhold-
ers across the world are integral to our
success. We are deeply grateful for their
efforts. In 2013, we will be celebrating
50 years of providing global capabilities
to our clients, and we look forward to
continuing this tradition for many years
to come.
Financially, we achieved all our objectives, both in our
insurance operations and in the performance of our investments.

Corporate executives are taking a more active role in property risk manage-
ment. Changes in the global business landscape, the sharp increase in natural
catastrophes and the magnitude of supply chain risk have captured the atten-
tion of governing boards and the investment community. Physical risk is now
embedded in a complex manufacturing and distribution web, where every
strand is likely to lead to another interdependency and greater vulnerability.
When a property loss event occurs, the result may be costly to a companys
reputation, to its competitive advantage and to shareholder and customer
condence. In the following pages, senior leaders from four multinational
corporations discuss this changing dynamic at their organizations. We thank
them and their companies for their participation.
Featured Clients
As one of the world leaders in bearing technology for more than
a century, SKF has developed a unique understanding of rotat-
ing equipment and how machine components and industrial
processes are interrelated. Today, SKF provides a wide range
of technologies and products to original equipment manufactur-
ers and aftermarket customers around the world, in more than
40 industries. With its knowledge in bearings and units, seals,
mechatronics and lubrication systems, SKF helps its customers
improve productivity and energy effciency, optimize designs
and reduce maintenance costs and time to market. Headquar-
tered in Gothenburg, Sweden, SKF has more than 46,000 em-
ployees and operates 140 sites in 32 countries. Its 16 technical
centers around the world, as well as established collaborations
with major universities and research institutes, allow SKF to
continuously develop new technologies that offer competitive
advantages to its customers. The company reported net sales
revenues of US$9.9 billion in 2012.
Celestica is dedicated to building end-to-end product lifecycle
solutions that drive its customers success. Its expertise in design
and engineering, electronics manufacturing and supply chain
management services allows Celestica to develop customized
solutions that drive product innovation, cost savings, supply
chain effciencies and improved time to market. With more than
30,000 employees in 14 countries throughout North America,
Asia and Europe, Celestica offers its customers a global network
that gives them the fexibility they need to respond quickly to
changes in end-market demand. Celesticas customers include
more than 100 original equipment manufacturers and some
of the biggest names in communications, consumer products,
aerospace and defense, industrial, alternative energy and health
care. Headquartered in Toronto, Canada, Celesticas 2012 rev-
enue was US$6.5 billion.
The Cooper Companies is a global medical device company.
Its CooperVision business unit is one of the worlds leading
manufacturers of soft contact lenses with a strong heritage
of solving the toughest vision challenges. CooperVision
produces a full array of contact lenses, all featuring
advanced technology, materials and cutting-edge science. Its
CooperSurgical business unit is dedicated to improving
the delivery of health care to women, offering over 600 prod-
ucts for use in hospitals, womens health clinics, OB/GYN
offces and fertility clinics. Growing and expanding since its
inception in 1990, CooperSurgical has completed over 30
acquisitions. Headquartered in Pleasanton, Calif., USA, The
Cooper Companies has approximately 7,800 employees, gener-
ated over US$1.4 billion in revenue in fscal year 2012 and sells
products in over 100 countries.
FedEx pioneered the express delivery industry in 1971 and
now delivers an average of 9 million shipments a day through
its express, ground and freight operations. Headquartered
in Memphis, Tenn., USA, FedEx operates in more than
220 countries and territories and serves every address in the
United States. It has more than 300,000 team members, 90,000
motor vehicles and 660 aircraft serving 375 airports worldwide.
FedEx is more than just an express delivery company, pro-
viding its customers and businesses with a broad portfolio of
transportation, e-commerce and business services. Its website
receives 32 million unique visitors a month and 6.5 million
package tracking requests a day. It is consistently ranked among
the worlds most admired and trusted employers, and its annual
revenue reached US$43 billion in 2012.
SKF
The cost of risk
improvement is marginal
when compared with the
cost of an expected loss.
Per Thorn, Group Treasurer
O
ne way we protect our business
continuity at SKF is through
oversight provided by our internal
loss prevention board, whose members
include senior managers from all our
business areas. Thanks to the efforts of
this group, we have made signifcant
gains in risk improvement.
Globally, our biggest challenge was to
build a common understanding of what
is an acceptable level of riskbecause
the interpretation of risk severity can vary
from one location to the next. We have ad-
dressed this by working with FM Global
to establish a companywide policy that
defnes our risk tolerance level.
Education is a main driver of the policy.
For instance, we are educating employ-
ees on what I call the zero-costor hu-
man elementissues that require very
little capital investment and strengthen
our risk management competency. Fur-
thermore, our risk management team has
codifed our loss prevention standards.
To ensure these standards are adopted
universally, we have dedicated an inter-
nal engineering consultant to oversee
risk quality of new construction, includ-
ing all greenfeld sites, whether we are
building in Shanghai, India or Korea. For
example, our policy clearly states that
every greenfeld site is to be sprinklered.
What we know, through such vehicles as
FM Globals business impact analysis,
is that the cost of risk improvement is
marginal when compared with the cost
of an expected loss, particularly when
assessing supply chain vulnerability. By
putting it in such transparent terms, we
create a true awareness of risk.
At SKF, we hold our strategic suppliers
to the same standards we apply to our-
selves. FM Global is helping us by con-
ducting engineering visits at key supplier
locations. We dont hesitate to insist our
major suppliers improve their risk qual-
ity if necessary. It is a pragmatic business
decision for us, and for them.
By the same measure, our customers are
interested in what we are doing to prevent
loss. Our larger customers visit our plants
to verify we are meeting their criteria.
They cannot afford to have an interrup-
tion in their stream of goods. Their busi-
ness continuity depends on our reliability.
The standards we have in place help to
ensure our reliability is never in doubt.
certainty
about the quality of risk worldwide
Celestica
A
s a provider of innovative supply
chain solutions, we recognize that
our customers expect more today.
They want us to help them anticipate
problems and proactively propose cre-
ative solutions to solve them. They want
us to share our expertise to help them
increase their fexibility and ensure
on-time delivery. Our strategy to drive
speed, fexibility and responsiveness
through our supply chain is critical to
our business and enables us to meet our
customer commitments in the event of
a disruption.
To minimize the risk of supply chain dis-
ruption, we diligently assess risks and
take action. Our policies and procedures
refect best practices on how to protect
our global sites, monitor our business
partners and respond to emergencies.
There is value in highly protected risk
(HPR) sites. Maintaining HPR status is
a competitive differentiator and demon-
strates our commitment to fawless
execution.
There are two ways to manage risk: you
can adopt good risk management prin-
ciples and you can transfer risk through
insurance. We focus on the former to
minimize the size and cost of the latter.
The program we have with FM Global
contributes to the success of our strategy.
Not only does FM Global help us with
risk assessments and improvements at
our current facilities, but they also assist
us with site selection and in the construc-
tion of new facilities.
The FM Global platform helps Celestica
identify what and where the risks are,
how they can be improved and how we
can educate the people in our network
on managing risk. By following this
course, we have already avoided poten-
tially steep food losses at a key location,
while reassuring our customers that due
diligence has been done on all new sites,
and that we will meet their expectations
for on-time delivery.
certainty
about supply chain continuity
To minimize the risk of supply chain
disruption, we diligently assess
risks and take action.
Jeff McConaghy, Vice President, Corporate Treasurer
The Cooper Companies
Risk mitigation is built into
our planning process. We
need world-class facilities to
achieve our long-term goals.
Carol Kaufman, Executive Vice President,
Secretary and Chief Administrative Ofcer
certainty
W
e cannot afford to have a long-
term disruptionits not an
option for a global company
operating in a very competitive market-
place. Thats why weve put together
comprehensive business continuity plans
for our major sites and business units. We
realize that lost production equates to lost
sales, and I am not aware of any company
that can afford lost sales.
At Cooper, risk mitigation is built into
our planning process. We need world-
class facilities to remain competitive and
meet our long-term goals. It wasnt always
viewed this way. For many years, deci-
sions about insurance and risk manage-
ment were made entirely at the corporate
level, with no input from the operations.
That all changed with a merger that
nearly doubled the size of our com-
pany in 2005. We forged our relationship
with FM Global that same year.
And in certain respects, FM Global was
a game changer for us because they
provide insight and guidance to ensure
we are protecting our assets to the best
of our ability.
The transition is now complete. The
concept of loss prevention is now part
of our DNA. Operations management
are thinking about risk mitigation when
theyre doing their planning. During the
last two years, we also created an inter-
nal risk committee that has helped our
various business units understand the
importance of a robust business continu-
ity plan and how it can be the most vital
document you turn to when placed in the
path of a hurricane or in the aftermath of
an earthquake. Our board of directors and
executives are equally committed to pro-
tecting our assets, and their support has
been tremendous.
about asset protection
There is a pervasive spirit of partner-
ship within our organization and with
FM Global. Among the advantages of
working with FM Global are its stabil-
ity as a mutual company and the vast
array of resources it brings to loss pro-
tection. We ask FM Global to put on our
business hat and view the risk from our
vantage point. They have gone to great
lengths to get to know our people and our
business. Its led to strong communica-
tion and the understanding that we are in
this together.

FedEx
L
ongevity and reliability are the cor-
nerstones of our relationship with
FM Global. Our working relation-
ship began in 1981, when FedEx was
much smaller than the US$43 billion
multinational enterprise it is today. As
FedEx has grown and become more com-
plex, FM Globals ability to support and
grow along with us has been invaluable.
A main attribute we provide to our cus-
tomers is access to the global economy.
We participate in supply chain and in
logistics fulfllment all around the world.
Continuity and reliability are fundamen-
tal to the promise we make to customers.
Consistently delivering on that promise is
fundamental to our mission, and has made
FedEx one of the most admired compa-
nies in the world. For us, its a question of
how to plan in advance to mitigate the im-
pact of disruptionswhich, in our busi-
ness, are inevitableand how to react
and adapt effectively during the events.
At the macro level, were always design-
ing resiliency into our global networks.
FM Globals role is to help us make sure
we are less vulnerable in terms of the
impact an event may have on our facili-
ties, particularly the major hub and sort
facilities around the world. Thats where
you can see the real tangible results of
our relationship.
A visible example is our Asia/Pacifc hub
in Guangzhou, China, one of our larg-
est hubs outside the United States. That
facility, which opened in 2009, is the cen-
ter point of our operations in the region.
It is also a model facility for property
protection. Working collaboratively on
design aspects and construction planning
with FM Global, we were able to take
an approach in China that mirrored our
approach in the United States. The result
was the development of a highly pro-
tected risk facility that will help us to
protect our people, our assets and our
brand. That is the brand promise we make,
and FM Global helps us to keep it.
certainty
about enterprise resilience

Continuity and reliability are
fundamental to the promise
we make to customers.
Mike Lenz, Corporate Vice President and Treasurer
FM Global products and services are available around the world.
The countries listed below represent those where we regularly serve our clients:
Bahamas
Canada
Costa Rica
Dominican
Republic
El Salvador
Guatemala
Honduras
Jamaica
Mexico
Nicaragua
Panama
Trinidad
and Tobago
United States
Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
Paraguay
Peru
Uruguay
Venezuela
Albania
Algeria
Angola
Armenia
Austria
Azerbaijan
Bahrain
Belgium
Bosnia and
Herzegovina
Botswana
Bulgaria
Burkina Faso
Cameroon
Croatia
Cyprus
Czech Republic
Denmark
Egypt
Estonia
Finland
France
Gabon
Georgia
Germany
Ghana
Greece
Hungary
Iceland
Ireland
Israel
Italy
Jordan
Kazakhstan
Kenya
Kuwait
Kyrgyzstan
Latvia
Lebanon
Liechtenstein
Lithuania
Luxembourg
Macedonia
Madagascar
Malta
Montenegro
Morocco
Mozambique
Nambia
Netherlands
Norway
Oman
Poland
Portugal
Qatar
Romania
Russia
Saudi Arabia
Senegal
Serbia
Slovakia
Slovenia
South Africa
Spain
Sweden
Switzerland
Tanzania
Tunisia
Turkey
Ukraine
United Arab
Emirates
United Kingdom
Australia
Bangladesh
Brunei
Cambodia
China
Hong Kong
India
Indonesia
Japan
Laos
Macau
Malaysia
New Zealand
Pakistan
Philippines
Singapore
South Korea
Sri Lanka
Taiwan
Thailand
Vietnam
North America South America Europe, Middle East and Africa Asia/Pacic
FM Global Around the World
FM Global Group
In addition to the large-risk property business, the FM Global Group includes
a number of other key business operations. Several of those are described in this section.
Affliated FM is focused on commer-
cial middle-market property clients. The
companys value proposition is to pro-
vide innovative products and services
designed to protect clients assets, help
improve their operating reliability, reduce
their overall cost of risk and maintain
their proft and market share. The com-
pany markets its products and services
worldwide through a select network of
agents and brokers, providing underwrit-
ing expertise and property loss control
engineering tailored to meet specifc cli-
ent needs.
Affliated FM is committed to developing
strong relationships with its brokers and
clients through:
n
Superior commercial property
underwriting knowledge, expertise
and products
n
Customized property loss
prevention engineering programs
n
Responsive and effcient services in
a highly automated environment
n
Prompt, professional, fexible and
fair claims service
The Affliated FM product line includes
the all-risk proVision
policy, as well as
market-specifc policies for commercial
real estate accounts, condominium asso-
ciations, educational institutions, health
care facilities, manufacturing risks and
retail operations. The company also of-
fers a number of unique endorsements to
provide market-leading coverage for our
brokers and clients. Some examples:
n
BI Selectscenario-based fex-
ible business interruption coverage
that helps clients maximize business
interruption recovery
n
Green Coverage Endorsement
added coverage for clients wishing
to enact or maintain sustainable,
environmentally friendly business
and building practices
n
Risk Improvement
Endorsementcoverage after a
loss for physical improvements to a
clients location in accordance with
FM Globals Property Loss Preven-
tion Data Sheets
Recognizing that middle-market clients
are increasingly expanding operations,
Affliated FM continues to focus on pro-
viding a market-leading international pro-
duct offering through the proVision 360
global master policy program. This of-
fering provides seamless coverage for
the international exposures of clients by
using the master policy concept in con-
junction with legally admitted underly-
ing coverage from either the companys
international licenses or by utilizing the
FM Global WorldReach
partner network.
Affliated FM provides international ex-
pertise with a local presence. The orga-
nization has offce locations in Australia,
Canada, France, Germany, the Nether-
lands, the United Kingdom and throughout
the United States, and it offers coverage
in 60 countries. Leveraging streamlined
processing systems and a global network,
Affliated FM provides consistent world-
wide delivery of coverage, underwriting
and engineering products and services,
and claims management.
FM Global Group
Mutual Boiler Re has provided boiler and
machinery insurance in North America
for 135 years, specializing in mechani-
cal, electrical and pressure systems
breakdown treaty reinsurance and sup-
port services to the commercial property
insurance marketplace. Today, it works
with more than 200 insurance companies,
providing broader and more competitive
coverage to policyholders. To meet the
growing demand for sustainable solu-
tions, Mutual Boiler Re introduced the
industrys frst green equipment break-
down endorsement.
Mutual Boiler Re fosters long-term treaty
relationships that help partner companies
develop new business opportunities and
retain their clients, from Main Street
business and commercial property own-
ers to farm owners and homeowners. The
company provides tailor-made coverage,
rate development, fling, underwriting and
claims support, and customized manage-
ment reports. Integral to the treaty agree-
ment is the provision of boiler and pres-
sure vessel jurisdictional certifcation,
which is carried out by commissioned
inspectors from FM Global. Through the
creation of customized training programs,
Mutual Boiler Re helps broaden its partner
companies knowledge of risk exposures.
By fostering a value proposition that
promotes customer advocacy, fexibility
and competitiveness, Mutual Boiler Re
has a leadership position in the specialty
market it serves.
FM Approvals is a leader in third-party
certifcation of property loss prevention
products and services. Industrial and
commercial companies around the
world know that products bearing the
FM APPROVED certifcation mark,
backed by more than 100 years of scien-
tifc research and leading-edge product
testing, conform to high standards. The
companys globally recognized expertise
spans more than 500 categories of prod-
ucts and services, including roofng and
building material, cleanroom material, and
electrical and fre protection equipment.
FM Approvals offers complimentary on-
line resources dedicated to property loss
prevention.

SM
FM Global Cargo provides innovative,
comprehensive and fexible cargo
insurance coverage, automated certif-
cate management, and risk engineering
services tailored to the international
trade and transportation needs of global
businesses. The all-risk cargo policy pro-
tects the full value of cargo throughout
a clients product distribution network.
Focused risk engineering services help
clients understand the hazards that threat-
en their supply chain or major project
shipments and determine cost-effective
loss prevention solutions.
Corporate Insurance Services (CIS) is
FM Globals wholly owned brokerage
operation, maintaining relationships with
a variety of U.S. domestic insurers,
Lloyds of London, excess and surplus
lines insurers, and specialty compa-
nies. CIS provides access to markets for
perils, coverage and/or capacity not
readily available through FM Global or
Affliated FM. (CIS coverage is tailored
to meet FM Global policyholders
insurance requirements.) CIS policy
options include all-risk, earthquake,
food, wind, MFL capacity, inland ma-
rine, ocean marine and other lines.
TSB Loss Control Consultants, LLC, is
an emergency services training organi-
zation providing comprehensive training
for emergency response personnel and
those responsible for organizing, manag-
ing and/or directing emergency response
activities. The company, founded in 1971
and based in Rome, Ga., USA, provides
specialized training at its own 328-acre
(132-hectare) loss control training center
and on-site to personnel from industrial
fre brigades, hazardous materials emer-
gency response teams, technical rescue
teams, emergency medical services,
municipal fre services and other pro-
fessionals responsible for emergency
response in industry and municipalities.
Investment Report ......................................................................................... page 26
Managements Statement on Internal Control
Over Financial Reporting ............................................................................... page 28
Report of Independent Auditors .................................................................... page 29
Consolidated Balance Sheets ........................................................................ page 30
Consolidated Statements of Operations ........................................................ page 31
Consolidated Statements of Comprehensive Income/(Loss) ......................... page 32
Consolidated Statements of Changes in Policyholders Surplus ................... page 32
Consolidated Statements of Cash Flows ....................................................... page 33
Notes to Consolidated Financial Statements ................................................ page 34
Financial Information
All nancial gures in U.S. dollars.
Investment Report
Global stock and bond markets performed well in 2012, despite lackluster global economic expansion and
political uncertainties. Two primary factors drove the markets move higher. First, aggressively accommodative
monetary policy in the U.S. and Europe resulted in downward pressure on interest rates, beneting nancial
asset valuation and economic expansion potential. Second, corporate prots and cash ow have remained a
positive factor, enabled by productivity gains and effective management of costs. The primary challenge remains
the scal imbalances in the U.S. and Europe, with government debt levels generally viewed as unsustainably
high, and the need for tax increases/spending cuts a potential depressant to economic activity.
FM Globals investment positions and returns by asset class are shown on page 27. Return on total assets was
10.11 percent compared to the benchmark return of 9.45 percent. Relative outperformance was achieved in
both the stock and bond categories. There was some offset from a relatively high cash balance, held partly as a
conservative funding source for operating cash outows due to the high natural catastrophe losses experienced
in 2011.
Return on FM Globals equity portfolio was 17.05 percent, compared to a 16.00 percent return in the S&P 500 and a
16.10 percent return on the equity benchmark (a blend of 89 percent S&P 500 and 11 percent MSCI world ex. U.S.).
The outperformance was the result of moderate overweights in some of the less defensive sectors of the market
(a positioning which detracted from returns in the risk-averse market of 2011). Specically, results beneted from
overweighted positions in technology and in the banking sector, along with an underweighted position in defen-
sive electric utilities. The primary negative sector exposure was a moderate overweight to the energy sector,
which underperformed due to lower energy commodity prices, which in turn reected supply factors including
improved natural gas production technologies.
Turning to the debt securities portfolio, FM Globals internally managed high-grade debt portfolio returned 5.50
percent versus the Barclays index benchmark return of 4.40 percent. Outperformance was driven by an over-
weight to non-U.S. government debt sectors, which beneted from tighter interest rate spreads. Similar to
sentiment change in the equity market, investor sentiment in xed income also became somewhat more opportu-
nistic in 2012, compared to the very risk-averse attitude which characterized 2011. This shift is also apparent in the
16.48 percent return of the externally managed high-yield debt portfolio. As is generally the case, FM Globals xed
income duration was a neutral factor (with the internal portfolio duration at 4.1 years, very close to the benchmark
4.2 years), reecting the ongoing strategy of value added through bottom-up security and sector positioning.
In addition to providing functional support to FM Globals business operations, the real estate group manages
4.6 million ft. (430,000 m) of investment properties. These real property assets provide an additional element
of portfolio diversication. They also provide a cost-effective approach in meeting FM Globals ongoing real estate
needs, while enhancing the value of its properties. For 2012, commercial properties produced $86.7 million in
revenue and $25.1 million in cash ow.
All nancial gures in U.S. dollars.
Rates of Return 2012 Portfolio Benchmark
Total portfolio 10.11% 9.45%
1

Debt securities
Investment-grade taxable bonds 5.50% 4.40%
2
Municipal bonds* 6.04% 5.65%
3
High-yield bonds 16.48% 15.55%
4

Equity securities total 17.05% 16.10%
5
Internal portfolio 16.76% 16.00%
6
External portfolios**
U.S. portfolios 15.72% N/A
International portfolios 20.23% 16.83%
7

1
Weighted S&P 500 Plus Global Stock Index, Barclays Index, T Bill

2
Custom Barclays Index

3
Barclays Muni 2-12 Year

4
Merrill Lynch U.S. High-Yield Master II Constrained Index

5
S&P 500 Index (89%) plus MSCI All World ex. U.S. (11%)

6
S&P 500

7
MSCI All World ex. U.S.

* Taxable equivalent return.
** Primarily smaller sized companies.
Pretax Contribution to Surplus (in millions)
2012 2011
Investment income $ 297.5 $ 292.3
Realized gains/(losses) 334.4 297.1
Unrealized gains/(losses) 389.2 (258.9)
$ 1,021.1 $ 330.5
As of December 31 2012 2011
Holdings (in millions)
Total Percentage Total Percentage

Equity securities $ 4,950 42.4% $ 4,417 42.0%
Taxable debt securities 3,585 30.7 3,259 31.0
Municipal debt securities 1,573 13.5 1,504 14.3
Short-term funds 953 8.2 796 7.6
Partnerships and alternative investments 612 5.2 537 5.1
Total $ 11,673 100.0% $ 10,513 100.0%
Investment Report
Managements Statement on Internal Control Over Financial Reporting
The management of FM Global is responsible for establishing and maintaining adequate internal control over
nancial reporting and for the preparation and integrity of the accompanying nancial statements and other
related information in this report. The consolidated nancial statements of the Company and its subsidiaries, in-
cluding the footnotes, were prepared in accordance with accounting principles generally accepted in the United
States of America and include judgments and estimates, which, in the opinion of management, are applied on
an appropriately conservative basis. The Company maintains a system of internal and disclosure controls intend-
ed to provide reasonable assurance that assets are safeguarded from loss or material misuse, that transactions
are authorized and recorded properly, and that the accounting records may be relied upon for the preparation of
the nancial statements. This system is tested and evaluated regularly for adherence and effectiveness by the
Companys staff of internal auditors.
The audit committee of the Board of Directors, which comprises directors who are not employees of the Company,
meets regularly with management and the internal auditors to review the Companys nancial policies and
procedures, its internal control structure, the objectivity of its nancial reporting, and the independence of the
Companys independent public accounting rm. The internal auditors have free and direct access to the audit
committee, and they meet periodically, without management present, to discuss appropriate matters.
Because of inherent limitations, a system of internal control over nancial reporting may not prevent or detect
misstatements and even when determined to be effective, can only provide reasonable assurance with respect
to nancial statement preparation and presentation.
These consolidated nancial statements are subject to an evaluation of internal control over nancial reporting
conducted under the supervision and with the participation of management, including the chief executive ofcer
and chief nancial ofcer. Based on that evaluation, conducted under the criteria established in Internal Control
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission,
management concluded that its internal control over nancial reporting was effective as of December 31, 2012.
Chairman and
Chief Executive Ofcer
Jeffrey A. Burchill
Senior Vice President Finance
Chief Financial Ofcer
Report of Independent Auditors
The Board of Directors and Policyholders of
Factory Mutual Insurance Company and Subsidiaries
We have audited the accompanying consolidated nancial statements of Factory Mutual Insurance Company and
Subsidiaries (the Company), which comprise the consolidated balance sheets as of December 31, 2012 and 2011,
and the related consolidated statements of operations and comprehensive income/(loss), changes in policyholders
surplus, and cash ows for the years then ended, and the related notes to the consolidated nancial statements.
Managements Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these nancial statements in conformity with
U.S. generally accepted accounting principles; this includes the design, implementation, and maintenance of internal
control relevant to the preparation and fair presentation of nancial statements that are free of material misstatement,
whether due to fraud or error.
Auditors Responsibility
Our responsibility is to express an opinion on these nancial statements based on our audits. We conducted our
audits in accordance with auditing standards generally accepted in the United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the nancial statements are free of material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial
statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of
material misstatement of the nancial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entitys preparation and fair presentation of the nancial state-
ments in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entitys internal control. Accordingly, we express no such opinion.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
signicant accounting estimates made by management, as well as evaluating the overall presentation of the
nancial statements.
We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the nancial statements referred to above present fairly, in all material respects, the consolidated
nancial position of Factory Mutual Insurance Company and Subsidiaries at December 31, 2012 and 2011, and
the consolidated results of their operations and their cash ows for the years then ended in conformity with U.S.
generally accepted accounting principles.
Boston, Massachusetts
February 15, 2013
See accompanying notes.
Consolidated Balance Sheets
(in thousands)
December 31 2012 2011
Assets
Investments:
Debt securities (including $300,300 and $261,100 of securities
on loan under a securities lending program) $ 5,375,300 $ 5,104,500
Equity securities 4,989,900 4,416,900
Other securities 611,000 533,500
Real estate 453,000 376,200
Total Investments 11,429,200 10,431,100

Cash and cash equivalents 831,700 611,200
Recoverable from reinsurers 2,126,600 2,011,400
Premium receivable 638,800 678,800
Prepaid reinsurance premium 315,400 325,900
Premises and equipment 323,700 344,400
Other assets 726,700 925,900
Total Assets $ 16,392,100 $ 15,328,700
Liabilities
Unpaid losses and loss adjustment expenses $ 4,744,800 $ 5,176,500
Reserve for unearned premium 2,371,200 2,263,800
Current and deferred income taxes 488,800 267,200
Other liabilities 880,500 738,400
Total Liabilities 8,485,300 8,445,900
Policyholders surplus
Accumulated other comprehensive income 831,800 582,200
Retained earnings 7,075,000 6,300,600
Total Policyholders surplus 7,906,800 6,882,800
Total Liabilities and Policyholders surplus $ 16,392,100 $ 15,328,700
Consolidated Statements of Operations
(in thousands)
Year ended December 31 2012 2011
Gross premium earned $ 5,299,000 $ 4,945,000
Ceded premium earned (1,677,600) (1,503,000)
Net premium earned 3,621,400 3,442,000
Membership credit (208,000)
Net premium earned after membership credit 3,621,400 3,234,000

Investment-related income 387,300 364,900
Fee-related income 53,000 48,400
Total revenue 4,061,700 3,647,300

Net losses and loss adjustment expenses 2,193,900 3,099,100
Insurance-related expenses 874,700 777,700
Investment-related expenses 147,700 135,300
Fee-related expenses 48,700 43,400
Total losses, loss adjustment and other expenses 3,265,000 4,055,500

Net income/(loss) from operations 796,700 (408,200)
Net realized investment gains 350,600 368,200
Other than temporary impairment losses (16,200) (71,100)
Net income/(loss) before income taxes 1,131,100 (111,100)

Income tax expense/(benet) 356,700 (69,600)

Net income/(loss) $ 774,400 $ (41,500)
Consolidated Statements of Comprehensive Income/(Loss)
(in thousands)
Consolidated Statements of Changes in Policyholders Surplus
(in thousands)
Net income/(loss) $ 774,400 $ (41,500)
Other comprehensive income/(loss):
Net unrealized appreciation/(depreciation) on investments in debt and equity securities,
net of income tax expense of $134,100 for 2012 and net of income tax benet of $87,200 for 2011. 255,100 (171,700)
Benet plan assets and liabilities, net of income tax benet of $11,800 for 2012 and $92,900 for 2011. (27,600) (172,500)
Foreign currency translation adjustment, net of income tax expense of $4,400 for 2012 and $1,600 for 2011. 22,100 (12,600)
Other comprehensive income/(loss) 249,600 (356,800)
Comprehensive income/(loss) $ 1,024,000 $ (398,300)
Retained earnings at beginning of year $ 6,300,600 $ 6,342,100
Net income/(loss) 774,400 (41,500)
Retained earnings at end of year 7,075,000 6,300,600
Accumulated other comprehensive income at beginning of year 582,200 939,000
Other comprehensive income/(loss) 249,600 (356,800)
Accumulated other comprehensive income at end of year 831,800 582,200
Policyholders surplus at end of year $ 7,906,800 $ 6,882,800
Consolidated Statements of Cash Flows
(in thousands)
Operating activities
Net income/(loss) $ 774,400 $ (41,500)
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Decrease/(increase) in premium receivable 40,000 (108,500)
Increase in reserves for unearned premium 107,400 219,100
Decrease/(increase) in unpaid losses and loss adjustment expenses (431,700) 1,483,100
Increase in recoverable from reinsurers (115,200) (801,700)
Change in current and deferred income taxes 229,900 (146,200)
Net realized investment gains (334,400) (297,100)
Decrease/(increase) in prepaid reinsurance premium 10,500 (82,800)
Other 183,900 (152,400)
Net cash provided by operating activities 464,800 72,000

Investing activities
Net sales of short-term investments 123,400 14,300
Purchases of debt and equity securities (3,533,700) (2,928,500)
Sales and maturities of debt and equity securities 3,212,700 3,202,200
Capital expenditures (98,800) (71,600)
Other 52,100 (34,300)
Net cash provided/(used in) investing activities (244,300) 182,100

Increase in cash and cash equivalents 220,500 254,100
Cash and cash equivalents at beginning of year 611,200 357,100

Cash and cash equivalents at end of year $ 831,700 $ 611,200
Notes to Consolidated Financial Statements (in thousands)
December 31, 2012 and 2011
Note 1. Signicant Accounting Policies
Basis of Presentation
The consolidated nancial statements are stated in U.S. dollars and have been prepared on the basis of U.S.
generally accepted accounting principles, which differ in some respects from statutory accounting practices
prescribed or permitted by the State of Rhode Island and Providence Plantations, Department of Business Regula-
tion, Insurance Division. On the basis of statutory accounting practices, consolidated policyholders surplus was
$7,525,100 and $6,431,600 at December 31, 2012 and 2011, respectively; net income/(loss) for the respective
years then ended was $712,300 and $(32,100).
The process of preparing nancial statements in conformity with U.S. generally accepted accounting principles
requires the use of managements estimates and assumptions regarding certain types of assets, liabilities,
revenues and expenses. Such estimates primarily relate to unsettled transactions and events as of the date of
the nancial statements. Accordingly, upon settlement, actual results may differ from estimated amounts.
The Company provides comprehensive lines of property coverage and supporting services for industrial and
institutional properties throughout the world.
Principles of Consolidation
The consolidated nancial statements include the accounts of the Company and its wholly owned subsidiaries.
All signicant intercompany accounts and transactions were eliminated in consolidation.
Reclassication
Certain amounts reported in the 2011 nancial statements and disclosures have been reclassied to conform
to the 2012 presentation.
Cash Equivalents
Cash equivalents consist of various sweep accounts with a maturity of less than 90 days at acquisition.
Investments
Management determines the appropriate classication of debt securities at the time of purchase. All equity and
debt securities are classied as available-for-sale and are stated at fair value.
The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity,
or in the case of mortgage and asset-backed securities, over the estimated life of the security adjusted for anticipated
prepayments. This amortization and accretion is included in investment-related income. For mortgage and asset-
backed xed maturity securities, the Company recognizes income using a constant effective yield based on antici-
pated prepayments over the economic life of the security. The mortgage and asset-backed portfolio is accounted for
under the retrospective method and prepayment assumptions are based on market expectations. When actual
prepayments differ signicantly from anticipated prepayments, the effective yield is recalculated to reect actual
payments to date and anticipated future payments, and any resulting adjustment is included in investment-related
income.
Other securities consist primarily of partnerships and alternative investments, which are accounted for under the
equity method. As a result of the timing of the receipt of valuation data from the investment managers, these
investments are reported on up to a three-month lag. Changes in the Companys equity in the net assets of these
investments are included in income as net realized investment gains.
Note 1. Signicant Accounting Policies (continued)
The cost of securities sold is based upon the specic identication method. Unrealized appreciation or depreciation
of available-for-sale debt and equity securities, net of tax, is reported directly in policyholders surplus.
Impairments in equity securities deemed to be other than temporary are reported as a component of net income/
(loss) before income taxes. Impairments in debt securities deemed to be other than temporary are segregated into
credit risk and non-credit risk impairments. Credit risk impairments are reported as a component of net income/(loss)
before income taxes. Non-credit risk impairments are recognized in other comprehensive income. Securities are
reviewed for both quantitative and qualitative considerations in the calculation of impairments.
Under a securities lending program with an agent, the Company has temporarily loaned certain debt securities.
Borrowers of these securities must deposit with the agent an amount of cash and/or securities equal to 102 percent
of the loaned securities fair value for US currency-denominated securities or 105 percent of the loaned securities
fair value for foreign-denominated securities. The portion of collateral received in securities is held in trust by the
agent. The portion of collateral received in cash is invested by the agent in high-quality, short-term investments. The
Company continues to receive the interest on the loaned debt securities as a benecial owner, and the loaned debt
securities are included in the investment portfolio of the Company. The cash collateral and the obligation to return
that collateral are included in other assets and other liabilities, respectively, on the Consolidated Balance Sheets.
Income Taxes
The Company les consolidated U.S. and foreign income tax returns as required by law. The income tax expense/
(benet) is based upon pretax income reported in the consolidated nancial statements. Deferred income taxes are
provided, when appropriate, for the effects of temporary differences in reporting income and expenses for tax and
nancial reporting purposes. Deferred income taxes are also provided for unrealized appreciation or depreciation of
investments, for pension and postretirement liabilities and for foreign currency translations.
The Internal Revenue Service (IRS) has reviewed the Companys federal tax returns for the 2005 through 2009
tax years and some issues remain unsettled. Additionally, the IRS is currently reviewing the Companys federal tax
returns for the 2010 and 2011 tax years. Any adjustments that might result from the IRS examination of these income
tax returns are not expected to have a material impact on the nancial position, liquidity or results of operations of
the Company.
Deferred Costs
Premium taxes and commissions, the principal business acquisition costs, are deferred to the extent recoverable and
are amortized over the period during which the related premium is earned. Deferred costs are included in other assets.
Certain pre-rental and other expenses incurred by the Companys real estate limited liability corporation subsidiaries
are deferred and amortized over the lives of the various tenant leases.

Real Estate and Premises and Equipment
Premises and equipment are stated at cost, and depreciation is provided on a straight-line basis over the estimated
useful lives of the respective assets. Upon retirement or sale, the cost of the asset disposed of and its related ac-
cumulated depreciation are removed from the accounts, and any resulting gain or loss is recognized in net realized
investment gains. The net book value of the Companys investments in land and buildings is included in real estate,
whereas the remaining net book value of the Companys occupied land and buildings, furniture, xtures and equip-
ment is included in premises and equipment.
Unpaid Losses and Loss Adjustment Expenses
Liabilities for unpaid losses and loss adjustment expenses are based on case estimates or reports from ceding
companies. Estimates of incurred-but-not-reported (IBNR) reserves are based on historical experience and
management analysis.
Although the above-described amounts are based on estimates, management believes recorded liabilities for un-
paid losses and loss adjustment expenses are adequate to cover the ultimate settlement cost of losses incurred.
These estimates are continually reviewed and adjustments to such estimates are reected in current operations.
Premiums
The Company issues term premium policies. The term premium is earned on a pro-rata basis over the life of the policy.
Recent Guidance on Existing Accounting Standards
In October 2010, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU)
No. 2010-26 Financial ServicesInsurance Accounting Standard Codication (ASC) 944: Accounting for Costs
Associated with Acquiring or Renewing Insurance Contracts, which prescribes how costs incurred in the acquisi-
tion of new and renewal contracts should be capitalized. The required implementation date of ASU No. 2010-26
was for scal years beginning after December 15, 2011. The Company early adopted ASU No. 2010-26 in 2011 and
determined there is no impact on its deferral policy or the consolidated nancial statements.

In May 2011, the FASB issued ASU No. 2011-04Fair Value Measurement (ASC 820): Amendments to Achieve
Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. The amendments change
the wording used to describe many of the requirements in U.S. GAAP for measuring fair value and for disclosing
information about fair value measurements. For many of the requirements, the Board does not intend for
the amendments in ASU No. 2011-04 to result in a change in the application of the requirements in ASC 820.
The required implementation date of ASU No. 2011-04 for non-public entities is scal years beginning after
December 15, 2011. The Company adopted ASU No. 2011-04 and has determined that it will have no impact on
its consolidated nancial statements.
In June 2011, the FASB issued ASU No. 2011-05Comprehensive Income (ASC 220): Presentation of Compre-
hensive Income, which prescribes that an entity has the option to present the total of comprehensive income, the
components of net income, and the components of other comprehensive income either in a single continuous
Statement of Comprehensive Income or in two separate but consecutive statements. The required implementa-
tion date of ASU No. 2011-05 for non-public entities is scal years ending after December 15, 2012. The Company
adopted ASU No. 2011-05 and elected to present the total of comprehensive income/(loss), the components of net
income, and the components of other comprehensive income/(loss) in two separate but consecutive statements.
Recent Accounting Pronouncements
In December 2011, the FASB issued ASU No. 2011-12Comprehensive Income (ASC 220): Deferral of the Effective
Date for Amendments to the Presentation of Reclassications of Items Out of Accumulated Other Comprehensive
Income which defers the requirement for entities to present reclassication adjustments, by component, on the
face of the nancial statements where net income and other comprehensive income are presented. The Company
will monitor future updates related to this deferral.
Reinsurance
In the normal course of business, the Company seeks to reduce losses that may arise from catastrophes or other
events that cause unfavorable underwriting results by reinsuring certain levels of risk with other insurance enterprises.
Reinsurance premium and losses and loss adjustment expenses ceded under these arrangements are accounted for
on a basis consistent with those used in accounting for the original policies issued and the terms of the reinsurance
contract.
Retirement Income Plans and Postretirement Benet Plans Other than Pensions
Noncontributory retirement income plans cover the vast majority of employees. The Companys funding policy
is generally to contribute the net periodic pension cost each year, as determined pursuant to the guidance on
Compensation Employee Benets (ASC 715). However, the contribution for any year will not be less than the
minimum required contribution, nor greater than the maximum tax-deductible contribution.
The Company provides certain health care and life insurance benets for retired employees and their dependents.
The plan is contributory; with retiree contributions adjusted annually, and contains other cost-sharing features,
such as deductibles and coinsurance. Current service and interest costs of postretirement health care and life
insurance benets are expensed on an accrual basis.
Investment- and Fee-Related Income
Investment-related income primarily consists of interest and dividends from the Companys investment portfolio
and income from leased ofce space, which is earned as services are provided, or over the term of applicable
leases. Fee-related income primarily consists of fees for ancillary services.
Note 2. Investments
Debt and Equity Securities
The following is a summary of securities at December 31, 2012:
Cost or Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
Debt securities
U.S. Treasury securities and obligations
of U.S. government agencies $ 354,200 $ 28,000 $ (1,700) $ 380,500
Obligations of states and political subdivisions 1,474,500 93,400 (1,300) 1,566,600
Mortgage and asset-backed securities
Agency 851,100 50,700 (200) 901,600
Commercial 160,600 14,300 174,900
Residential 35,000 800 35,800
Other mortgage and asset-backed securities 143,300 12,900 156,200
U.S. corporate securities 1,196,200 95,200 (1,800) 1,289,600
Foreign government securities 561,900 26,700 (300) 588,300
Other debt securities 266,700 15,100 281,800
Total debt securities 5,043,500 337,100 (5,300) 5,375,300
Equity securities
Consumer Discretionary 294,700 183,900 (4,500) 474,100
Consumer Staples 327,400 212,200 (4,900) 534,700
Energy 318,300 233,400 (5,900) 545,800
Financials 422,900 174,900 (1,000) 596,800
Health Care 354,300 171,900 (1,800) 524,400
Industrials 287,700 158,600 (6,600) 439,700
Information Technology 384,300 434,700 (2,400) 816,600
Mutual Funds (International and Emerging Markets) 518,400 170,000 (1,100) 687,300
All other sectors 231,200 143,100 (3,800) 370,500
Total equity securities 3,139,200 1,882,700 (32,000) 4,989,900
Total debt and equity securities $ 8,182,700 $ 2,219,800 $ (37,300) $ 10,365,200
Note 2. Investments (continued)
The following is a summary of securities at December 31, 2011:
Cost or Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
Debt securities
U.S. Treasury securities and obligations
of U.S. government agencies $ 279,300 $ 36,600 $ $ 315,900
Obligations of states and political subdivisions 1,384,100 92,000 (900) 1,475,200
Agency 763,500 51,900 815,400
Commercial 151,200 12,400 163,600
Residential 9,700 3,000 (200) 12,500
Other mortgage and asset-backed securities 172,400 8,700 (100) 181,000
U.S. corporate securities 1,279,700 69,900 (8,400) 1,341,200
Foreign government securities 520,900 38,600 559,500
Other debt securities 229,200 11,600 (600) 240,200
Total debt securities 4,790,000 324,700 (10,200) 5,104,500
Equity securities
Consumer Discretionary 186,800 108,900 (6,300) 289,400
Consumer Staples 387,600 241,700 (4,600) 624,700
Energy 329,100 246,000 (5,200) 569,900
Financials 430,800 60,000 (11,000) 479,800
Health Care 282,300 134,600 (700) 416,200
Industrials 288,200 141,300 (4,100) 425,400
Information Technology 397,700 382,900 (7,400) 773,200
Mutual Funds (International and Emerging Markets) 464,000 102,100 (7,200) 558,900
All other sectors 171,600 112,300 (4,500) 279,400
Total equity securities 2,938,100 1,529,800 (51,000) 4,416,900
Total debt and equity securities $ 7,728,100 $ 1,854,500 $ (61,200) $ 9,521,400
During the years ended December 31, 2012 and 2011, proceeds from the sale of debt and equity securities were
$3,076,800 and $3,135,900, respectively. The gross realized gains and (losses) on such sales totaled $347,700 and
$(47,100), and $392,900 and $(51,300), in 2012 and 2011, respectively.
Note 2. Investments (continued)
The amortized cost and fair value of debt securities at December 31, 2012, by contractual maturity are shown
below. Expected maturities may differ from contractual maturities because the issuers of the securities may have
the right to call or prepay obligations with or without call or prepayment penalties.
Amortized Cost Fair Value
Due in one year or less $ 358,400 $ 363,400
Due after one year through ve years 1,383,700 1,460,700
Due after ve years through 10 years 1,746,100 1,892,400
Due after 10 years 365,300 390,300
3,853,500 4,106,800
Mortgage and asset-backed securities 1,190,000 1,268,500
Total debt securities $ 5,043,500 $ 5,375,300
Under a securities lending program with an agent, the Company has temporarily loaned certain debt securities with a
fair value of $300,300 and $261,100 at December 31, 2012 and 2011, respectively. At December 31, 2012 and 2011,
the Company held total collateral values of $307,100 and $266,700 related to the securities lending program, of which
cash collateral recognized in the Consolidated Balance Sheets were $125,900 and $139,300, respectively.
Included in the Companys debt security portfolio are securities with unrealized losses deemed to be temporary.
The total unrealized loss on these securities was $5,300 (fair value of $448,600) at December 31, 2012, and $10,200
(fair value of $325,400) at December 31, 2011. The amount of loss that existed for 12 months or more was immaterial
for both 2012 and 2011. In reaching its conclusion that these impairments are temporary, the Company considered
issuer-specic circumstances as well as the fact that the Company has the intent and ability to hold these securities
until they recover in value or mature, and it is not more likely than not that the Company will be required to sell before
that time.
Included in the Companys equity security portfolio are securities with unrealized losses deemed to be temporary.
The total unrealized loss on these securities was $32,000 (fair value of $238,700) at December 31, 2012, and
$51,000 (fair value of $470,000) at December 31, 2011. The amount of loss that existed for 12 months or more was
immaterial for both 2012 and 2011. In reaching its conclusion that these impairments are temporary, the Company
considered the duration and severity of the decline as well as the near-term prospects of the issuer. The Company
believes these securities will appreciate over time, and the Company has the ability and intent to hold these
securities until such time.
During the years ended December 31, 2012 and 2011, net realized investment gains on other securities were
$50,000 and $26,600, respectively.
Credit Risk
All investment transactions have credit exposure to the extent that a counterparty may default on an obligation to
the Company. Credit risk is a consequence of carrying investment positions. To manage credit risk, the Company
focuses on high-quality xed-income securities, reviews the credit strength of all companies in which it invests,
limits its exposure in any one investment and monitors the portfolio quality, taking into account credit ratings
assigned by recognized credit-rating organizations.
Note 3. Fair Value
The valuation techniques required by the Fair Value Measurements (ASC 820) guidance are based upon observable
and unobservable inputs. Observable inputs reect market data obtained from independent sources,
while unobservable inputs reect market assumptions.
These two types of inputs create the following fair value hierarchy:
Level 1 Quoted prices for identical instruments in active markets.
Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar
instruments in markets that are not active; and model-derived valuations whose inputs are
observable or whose signicant value drivers are observable.
Level 3 Signicant inputs to the valuation model are unobservable.
The Company retains independent pricing vendors to assist in valuing invested assets. In compliance with the
Fair Value Measurements (ASC 820) guidance, the Company conducted a review of the primary pricing vendor,
validating that the inputs used in that vendors pricing process are deemed to be market-observable as dened
in the standard.
When available, the Company uses quoted market prices to determine the fair value of investment securities,
and they are included in Level 1.
When quoted market prices are unavailable, the Company uses quotes from independent pricing vendors based
on recent trading activity and other relevant information. Debt securities are priced by an independent vendor using
evaluated market pricing models that vary by asset class. These models incorporate available trade, bid and other
market information, and for structured securities also incorporate cash ow and, when available, loan performance
data. The pricing models apply available market information through processes such as benchmark curves, bench-
marking of similar securities, and sector groupings. The vendors also integrate observed market movements, sector
news and relevant credit information into the evaluated pricing applications and models. These investments are
included in Level 2 and are primarily comprised of the debt securities.
In infrequent circumstances, the pricing is not available from the pricing vendor, and is based on signicant
unobservable inputs. In those circumstances, the investment security is classied in Level 3.
The following table presents the Companys invested assets measured at fair value as of December 31, 2012:

Quoted Prices in
Active Markets for Signicant Other Signicant
Identical Assets Observable Inputs Unobservable Inputs
Invested Assets, at Fair Value Total (Level 1) (Level 2) (Level 3)
Debt securities, available for sale $ 5,375,300 $ 247,600 $ 5,127,700 $
Equity securities, available for sale 4,989,900 4,933,900 56,000
Total $ 10,365,200 $ 5,181,500 $ 5,183,700 $
Note 3. Fair Value (continued)
The following table presents the Companys invested assets measured at fair value as of December 31, 2011:

Quoted Prices in
Active Markets for Signicant Other Signicant
Identical Assets Observable Inputs Unobservable Inputs
Invested Assets, at Fair Value Total (Level 1) (Level 2) (Level 3)
Debt securities, available for sale $ 5,104,500 $ 366,600 $ 4,737,900 $
Equity securities, available for sale 4,416,900 4,313,900 103,000
Total $ 9,521,400 $ 4,680,500 $ 4,840,900 $
All debt securities are measured at fair value and are classied as Level 2 with the exception of short-term securities which
are priced using quoted market prices and therefore classied as Level 1. See Note 2 for breakout of debt securities by
category.
All equity securities are priced using quoted market prices and classied as Level 1 with the exception of certain mutual
funds which are priced by the manager using other observable inputs and therefore classied as Level 2. See Note 2 for
breakout of equity securities by category.
There were no transfers of securities between Levels 1 and 2 in 2012 or 2011.
Securities lending collateral in 2012 and 2011 consists of highly liquid investments, which would be classied as Level 1 in
the fair value hierarchy.
Note 4. Membership Credit
The Companys Board of Directors approved a membership credit to policyholders for 2011 and 2010. Policyholders were
eligible for the membership credit upon renewal of their policies with inception dates between June 30, 2010 and June
29, 2011. The membership credit was recorded as a reduction of net premium earned.
Note 5. Reinsurance
The Company evaluates the nancial condition of its reinsurers and monitors concentrations of credit risk to minimize
its exposure to signicant losses from reinsurer insolvencies. While such evaluations minimize the Companys exposure,
the ultimate collection of reinsurance recoverables depends on the nancial soundness of the individual reinsurers. Gen-
erally, the reinsurance contracts do not relieve the Company from its obligations to policyholders. Failure of reinsurers
to honor their obligations could result in losses to the Company; consequently, allowances are established for amounts
deemed uncollectible.
The effect of reinsurance on written premium is as follows:
Year ended December 31
2012 2011
Gross written premium $ 5,406,400 $ 5,164,100
Ceded written premium (1,721,100) (1,614,800)
Net written premium $ 3,685,300 $ 3,549,300
Ceded losses incurred for the years ended December 31, 2012 and 2011, were $1,038,700 and $1,484,800, respectively.
Note 6. Unpaid Losses and Loss Adjustment Expenses
Activity in the net liability for unpaid losses and loss adjustment expenses is summarized as follows:
Year ended December 31
2012 2011
Net balance at January 1 $ 3,322,200 $ 2,615,900
Net incurred related to:
Current year 2,287,400 3,373,300
Prior year (93,500) (274,200)
Total incurred 2,193,900 3,099,100
Paid related to:
Current year 949,300 1,410,000
Prior year 1,507,700 982,800
Total paid 2,457,000 2,392,800

Net balance at December 31 $ 3,059,100 $ 3,322,200
As a result of changes in estimates of insured events related to prior years, the provision for losses and loss
adjustment expenses decreased by $93,500 and $274,200 in 2012 and 2011, respectively. The decreases in
both years were due to reductions of incurred-but-not-reported (IBNR) reserves based on actual experience,
and decreases on a small number of individual losses. In establishing reserves for property losses there is some
uncertainty in managements estimates that cause these estimates to differ from ultimate payments.
In establishing the liability for unpaid losses and loss adjustment expenses related to asbestos, environmental and
other mass tort-related claims, which applies only to business that is now in runoff, management considers facts
currently known and the current state of the law and coverage litigation. Liabilities are recognized for known claims
(including the cost of related litigation) when sufcient information has been developed to indicate the involvement
of a specic insurance policy and management can reasonably estimate the Companys liability. Liabilities have also
been established to cover additional exposures on both known and unasserted claims. Estimates of the liabilities are
reviewed continuously. Developed case law and adequate claim history do not exist for such claims, primarily because
signicant uncertainty exists about the outcomes of coverage litigation and whether past claim experience will be
representative of future claim experience.
The Company is the subject of various asserted and unasserted claims and lawsuits covering a wide variety of
issues that arise out of the normal course of its business activities. Contingent liabilities arising from litigation and
other matters are not considered material in relation to the nancial position or operations of the Company.
Note 7. Real Estate and Premises and Equipment
Real estate and premises and equipment at December 31, 2012 and 2011 are summarized as follows:
2012 2011
Land and buildings $ 1,012,100 $ 916,600
Furniture, xtures and equipment 299,400 304,900
Accumulated depreciation (534,800) (500,900)
Total $ 776,700 $ 720,600

During 2012 and 2011, depreciation expense for real estate and premises and equipment was $49,300 and $48,200,
respectively.
Note 8. Leases
In connection with its various operating ofces throughout Asia, Australia, Europe, North America and South America,
the Company leases ofce space, automobiles, and equipment. These leases are classied as operating leases.
Future minimum lease payments at December 31, 2012, under operating leases with terms of one year or more, are in
aggregate $141,400. The future minimum lease payments for each of the ve succeeding years from 2013 to 2017 are
$37,100, $31,400, $22,500, $15,400 and $13,300, respectively.
During 2012 and 2011, rent expense for all operating leases was $44,000 and $47,600, respectively.
Note 9. Income Taxes
Current income taxes primarily represent the U.S. federal and foreign tax expense/(benet). The most signicant
components of deferred tax liabilities relate to net unrealized gains on investment securities, benet plans expense and
depreciation. Deferred tax assets primarily represent the U.S. tax effects of temporary differences relating principally to
discounting of unpaid losses and loss adjustment expenses, adjustments to the net reserve for unearned premium, the
write-down of other than temporarily impaired investments and the pension and postretirement surplus adjustment.
The Company has established a valuation allowance for its foreign subsidiarys unrelieved foreign tax.
The components of the net deferred tax liability at December 31, 2012 and 2011, are as follows:
2012 2011
Total deferred tax liabilities $ (1,145,200) $ (998,000)
Total deferred tax assets 680,800 755,800
Valuation allowance (26,200) (25,000)
Net deferred tax assets 654,600 730,800
Net deferred tax liability $ (490,600) $ (267,200)
Note 9. Income Taxes (continued)
The following is the current and deferred income tax expense/(benet) for the years ended December 31, 2012 and 2011:
2012 2011
Current income tax expense/(benet) $ 260,100 $ (94,300)
Deferred income tax expense 96,600 24,700
Total income tax expense/(benet) $ 356,700 $ (69,600)
The Company has not recognized a deferred tax liability for the undistributed earnings of certain of its wholly owned
foreign subsidiaries that arose in 2012 and prior years, because the Company does not expect those unremitted
earnings to reverse and become taxable to the Company in the foreseeable future. A deferred tax liability will be
recognized when the Company expects that it will recover those undistributed earnings in a taxable manner, such as
through receipt of dividends or sale of the investment. As of December 31, 2012, the undistributed earnings of these
subsidiaries were approximately $129,000.
In 2012, effective income tax rates differed from current U.S. statutory rates primarily as a result of the dividends
received deduction, tax-exempt income and the effect of foreign operations.
Income tax paid during 2012 and 2011 was $252,400 and $102,000, respectively. In addition, the Company received
income tax refunds of $133,300 and $24,000 during 2012 and 2011, respectively.
The Companys unrecognized tax benets are immaterial and it does not expect any material changes within 12
months of the reporting date.
Note 10. Retirement Income Plans and Postretirement Benet Plans Other than Pensions
The Company sponsors a noncontributory retirement income plan covering the vast majority of employees.
The benets are generally based on years of service and the average of the highest consecutive 60 months of
the employees compensation within the 120 months prior to retirement. Generally, the Companys funding policy
is to maintain a sufciently funded level to ensure benet security and to vary contribution levels as appropriate
to business conditions. The Company also has supplemental retirement plans that are noncontributory dened
benet plans covering certain employees.
The Company provides health care and life insurance benets for certain retired employees and their dependents.
Employees not eligible for benets under pre-merger plan provisions, under age 30 as of January 1, 2000, or hired
after January 1, 2000, are ineligible for benets. Other employees may become eligible if they meet certain age and
service requirements. The plan is generally contributory; with retiree contributions adjusted annually, and contains
other cost-sharing features, including deductibles and coinsurance.
Note 10. Retirement Income Plans and Postretirement Benet Plans
Other than Pensions (continued)
Obligations and funded status are as follows:
Pension and Supplemental Benets Other Benets
Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Fair value of plan assets $ 2,022,400 $ 1,833,100 $ 126,300 $ 110,200
Benet obligations 2,028,800 1,782,800 162,800 159,300
Funded status, end of year $ (6,400) $ 50,300 $ (36,500) $ (49,100)

The accumulated benet obligation for the pension and supplemental benets plans were $1,745,400 and $1,537,100,
for December 31, 2012 and December 31, 2011, respectively.
Amounts recognized in the Consolidated Balance Sheets are as follows:
Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Asset $ 132,600 $ 165,200 $ $
Liability (139,000) (114,900) (36,500) (49,100)
Total $ (6,400) $ 50,300 $ (36,500) $ (49,100)
Pretax amounts included in accumulated other comprehensive income are as follows:
Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Net actuarial loss $ 869,500 $ 816,400 $ 59,300 $ 69,800
Prior service cost/(credit) 3,200 5,400 (300) (300)
Transition obligation 1,000
Total $ 872,700 $ 821,800 $ 59,000 $ 70,500
The projected benet obligation, accumulated benet obligation and fair value of plan assets for pension plans with
an accumulated benet obligation in excess of plan assets are as follows:
Dec. 31, 2012 Dec. 31, 2011
Projected benet obligation, end of year $ 115,000 $ 131,700
Accumulated benet obligation, end of year 99,000 115,300
Fair value of plan assets, end of year 29,700

The projected benet obligation and fair value of plan assets for pension plans with a projected benet obligation in
excess of plan assets are as follows:
Dec. 31, 2012 Dec. 31, 2011
Projected benet obligation, end of year $ 115,000 $ 131,700
Fair value of plan assets, end of year 29,700
Other changes in plan assets and benet obligations recognized in Consolidated Statements of Comprehensive
Income/(loss) are as follows:

Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Current year actuarial loss/(gain) $ 99,300 $ 283,500 $ (4,300) $ 16,800
Amortization of actuarial loss (46,200) (27,000) (6,200) (4,400)
Amortization of prior service cost (2,200) (2,200)
Amortization of transition obligation (1,000) (1,300)
Total recognized in other comprehensive income/(loss) 50,900 254,300 (11,500) 11,100
Net periodic benet cost 31,700 20,600 9,300 8,400
Total recognized in net periodic benet cost
and other comprehensive income/(loss) $ 82,600 $ 274,900 $ (2,200) $ 19,500
The estimated amounts that will be amortized from accumulated other comprehensive income into net periodic
benet cost in 2013 are as follows:
Pension and Supplemental Benets Other
Benets
Actuarial loss $ 62,100 $ 5,000
Prior service cost 2,200
Total $ 64,300 $ 5,000
Assumptions
Weighted-average assumptions used to determine benet obligations are as follows:
Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Discount rate 4.06% 4.53% 4.00% 4.48%
Expected return on plan assets 7.50 7.52 6.00 6.00
Rate of compensation increase 4.51 4.52 4.46 4.47
Assumed health care cost trend rates:
Other Benets
Dec. 31, 2012 Dec. 31, 2011
Initial rate 7.54% 8.03%
Ultimate rate 5.00% 5.00%
Years to ultimate 5 years 6 years
Weighted-average assumptions used to determine net periodic cost are as follows:
Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2012 Dec. 31, 2011
Discount rate 4.53% 5.19% 4.48% 5.25%
Expected long-term return on plan assets 7.52 7.53 6.00 6.00
Rate of compensation increase 4.52 4.55 4.47 4.47
Assumed health care cost trend rates:
Other Benets
Dec. 31, 2012 Dec. 31, 2011
Initial rate 8.04% 8.53%
Ultimate rate 5.00% 5.00%
Years to ultimate 6 years 7 years
Pension and Supplemental Benet Plan Assets
The Companys pension plan asset allocation and target allocation are as follows:
Target Allocation Percentage of Plan Assets
Dec. 31, 2013 Dec. 31, 2012 Dec. 31, 2011
Asset Class
Equity securities 65% 70% 66%
Debt securities 28 17 18
Cash equivalents 4 8 12
Other 3 5 4
Total 100% 100% 100%
The maturities of debt securities are as follows:
Dec. 31, 2012 Dec. 31, 2011
Maturity range 0-40 years 0-50 years
Weighted-average maturity 8.34 years 9.52 years
The fair value measurements of pension and supplemental benet plan assets at December 31, 2012, are as follows
(refer to Note 3 for the valuation techniques):
Quoted Prices in Active Markets Signicant Other Signicant
for Identical Assets Observable Inputs Unobservable Inputs
Asset Class Total (Level 1) (Level 2) (Level 3)
Equity securities (a):
Consumer Discretionary $ 108,500 $ 108,500 $ $
Consumer Staples 102,600 102,600
Energy 134,200 134,200
Financials 167,100 167,100
Health Care 145,300 145,300
Industrials 116,900 116,900
Information Technology 203,900 203,900
Mutual Funds 347,900 195,200 152,700
All other sectors 94,600 94,600
Total equity securities 1,421,000 1,268,300 152,700
Debt securities (b):
U.S. Treasury securities
and obligations of
U.S. government agencies 48,000 48,000
Agency 83,200 83,200
Commercial 20,600 20,600
Residential 4,300 4,300
Other mortgage and
asset-backed securities 13,200 13,200
U.S. corporate securities 86,100 86,100
Mutual Funds 86,200 86,200
Other debt securities 7,800 7,800
Total debt securities 349,400 349,400
Cash equivalents 163,300 163,300
Other (c) 88,700 88,700
Total $ 2,022,400 $ 1,431,600 $ 502,100 $ 88,700
(a) Includes common stocks and equity mutual funds of which $130,500 were on loan under a securities lending
program as of December 31, 2012.
(b) Includes $25,200 of debt securities that were on loan under a securities lending program as of December 31, 2012.
The total collateralized value of these loaned securities for both items (a) and (b) was $159,500 and consisted of
$143,800 in Level 1 short-term and money market investments and $15,700 in Level 2 government agency xed
income securities.
(c) Includes private equity partnerships.
The change in the fair value of the Level 3 Plan investments during 2012 was as follows:
Other Investments
Balance at January 1, 2012 $ 76,000
Realized loss (100)
Unrealized gain relating to instruments still held at the reporting date 6,600
Purchases, sales, issuances and settlements (net) 6,200
Balance at December 31, 2012 $ 88,700
The fair value measurements of pension and supplemental benet plan assets at December 31, 2011, are as follows
Equity securities (a):
Energy 139,000 139,000
Financials 90,500 90,500
Health Care 114,400 114,400
Mutual Funds 263,400 132,300 131,100
Total equity securities 1,206,600 1,075,500 131,100
Debt securities (b):
U.S. Treasury securities
and obligations of
U.S. government agencies 48,300 48,300
Agency 82,000 82,000
Commercial 19,300 19,300
Residential 5,900 5,900
Other mortgage and
asset-backed securities 13,300 13,300
U.S. corporate securities 83,400 83,400
Other debt securities 7,900 7,900
Total debt securities 330,500 330,500
Other (c) 76,000 76,000
Total $ 1,833,100 $ 1,295,500 $ 461,600 $ 76,000
(a) Includes common stocks and equity mutual funds of which $94,800 were on loan under a securities
lending program as of December 31, 2011.
(b) Includes $46,200 of debt securities that were on loan under a securities lending program as of
December 31, 2011. The total collateralized value of these loaned securities for both items (a) and (b)
was $144,400 and consisted of $122,800 in Level 1 short-term and money market investments and
$21,600 in Level 2 government agency xed income securities.
(c) Includes private equity partnerships.
The change in the fair value of the Level 3 Plan investments during 2011 was as follows:
Other Investments
Balance at January 1, 2011 $ 58,000
Realized gain 500
Unrealized gain relating to instruments still held at the reporting date 3,300
Purchases, sales, issuances and settlements (net) 14,200
Balance at December 31, 2011 $ 76,000
Other Postretirement Benet Plan Assets
The Companys other postretirement benet plan asset allocation and target allocations are as follows:
Target Allocation Percentage of Plan Assets
Dec. 31, 2013 Dec. 31, 2012 Dec. 31, 2011
Asset Class
Equity securities 90% 83% 86%
Cash equivalents 10 16 13
Other 1 1
Total 100% 100% 100%
The maturities of debt securities are as follows:
Dec. 31, 2012 Dec. 31, 2011
Maturity range 1-2 years 1-3 years
Weighted-average maturity 1.80 years 2.80 years
The fair value measurements of other postretirement benet plan assets at December 31, 2012, are as follows
Equity securities:
Energy 12,400 12,400
Health Care 12,400 12,400
Total equity securities 104,800 104,800
Debt securities:
U.S. corporate securities 200 200
Total debt securities 200 200
Other (a) 700 700
Total $ 126,300 $ 125,400 $ 200 $ 700
(a) Includes private equity partnership.
The fair value of the Level 3 Plan investments for the year ended December 31, 2012 is immaterial.
The fair value measurements of other postretirement benet plan assets at December 31, 2011, are as follows
Equity securities:
Energy 12,900 12,900
Health Care 10,000 10,000
Total equity securities 94,400 94,400
Debt securities:
U.S. corporate securities 200 200
Total debt securities 200 200
Other (a) 800 800
Total $ 110,200 $ 109,200 $ 200 $ 800
(a) Includes private equity partnership.
The fair value of the Level 3 Plan investments for the year ended December 31, 2011 is immaterial.
Pension and Postretirement Plan Asset Investment Narrative
The investment policy of the Pension Plan species the type of securities that may be used, limits on the amount of
the asset classes and subclasses, and general principles used in managing the plans assets. The overriding objective
is to maximize long-term total return of plan assets within constraints established to control risk and volatility. Three
primary asset classes represent the rst layer of asset allocation, these being equity securities, debt securities, and
cash equivalents. Since equity securities are expected to provide the highest long-term total return, exposure to
equities is emphasized. Current approved ranges for the three asset classes are as follows:
Asset Class Range
Equity securities 50-80%
Debt securities 20-50%
Cash equivalents 0-10%
Equity securities include individual common stocks as well as equity mutual funds and private equity partnerships.
All equity investments are based on fundamental analysis of investment variables, including earning prospects,
cash ow, balance sheet strength, competitive positioning and other factors. Diversication is emphasized, with
specic size limits on individual stocks, international-oriented mutual funds, small capitalization-oriented funds and
private equity. Investment returns are benchmarked against standard indices including the S&P 500 and MSCI global
stock indices. In the taxable Postretirement Plan, equities are more heavily weighted based partly on favorable tax
considerations.
Debt securities include individual securities, primarily in the high-grade taxable subcategory, debt mutual funds, as
well as an outside managed portfolio of U.S. high-yield bonds. Debt securities are actively managed, using many of
the same investment disciplines as in the Companys general account. These disciplines include an intermediate-term
duration, diversication of securities, and ongoing analysis of the fundamental and valuation factors underlying the
securities owned.
Short-term investments, dened as debt securities with a maturity of less than one year, are held primarily for liquidity
purposes. Safety of principal is the primary consideration of investment in this asset class, and so only the highest
quality investments are used. This will principally be money market funds and commercial paper carrying the highest
quality ratings.
Expected rate of return assumptions are created based on assessments of future behavior of asset classes. As part of
the process, historical relationships are considered. Using a three- to ve-year outlook, estimates of numerous variables
have been combined to gauge economic growth potential. Corporate cash ows are correlated with economic growth
but also reect productivity trends, with positive cash ow trends driving favorable return to equity owners. Debt security
returns are expected to approximate their historical relationship with equity securities and produce somewhat lower
returns with a lower level of volatility.
Cash Flows
Employer Contributions Pension and
Supplemental Benets Other Benets
2011 $ 250,200 $ 11,800
2012 15,800 10,700
2013 (expected) 14,700 11,000
Contributions by participants to the other benet plans were $3,400 and $2,700 for the years ending December 31,
2012 and 2011, respectively.
Pension and Other Benets
Supplemental Other (Government
Benet Payments Benets Benets Subsidy)
2011 $ 56,400 $ 13,000 $ 1,200
2012 57,000 12,000 1,300
Pension and Other Benets
Supplemental Other (Government
Estimated Future Payments Benets Benets Subsidy)
2013 $ 67,700 $ 12,400 $ 1,400
2014 75,000 12,700 1,500
2015 78,000 12,700 1,600
2016 81,800 12,900 1,700
2017 87,200 12,900 1,800
2018-2022 514,100 62,100 10,300

The Company also sponsors a 401(k) savings plan whereby eligible employees may elect annually to contribute
from 1 percent to 50 percent of their base pay on a pretax or after-tax basis. Employee contributions are restricted
to Internal Revenue Service limits. The Company matches pretax and after-tax contributions up to 6 percent of the
employees base pay. Company contributions to the plan were $17,600 in 2012 and $17,200 in 2011.
Note 11. Components of Accumulated Other Comprehensive Income
The components of accumulated other comprehensive income at December 31, 2012 are as follows:
Unrealized appreciation Benet Plan Foreign Currency Accumulated other
on investments in debt Asset and Translation Comprehensive
and equity securities Liabilities Adjustment Income
Balance at January 1, 2012 net of income tax $ 1,174,500 $ (583,500) $ (8,800) $ 582,300
Gross current period change 389,200 (39,400) 26,500 376,300
Income tax (expense)/benet (134,100) 11,800 (4,400) (126,700)
Balance at December 31, 2012 net of income tax $ 1,429,600 $ (611,100) $ 13,300 $ 831,800
The reclassication adjustments for gains recognized in net income are $284,300 for 2012.
The components of accumulated other comprehensive income at December 31, 2011 are as follows:
Unrealized appreciation Benet Plan Foreign Currency Accumulated other
on investments in debt Asset and Translation Comprehensive
and equity securities Liabilities Adjustment Income
Balance at January 1, 2011 net of income tax $ 1,346,200 $ (411,000) $ 3,800 $ 939,000
Gross current period change (258,900) (265,400) (11,000) (535,300)
Income tax benet/(expense) 87,200 92,900 (1,600) 178,500
Balance at December 31, 2011 net of income tax $ 1,174,500 $ (583,500) $ (8,800) $ 582,200
The reclassication adjustments for gains recognized in net income are $269,800 for 2011.
Note 12. Subsequent Events
Subsequent events were evaluated through February 15, 2013, the date the consolidated nancial statements were
available to be issued. No material transactions occurred after the balance sheet date that would impact the consolidated
nancial statements.
Management .................................................................................................. page 58
Risk Management Executive Councils ............................................................ page 59
Advisory Boards ............................................................................................. page 62
Board of Directors........................................................................................... page 66
Corporate Governance
Management
Chairman and
Jonathan W. Hall
Executive Vice President
Thomas A. Lawson
Bret N. Ahnell
Senior Vice President
Western Division
Gerardo L. Alonso
Claims and Enterprise Learning
Jeffrey A. Burchill
Finance
Roberta H. Butler
Marketing
Brion E. Callori
Engineering and Research
Kenneth W. Davey
EMEA Division
Rodney C. Fisher
Underwriting and Reinsurance
James R. Galloway
Central Division
Chris Johnson
Asia/Pacic Division
Paul E. LaFleche
Investments
Kenneth V. Lavigne
Canada Division
Michael C. Lebovitz
Afliated FM
Jeanne R. Lieb
Information Services
John J. Pomeroy
Law and Governmental Affairs
Enzo Rebula
Human Resources
Ziad Alex S. Tadmoury
Client Service and Sales
Michael R. Turner
Eastern Division
Ian Berg
Vice President
Australia Operations
Dennis Bessant
Vice President
Asia/Pacic Division
Kevin L. Bradshaw
Vice President
Forest Products and
Latin America Operations
Benoit Charbonneau
Vice President
Montreal Operations
Thomas M. Dusel
Vice President
Real Estate
Richard M. Gillen
Vice President
Mutual Boiler Re
Achim Hillgraf
Vice President
Central Europe Operations
Kevin S. Ingram
Vice President, Finance
FM Insurance Company Ltd.
Derry K. Johnson
Vice President
San Francisco Operations
Gervais Landry
Vice President
Afliated FM
William M. Lonchar
Vice President
Atlanta Operations
David L. Mackin
Vice President
Afliated FM
Thierry Masurel
Vice President
Southern Europe Operations
William A. Mekrut
Vice President
Treasury
Brian M. Nyquist
Vice President
Cleveland Operations
James P. OBrien
Vice President
Chicago Operations
Douglas S. Patterson
Vice President
Dallas Operations
Paul J. Pendolino
Vice President
Afliated FM
Ray K. Phillips
Vice President
Boston Operations
George J. Plesce
Vice President
Washington, D.C., Operations
Vincent A. Reyda
Vice President
New York Operations
Malcolm C. Roberts
Vice President
Chemical Operations
Denis C. Shine
Vice President
St. Louis Operations
David R. Thoman
Vice President
Los Angeles Operations
David M. Thompson
Vice President
Toronto Operations
Stefano Tranquillo
Vice President
Northern Europe Operations
Risk Management Executive Councils
Canada Division
Carol A. Campbell
Vice President
Risk Management
Empire Company Limited
Anne J. Chalmers
Vice President
Risk and Security
Teck Resources Limited
Ginette Demers
Director
Risk Management
Resolute Forest Products
Terry Henderson
Global Insurance Manager
ShawCor Ltd.
Marilyn P. Leonard
Manager, Corporate Risk
and Insurance
NALCOR Energy Inc.
Vronick Marcotte
Vice President
Risk Management and Insurance
Tembec Industries Inc.
Cynthia Mathews
Risk Manager
Royal Utilities Income Fund
Robert Patzelt
Vice President
Risk Management
and General Counsel
Scotia Investments Ltd.
Kim Rogerson
Director, Risk Management
and Insurance
Domtar Inc.
Adib Samaan
J.D. Irving Limited
David R. Stewart
Vice President
Property Tax and Insurance
Ivanhoe Cambridge
Richard Stewart
Manager
Risk and Insurance
ATCO Ltd.
Linda Stojcevski
Director
Global Risk Management
Magna International Inc.
Chukie Wijegoonewardane
Corporate Manager
Treasury and Risk
Chemtrade Logistics Inc.
Central Division
James R. Averitt
Director of Risk Management
Vulcan Materials Company
Eugene W. Bader
AbbVie, Inc.
Lara Baugh
Deere & Company
Brian W. Beeghly
Executive Director
Risk Management
Johnson Controls, Inc.
Sandra R. Boillot
Vice President
Risk Management
Ascension Health
Stephen S. DiGiacinto
Director
Risk Management Services
Hallmark Cards, Inc.
Julie Ellison
Director
The Goodyear Tire & Rubber
Company
Kristine M. Fletcher
Vice President
Risk Management
RR Donnelley
Karen J. Golden
and Real Estate
Kraft Foods Group, Inc.
Chris Harden
AGCO Corporation
Michael Harrington
Senior Director
Jabil Circuit, Inc.
Chad C. Jackson
Staff Director, Risk Management
FedEx Corporation
Hal D. Larson
Vice President, Risk Manager
Kent Corporation
Gail M. Meyer
Manager, Risk Management and
Insurance Services Division
Caterpillar Inc.
Mark Meyer
Manager, Corporate Risk
Steelcase Inc.
Rob Milligan
TRW Automotive Inc.
Paul E. Morrison
Emerson Electric Co.
Katherine H. Schweikart
Senior Financial Manager
Risk Management
General Mills, Inc.
Karen H. Sullivan
Vice President
Community Health Systems
Michael D. Tarling
Assistant Treasurer
The Boeing Company
Claudia P. Temple
Assistant Treasurer
and Insurance
Mondelz International, Inc.
Douglas A. Troupe
Director
Insurance Risk Management
Tenaska, Inc.
Bill Whitmire
Director
Corporate Risk Management
Shaw Industries, Inc.
Eastern Division
Ronald Allen
Altria Client Services Inc.
Anthony Avitabile
Director of Industry
Risk Management
Major League Baseball
Scott P. Borup
Director
Johnson & Johnson
James A. Breeding
and Insurance
Rutgers, The State University
of New Jersey
Maria C. Diaz
Director
Xerox Corporation
Jason Duffy
Vice President
Insurance and Risk Management
FMR LLC
Katie Elein
Senior Director
Risk Management
Celgene Corporation
Donald J. Hatcher
United States Enrichment
Corporation
Kathleen M. Ireland
Director, Global Risk and
Insurance Management
International Business Machines
Corporation
Christopher I. Johnson
Assistant Treasurer
Risk Management
Textron Inc.
Kevin P. Lang
Ingersoll-Rand Company
Gary W. Langsdale
University Risk Ofcer
The Pennsylvania
State University
Meredith Lee
Covidien PLC
David H. McClain
Director, Insurance
and Fleet Services
PPG Industries, Inc.
R. Scott McCurdy
Manager, Insurance Programs
General Electric Company
Brian W. Merkley
Global Director
Huntsman Corporation
William Milaschewski
Cabot Corporation
Terry Novatnack
Director, Corporate Risk
and Insurance
PPL Corporation
Thomas Patchel
TE Connectivity Ltd.
J. Jeffrey Purdy
Corporate Risk Director
Computer Sciences Corporation
Peter F Roueche
Manager, Enterprise Risk
and Insurance
Eastman Chemical Company
Theodore A. Schlert
Vice President, Risk Services
and Chief Risk Ofcer
Catholic Health East
Charles W. Scott, Jr.
FMC Corporation
Steven T. Wilking
Managing Director of
Global Risk and
Insurance Management
Tishman Speyer Properties, L.P.
Richard A. Yost
Campbell Soup Company
EMEA Division
Robert Ashmore
Group Insurance Director
Reckitt Benckiser plc
Nicholas Bailey
Group Risk Manager
BBA Aviation Plc
Klaus Braukmann
Group Insurance Manager
Conti Versicherungsdienst
Andy Bryson
Director, Property
and Loss Prevention
GlaxoSmithKline Plc
Martina Fernndez Porto
Risk Management Director
INDITEX, S.A.
Tim Guy
Group Insurance Manager
Imperial Tobacco Group Plc
Carine Habay Bony
Corporate Insurance Director
Group Danone
Wilhelm Hauf
Head of Accounting
and Financial Reporting
SGL Carbon SE
David Howells
Director
Group Risk Management
and Insurance
Tetra Laval International
Klas Iloson
Managing Director
SKF Reinsurance Company Ltd.
Udo Kappes
Senior Manager, Property
EADS IRM GmbH
Adrian Latimer
Risk and Insurance Manager
Schlumberger Oileld Services
Kate Loades
Group Insurance
and Risk Manager
Pearson Plc
Chris McCormack
Head of Group Insurance
and Risk
Reed Elsevier
Sunil Mehra
Head of Corporate Insurance
Dubai Aluminium Co Ltd
Len Moore
Senior Director
Property Insurance
Deutsche Post AG
Ola Nilsson
Vice President
Svenska Cellulosa Aktiebolaget
SCA (publ)
Andr J. Oude Hergelink
Group Risk and
Insurance Manager
Ten Cate Assurantin BV
Bjrn-Erik Pagels
Director, Group Funding
and Insurance
Ahlstrom Corporation
Pawel Pietrucha
Director
and Insurance
Philip Morris International Inc.
Isabella Pchmann
Managing Director, Insurance
Behr Versicherungsdienst GmbH
Peter Rehberg
Director Corporate Insurance
Mahle GmbH
Sabine Segor
Head of Insurance/
Risk Management
Hugo Boss AG
Francis Van den Neste
Corporate Risk Manager
Roquette Freres
Johan Willaert
Corporate Risk Manager
Agfa Gevaert N.V.
Western Division
Stephen Anderson
Vice President and Treasurer
Simpson Lumber Company, LLC
David E. Arick
Assistant Treasurer
International Paper Company
Douglas A. Bachman
RockTenn
Tom Bandoni
Senior Manager
Treasury Risk Management
Cisco Systems, Inc.
Anthony M. Black
Cameron International
Corporation
Timothy J. Bunt
CBRE Group, Inc.
Kristen R. Carnevali
Director, Treasury and Risk
Esterline Corporation
Andrea Dudek
Dell Inc.
Lanette A. Frostestad
Senior Director of
Risk Management
McKesson Corporation
Renee N. Garbus
Vice President
Assistant Treasurer
PepsiCo, Inc.
Jackie Hair
Executive Director
Risk Management
Corporate
Ingram Micro Inc.
Franc Hangarter
Managing Director
Corporate Insurance
and Risk Management
American Airlines
Richard E. Hearn
General Manager Enterprise Risk
Minerals & Metals Group (MMG)
Diane R. Labrador
Assistant Treasurer
Risk and Insurance
Intel Corporation
John W. Lambdin
Assistant Treasurer
and Director of Insurance
Weyerhaeuser Company
Rodrigo Levy
Corporate Business Controller
Empresas CMPC
Ren A. Martinez
Director of Insurance
and Risk Management
CEMEX Central, S.A. de C.V.
Kevin P. McGinnis
Director of Risk Management/
Benets Administration
The Texas A&M University
System
Robert Moussaid
Director, Risk and Insurance
Energy Future Holdings Corp.
Drew Porter
Risk Manager
Cinemark USA, Inc.
Paul D. Rytting
The Church of Jesus Christ
of Latter-Day Saints
Marty Simmonsen
Risk Manager
Boise Inc.
John J. Vinski
Director, Corporate Insurance
and ERM
NV Energy
Stephen M. Wilder
Vice President
Risk Management
The Walt Disney Company
Soraya Wright
Vice President
The Clorox Company
Advisory Boards
Canada
John D. Amodeo
and Chief Financial Ofcer
Samuel, Son & Co., Limited
Brian R. Bale
ATCO Ltd.
George J. Bunze
Vice Chairman and Director
Kruger Inc.
Doreen Cole
Electricity Services
EPCOR Utilities Inc.
Robert M. Davis
Chairman and
The Innovak Group
Michel J. Dumas
Executive Vice President, Finance
Tembec Inc.
Todd D. Eby
Hood Packaging Corporation
William C. MacLean
J.D. Irving, Limited
Andre Martel
President and
Aluminerie Alouette Inc.
Kelvin L. Nelson
High Liner Foods Incorporated
Peter C. Rozee
Commercial and Legal Affairs
Teck Resources Limited
D. Todd Smith
Treasurer
Torstar Corporation
Derrick Sturge
NALCOR Energy Inc.
Peter G. Wong
Alterra Power Corp.
Europe
Dr. Annette Beller
B. Braun Melsungen AG
Stephen Benad
Company Secretary
Computacenter
Oswald Bubel
Finance Director
Hager Electro GmbH
Colin Day
Chief Executive
Filtrona plc
Bernard de Laguiche
Member of the
Executive Committee
Solvay
Michel DeCorte
Indaver
Eric Drap
Manufacturing and
Supply Organization
Ipsen Pharma
Christopher M. Green
Finance Director
Northumbrian Water Limited
Poul Hartvig Nielsen
General Counsel
KIRKBI & LEGO Group
Jean-Jacques Jegou
Zodiac
Victor Jerez
Vice President
Audit and Business Development
Pernod Ricard Holding
Jean Larmande
Deputy Chief Executive Ofcer
Groupe Soparind Bongrain
Pierre-Xavier Lemaire
Roquette Freres
Andrea Minguzzi
Lecta Europe
Tim Murray
Aluminium Bahrain B.S.C. (c)
Denis Musson
Group General Counsel
and Company Secretary
Imerys
Patrick Noonan
Senior Corporate Vice President
General Counsel and Secretary
Nexans SA
Xavier Roy-Contancin
Sequana
Dr. Oliver Schumy
Member of the
Management Board
The Mayr-Melnhof Group
Per Thorn
Group Treasurer
AB SKF
Dr. Bernhard Volkmann
Corporate Executive
Vice President
MAHLE GmbH
Olle Walln
General Counsel
Husqvarna AB
Marie-Claire Wastiaux
Hachette Livre
United States
Atlanta/Dallas
Kenneth R. Allen
Texas Industries, Inc.
Mario Arregun
Finance and Information Systems
Servicios Administrativos Peoles
Frank H. Boykin
Mohawk Industries, Inc.
Jo Ann Fuller
Entegra Power Group, LLC
Patrick Gaussent
IPR-GDF SUEZ
North America, Inc.
John W. Geeraerts
Assistant General Manager
Seminole Electric
Cooperative, Inc.
Paula Gold-Williams
CPS Energy
Brian W. Hobbs
Vice President
Legal and Corporate Services
Western Farmers Electric
Cooperative
Advisory Boards
Kenneth G. Jackson
Shaw Industries Group, Inc.
Robert A. Kyle
Vice President and
PowerSouth Energy Cooperative
Ralph E. Lawson
Baptist Health South Florida
Patrick C. Lynch
Interface, Inc.
George C. Mitchell
Senior Vice President of Finance
Dallas Cowboys Football Club,
Ltd./Blue Star Investments Inc.
John O. Muse
Finance and Administration
Darling International
Stuart B. Parker
USAA
Terry L. Richardson
Administration and Secretary
Riceland Foods, Inc.
Van L. Richey
President and
American Cast Iron
Pipe Company
Daniel F. Sansone
Vulcan Materials Company
Judy A. Schmeling
HSN, Inc.
Dellmer B. Seitter, III
Vice President and
Printpack, Inc.
Steven C. Voorhees
Chief Financial Ofcer and
Chief Administrative Ofcer
RockTenn
Mark Watkins
Technology and Forestry
MeadWestvaco Corporation
Chicago/St. Louis
Patrick E. Allen
Senior Vice President and
Rockwell Collins, Inc.
Philip D. Anderson
Spirit AeroSystems Holdings, Inc.
David A. Berg
President
American Crystal Sugar Company
Michael DeHaven
and General Counsel
BJC HealthCare
David A. Dohnalek
Vice President of Finance
and Treasurer
The Boeing Company
John T. Drexler
Arch Coal, Inc.
Sheri H. Edison
Vice President
Bemis Company, Inc.
John C. Fowler
Quad/Graphics
Matthew W. Geekie
Secretary and General Counsel
Graybar Electric Company, Inc.
Margaret C. Kelsey
Vice President
Corporate Development
Modine Manufacturing Company
John J. Kita
A.O. Smith Corporation
Bradley W. Oachs
Chief Operating Ofcer
Minnesota Power
Mark W. Peterson
Rexnord Corporation
Ronald N. Quinn
Executive Vice President and
Chief Strategy and Legal Ofcer
Tenaska, Inc.
David J. Rabe
Vice President and Treasurer
Larry Schmid
Vice President and
Great River Energy
Edward J. Scott
Corporate Treasurer
Caterpillar Inc.
Daniel J. Sescleifer
Energizer Holdings, Inc.
Cleveland
Mark R. Belgya
The J.M. Smucker Company
Glenn A. Eisenberg
The Timken Company
Albert E. Ferrara Jr.
AK Steel Corporation
William C. Gale
Cintas Corporation
Bentraum D. Huffman
Ellwood Group, Inc.
Jeff Maddox
Gordon Food Service
James M. Milinski
Senior Vice President of
Finance and Treasurer
MTD Products Inc.
Mark J. Minnaugh
Giant Eagle, Inc.
Vincent K. Petrella
and Treasurer
Lincoln Electric Holdings, Inc.
William A. Roberts
Buckeye Power, Inc.
Frank J. Roddy
Swagelok Company
Advisory Boards
Robert F. Schneider
Kimball International, Inc.
Timothy P. Slottow
Regents of the
University of Michigan
Stephen J. Smith
American Greetings
Nickolas A. Vitale
Beaumont Hospitals
New York
Thomas F. Ackerman
Charles River Laboratories
International, Inc.
Laurence F. Chaplin
Administrative Vice President
Southern Wine & Spirits
of America
Martin S. Dorph
Executive Vice President, Finance
and Information Technology
New York University
James N. Fernandez
Tiffany & Co.
James F. Flynn
King Kullen Grocery Co., Inc.
Kyle F. Gendreau
and Executive Director
Samsonite International SA
Susan E. Gonzalez
Vice President
and General Counsel
InterGen N.V.
Craig C. Harnett
Senior Executive Vice President
National Hockey League
Stephen Hoey
Partner, Administration
KPS Capital Partners, LP
James H. Lapple
Vice President
Finance
The Rockefeller University
Ronald C. Lindsay
Eastman Chemical Company
Russell Makowsky
Senior Managing Director
Tishman Speyer Properties
John A. Papa
Treasurer
Johnson & Johnson
Thomas H. Peck
Daily News, L.P.
Larry Schiffman
Sudler Management Corp.
Michael A. Shaffer
PVH
Michael E. Sibilia
JFK International
Air Terminal, LLC
Matthew M. Walsh
Catalent Pharma Solutions
San Francisco
Howard Anson
Triple Five Group of Companies
Patricia M. Bedient
Weyerhaeuser Company
Michael A. Bless
Century Aluminum Company
Thomas E. Carlile
Boise Cascade, LLC
Steve Condiotti
and Chief Accounting Ofcer
Lucaslm Ltd.
Charles N. Eldred
PNM Resources
Kimball Hall
Vice President of
Corporate Manufacturing
Amgen Inc.
Carol R. Kaufman
Secretary and
The Cooper Companies
Dana M. Kelley
Vice President
American Pacic Corporation
Gary L. Lavey
Vice President Internal Audit
NV Energy
Richard J. Martin
Unied Grocers, Inc.
Susan C. Miller
Avery Dennison Corporation
Cindy Nichol
Director of Financial and
Administrative Services
Port of Portland
Maria M. Pope
Finance, Chief Financial
Ofcer and Treasurer
Portland General Electric
Erik Rasmussen
Corporate General Counsel
MultiCare Health Systems
A.William Stein
and Chief Investment Ofcer
Digital Realty
Allan F. Trinkwald
President
Simpson Investment Company
Roger E. von Ting
Vice President and
Watson Land Company
Anthony L. Youga
E & J Gallo Winery
Advisory Boards
Washington, D.C./
Philadelphia
Humberto P. Alfonso
The Hershey Company
Jonathan D. Fain
Chairman and
Teknor Apex Company
Paul A. Farr
PPL Corporation
Robert E. Fenza
and Chief Operating Ofcer
Liberty Property Trust
John M. Ferrari
and Treasurer
United Therapeutics Corporation
Jim A. Hacker
Manufacturing and Operations
Carpenter Co.
Bruce A. Heugel
B. Braun of America Inc.
John P. Jacunski
Glatfelter
M. David Kornblatt
Triumph Group, Inc.
Robert R. Mandos Jr.
AMETEK, Inc.
Francis J. Norris
Treasury, Risk and Administration
Mannington Mills, Inc.
Daniel T. OConnell
QVC
James Radin
Vice President
Global Supply Chain
McCormick & Company, Inc.
Joseph M. Savage
Victaulic Company
Anthony E. Wagner
and Treasurer
Temple University
Lawrence H. Wilt Jr.
Vice President and
Titan America LLC
James F. Woodward
Media General, Inc.
Board of Directors
Frank T. Connor A
Executive Vice President and
Textron Inc.
Walter J. Galvin E F
Vice Chairman
John A. Luke Jr. C E
Chairman and
MeadWestvaco Corporation
Jonathan D. Mariner A
Finance and
Major League Baseball
Gracia C. Martore C
President and
Gannett Co., Inc.
Christine M. McCarthy F
Corporate Real Estate, Sourcing,
Alliances and Treasurer
The Walt Disney Company
Robert J. OToole A C E
Retired Chairman and
A.O. Smith Corporation
John R. Paloian F
Chief Operating Ofcer
RR Donnelley
David Pulman C
Special Advisor to the
GlaxoSmithKline
Edward J. Rapp A E
Group President
Construction Industries
Caterpillar Inc.
Shivan S. Subramaniam E F
Chairman and
Factory Mutual
Insurance Company
James C. Thyen C
President and
Kimball International, Inc.
Alfred J. Verrecchia C
Chairman of the Board
Hasbro, Inc.
A Audit Committee C Compensation Committee E Executive Committee F Finance Committee
1
P13000 Printed in USA
2013 FM Global
All rights reserved. www.fmglobal.com
In the United Kingdom:
FM Insurance Company Limited
1 Windsor Dials, Windsor, Berkshire, SL4 1RS
Regulated by the Financial Services Authority.
Annual Repor t 2012
certainty
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