Travelers has become one of the first insurers to respond to the effects of the war in Iraq, by taking a $77m (£48.7m) charge to bolster its reserves.
Despite the charge, which is expected to shore up "certain reserves" at its Gulf Insurance unit, it said it still expects to earn up to $1.8bn (£1.1bn) in 2003.
A Travelers statement said: "This reserve strengthening primarily relates to a line of business that insured residual values of leased vehicles and that was placed in runoff in late 2001."
