Departing Travelers CEO Jay Fishman and his designated successor, Alan Schnitzer insist that that the change won’t be wrenching, and that the property/casualty insurance giant will experience a smooth transition.
The Travelers Companies announced on Aug. 4 that Fishman would give up his long-time role as chief executive officer due to a neurodegenerative condition that appears to be a form of ALS. Schnitzer, currently CEO of Travelers’ Business and International Insurance segment, will replace Fishman on Dec. 1, and Fishman will become executive chairman at that point.
Both Fishman and Schnitzer emphasized that Travelers has always evolved and will continue to do so, both internally and externally, as it gains a new CEO.
“This is really an institutional strategy that we have and we’ve been executing on. It’s not of the moment. It’s over many years,” Schnitzer said during the Travelers investor call held late on Aug. 4 to address the transition.
“It would have changed anyway, right? It would have changed because the marketplace changes, the world changes and we’ll continue to be at the forefront of that,” Schnitzer continued. “We’ll be bold and creative and thoughtful and continue to take on the challenges of the marketplace in all the ways you would expect a great leadership team to do that.
Fishman added that he has encouraged Schnitzer and the rest of the Travelers team to evolve and adapt.
“Just because something has been the right course of action for the past 10 years doesn’t relieve us of the responsibility to challenge how to be successful over the next 10,” Fishman said. “It should never be a passive strategy but an active one.”
Moving ahead, Fishman noted, there won’t necessarily be large-scale M&A in Travelers’ horizon, even as the market goes through a new wave of consolidation.
“I have always said that we look at anything and everything, and if there’s a rumor around that we’re looking at it, it’s probably a good assumption that we are,” Fishman said.
But M&A deals must add value to the company, and serve as a viable opportunity to do so, Fishman noted.
“We couldn’t care less about being bigger for bigger sake,” Fishman said. “We’d like to be bigger if it changes either our growth trajectory or our return opportunity, or if the return volatility gets lower. But just to do a transaction to do a transaction [creates] way too much risk with our shareholders’ money, and I’ve got to make sense out of it and make everyone understand why it makes sense.”
Fishman, 62, in reference to his Schnitzer, 49, offered the following anecdote about succession and why the change at Travelers will be a good one:
“I have … joked many times that underwriters become damaged with age, that eventually, there is just no risk left you’ll write,” Fishman said. “I recognize that over all these years, I have accumulated a little of that underwriting scar tissue myself. And so one of the great joys of succession is that someone with a little less scar tissue can see the world in a little more opportunistic way.”
Fishman said that Schnitzer will bring that facet to the CEO job, “and it is a perspective that will be very helpful.”