Daniel Frey
Executive Vice President and Chief Financial Officer at TRV
Executive
About Daniel Frey
Daniel S. Frey, age 60, is Executive Vice President and Chief Financial Officer of The Travelers Companies, Inc., a role he has held since September 2018 following senior finance roles across Travelers’ businesses since 2006, and prior finance leadership at Spalding, Duracell, and Deloitte . Under his tenure, Travelers delivered strong shareholder returns with TSR of ~29% in 2024 (59th percentile vs compensation peers), 64% over 3 years (64th percentile), and 97% over 5 years (61st percentile), with long-cycle outperformance since 2008 (575% TSR) . 2024 core ROE reached 17.2% (a key performance anchor for incentive decisions), and consolidated net income was $4,999 million .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Travelers | EVP & CFO | Sep 2018–Present | Not disclosed |
| Travelers | SVP & CFO, Personal Insurance | Sep 2014–Sep 2018 | Not disclosed |
| Travelers | SVP Finance, Business Insurance | Aug 2010–Sep 2014 | Not disclosed |
| Travelers | SVP & CFO, Claim Services | Jun 2006–Aug 2010 | Not disclosed |
| Spalding Sports Worldwide | CFO | 1999–2003 | Not disclosed |
| Duracell International | Finance roles | 1994–1999 | Not disclosed |
| Deloitte | Audit/Advisory | Began 1986 | Not disclosed |
External Roles
- Skip: No public company directorships or external committee roles disclosed for Daniel Frey .
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $787,692 | $800,000 | $800,000 |
| Annual Cash Bonus (Non-Equity Incentive Plan) ($) | $2,400,000 | $2,280,000 | $2,700,000 |
| All Other Compensation ($) | $7,792 | $12,606 | $10,169 |
| Change in Pension Value ($) | $76,381 | $242,635 | $205,811 |
| Target Bonus % | Not disclosed | Not disclosed | Not disclosed (cap introduced for 2025: 5× base salary for NEOs) |
Performance Compensation
Long-Term Incentive Grants (PSUs and Options)
| Grant Year | PSU Target (#) | PSU Max (#) | Option Grants (#) | Option Exercise Price ($/sh) | Grant Date Fair Value – Stock ($) | Grant Date Fair Value – Options ($) |
|---|---|---|---|---|---|---|
| 2024 awards (granted Feb 6, 2024) | 7,042 | 14,084 | 17,716 | $213.01 | $1,500,016 | $1,000,030 |
| 2023 awards (granted Feb 7, 2023) | 3,810 | 15,238 | 20,091 | $189.01 | $1,440,067 | $959,828 |
- NEO long-term incentive mix is approximately 60% performance shares and 40% stock options by grant date value; for Frey, the grant sizing guideline was 3× base salary in 2024 and 2025 .
Performance Share Metrics, Targets, and Vesting
| Metric | Weighting | Target | Actual (2024) | Payout | Vesting |
|---|---|---|---|---|---|
| Performance Period ROE (3-year) – PSU schedule | PSU vesting schedule; no explicit % weighting disclosed | 2024 grant schedule: 0% if <8.0%; 100% at 11.0%; up to 200% at ≥16.0% | In-progress (2023 award performance period ends 12/31/2025; 2024 award ends 12/31/2026) | Interpolated 0–200% per schedule; rTSR modifier ±20 percentage points for 2025 grants (overall cap 200%) | Cliff vest at end of 3-year performance period; dividend equivalents reinvested and paid only upon vest |
| Core ROE (annual, used in bonus deliberations) | Principal factor; no formulaic weighting | 2024 plan: Core ROE 14.2%; Adjusted Core ROE 20.7% | Core ROE 17.2% (2024) | Discretionary bonus determination (Frey 2024 bonus $2.7M, +18% YoY average for Frey/Kess) | Bonus paid annually |
- Committee uses broad metrics (core income, core EPS, underwriting/investment quality, capital management) without formulaic weights; dividends are not paid on unvested performance shares; no time-vested restricted stock in NEO annual grants .
Option Vesting and Terms
- Options vest 100% on the third anniversary of grant; strike set at closing market price on grant date; repricing not permitted without shareholder approval .
Equity Ownership & Alignment
Beneficial Ownership (as of March 24, 2025)
| Item | Value |
|---|---|
| Shares Owned Directly & Indirectly (#) | 26,931 |
| Stock Options Exercisable within 60 Days (#) | 81,528 |
| Total Stock-Based Ownership (#) | 108,459 |
| Ownership Guidelines | 300% of base salary for NEOs; all NEOs in compliance |
| Hedging/Pledging | Hedging prohibited; pledging requires consent; no shares pledged |
Outstanding Equity Awards (December 31, 2024)
| Instrument | Grant Date | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration | Unvested PSUs (#) | PSU Market/Payout Value ($) |
|---|---|---|---|---|---|---|---|
| Stock Option | 2/4/2020 | 20,286 | — | 132.58 | 2/4/2030 | — | — |
| Stock Option | 2/2/2021 | 36,037 | — | 139.83 | 2/2/2031 | — | — |
| Stock Option | 2/8/2022 | — | 25,205 | 172.50 | 2/8/2032 | — | — |
| Stock Option | 2/7/2023 | — | 20,091 | 189.01 | 2/7/2033 | — | — |
| Stock Option | 2/6/2024 | — | 17,716 | 213.01 | 2/6/2034 | — | — |
| Performance Shares | 2/7/2023 | — | — | — | — | 15,873 | $3,823,558 |
| Performance Shares | 2/6/2024 | — | — | — | — | 14,344 | $3,455,389 |
2024 Realized Values (Exercises and Vesting)
| Metric | Value |
|---|---|
| Options Exercised (Shares) | 38,000 |
| Value Realized on Exercise ($) | $3,038,925 |
| Performance Shares Vested (Shares) | 15,766 |
| Value Realized on Vesting ($) | $3,797,906 |
Employment Terms
Severance and Change-in-Control Economics (as of 12/31/2024)
| Scenario | Cash Severance ($) | Acceleration of Equity Awards ($) | Continuing Benefits ($) | Notes |
|---|---|---|---|---|
| Involuntary termination without cause / Good reason | $9,074,985 | $3,260,013 | $9,631 (outplacement credits) | NEO severance equals total monthly cash comp for at least 21 months; 24 months for Frey (10+ years service); total monthly comp = 1/12 base + greater of 1/12 avg two most recent bonuses or 1/12 of 125% of base |
| Voluntary termination without good reason (incl. retirement) | $2,794,985 | $3,260,013 | $5,001 | Option and PSU post-termination treatment per award terms |
| Disability | — | $3,260,013 | — | Performance shares continue on schedule subject to goal achievement |
| Death | — | $6,899,486 | — | Immediate vesting of full PSUs (100%) plus dividend equivalents |
| Change in Control (CIC) – Double trigger (termination within 24 months) | — | “Double-trigger” vesting waiver of service conditions; PSUs remain subject to performance; option vest accelerates | — | No excise tax gross-up; CIC threshold requires 50% acquisition or completion of transaction |
Restrictive Covenants, Non-Compete, and Benefits
- Non-solicitation/non-disclosure agreements provide enhanced severance; non-compete can be imposed for six months post-termination with healthcare reimbursement equivalent during period .
- Clawback policies: Dodd-Frank-compliant recoupment for restatements covering incentive comp over prior 3 fiscal years; additional company clawback and forfeiture for misconduct and restrictive covenant breaches .
Retirement and Deferred Compensation
| Plan | Years Credited Service | Present Value of Accumulated Benefit ($) | Qualified Account Balance ($) | Non-Qualified Account Balance ($) |
|---|---|---|---|---|
| Pension Plan (Qualified) | 22 | $233,576 | $251,135 | — |
| Pension Restoration Plan (Non-Qualified) | 22 | $1,175,649 | — | $1,254,319 |
| TPC Benefit Equalization Plan (Non-Qualified) | — | — | — | — (Frey not a participant) |
| Deferred Compensation Plan | — | — | — | No balances reported for Frey |
Investment Implications
- Pay-for-performance alignment: Frey’s variable pay is heavily performance-based, with annual bonuses driven by core ROE and long-term incentives tied to 3-year ROE, enhanced by a relative TSR modifier starting in 2025; no time-vested restricted stock awards for NEOs, which raises alignment to shareholder outcomes .
- Retention risk: Enhanced severance (24 months for Frey) and double-trigger equity vesting on CIC reduce departure friction; strong compliance with stock ownership guidelines and no pledging mitigate misalignment risk .
- Insider selling pressure: 2024 exercises and vesting totaled ~$6.84M realized value, indicating liquidity but option overhang remains with multiple unexercisable tranches; monitor Form 4s and vesting calendars for selling windows .
- Governance signals: Shareholder feedback led to rTSR modifier in PSUs and bonus caps for all NEOs beginning with 2025 performance, supporting disciplined payout governance; say-on-pay historically supported by a substantial majority, albeit lower in 2024, prompting changes .
Peer benchmarking: Compensation comparison group includes P&C peers (AIG, ALL, CB, HIG, PGR) and broader financials (AFL, AXP, BK, HUM, LNC, MMC, MET, PRU); Travelers’ 2024 net income ~70th percentile, revenue ~45th percentile, market cap ~median, informing committee context without formulaic targets .
Additional References for Performance Context
- The committee raised ROE standards by 75 bps for 2025 PSUs and previously raised 2024 standards, reflecting a higher rigor level versus industry returns and cost of equity .
- Risk management integration: Compensation design emphasizes multi-year returns, catastrophe management effectiveness, and capital discipline rather than revenue growth formulas, reducing incentives for short-term risk-taking .