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Travelers Ends ExlService Agreement After Confidentiality Breach

Travelers Cos. (TRV), the property insurer in the Dow Jones Industrial Average, ended a contract with ExlService Holdings Inc. (EXLS) after the vendor’s employees violated confidentiality policies.

The staff shared a “procedural document” externally, according to a regulatory filing today from New York-based ExlService, which provides offshore business-process services to financial companies. The employees were fired, according to the filing, which didn’t say how many people were involved.

Travelers represented 9.6 percent of the company’s revenue for the three months ended Sept. 30. Termination of the contract may lower ExlService’s revenue by $14 million to $28 million next year, according to the filing. The vendor also said it’s required to provide “disentanglement services” at its own expense for as many as 18 months.

“While the company is disappointed in Travelers’ decision to terminate, it is committed to work with Travelers to effect a smooth transition while continuing to provide ongoing services in accordance with the agreement,” ExlService said.

Patrick Linehan, a spokesman for New York-based Travelers, declined to comment.

To contact the reporter on this story: Noah Buhayar in New York at nbuhayar@bloomberg.net.

To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net

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