Analyst Day Presentation_MASTER_09 19_Public V2

7/27/2019 Analyst Day Presentation_MASTER_09 19_Public V2

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Towers Watson Analyst Day

Welcome

2013 Towers Watson. All rights reserved.

September 20, 2013


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Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You

can identify these statements and other forward-looking statements in this document by words such as may, will, would, expect,

anticipate, believe, estimate, plan, intend, continue, or similar words, expressions or the negative of such terms or other

comparable terminology. Such statements are based upon the current beliefs and expectations of Towers Watson's management,

and are subject to significant risks and uncertainties. Actual results may differ fromthose set forth in the forward-looking statements.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: a

decline in client demand (for example, resulting from the reduced use of defined benefit plans); the risk of a disclosure breach of

company or client data; the ability to successfully make suitable acquisitions and divestitures; the risk that the acquisition of Extend

Health is not profitable or is not otherwise successfully integrated; the ability to successfully address issues surrounding the numberof company shares that will become freely tradable on January 1, 2014; the risk that potential changes in federal and state health care

regulations, or future interpretation of existing regulations, may have a material adverse impact on our business; the risk that our

Exchange Solutions business fails to maintain good relationships with insurance carriers, becomes dependent upon a limited number

of insurance carriers or fails to develop new insurance carrier relationships; the risk that changes and developments in the health

insurance system in the United States could harm our business; our ability to respond to rapid technological changes; the ability to

recruit and retain qualified employees and to retainclient relationships; and the risk that a significant or prolonged economic downturn

could have a material adverse effect on Towers Watson's business, financial condition and results of operations. Additional risks and

factors are identified under Risk Factors in Towers Watsons most recent Annual Report on Form 10-K filed with the SEC.

You should not rely upon forward-looking statements as predictions of future events because these statements are based on

assumptions that may not come true and are speculative by their nature. Towers Watson does not undertake an obligation to update

any of the forward-looking information included in this document, whether as a result of new information, future events, changed

expectations or otherwise.

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Non-GAAP Measures

In order to assist readers of our financial statements in understanding the core operating results that the Company's managementuses to evaluate the business and for financial planning, we present (1) Adjusted EBITDA, (2) Adjusted Net Income Attributable toControlling Interests, (3) Adjusted Diluted Earnings Per Share and (4) Free Cash Flow (which are all non-U.S. GAAP measures). Weuse Adjusted EBITDA and Adjusted Diluted Earnings Per Share to eliminate the effect of acquisition-related expenses from thefinancial results of our operations. We use Adjusted Net Income Attributable to Controlling Interests (the numerator) for the purpose ofcalculating Adjusted Diluted Earnings Per Share. We use Free Cash Flow to represent cash provided by our operations that may beavailable for investing or for repaying debt. The Company believes that Adjusted EBITDA, Adjusted Diluted Earnings Per Share andFree Cash Flow are relevant and useful information widely used by analysts, investors and other interested parties in our industry toprovide a baseline for evaluating and comparing our operating results.

We incurred significant acquisition-related expenses related to our merger and integration activities necessary to combine WatsonWyatt and Towers Perrin from the Merger in January 2010 through fiscal year 2013. These acquisition-related expenses includedtransaction and integration costs, severance costs, non-cash charges for amortization of intangible assets and merger-related stock-based compensation costs from the issuance of merger-related restricted shares. Acquisition-related gains include a gain resultingfrom the fair value adjustment to our investment in Fifth Quadrant upon the purchase of a controlling interest. Included in ouracquisition-related transaction and integration costs were integrationconsultant fees and legal, accounting, marketing and informationtechnology integration expenses.

Although our merger and integration activities have been completed, we will continue to provide adjusted measures as we incur asignificant amount of amortization from acquired intangibles. We expect that this amortization will continue over the estimated usefullives of the related intangibles.

We consider Adjusted EBITDA, Adjusted Diluted Earnings Per Share and Free Cash Flow to be important financial measures, whichwe use to internally evaluate and assess our core operations, and benchmark our operating results against our competitors. We use

Adjusted EBITDA and Adjusted EPS to evaluate and measure our performance-based compensation plans. Adjusted EBITDA andAdjusted Diluted Earnings Per Share are important in illustrating what our operating results would have been had we not incurredthese acquisition-related expenses.

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Non-GAAP Measures

We define Adjusted EBITDA as net income before non-controlling interests adjusted for provision for income taxes, interest, net,depreciation and amortization, transaction and integration expenses, acquisition related non-cash stock-based compensation, changein accounting method for pension, and other non-operating income. We define Adjusted Diluted Earnings Per Share as dilutedearnings per share from continuing operations adjusted for transaction and integration expenses, non-cash stock-basedcompensation, amortization of merger and acquisition accounting intangible assets, a change in accounting method for pension andother merger related items. We define Free Cash Flow as Cash Flows from Operating Activities less cash flows used for Fixed Assetsand Software for Internal Use, each of which is presented on the GAAP Consolidated Statements of Cash Flows. These non-U.S.GAAP measures are not defined in the same manner by all companies and may not be comparable to other similarly titled measuresof other companies. Non-U.S. GAAP measures should be considered in addition to, and not as a substitute for, the information

contained within our financial statements.

Reconciliations of Net Income before Non-Controlling Interests to Adjusted EBITDA; Diluted Earnings Per Share to Adjusted DilutedEarnings Per Share; and Cash Flow from Operating Activities to Free Cash Flow are available in our supplemental Analyst Day slideson our website in the Investor Relations > Financial Presentations section.

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Agenda

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Time Session Speaker 9:30 a.m. Continental Breakfast

10:00 a.m. Opening Remarks John Haley, Chief Executive Officer

10:15 a.m. Risk and Financial ServicesPatricia Guinn, Managing Director, Risk andFinancial Services

10:30 a.m. Talent and RewardsJulie Gebauer, Managing Director, Talent and

Rewards

10:45 a.m. Benefits Gene Wickes, Managing Director, Benefits

11:00 a.m. Break

11:15 a.m. Exchange SolutionsBen Pajak, SVP, Strategy and BusinessDevelopment, Exchange Solutions

11:30 a.m. OneExchange

Brian Tenner, SVP, Exchange Solutions

David Osterndorf, Chief Health Actuary, NorthAmerica

12:00 noonFinancial Overview andFY14 Guidance

Roger Millay, Chief Financial Officer

12:15 p.m. Q&A Session

12:45 p.m. Lunch with Towers Watson Leaders5


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Opening Remarks


John Haley

September 20, 2013


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FY13 Performance

l Top-line revenue growth: +5% constant currency, +4% organic growth

l All segments ended the year with constant currency revenue growth

l Adjusted diluted EPS $5.57, up 8% vs. FY12

l Adjusted EBITDA 19.1%

l Completed the Towers Watson integration effortsl Free cash flow of $453 million, an increase of 136% over FY12

l Repurchased 838 thousand shares*

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*Shares repurchased under authority to offset dilution and authority to repurchase shares outside of the anti -dilutive authorization


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Drivers ofTowers Watson

Business

Globalization

Human Capital Key toBusiness Success

Economic Uncertainty

Emerging Markets

Legislative Issues

Compliance, Accountingand Tax Regulations

Industry-Specific Issues

De-Risking

Mergers and Acquisitions

Complexity ofBenefit Plans

Market drivers

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Our strategy for continued growth

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Our strategy is focused on profitable growth

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InorganicGrowth

l Expand core

l Adjacent spaces

Organic Growth

l Market penetration

l Emerging markets

l Target marketapproach

Innovation

l Seed new capabilities

l Disciplined approach


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Benefits

l Health care cost and legislativeuncertainties

l OneExchange Active HGB and TAS

Talent and Rewards

l Our work peaks with peak employment inthe economy

l Emerging markets competition for talent

l Technology

Exchange Solutions

l OneExchange Access

l OneExchange Retiree

l Fidelity channel partner

Investment

l Delegated investment solutions

l Diversification of clients: insurers,endowments, foundations and sovereignfunds

Key growth opportunities

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Continued Inorganic and Strategic Solutions

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Towers Watson business

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We offer solutions in the areas of benefits, talent management, rewards, andrisk and capital management

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Benefitsl Retirement (38%)

l Health and Group Benefits (8%)

l Technology and AdministrationSolutions (7%)

l International (2%)

Risk and FinancialServicesl Risk Consulting and Software

(11%)

l Investment (6%)

l Reinsurance and InsuranceBrokerage (5%)

Talent and Rewardsl Rewards, Talent and

Communication (6%)l Data, Surveys and Technology

(6%)

l Executive Compensation (4%)

Exchange Solutionsl OneExchange Retiree (3%)

l OneExchange Accessl New offering for FY14

(seasonal, part-time,contract)

FY13 split based on total company revenues


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Benefits Business drivers

l Economic environment and changing risk appetite of pension providersleading to opportunities such as lump sum distribution and otherpension de-risking projects for the Retirement group

l The complexity of changing regulations, such as the PPACA, iscreating work for Health and Group Benefits

l Large plan benefits outsourcing driving Technology andAdministration Solutions revenue growth in EMEA and the U.S.

l International Consulting Group helping multinational organizationsprovide global strategy, oversight and management of benefitprograms

l OneExchangeActive: Expect enrollments to increase pace in 2015and 2016, and beyond

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Expect low single digit growth for FY14

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Benefits RFS

T&RExchangeSolutions


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Risk and Financial Services Business drivers

l In Risk Consulting and Software, insurance companies interest inanalytics, performance improvement and our leading risk and financialsoftware creates opportunities for us.

l Investment opportunities are created through volatile economiesaround the globe as clients seek to improve their fund governance,

control their risks and increase their returns.

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Expect low to mid single digit decline for FY14

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Benefits RFS



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Talent and Rewards Business drivers

l Solid project revenue

l Intense market focus, need for benefits and HR program implementationsupport

l Ongoing need for executive pay advisory services, compensation andworkforce benchmarking data

l Increasing focus on HR technology

l Differentiation through integration of technology and consultingsolutions

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Expect mid single digit growth for FY14

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Benefits RFS



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Exchange Solutions Business drivers

l OneExchange Retiree post- and pre-65 retirees

l OneExchange Access seasonal, contractors, part-time

l Contract with Centers for Medicare & Medicaid Services (CMS)

l Partnership opportunities

l The PPACA provides future opportunities to enter new markets

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Expect around 60% growth for FY14

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Benefits RFS



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Strategic outlook

l Increasing revenue at stable margins in our core business

l Continue to leverage existing business portfolio

l Expanded global target market focus

l Organic and inorganic capability enhancement

l

Continue record of mid-single-digit revenue growth and double-digitEPS growth

l Continued strong revenue stability

l Stable base of recurring revenues

l Strong client retention

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towerswatson.com



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Risk and Financial Services

Tricia Guinn

September 20, 2013



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Risk and Financial Services Business overview

Profile

l Investment Consulting and Solutions

l Investment policy, governance and risk assessment

l Investment strategy

l Structured products design

l Manager structure, selection, monitoring and evaluation

l Delegated/implemented consulting

l Risk Consulting and Software

l Financial and regulatory reportingl Enterprise risk and capital management

l M&A and corporate restructuring

l Product and market strategies, including pricing

l Financial modeling software and implementation support

l Reinsurance and Insurance Brokerage

l Discontinued operations as of Q1 FY14

Revenue by Line of Business*

Revenue by Geography*

Reinsurance andInsurance Brokerage

Risk Consulting andSoftware

Investment Consultingand Solutions

More than 50% of revenues are recurring

FY14 Guidance (does not include impact of Brokeragesale)

l Low-to mid-single-digit constant FX revenue decline

NOI margin in the low- 20% range *FY13 split based on total RFS Segment revenue.FY13 constant currency revenue growth of 1%FY13 NOI margin of 22%


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We have signed an agreement for JLT to acquire TowersWatsons global brokerage business

l The combination of Towers Watsons (re)insurance brokerage businesswith JLT Re creates a $260+ million global business which is theclear #4 player in this space

l JLT is committed to investing in this business to further grow in thisarea

l Towers Watson and JLT will have an ongoing relationship to offer acompelling market proposition which will help drive revenue for bothorganizations


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Towers Watson is a global leader in investment adviceand implementation

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l Trusted advisor to institutional investors

l Focus on liability-driven investing since 1990

l European Pensions Fiduciary ManagementFirm of the Year 2012

Our Firm

l $2 trillion+ in global client assets underadvisement

l ~$60 billion in delegated (outsourced) global

assets

l Diverse asset pools: pensions, insurance,sovereign funds, foundations and endowments

l Over $100 bil lion in liability-driven investmentstrategies implemented

Our Client Base

l More than 750 associates across strategy,consulting and research disciplines

Our People

140+STRATEGYCONSULTANTS150+RESEARCHSPECIALISTS

750+TOTAL INVESTMENT ASSOCIATES, INCLUDING:

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The Investment business has a strong history of revenue growth

$120

$158$174

$194 $195

$208

$225

$0

$50

$100

$150

$200

$250

FY07 FY08 FY09 FY10 FY11 FY12 FY13

Revenue ($ in Millions)

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Margins have generally been around the company average



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Increased Delegation

Our business has moved from purely advisory to greaterdelegation/implementation

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l Current state and desired future state

l Goals, risk tolerance/return objectives

l Governance and roles/responsibilities

l Stakeholder approach to change

l Investment beliefs

l Balance sheet/enterprise risk position

l Liquidity and timing requirements

l Tax/accounting/regulatory implications

FlexiblePartnership

Analytics Advisory Implementation

OurCapabilities

ClientNeeds

Research ClientsFirst

Insight

Investment Servicesglobal depth and scale



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We have a diverse delegated business

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Towers Watson delegated assets under management as of July 2013 US$

Towers Watson delegated client count by region and type July 2013


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InvestmentServices

Investment Insight Clients First

The funds business is the next step in our journey alongthe responsibility spectrum

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Principles

Tools Advice DelegationDelivery

Implementation

Pooled Funds Custom Portfolio


New!


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Transformation work is another area of opportunity

Missionand

Beliefs

ValueChain

Culture

RiskPolicy

InvestmentManagementGlobal Best

Practices

OrganizationalDesign

InvestmentManagement

Cycle

Bringing best practices to internal investment management



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FY13 was a challenging year for the Risk Consultingand Software business

l Continuation of EMEA financial crisis caused clients to decreasediscretionary consulting spend

l Shelving of Solvency II requirements led to the deferral or cancellationof consulting projects, and meant we were overstaffed in EMEA

l Lower level of demand led to intense competition for consulting

business and severe pricing pressures

l Lower level of M&A activity than prior year

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While FY14 outlook is strong for Software, it remainsmixed for our consulting businesses

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Americas Consulting

l Expect stable client demand

l P&C/Corporate practices have a strongbase of recurring revenue and a goodpipeline

l Life practice remains dependent on M&Aand will continue to be volatile

Asia Pacific Consulting

l Expect modest growth, but revenue inregion will continue to be volatile

l Key growth areas are China, SoutheastAsia and insurance managementconsulting and UBI

EMEA Consulting

l Economic outlook remains uncertain

l Anticipate continued depressed client

demand

Software

l Expect continued growth driven byexpansion of sales force and new

products


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Life Financial Modeling

Our market-leading software solutions

MoSes

MoSes Azure (NEW)

MoSes HPC

RiskAgility MoSes

RiskAgility

Enterprise Modeling Platform

RiskAgility EC

Economic Capital

P&C Pricing

Classifier

Emblem

Optimiser

Radar (NEW)

Rate Assessor

ResQ

P&C Reserving

Replica

Replicating Portfolio

P&C Capital Modeling

Igloo

Igloo Compact Edition

Igloo DCC

Igloo Enterprise

Technology Consulting Services

Global Alliance Partner

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We are taking action to align our business with marketdemand and improve profitability

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Revenue Enhancement Expense Reduction

l Move to more sales-oriented culture

l Recruit rainmakers to drive sales

l Broaden out and raise value add

of our servicesl Emphasize growth of annuity

revenue

l Align staffing with market demand

l Drive delivery efficiency andimproved utilization

l

Prioritize product developmentefforts

l Scale back certain investments


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We continue to believe in the longer-term outlook forRisk Consulting and Software

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Strong franchise

Right vision for the business

Taking appropriate action

Need time to see results

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Talent and Rewards

Julie Gebauer

September 20, 2013



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Talent and Rewards business overview

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13%

26%

61%

Asia Pacific

EMEA

Americas

23%

36%

41%

*FY13 split based on total T&R Segment revenueFY13 constant currency revenue growth of 2%FY13 NOI margin of 20%

Profile

l Rewards, Talent and Communication

l Base pay and incentive design

l Leadership services and talent management

l Change management and communication strategy

l Data, Surveys and Technology

l Employee opinion surveys

l Compensation benchmarking

l HR technology implementation

l Proprietary technology solutions to support HR processes

l Executive Compensation

l Executive pay philosophy and strategy development

l Public disclosure development and technical reviews

l Top executive compensation consultancy with over 300consultants in 35 offices in 16 countries providing advice toover 3,000 clients

l

Compensation data covering 110 countries, over 40industry sectors, 50 functions/job families and 9,900 jobs

l Decades of experience surveying over 40 million employeesfrom more than 3,000 companies in more than 106 countries

ExecutiveCompensation

Rewards, Talent andCommunication

Data, Surveys andTechnology

2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

FY14 Guidance

Mid- single digit constant FX revenue growth NOI Margin in the low- to mid-20% range

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Greater opportunity for integratedprojects relative to point solutions in

strong economy

Talent and Rewards market proposition

l Consulting in areas of strategic importance

l Competing on differentiated value through:

l Depth of expertise

l Industry focus

l Data and analytics

l Delivering point solutions and appropriately linking complementarypractices

l Within T&R: to provide complete solutions, from strategy to implementation

l Across segments: to support the employee experience associated withdesign and administration of benefits and Exchange Solutions

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FY14 mix of work expected tocreate stronger backlog and

pipeline during year

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Focus for FY2014

Key ingredients for profitable growth

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Low-cost operationsStandardized processes

Offshored resource center

Close management of

controllable costs

High-performance standardsSales and delivery expectations

Few pure management roles

Annuity/product revenueBenchmarking data

Employee attitude surveys

SaaS

New productized offerings

Market-responsive staffing modelHiring just behind demand

Staffing across boundaries

Balance of FTEs/contractors

Stablemargins

Foundationfor growth

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Current market conditions

HR Consulting Budgets

l Stable to modest increases in mature markets for target clients,partially due to minimal regulatory change

l Meaningful increases in selected emerging markets

HR Technology Budgets

l Meaningful increases across markets

l But relatively small portion of our T&R portfolio

Implementation Support

l

Strong demand related to pension changes, PPACA, ExchangeSolutions (retiree and active exchanges)

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Regional variations

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l Ongoingdemand

for HRtechnology

l Ongoing need forbasic HR consulting

l Low to moderatedemand for HRconsulting l Moderate demand for

basic HR consultingl New pull for HR

technology

l Continuing needfor implementationsupport

l Selectedopportunity fortechnology sales

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Benefits Segment

Gene Wickes

September 20, 2013



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Benefits business overview

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3%

30%

67%

Asia Pacific

EMEA

Americas

4%

13%

15%

68%

*FY13 split based on total Benefits Segment revenue.FY13 constant currency revenue growth of 5%FY13 NOI margin of 34%


Profile

l Retirement

l Strategy and plan design

l De-Risking

l Actuarial services, compliance and governance strategies

l Defined contribution solutions

l Health and Group Benefits

l Program strategy, design and pricing

l OneExchange Active

l Wellness, Rx Collaborativel Vendor evaluation, selection and management

l Technology and Administration Solutions

l Pension and retirement plan administration

l Health and welfare administration

l OneExchange Active

l International

l Cost and risk control solutions for employee benefit plans

globally

l Provides actuarial services to more of the worlds top300 pension funds than any other professional servicesfirm

International

Retirement

Health and Group Benefits

Technology andAdministration Solutions


FY14 Guidance

Low- single- digit constant FX revenue growth NOI Margin in the low-to mid - 30% range 38

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Retirement outlook: Overview of pension de-riskingmarket

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Liability-DrivenAsset Strategies

Plan TerminationTraditionalOngoing Plans

Close Plan toNew Entrants

Freeze BenefitAccruals

ProspectiveLump Sum Option

Bulk LumpSums (Former

Employees)

Bulk LumpSums (Retirees)

AnnuityPurchases

IncreasedFunding

Account-BasedPlans

Spectrum of Pension De-Risking Actions

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Retirement outlook: Leading indicators U.S. August2013

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Indicator July 31, 2013De-Risking

Assessment

Interest Rates l High-quality corporate bond indices generally unchanged during July and +70-80 bps YTD

l Long-term Treasuries +8-12 bps during July and +70-80 bps YTD

Funded Status

l Strong equity market performance during July and YTD (S&P 500 +19.62%, Russell 2500+22.96%, EAFE +9.60%)

l

YTD funded status improvement for many sponsors in the +10-15% range (although manysponsors still underfunded on a plan termination basis)

Market Movers

l Significant uptick in de-risking activity

l Sponsors proceeding with lump sum programs during 2013 contemplating delay until early2014 given interest rate movements

l Limited activity (but significant potential) in mega ($1B+) annuity market

Accounting/RegulatoryChange

l Verizon class-action lawsuit dismissed by Texas court

l Subsequent retiree lump sum PLRs under review by IRS we are aware of a PLR underreview since mid-2012 with no response

l IRS-sponsored research being conducted regarding de-risking activities

Innovation

l Continued annuity marketplace evolution

l Settlement readiness initiative gaining traction

l Plan termination initiative under way to better coordinate delivery approach

Change from/toFavorable Emerging Unfavorable

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Benefits outlook: EMEA

l Regulatory changes in the UK and Netherlands

l Auto enrollment

l New Pension Accord

l Launch of Premium Pension Institute

l Design and execution of new market standard for DC plans

l Launch of health care practice

l Increasing demand and costs of retirement and health care provisions

l Economic crisis and demographic changes increasing pressure to reducestate pension and health care provision

l Grow Benefits Brokerage business

l Launch Data Solution services

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HGB North America outlook

l Towers Watson is helping clients continue with self-managed programsor access high performance plans via OneExchange Active

l Investments in OneExchange: Impact on Utilization

l Working with carriers to develop high performance plans

l HGB associates involved with Access and Retirees sales

l Client education and analysis regarding active market

l Long term revenue prospects:

l We have good prospects either path a client selects; self-managedprograms or OneExchange.

l OneExchange shifting of revenue source, greater market share is

expected

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Client demand is being driven by the imperative to have high-performing healthand welfare programs to enable affordable coverage for employees,

to maintain a healthy workforce and to avoid the 2018 excise tax.

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TAS outlook

North America

l Active market anticipated for benefits administration/outsourcing

l Health and Welfare market activity expected to be very robust in 2014 and forthe next few years

l DB market activity is expected to be strong

l Strong selling season in 2013 impacting 2014 revenues due to deferralaccounting

EMEA

l UK and Germany continue to be active markets for pension administrationoutsourcing

l Slower pace than last year but some big long-term opportunities

l Very well placed competitively with biggest market share of top 100/200 privatesector funds in UK and market leader in Germany

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TAS well-positioned for growth

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OneExchange

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FY14 enrollment

period ends

FY15 enrollment

period begins

FY14Q1

FY14Q2

FY14Q3

FY14Q4

FY15Q1

FY15Q2

FY15Q3

FY15Q4

$'s

Revenue Expense

FY14 all investment/revenue inguidance

FY15 and beyond expect profitat company average

TAS/HGB

Retiree

PopulationsCOBRA

Part-TimeEmployees

Active

Employees

OneExchangeActive

OneExchangeAccess

OneExchangeRetiree

Seasonal


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Global Health and Group Benefits Solutions (GHGB)

l Client demand for GHGB consulting and brokerage is increasing as clients expand theirglobal footprint and health care cost increases continue to reach high single digits

l Building on the success of our HGB businesses in North America and the U.K., we arecontinuing to expand our health and group benefits business to meet our clients emerging

needs

l The overall market size outside of North America and the U.K. for these types of services isapproximately $700M, and represents a dynamic market opportunity for Towers Watson.

0%

2%

4%

6%

8%

10%

12%

Global Asia Pacific Europe Latin America Middle East North America

2011

2012

Health Care Cost Increases by Region

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Global Health and Group Benefits Solutions (GHGB)

l Looking ahead to FY14, our plan is to:l Set up HGB businesses and obtain brokerage licenses in seven additional

countries

l Work with several major insurance companies to create prepackaged solutionsfor our clients in key countries where they dont have critical mass to justifycustom approaches

l

Engage a limited number of pilot clients on a global basis as we build out ourcapabilities

l The FY14 revenues and investments are included in the FY14 guidance.l System development approximately $500,000

l Net investment on P&L approximately $2-3 million.

l This is a multiyear project for Towers Watson estimates suggestprofitability in line with Segment margins within three years. Profitable asof second year.

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Exchange Solutions


Ben Pajak

September 20, 2013


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Exchange Solutions Business Overview

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0%

0%

100%

Asia Pacific

EMEA

Americas

Revenue by Geography

Profile

l Private Exchange infrastructure (Extend Healthacquired in 2012)

l Largest private Medicare insurance exchange

l 10% of Fortune 500

l 400,000+ Medicare plan participants

l Patented technology platforml Growing Individual market, pre Medicare, population

l Partnerships with third party advisors andadministrators, i.e., Fidelity

l Most Exchange Solutions revenues come from thecommissions we receive from insurance carriers

l Over the long term, NOI margin is expected to be atleast in the mid-20% range


FY14 Guidance

Revenue growth around 60% Low 20% NOI Margin

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FY13 proforma* revenue growth of 58%FY13 proforma** NOI margin of 26%

*as if Towers Watson owned Extend Health for entire FY12 andexcluding purchase accounting revenue adjustments in FY12 and FY13**excluding purchase accounting revenue adjustments in FY13


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Significant growth opportunity for Exchange Solutions

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Medicare-Eligible Retirees With Employer-Sponsored Coverage

TowersWatson

Others


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Exchange Solutions: Business drivers

l Continued interest and focus on Medicare exchange business(rebranded as OneExchange Retiree)

l Pre-Medicare individual market offering (OneExchange Access)launched on a pilot basis for this open enrollment period (OEP 14)

l Entered into contract with Centers for Medicare & Medicaid Services(CMS) to participate in the Federally Facilitated Marketplace (FFM)

l Fidelity relationship signed in February; showing results

l Retail partnership pilot (50 stores in CA, FL, TX) rolling out October 1

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Exchange Solutions: Medicare eligible retiree market

l Coming off a very strong OEP 2013 enrollment year

l Notable client wins last year

l Dupont, The Goodyear Tire & Rubber Company, Ingersoll-RandCompany, Bridgestone/Firestone

l Signed largest retiree client in company history (IBM)

l Partnering closely with other LOBs and segments to launch theOneExchange offering and drive growth

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Video in progress


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OneExchange delivers value to your entire population

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Retiree

Populations

Part-TimeEmployees

COBRA

Active

Employees

OneExchangeActive

OneExchangeAccess

OneExchangeRetiree

Seasonal

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Connecting individuals to new Marketplaces

All state and federal exchanges

All Carriers

Right AnswerRight Coverage

Best Price

Employer-ProvidedAccess

OneExchange Benefit Advisors

State State FFE

State State FFE

l Subsidy Optimization

l Transition Services

l Public Exchanges

l Personalization

l Carrier and ExchangeConnectivity

l Advocacy

OneExchange Access Part-time employees, seasonal workers, COBRA eligibles

OneExchange Retiree Early Retirees (Pre-65, not Medicare eligible)

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Web broker agreement with federal government

l Signed agreement with the Centers for Medicare & Medicaid Services

l Exchange platform will integrate with federal eligibility systems

l Allows ability to assist individuals and sell plans on the federal exchange

l Single destination in all 36 states served by the federal exchange

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OneExchange Access: Marketplace map 2015 OEP

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WA

OR

CA

NV

ID

UT

AZ

MT

TX

NM

AK

HI

CO

WY

NE

OK

KS

ND*

SD

MI*

WI

MN

IA

MO

AR

LA

INIL

OH

KY

TN

MS AL

FL

GA

SC

NC

VAWV

MD

DE

PA

ME

NH

VT

RI

NY

CT

NJ

MA

DC

n Full Integration Enrollment (36)n Web Portal Integration Enrollment (14)n Guidance Referral Only (1)

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Retail partnership pilot overview

l Three-state, 50-store programl Co-branded, in-store health

education center (kiosk) staffedby Towers Watson

l Eligibility/appointment tool will

reside within each kiosk

l Pre- and post-65 insuranceoptions in pilot states

l Post-65 insurance options only innon-pilot states

l Several marketing programs

planned to drive online traffic

towerswatson.com

57 2013 Towers Watson. All rights reserved.

NV

CO

ND

KS

OK

MD

VT

MA

CT

CA

OR

WA

UT

ID

AZ NM

WY

MT

SD

MN

IA

NB

MO

TX

AR

MS

AL

TN

KY

GA

NC

SC

FL

WV

PA

NY

NH

ME

ILIN

OH

WI

MI

LA

ND

NV

CO

KS

OK

VA

MD

Pilot states; Pre and post-65 insurance options

National program; Post-65 insurance options only


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OneExchange


Dave OsterndorfBrian Tenner

September 20, 2013


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Health care benefits evolution

l The objective of the acquisition was to enhance the capabilities of both organizations

l is one result of that collaboration and brings together:

l The leading retiree exchange

l

Leading group health and welfare outsourcing technology and administration process*l Market-leading health care consulting

l Benefit change management expertise

l Total compensation expertise

l The acquisition also deepened and enhanced both Towers Watson and Extend Healths:

l Carrier and client relationships

l Technology platforms and administrative processes

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*Sources: International Association of Outsourcing Professionals, 2013 Global Outsourcing List; Everest Group, 2013 Benefits AdministrationOutsourcing Report

The acquisition of Extend Health brought together the expertise ofTowers Watsons core benefits business with the market leading Medicare exchange.

OneExchange is developed, managed and maintainedentirely by Towers Watson.

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OneExchange delivers value to any or all of an employerspopulations

RetireePopulationsCOBRA

Part-TimeEmployees

ActiveEmployees

OneExchangeActive

OneExchangeAccess

OneExchangeRetiree

Delivers transitionassistance for

full-time employeepopulations moving to

our high-performingexchange-based plans

Delivers transition assistancefor part-time and other (e.g.,

seasonal) employees toindividual market plans on

public and private exchanges

Delivers transition assistance forpost- and pre-65 retirees

moving from employer-sponsoredhealth care coverage to individual

Medicare market plans, or publicand private exchanges

Seasonal

Createspositive behavior change, andimproved physical and financialwell-being

Accessesnew/increased federal funding

Connectsto lower-cost risk pool andmore federal money

towerswatson.com


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How will participants and companies find value in exchanges?

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Towers Watson has the know-how and capability to connectemployees and retirees to value in exchanges

Value opportunities foremployers and participants

OneExchange

Access Active Retiree

Use other peoples money

Make people healthier

Create better consumers

Reduce company workload

Make it personal/higher

employee satisfaction

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Market Opportunity for Exchange Offerings

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OneExchange Access and Retiree facilitate the transition fromgroup to individual

Platinum

OneExchange Access orRetiree

l Contracts with/providespreferred plans

l Supports communications andenrollment

l Administers employer subsidies(where applicable)

Participantsl Evaluate preferred options

l Elect coverage

l Work with OneExchange toresolve issues

Gold

Silver

Employer

CensusLimited

interaction

Plans*

Bronze

Catastrophic

Ancillary

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Funding(optional)

*Public Marketplace plans shown other options use private market offerings (e.g., Medicare ret iree Medigap/MA/Part D plans)

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EligibilityDetermination forFederal Subsidy

Application Dispatched to Carrier

Public Marketplace QHPsWith Federal Subsidy

OneExchange Access enrollment process

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Application Dispatchedto Public Marketplace

Public MarketplaceQHPs Without

Federal Subsidy

PrivateExchange

QHPs

Eligible Ineligible

Early Retiree/Non-FT Employee

+

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Towers Watson role and compensation Access/Retiree

Towers Watson is responsible for:

Companies save time and money by providing participants with thisalternative enrollment process and access to greater market choice.

Connection tohealth plans

Participanteducation/enrollmentsupport

Ongoingparticipantadvocacy

Commissions from carriers Client fees

Towers Watson is compensated through:

OneExchange is developed,

managed and maintained byTowers Watson.

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Objectives in building an exchange for actives

The exchange should incorporatebest practices*

l Ongoing medical trend at halfor less than median of all companies

l Contracting strategies rewardhigher-performing network providers

l Better purchasingthrough cost-consciousness

l Proactive management of high-cost casesthrough robust support and engagement

l Increased employee accountabilityties financial outcomes to actions

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*2013 TW/NBGH Employer Survey on Purchasing Value in Health Care; Results of Best Performers

Getting to high performance can be a buy rather than build strategy

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OneExchange Active: Our private exchange model

Multiple national carriers

Four plan design choices

Primarily self-funded plans in 2014 with employerchoice in funding in future years

High-value design elementsWellness, care/Rx management, transparency and more

Ancillary productsDental and vision

Consumer-

GuidedEnrollmentExperience

Enrollment and

OngoingAdministrationPlatform

The goal: Deliver a high-value, sustainable framework

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Savings opportunities: OneExchange Active

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Best-in-market discount/contracting arrangements

High-performance Rxstructure and contracting

Sophisticated caremanagement programs

Year 1savings projections are

substantial, without cost-shifting

Medical and pharmacycontracting terms

Health promotion/improvement linked tofinancial incentives

Improved consumerchoices

Connects physical andfinancial well-being

Ongoingtrend approximately half ofprevailing national levels

$

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Directed fees inself-insured healthplans

Commissions infully insured healthplans and otherancillary/welfarebenefit plans

Success-sharingarrangements

Towers Watson role and compensation Active

Towers Watson is responsible for:

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Carriers on theplatform

Plan designs,clinicalmanagement,Rx programs,operationalelements

Fundingapproaches,networkconfigurations,cost managementstrategies

Towers Watson is compensated through:

The magnitude of total benefit savings is expected to be substantial, andTowers Watson compensation is easily ROI-justified for clients.

OneExchange is developed,managed and maintainedby Towers Watson

OneExchange is developed,managed and maintained byTowers Watson.

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Financial Overview and FY14 Guidance


Roger Millay

September 20, 2013


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$5.57

FY13FY11

$4.46

+25%

Strong Historical Performance

71

l Continued strong growth acrosskey initiatives

l Strong acquisition performance

Revenue

About $7B

$3.3B

Sep 13Jul 10

Over 100%

$688M

$616M

FY13FY11

18.9%

19.1%

+12%

Adj. EBITDARevenues

Adj. EPS Market Capitalization

$3.60B

FY13FY11

$3.26B

Earnings Leverage

l Disciplined operating marginmanagement

l Industry-leading margins

l Significant EPS leverage

Cash & ShareholderReturn

l Generated ~$1.1B in free cashflow and returned ~$280 million toshareholders through repurchasesand dividends since July 2010

+10%



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Efficient Capital Structure

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(US$ millions) 6/30/2013

Cash and Short-Term Investments $ 589

Total Debt $ 250

Accrued Retirement Benefits/Other Employee-Related Liabilities

$ 771

Total Towers Watson Equity $ 2,724

Balance Sheet

l $461 million cash available for use as of 6/13

l Predominantly outside of U.S.

l At lower end of targeted debt to EBITDARratio of 2 to 3 times (rating agency basis)

l As of 6/30/13, no balance on $500million revolver

l $250 million outstanding term loan,matures 6/1/17

l Decrease in Retirement liability due toincreased discount rate and payments/contributions

l ~71 million diluted shares

l Share unlock overhang has beenmanageable, with no significant pressure onthe stock, 5.4 million shares remain

Solid Balance Sheet



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Efficient Capital Structure

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Cash Flow from Operations Free Cash Flow

$316M

$531M

+68%

FY13

Improvement driven by receivables recovery, integration wind-down and businessperformance

Pension contributions a $90 million Headwind in FY13 but will be approximately a$50 million Tailwind in FY14

Going forward, we expect free cash flow to be in the neighborhood of adjusted netincome

$192M

$453M

+136%

FY12 FY13

FY12

Strong Free Cash Flow Growth



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Capital Allocation Priorities

towerswatson.com


Reinvest in

Business

RepurchaseShares

Dividends

Acquisitions

Targeting dividendpayout ratio of 10%

OneExchange platform

Global Benefits Brokerage

Seed new capabilities

OneExchange platform

Global Benefits Brokerage

Seed new capabilities

We expect to continueto make targetedacquisitions to enhanceour competitive position

Approximately $120 million

remains available onClass A stock repurchaseauthorization

Expect more consistentrepurchasing

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Reinsurance and Insurance Brokerage Sale

l FY14 guidance provided in this presentation does not include theimpact of the sale. The following information provides some additionalcontext to the guidance in relation to the sale:

l Expected close date FY14 Q2 various regulatory approvals required.

l This will be treated as a discontinued operation for Q1.

l FY13 revenues $166 million, 53% weighting in second half of fiscal year.l Gain/Loss transaction may result in either.

l Likely dilutive to EPS and margins from continuing operations specificsnot yet determined.

l Allocation of cash proceeds will assess the cash needs of thecompany but overall we anticipate becoming more active in share

repurchases.

l Will provide an update on the next earnings call.

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TW Guidance - UpdateFirst Quarter Fiscal 2014

Revenues expected to be around the low end of the range of $850 to$870 million

Adjusted diluted EPS* expected to be within the range of $1.36 to $1.41

EBITDA margin in the range of 18.0% - 18.5%

Income tax rate* around 24%

Diluted shares outstanding of approximately 71 million

*Includes $15 million of resolved tax examinations

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Guidance does not include impact of Brokerage Sale


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Segment Guidance - UpdateFirst Quarter Fiscal 2014

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Q1 FY13Constant Currency

Growth RateReported Currency

Growth RateNOI Range

Benefits $457 about flat about flat around 30%

Risk and FinancialServices $192 mid single digitdecline mid single digitdecline mid teens

Talent and Rewards $140mid- to high- single

digitmid- to high- single

digitlow- to mid- 20%

Exchange Solutions $ 14 around 145% around 145% high single digit




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FY14 Guidance Full Year

Revenues around $3.7 billion

Adjusted diluted EPS* expected to be within the range of $5.90 to$6.00

EBITDA margin in the range of 19.0% - 19.5%

Income tax rate* around 32%

Capital expenditures within the range of $95 million to $100 million

Diluted shares outstanding of approximately 71 million

Guidance assumes a monthly average exchange rate of 1.00 =US$1.55 and 1.00 = US$1.32

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*Includes $15 million of resolved tax examinations




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Segment Guidance Full Year FY14

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FY13Constant Currency

Growth RateReported Currency

Growth RateNOI Range

Benefits $1,994 low single digit low single digit low- to mid- 30%

Risk and FinancialServices

$ 812low- to- mid single

digit declinelow- to- mid single

digit declinelow 20%

Talent and Rewards $ 573 mid single digit mid single digit low- to mid- 20%

Exchange Solutions $ 95 around 60% around 60% low 20%




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Strong Financial Profile

Significant recurring revenues

Consistent margins

Diversified client base

Largest client relationship


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Appendix

September 20, 2013



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Fiscal 2013 Impact of Reserve Methodology Change

towerswatson.com 2013 Towers Watson. All rights reserved.

NOI Margin Q1 FY13 Q2 FY13 Q3 FY13 Q4 FY13

Reported Impact Reported Impact Reported Impact Reported Impact

Benefits 30% 1% 36% 0% 35% 0% 34% 0%

Risk and Financial Services 19% 0% 22% 0% 29% 0% 15% 1%

Talent and Rewards 18% 1% 34% 0% 11% 1% 11% -1%

Exchange Solutions -41% 0% -64% 0% 48% 0% 51% 0%

NOI Margin Full Year FY13

Reported Impact

Benefits 34% 0%

Risk and Financial Services 22% 0%

Talent and Rewards 20% 0%

Exchange Solutions 17% 0%

Beginning in FY14 Towers Watson has aligned the segment reserving methodology with the GAAP reservingmethodology. This table provides the impact to FY13 NOI margins as if in FY13 Towers Watson had followed the newreserving methodology.

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Todays Speakers

Julie Gebauer Julie Gebauer is Managing Director, Talent and Rewards. During her 26 years with the company, she has held a

number of leadership roles, including U.S. East Division leader, and head of the global workforce effectiveness andemployee survey businesses. She is a Fellow of the Society of Actuaries.

Patricia Guinn Patricia Guinn is Managing Director, Risk and Financial Services. She joined Towers Perrin in 1976. Patricia is aFellow of the Society of Actuaries, a member of the American Academy of Actuaries and a Chartered Enterprise Risk

Analyst. She currently serves as a board member of the International Insurance Society.

John Haley John Haley is Chairman and Chief Executive Officer. John joined Watson Wyatt in 1977 and became the consultingactuary to several of Watson Wyatts largest clients. He negotiated the strategic alliance with Watsons in the U.K. and,in 1995, he was appointed the leader of the global retirement practice. He was named Watson Wyatts chief executiveofficer in 1998. Under his leadership, the company went public in 2000, and completed two historic mergers, in 2005and 2010, that formed present-day Towers Watson. John also serves on the board of directors of MAXIMUS and

Hudson Global, Inc. He is a Fellow of both the Society of Actuaries and the Conference of Consulting Actuaries, andhas servedas a trustee of The Actuarial Foundation.

Roger Millay Roger Millay is Vice President and Chief Financial Officer. Roger has more than 25 years of experience in financialofficerpositions, including roles at Airgas, Arthur Young & Company, Citigroup, Discovery and GE Capital.

Dave

Osterndorf

Dave Osterndorf is Chief Health Actuary, North America. Dave joined Towers Perrin in 1989 and leads our healthactuarial practice in both policy/practices and product development activities. He is a Fellow of the Society of Actuariesand a member of the American Academy of Actuaries.

Ben Pajak Ben Pajak is Senior Vice President, Strategy and Business Development, Exchange Solutions, and is a leader ofthe OneExchange health benefit solution. Prior to the acquisition of Extend Health, Ben served as a business leader for

Towers Watsons Health and Group Benefits practice. Ben joined Towers Perrin in 2003 and became a Principal in2007.

Brian Tenner Brian Tenner is Senior Vice President, Exchange Solutions. Since 2004 Brian has led sales and businessdevelopment for major market segments. Brian has held executive level leadership positions at Ceres Group andHewitt Associates.

Gene Wickes Gene Wickes is Managing Director, Benefits. Gene has 34 years of experience consulting on retirement, actuarial,plan administration and other human resource issues. He is a Fellow of the Society of Actuaries and an enrolledactuary under ERISA.

towerswatson.com

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Towers Watson Leaders

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Jim Foreman Jim Foreman is Managing Director, Americas. He also is a member of the companys executive committee. Heworked for more than 20 years at Towers Perrin in a number of leadership posi tions, which inc luded globa lresponsibilities.

Carl Hess Carl Hess is Managing Director, Investment. He joined the Watson Wyatt in 1989. He has worked with many of theworlds largest institutional investors over his 30 years of experience. Carls areas of expertise include asset allocation,risk budgeting, pension finance and governance. Carl is a Fellow of both the Society of Actuaries and the Conferenceof Consulting Actuaries, and is a Chartered Enterprise Risk Analyst.

Mark Maselli Mark Maselli is Managing Director, Health and Group Benefits, North America. He has 30 years of experienceconsulting on health and welfare, retirement, plan administration and other benefits areas. Mark is an Associate in theSociety of Actuaries and a member of the American Academy of Actuaries.

Paul Morris Paul Morris is Managing Director, Europe, Middle East and Africa. Previously, he served as Director, ConsultingServices for Towers Watson and was a Managing Consultant in Watson Wyatt. He is a Fellow of the Society of

Actuaries and a Member of the Institute of Actuaries.

Mark Reid Mark Reid is Managing Director, Talent and Rewards, Europe, Middle East and Africa. Mark joined the firm in1991 in London and qualified as a Fellow of the Institute of Actuaries. He has spent most of his career working in thefield of executive compensation, primarily advising board compensation committees, working in both the U.S. andEurope.

Documents

Analyst Day Presentation_MASTER_09 19_Public V2