Losses and Loss Adjustment Expenses Incurred and Paid

12 Months Ended

Dec. 31, 2013

Insurance [Abstract]

Losses and Loss Adjustment Expenses Incurred and Paid

9. Losses and Loss Adjustment Expenses Incurred and Paid

Information regarding the reserve for unpaid losses and LAE is as follows (in thousands).

	Year Ended December 31,						Six Months Ended December 31,			Year Ended June 30,
	2013			2012			2011			2011
Liability for unpaid losses and LAE at beginning of period, gross	$	79,260		$	69,436		$	68,424		$	73,198
Reinsurance balances receivable		(260	)		(187	)		(133	)		(46	)
Liability for unpaid losses and LAE at beginning of period, net		79,000			69,249			68,291			73,152
Add: Provision for losses and LAE:
Current period		145,877			144,207			60,162			130,888
Prior periods		(3,038	)		4,016			5,591			(1,721	)
Net losses and LAE incurred		142,839			148,223			65,753			129,167
Less: Losses and LAE paid:
Current period		88,726			89,157			32,022			84,736
Prior periods		49,132			49,315			32,773			49,292
Net losses and LAE paid		137,858			138,472			64,795			134,028
Liability for unpaid losses and LAE at end of period, net		83,981			79,000			69,249			68,291
Reinsurance balances receivable		305			260			187			133
Liability for unpaid losses and LAE at end of period, gross	$	84,286		$	79,260		$	69,436		$	68,424

The favorable change in the estimate of unpaid losses and loss adjustment expenses of $3.0 million for the year ended December 31, 2013 was primarily related to bodily injury claims occurring in accident years 2010 through 2012, partially offset by unfavorable loss and loss adjustment expense development on Florida personal injury protection claims.

The unfavorable change in the estimate of unpaid losses and loss adjustment expenses of $4.0 million for the year ended December 31, 2012 was primarily due to higher than expected severity with Florida personal injury protection claims and with Georgia bodily injury claims in older accident periods, and unfavorable loss adjustment expense development that was primarily related to higher than expected legal expenses for bodily injury claims for accident years 2010 and prior.

The unfavorable change in the estimate of unpaid losses and loss adjustment expenses of $5.6 million for the six months ended December 31, 2011 was primarily related to the strengthening of loss adjustment expense reserves for prior accident periods and included amounts related to the settlement of claims for extra-contractual damages.

The favorable change in the estimate of unpaid losses and loss adjustment expenses of $1.7 million for the year ended June 30, 2011 was due to lower than anticipated severity of accidents occurring during the fiscal 2009 and 2010 accident years, specifically in bodily injury coverage in Texas, Tennessee and South Carolina and physical damage coverages in Georgia, partially offset by higher loss adjustment expenses specific to bodily injury and Florida no-fault coverages.