Insurance

3 Months Ended

Mar. 31, 2024

Property and Casualty Insurance Reserves The following table provides an analysis of changes in the liability for losses and loss adjustment expenses during the first three months of 2024 and 2023 (in millions):


	Three months ended March 31,
	2024		2023
Balance at beginning of year	$	13,087	$	11,974
Less reinsurance recoverables, net of allowance	4,288		3,767
Net liability at beginning of year	8,799		8,207
Provision for losses and LAE occurring in the current period	962		883


Net decrease in the provision for claims of prior years	(50)		(63)
Total losses and LAE incurred	912		820
Payments for losses and LAE of:
Current year	(94)		(66)
Prior years	(895)		(815)
Total payments	(989)		(881)
Foreign currency translation and other	1		1
Net liability at end of period	8,723		8,147
Add back reinsurance recoverables, net of allowance	4,327		3,614
Gross unpaid losses and LAE included in the balance sheet at end of period	$	13,050	$	11,761

The net decrease in the provision for claims of prior years during the first three months of 2024 reflects (i) lower than anticipated losses in the crop business and lower than expected claim severity in the property and inland marine business (within the Property and transportation sub-segment), (ii) lower than anticipated claim severity in the workers’ compensation businesses and lower than expected claim frequency and severity in the executive liability business (within the Specialty casualty sub-segment) and (iii) lower than anticipated claim frequency in the fidelity business and lower than expected claim frequency and severity in the financial institutions business (within the Specialty financial sub-segment). This favorable development was partially offset by (i) higher than anticipated claim severity in the excess liability businesses and higher than expected claim frequency and severity in the social service business (within the Specialty casualty sub-segment), (ii) higher than anticipated claim severity in the innovative markets business (within the Specialty financial sub-segment) and (iii) net adverse development associated with AFG’s internal reinsurance program (within Other specialty).

The net decrease in the provision for claims of prior years during the first three months of 2023 reflects (i) lower than anticipated losses in the crop business, lower than expected claim frequency and severity in the trucking business and lower than anticipated claim frequency in the property and inland marine business (within the Property and transportation sub-segment), (ii) lower than anticipated claim severity in the workers’ compensation businesses and lower than expected claim frequency in the executive liability, excess and surplus and environmental businesses (within the Specialty casualty sub-segment) and (iii) lower than anticipated claim frequency in the surety and trade credit businesses (within the Specialty financial sub-segment). This favorable development was partially offset by (i) higher than anticipated claim severity in the public sector and excess liability businesses (within the Specialty casualty sub-segment) and (ii) net adverse development associated with AFG’s internal reinsurance program (within Other specialty).

Recoverables from Reinsurers and Premiums Receivable Progressions of the 2024 and 2023 allowance for expected credit losses on recoverables from reinsurers and premiums receivable are shown below (in millions):


	Recoverables from Reinsurers				Premiums Receivable
	2024		2023		2024		2023






Balance at December 31	$	10	$	8	$	15	$	8

Provision (credit) for expected credit losses	—		1		—		—
Write-offs charged against the allowance	—		—		—		—
Balance at March 31	$	10	$	9	$	15	$	8