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Unpaid losses and loss adjustment expenses (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of liability for unpaid claims and claims adjustment expense

A reconciliation of the changes in claim liabilities for each of the three years ending December 31, 2016 is as follows (in millions).


	2016			2015			2014
Unpaid losses and loss adjustment expenses—beginning of year:
Gross liabilities	$	73,144		$	71,477		$	64,866
Reinsurance recoverable and deferred charges		(10,994	)		(10,888	)		(7,414	)

Net balance		62,150			60,589			57,452

Incurred losses and loss adjustment expenses recorded during the year:
Current accident year events		30,636			27,829			24,335
Prior accident years’ events		(1,512	)		(2,014	)		(2,280	)
Retroactive reinsurance and discount accretion		1,782			712			4,351

Total incurred losses and loss adjustment expenses		30,906			26,527			26,406

Paid losses and loss adjustment expenses during the year with respect to:
Current accident year events		(14,898	)		(13,070	)		(11,291	)
Prior accident years’ events		(10,958	)		(10,268	)		(10,297	)
Retroactive reinsurance		(1,130	)		(1,151	)		(1,082	)

Total payments		(26,986	)		(24,489	)		(22,670	)

Foreign currency translation adjustment		(537	)		(545	)		(666	)
Business acquisitions		—			68			67

Unpaid losses and loss adjustment expenses—end of year:
Net balance		65,533			62,150			60,589
Reinsurance recoverable and deferred charges		11,385			10,994			10,888

Gross liabilities	$	76,918		$	73,144		$	71,477

Schedule of reconciliation of unpaid losses and allocated loss adjustment expenses to balance sheet liability

A reconciliation of certain net unpaid losses and allocated loss adjustment expenses (the latter referred to as “ALAE”) of GEICO, General Re, Berkshire Hathaway Reinsurance Group (“BHRG”) and Berkshire Hathaway Primary Group (“BH Primary”) to our consolidated unpaid losses and loss adjustment expenses as of December 31, 2016, along with a discussion regarding each group’s liability estimation processes, follows.


	December 31, 2016
	(in millions)
Unpaid losses and ALAE, net of reinsurance recoverable:
GEICO	$	12,981
General Re		13,973
BHRG		10,172
BH Primary		10,173	$	47,299

Reinsurance recoverable:
GEICO		1,084
General Re		611
BHRG		121
BH Primary		1,099		2,915

Retroactive reinsurance, unpaid losses and loss adjustment expenses				24,675
Other short-duration contracts, unpaid losses and loss adjustment expenses				1,390
Discount on workers’ compensation reinsurance liabilities				(1,433	)
Unpaid unallocated loss adjustment expenses				2,072

Unpaid losses and loss adjustment expenses			$	76,918

Schedule of average historical claims duration

Supplemental unaudited average historical claims duration information based on the net losses and ALAE incurred and paid accident year data in the preceding tables follows. The percentages show the average portions of losses and ALAE paid by each succeeding year, with year 1 representing the current accident year.


	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
In Years	1			2			3			4			5			6			7			8			9			10
GEICO		62.2	%		19.6	%		8.0	%		4.8	%		2.7	%
Gen Re		14.8	%		31.0	%		12.2	%		6.8	%		4.6	%		3.2	%		2.6	%		1.1	%		1.2	%		0.9	%
BHRG		14.7	%		28.2	%		17.2	%		9.4	%		6.3	%		3.9	%		2.4	%		1.9	%		1.0	%		0.7	%
BH Primary		15.4	%		17.8	%		14.5	%		11.9	%		9.2	%		6.8	%		4.3	%		2.6	%		1.9	%		1.2	%

Insurance Group [Member] | GEICO [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

GEICO’s claim liabilities predominantly relate to various types of private passenger auto liability and physical damage claims. Aggregate incurred and paid loss and ALAE data by accident year for these claims, net of reinsurance, follows. IBNR and case development liabilities are as of December 31, 2016. Dollars are in millions.


Accident Year	Incurred Losses and ALAE through December 31,										IBNR and Case Development Liabilities		Cumulative Number of Reported Claims (in thousands)
Accident Year	2012*		2013*		2014*		2015*		2016		IBNR and Case Development Liabilities		Cumulative Number of Reported Claims (in thousands)
2012	$	12,034	$	11,904	$	11,893	$	11,906	$	11,900	$	79		6,459
2013				12,990		12,815		12,859		12,837		184		7,102
2014						14,597		14,488		14,477		539		7,965
2015								16,807		16,798		1,394		8,891
2016										18,982		3,132		9,336

		Incurred losses and ALAE							$	74,994


Accident Year	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2012*		2013*		2014*		2015*		2016
2012	$	7,550	$	9,832	$	10,744	$	11,311	$	11,609
2013				7,944		10,494		11,569		12,174
2014						9,133		11,956		13,060
2015								10,543		13,785
2016										11,927

		Paid losses and ALAE								62,555

Net unpaid losses and ALAE for 2012—2016 accident years										12,439
Net unpaid losses and ALAE for accident years before 2012*										542

Net unpaid losses and ALAE									$	12,981

*	Unaudited supplemental information

Insurance Group [Member] | General Re [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

General Re’s incurred and paid loss and ALAE data by accident year, net of reinsurance, is presented in the following tables. IBNR and case development liabilities are as of December 31, 2016. Dollars are in millions.


Accident Year	Incurred Losses and ALAE through December 31,																				IBNR and Case Development Liabilities
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016		IBNR and Case Development Liabilities
2007	$	1,857	$	1,915	$	1,852	$	1,746	$	1,673	$	1,619	$	1,574	$	1,559	$	1,535	$	1,512	$	73
2008				1,920		2,011		1,903		1,818		1,746		1,713		1,669		1,648		1,635		93
2009						1,703		1,790		1,704		1,601		1,523		1,490		1,471		1,431		125
2010								1,881		2,055		1,939		1,845		1,757		1,712		1,674		156
2011										2,102		2,126		1,897		1,792		1,744		1,669		208
2012												1,810		1,850		1,707		1,603		1,535		335
2013														1,945		2,095		1,994		1,854		417
2014																1,740		1,843		1,794		578
2015																		1,811		1,999		777
2016																				1,715		1,173

						Incurred losses and ALAE													$	16,818


Accident Year	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016
2007	$	282	$	821	$	1,020	$	1,132	$	1,195	$	1,238	$	1,291	$	1,309	$	1,322	$	1,335
2008				330		894		1,074		1,187		1,246		1,289		1,315		1,330		1,354
2009						264		734		897		994		1,065		1,115		1,145		1,161
2010								247		782		997		1,147		1,243		1,304		1,359
2011										302		841		1,086		1,190		1,259		1,317
2012												199		664		829		916		991
2013														275		829		1,060		1,162
2014																171		666		864
2015																		207		693
2016																				171

						Paid losses and ALAE														10,407

				Net unpaid losses and ALAE for 2007—2016 accident years																6,411
				Net unpaid losses and ALAE for accident years before 2007*																7,562

				Net unpaid losses and ALAE															$	13,973

*	Unaudited supplemental information

Insurance Group [Member] | BHRG [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BHRG’s incurred and paid loss and ALAE data by accident year, net of reinsurance, is presented in the following tables. IBNR and case development liabilities are as of December 31, 2016. Dollars are in millions.


Accident Year	Incurred Losses and ALAE through December 31,**																				IBNR and Case Development Liabilities
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016		IBNR and Case Development Liabilities
2007	$	1,810	$	1,756	$	1,659	$	1,658	$	1,652	$	1,590	$	1,583	$	1,560	$	1,500	$	1,471	$	133
2008				3,388		3,130		2,988		2,903		2,835		2,748		2,683		2,605		2,578		244
2009						2,974		2,858		2,989		2,926		2,847		2,759		2,691		2,668		215
2010								2,876		2,974		2,883		2,771		2,610		2,575		2,551		238
2011										4,418		4,544		4,358		4,440		4,389		4,365		452
2012												4,054		3,878		3,648		3,583		3,531		694
2013														3,326		3,144		2,935		2,832		733
2014																2,688		2,585		2,492		736
2015																		3,207		3,070		1,113
2016																				3,390		1,907

						Incurred losses and ALAE													$	28,948


Accident Year	Cumulative Paid Losses and ALAE through December 31,**
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016
2007	$	171	$	677	$	891	$	993	$	1,055	$	1,120	$	1,170	$	1,196	$	1,211	$	1,221
2008				364		1,146		1,617		1,836		1,976		2,056		2,131		2,205		2,228
2009						372		1,182		1,605		1,937		2,147		2,306		2,336		2,363
2010								193		889		1,414		1,736		2,041		2,119		2,177
2011										552		2,130		2,872		3,315		3,475		3,600
2012												360		1,279		2,080		2,350		2,519
2013														516		1,070		1,555		1,774
2014																437		1,031		1,319
2015																		550		1,354
2016																				778

						Paid losses and ALAE														19,333

				Net unpaid losses and ALAE for 2007—2016 accident years																9,615
				Net unpaid losses and ALAE for accident years before 2007*																557

				Net unpaid losses and ALAE															$	10,172

*	Unaudited supplemental information

**	Excludes retroactive reinsurance losses and ALAE

Insurance Group [Member] | BH Primary [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BH Primary’s incurred and paid loss and ALAE data by accident year, net of reinsurance, is presented in the following tables. IBNR and case development liabilities are as of December 31, 2016. Dollars are in millions.


Accident Year	Incurred Losses and ALAE through December 31,																				IBNR and Case Development Liabilities		Cumulative Number of Reported Claims (in thousands)
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016		IBNR and Case Development Liabilities		Cumulative Number of Reported Claims (in thousands)
2007	$	1,328	$	1,233	$	1,174	$	1,090	$	955	$	901	$	852	$	817	$	788	$	775	$	46		137
2008				1,349		1,273		1,228		1,168		1,081		1,015		979		948		920		80		136
2009						1,298		1,211		1,180		1,159		1,068		1,020		966		936		99		117
2010								1,268		1,186		1,191		1,129		1,062		994		956		150		111
2011										1,888		1,633		1,605		1,452		1,375		1,297		223		109
2012												2,129		2,079		2,017		1,944		1,903		453		135
2013														2,294		2,213		2,133		2,060		595		150
2014																2,967		2,780		2,730		1,027		177
2015																		3,575		3,458		1,631		188
2016																				4,149		2,682		135

						Incurred losses and ALAE													$	19,184


Accident Year	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2007*		2008*		2009*		2010*		2011*		2012*		2013*		2014*		2015*		2016
2007	$	128	$	284	$	409	$	510	$	578	$	628	$	660	$	679	$	696	$	705
2008				174		333		464		578		662		728		772		795		810
2009						147		305		445		569		655		726		771		798
2010								146		313		458		570		657		722		758
2011										163		396		602		753		898		973
2012												211		598		844		1,053		1,208
2013														350		706		985		1,197
2014																453		896		1,247
2015																		502		1,078
2016																				634

						Paid losses and ALAE														9,408

				Net unpaid losses and ALAE for 2007—2016 accident years																9,776
				Net unpaid losses and ALAE for accident years before 2007*																397

				Net unpaid losses and ALAE															$	10,173

*	Unaudited supplemental information