Unpaid losses and loss adjustment expenses (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of liability for unpaid claims and claims adjustment expense

A reconciliation of the changes in claim liabilities, excluding liabilities under retroactive reinsurance contracts (see Note 16), for each of the three years ending December 31, 2020 is as follows (in millions).

	2020			2019			2018
Balances at beginning of year:
Gross liabilities	$	73,019		$	68,458		$	61,122
Reinsurance recoverable on unpaid losses		(2,855	)		(3,060	)		(3,201	)
Net liabilities		70,164			65,398			57,921
Incurred losses and loss adjustment expenses:
Current accident year events		43,400			43,335			39,876
Prior accident years’ events		(356	)		(752	)		(1,406	)
Total		43,044			42,583			38,470
Paid losses and loss adjustment expenses:
Current accident year events		(17,884	)		(19,482	)		(18,391	)
Prior accident years’ events		(18,862	)		(17,642	)		(15,452	)
Total		(36,746	)		(37,124	)		(33,843	)
Foreign currency translation adjustment		480			(23	)		(331	)
Business acquisition (disposition)		—			(670	)		3,181
Balances at December 31:
Net liabilities		76,942			70,164			65,398
Reinsurance recoverable on unpaid losses		2,912			2,855			3,060
Gross liabilities	$	79,854		$	73,019		$	68,458

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

A reconciliation of the disaggregated net unpaid losses and allocated loss adjustment expenses (the latter referred to as “ALAE”) of GEICO, Berkshire Hathaway Primary Group (“BH Primary”) and Berkshire Hathaway Reinsurance Group (“BHRG”) to our consolidated unpaid losses and loss adjustment expenses as of December 31, 2020 follows (in millions).

	GEICO Physical Damage		GEICO Auto Liability		BH Primary Medical Professional Liability		BH Primary Workers’ Compensation and Other Casualty		BHRG Property		BHRG Casualty		Total
Unpaid losses and ALAE, net	$	524	$	18,755	$	7,897	$	11,294	$	11,280	$	22,890	$	72,640
Reinsurance recoverable		—		1,109		49		621		181		864		2,824
Unpaid unallocated loss    adjustment expenses														2,671
Other unpaid losses and loss    adjustment expenses														1,719
Unpaid losses and loss adjustment    expenses													$	79,854

Schedule of average historical claims duration

Required 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 net 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 Year	1			2			3			4			5			6			7			8			9			10
GEICO Physical Damage		97	%		2	%
GEICO Auto Liability		42	%		29	%		13	%		7	%		4	%
BH Primary Medical Professional Liability		2	%		7	%		12	%		14	%		14	%		12	%		9	%		6	%		5	%		2	%
BH Primary Workers’ Compensation and Other Casualty		16	%		21	%		16	%		13	%		8	%		4	%		3	%		2	%		1	%		1	%
BHRG Property		19	%		37	%		17	%		8	%		4	%		4	%		1	%		2	%		1	%		0	%
BHRG Casualty		11	%		16	%		14	%		9	%		5	%		5	%		5	%		2	%		2	%		1	%

GEICO [Member] | Insurance Group [Member] | Physical Damage [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

GEICO’s incurred and paid losses and ALAE, net of reinsurance, are summarized by accident year below for physical damage and auto liability claims. IBNR and case development liabilities are as of December 31, 2020. Claim counts are established when accidents that may result in a liability are reported and are based on policy coverage. Each claim event may generate claims under multiple coverages, and thus may result in multiple counts. The “Cumulative Number of Reported Claims” includes the combined number of reported claims for all policy coverages and excludes projected IBNR claims. Dollars are in millions.

Physical Damage

	Incurred Losses and ALAE through December 31,							Cumulative Number of
Accident Year		2019*		2020		IBNR and Case Development Liabilities		Reported Claims (in thousands)
2019		$	9,020	$	8,920	$	69		8,929
2020					8,603		296		7,794
	Incurred losses and ALAE			$	17,523
	Cumulative Paid Losses and ALAE through December 31,
Accident Year		2019*		2020
2019		$	8,678	$	8,905
2020					8,118
	Paid losses and ALAE				17,023
	Net unpaid losses and ALAE for 2019 – 2020 accident years				500
	Net unpaid losses and ALAE for accident years before 2019				24
	Net unpaid losses and ALAE			$	524

GEICO [Member] | Insurance Group [Member] | Auto Liability [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

Auto Liability

	Incurred Losses and ALAE through December 31,												Cumulative Number of
Accident Year	2016*		2017*		2018*		2019*		2020		IBNR and Case Development Liabilities		Reported Claims (in thousands)
2016	$	11,800	$	12,184	$	12,149	$	12,178	$	12,198	$	222		2,451
2017				14,095		13,864		13,888		13,824		502		2,639
2018						15,383		15,226		14,985		1,163		2,702
2019								16,901		16,678		2,905		2,749
2020										14,637		4,482		1,945
	Incurred losses and ALAE								$	72,322
	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2016*		2017*		2018*		2019*		2020
2016	$	5,069	$	8,716	$	10,330	$	11,294	$	11,718
2017				5,806		9,944		11,799		12,729
2018						6,218		10,772		12,658
2019								6,742		11,671
2020										5,395
	Paid losses and ALAE									54,171
	Net unpaid losses and ALAE for 2016 – 2020 accident years									18,151
	Net unpaid losses and ALAE for accident years before 2016									604
	Net unpaid losses and ALAE								$	18,755

* Unaudited required supplemental information

Berkshire Hathaway Primary Group [Member] | Insurance Group [Member] | Medical Professional Liability [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BH Primary Medical Professional Liability

We estimate the ultimate expected incurred losses and loss adjustment expenses for medical professional claim liabilities using a variety of commonly accepted actuarial methodologies, such as the paid and incurred development method and Bornhuetter-Ferguson based methods, as well as other techniques that consider insured loss exposures and historical and expected loss trends, among other factors. These methodologies produce loss estimates from which we determine our best estimate. In addition, we study developments in older accident years and adjust initial loss estimates to reflect recent development based upon claim age, coverage and litigation experience.

	Incurred Losses and ALAE through December 31,																						Cumulative Number of
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020		IBNR and Case Development Liabilities		Reported Claims (in thousands)
2011	$	1,346	$	1,334	$	1,321	$	1,262	$	1,173	$	1,115	$	1,050	$	1,004	$	968	$	972	$	39		11
2012				1,336		1,306		1,277		1,223		1,168		1,078		1,035		998		988		53		11
2013						1,328		1,296		1,261		1,195		1,127		1,086		1,019		985		65		11
2014								1,370		1,375		1,305		1,246		1,218		1,127		1,061		129		11
2015										1,374		1,342		1,269		1,290		1,218		1,157		202		12
2016												1,392		1,416		1,414		1,394		1,341		286		14
2017														1,466		1,499		1,495		1,474		494		20
2018																1,602		1,650		1,659		780		22
2019																		1,670		1,691		1,204		17
2020																				1,704		1,529		13
	Incurred losses and ALAE																		$	13,032
	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020
2011	$	16	$	82	$	200	$	356	$	517	$	632	$	711	$	767	$	822	$	842
2012				15		93		218		377		522		642		725		789		830
2013						15		90		219		368		518		635		743		793
2014								21		106		238		396		540		671		752
2015										23		108		218		382		543		663
2016												22		115		274		461		620
2017														27		128		300		457
2018																35		166		367
2019																		39		160
2020																				34
	Paid losses and ALAE																			5,518
	Net unpaid losses and ALAE for 2011– 2020 accident years																			7,514
	Net unpaid losses and ALAE for accident years before 2011																			383
	Net unpaid losses and ALAE																		$	7,897

* Unaudited required supplemental information

Berkshire Hathaway Primary Group [Member] | Insurance Group [Member] | Workers' Compensation and Other Casualty [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BH Primary Workers’ Compensation and Other Casualty

We periodically evaluate ultimate loss and loss adjustment expense estimates for the workers’ compensation and other casualty claims using a combination of commonly accepted actuarial methodologies such as the Bornhuetter-Ferguson and chain-ladder approaches using paid and incurred loss data. Paid and incurred loss data is segregated and analyzed by state due to the different state regulatory frameworks that may impact certain factors, including the duration and amount of loss payments. We also separately study the various components of liabilities, such as employee lost wages, medical expenses and the costs of claims investigations and administration. We establish case liabilities for reported claims based upon the facts and circumstances of the claim. The excess of the ultimate projected losses, including the expected development of case estimates, and the case-basis liabilities is included in IBNR liabilities.

	Incurred Losses and ALAE through December 31,																						Cumulative Number of
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020		IBNR and Case Development Liabilities		Reported Claims (in thousands)
2011	$	738	$	675	$	675	$	624	$	621	$	618	$	607	$	596	$	591	$	576	$	39		46
2012				873		850		837		791		780		762		750		736		718		53		53
2013						1,258		1,228		1,178		1,127		1,096		1,072		1,050		1,028		120		67
2014								1,743		1,638		1,614		1,548		1,482		1,497		1,477		190		90
2015										2,169		2,127		2,042		2,014		2,025		1,997		267		111
2016												2,511		2,422		2,359		2,325		2,365		470		115
2017														3,044		2,907		2,842		2,843		691		138
2018																3,544		3,412		3,480		1,152		160
2019																		4,074		4,102		1,788		170
2020																				4,421		2,987		120
	Incurred losses and ALAE																		$	23,007
	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020
2011	$	109	$	220	$	333	$	403	$	453	$	481	$	496	$	505	$	512	$	519
2012				116		299		414		501		560		592		611		626		634
2013						177		422		609		725		793		835		858		874
2014								239		557		800		1,007		1,111		1,176		1,214
2015										289		700		1,017		1,289		1,488		1,570
2016												329		775		1,148		1,461		1,661
2017														441		1,003		1,434		1,771
2018																538		1,198		1,683
2019																		682		1,478
2020																				695
	Paid losses and ALAE																			12,099
	Net unpaid losses and ALAE for 2011 – 2020 accident years																			10,908
	Net unpaid losses and ALAE for accident years before 2011																			386
	Net unpaid losses and ALAE																		$	11,294

* Unaudited required supplemental information

Berkshire Hathaway Reinsurance Group [Member] | Insurance Group [Member] | Property [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BHRG’s disaggregated incurred and paid losses and ALAE are summarized by accident year, net of reinsurance. IBNR and case development liabilities are as of December 31, 2020. Dollars are in millions.

BHRG Property

	Incurred Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020		IBNR and Case Development Liabilities
2011	$	4,111	$	4,095	$	3,804	$	3,711	$	3,707	$	3,672	$	3,654	$	3,638	$	3,627	$	3,616	$	30
2012				3,153		2,846		2,644		2,403		2,351		2,348		2,329		2,315		2,305		35
2013						3,255		3,093		2,745		2,653		2,631		2,570		2,518		2,504		45
2014								2,648		2,436		2,322		2,178		2,123		2,050		2,021		48
2015										3,287		3,135		2,577		2,979		2,976		3,000		143
2016												3,293		3,923		3,646		3,614		3,616		218
2017														5,291		4,986		4,837		4,727		187
2018																4,426		4,524		4,397		678
2019																		4,146		4,299		952
2020																				5,858		3,129
Incurred losses and ALAE																			$	36,343
	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020
2011	$	609	$	2,259	$	2,917	$	3,188	$	3,304	$	3,387	$	3,429	$	3,474	$	3,493	$	3,507
2012				262		1,232		1,813		1,950		2,040		2,117		2,135		2,181		2,199
2013						526		1,459		1,906		2,105		2,226		2,307		2,347		2,376
2014								467		1,249		1,574		1,713		1,779		1,829		1,858
2015										581		1,614		1,969		2,166		2,271		2,453
2016												709		1,811		2,208		2,670		2,923
2017														1,028		2,734		3,660		3,972
2018																915		2,341		2,868
2019																		751		2,282
2020																				960
Paid losses and ALAE																				25,398
Net unpaid losses and ALAE for 2011 – 2020 accident years																				10,945
Net unpaid losses and ALAE for accident years before 2011																			335
Net unpaid losses and ALAE																			$	11,280

* Unaudited required supplemental information

Berkshire Hathaway Reinsurance Group [Member] | Insurance Group [Member] | Casualty [Member]

Schedule of incurred and paid losses and allocated loss adjustment expenses

BHRG Casualty

	Incurred Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020		IBNR and Case Development Liabilities
2011	$	2,635	$	2,726	$	2,595	$	2,536	$	2,447	$	2,354	$	2,346	$	2,307	$	2,272	$	2,255	$	279
2012				2,820		3,002		2,837		2,899		2,827		2,712		2,645		2,588		2,581		317
2013						2,160		2,298		2,328		2,170		2,114		2,060		1,964		1,892		387
2014								1,900		2,099		2,068		2,030		1,944		1,980		1,970		537
2015										1,902		2,109		2,137		2,035		1,908		1,870		455
2016												1,928		2,138		2,047		2,003		1,922		555
2017														2,216		2,711		2,588		2,494		762
2018																2,948		3,585		3,509		1,183
2019																		3,455		3,931		1,924
2020																				3,883		2,754
	Incurred losses and ALAE																		$	26,307
	Cumulative Paid Losses and ALAE through December 31,
Accident Year	2011*		2012*		2013*		2014*		2015*		2016*		2017*		2018*		2019*		2020
2011	$	294	$	824	$	1,169	$	1,412	$	1,501	$	1,595	$	1,673	$	1,713	$	1,748	$	1,776
2012				312		757		1,150		1,381		1,539		1,664		1,764		1,825		1,883
2013						294		530		818		947		1,052		1,155		1,215		1,273
2014								153		488		655		765		889		974		1,119
2015										199		500		725		846		938		1,029
2016												255		563		742		874		972
2017														233		574		830		1,282
2018																267		875		1,649
2019																		356		906
2020																				406
	Paid losses and ALAE																			12,295
	Net unpaid losses and ALAE for 2011 – 2020 accident years																			14,012
	Net unpaid losses and ALAE for accident years before 2011																			8,878
	Net unpaid losses and ALAE																		$	22,890

* Unaudited required supplemental information