PROPERTY CASUALTY LOSS AND LOSS EXPENSES

This table summarizes activity for our consolidated property casualty loss and loss expense reserves:



(In millions)	Three months ended June 30,						Six months ended June 30,
	2014			2013			2014			2013
Gross loss and loss expense reserves, beginning of period	$	4,323		$	4,173		$	4,241		$	4,169
Less reinsurance receivable	289			349			299			356
Net loss and loss expense reserves, beginning of period	4,034			3,824			3,942			3,813
Net incurred loss and loss expenses related to:
Current accident year	773			675			1,478			1,209
Prior accident years	(66		)	(92		)	(95		)	(102		)
Total incurred	707			583			1,383			1,107
Net paid loss and loss expenses related to:
Current accident year	309			249			506			370
Prior accident years	306			272			693			664
Total paid	615			521			1,199			1,034
Net loss and loss expense reserves, end of period	4,126			3,886			4,126			3,886
Plus reinsurance receivable	282			333			282			333
Gross loss and loss expense reserves, end of period	$	4,408		$	4,219		$	4,408		$	4,219

We use actuarial methods, models and judgment to estimate, as of a financial statement date, the property casualty loss and loss expense reserves required to pay for and settle all outstanding insured claims, including incurred but not reported (IBNR) claims, as of that date. The actuarial estimate is subject to review and adjustment by an

inter-departmental committee that includes actuarial management that is familiar with relevant company and industry business, claims and underwriting trends, as well as general economic and legal trends that could affect future loss and loss expense payments. The amount we will actually have to pay for claims can be highly uncertain. This uncertainty, together with the size of our reserves, makes the loss and loss expense reserves our most significant estimate. The reserve for loss and loss expenses in the condensed consolidated balance sheets also included $36 million at June 30, 2014, and $65 million at June 30, 2013, for certain life and health loss and loss expense reserves.

For the three months ended June 30, 2014, we experienced $66 million of favorable development on prior accident years, including $57 million of favorable development in commercial lines, $1 million of favorable development in personal lines and $8 million favorable development in excess and surplus lines. This included $5 million from favorable development of catastrophe losses for the three months ended June 30, 2014, compared with $8 million of favorable development of catastrophe losses for the three months ended June 30, 2013. We recognized favorable reserve development during the three months ended June 30, 2014 of $24 million for the commercial casualty line and $22 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines.

For the six months ended June 30, 2014, we experienced $95 million of favorable development on prior accident years, including $60 million of favorable development in commercial lines, $18 million of favorable development in personal lines and $17 million favorable development in excess and surplus lines. This included

$14 million from favorable development of catastrophe losses for the six months ended June 30, 2014, compared with $15 million of favorable development of catastrophe losses for the six months ended June 30, 2013. We recognized favorable reserve development during the six months ended June 30, 2014, of $24 million for the commercial property line and $30 million for the workers' compensation line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines.