BENEFITS PAYABLE

On a consolidated basis, activity in benefits payable, excluding military services, was as follows for the six months ended June 30, 2018 and 2017:



	For the six months ended June 30,
	2018			2017
	(in millions)
Balances, beginning of period	$	4,668		$	4,563
Less: Reinsurance recoverables	(70		)	(76		)
Balances, beginning of period, net	4,598			4,487
Incurred related to:
Current year	23,543			22,576
Prior years	(338		)	(345		)
Total incurred	23,205			22,231
Paid related to:
Current year	(18,914		)	(18,332		)
Prior years	(3,897		)	(3,626		)
Total paid	(22,811		)	(21,958		)
Reinsurance recoverable	86			78
Less: Held-for-sale	(58		)	—
Balances, end of period	$	5,020		$	4,838

Amounts incurred related to prior periods vary from previously estimated liabilities as the claims ultimately are settled. Negative amounts reported for incurred related to prior years result from claims being ultimately settled for amounts less than originally estimated (favorable development).

Our reserving practice is to consistently recognize the actuarial best estimate of our ultimate liability for claims. Actuarial standards require the use of assumptions based on moderately adverse experience, which generally results in favorable reserve development, or reserves that are considered redundant.

Benefits expense excluded from the previous table was as follows for the six months ended June 30, 2018 and 2017.



	For the six months ended June 30,
	2018			2017
	(in millions)
Future policy benefits:
Individual Commercial	$	(14	)	$	(36	)
Other Businesses	15			20
Total future policy benefits	$	1		$	(16	)

Incurred and Paid Claims Development

The following discussion provides information about incurred and paid claims development for our Retail, Group and Specialty, and Individual Commercial segments as of June 30, 2018 and 2017, net of reinsurance, and the total of IBNR included within the net incurred claims amounts.

Retail Segment

Activity in benefits payable for our Retail segment was as follows for the six months ended June 30, 2018 and 2017:



	For the six months ended June 30,
	2018			2017
	(in millions)
Balances, beginning of period	$	3,963		$	3,507
Less: Reinsurance recoverables	(70		)	(76		)
Balances, beginning of period, net	3,893			3,431
Incurred related to:
Current year	21,069			20,010
Prior years	(247		)	(287		)
Total incurred	20,822			19,723
Paid related to:
Current year	(17,061		)	(16,385		)
Prior years	(3,327		)	(2,707		)
Total paid	(20,388		)	(19,092		)
Reinsurance recoverable	86			78
Balances, end of period	$	4,413		$	4,140

At June 30, 2018, benefits payable for our Retail segment included IBNR of approximately $2.9 billion, primarily associated with claims incurred in 2018.

Group and Specialty Segment

Activity in benefits payable for our Group and Specialty segment, excluding military services, was as follows for the six months ended June 30, 2018 and 2017:



	For the six months ended June 30,
	2018			2017
	(in millions)
Balances, beginning of period	$	568		$	578
Incurred related to:
Current year	2,665			2,629
Prior years	(34		)	(31		)
Total incurred	2,631			2,598
Paid related to:
Current year	(2,094		)	(2,117		)
Prior years	(496		)	(518		)
Total paid	(2,590		)	(2,635		)
Balances, end of period	$	609		$	541

At June 30, 2018, benefits payable for our Group and Specialty segment included IBNR of approximately $530 million, primarily associated with claims incurred in 2018.

Individual Commercial Segment

Activity in benefits payable for our Individual Commercial segment was as follows for the six months ended June 30, 2018 and 2017:



	For the six months ended June 30,
	2018			2017
	(in millions)
Balances, beginning of period	$	101		$	454
Incurred related to:
Current year	—			304
Prior years	(55		)	(26		)
Total incurred	(55		)	278
Paid related to:
Current year	—			(223		)
Prior years	(31		)	(378		)
Total paid	(31		)	(601		)
Balance, end of period	$	15		$	131

At June 30, 2018, benefits payable for our Individual Commercial segment included IBNR of approximately $6 million, associated with claims incurred in 2017 and prior.

Reconciliation to Consolidated

The reconciliation of the net incurred and paid claims development tables to benefits payable in the consolidated

statement of financial position is as follows:



Reconciliation of the Disclosure of Incurred and Paid Claims Development to Benefits Payable, net of reinsurance

	June 30,
	2018
Net outstanding liabilities
Retail	$	4,327
Group and Specialty	609
Individual Commercial	15
Other Businesses	41
Benefits payable, net of reinsurance	4,992

Reinsurance recoverable on unpaid claims
Retail	86
Total reinsurance recoverable on unpaid claims	86
Held-for-sale	(58		)
Total benefits payable, gross	$	5,020