POLICY LIABILITIES

6 Months Ended

Jun. 30, 2019

Changes in the liability for unpaid policy claims were as follows:



	Three Months Ended June 30,							Six Months Ended June 30,
(In millions)		2019			2018				2019			2018
Unpaid supplemental health claims, beginning of period		$	3,967		$	4,041			$	3,952		$	3,881
Less reinsurance recoverables		29			31				28			28
Net balance, beginning of period		3,938			4,010				3,924			3,853
Add claims incurred during the period related to:
Current year		1,785			1,779				3,610			3,621
Prior years		(136		)	(133		)		(303		)	(325		)
Total incurred		1,649			1,646				3,307			3,296
Less claims paid during the period on claims incurred during:
Current year		1,229			1,226				1,735			1,746
Prior years		430			426				1,568			1,540
Total paid		1,659			1,652				3,303			3,286
Effect of foreign exchange rate changes on unpaid claims		65			(91		)		65			50
Net balance, end of period		3,993			3,913				3,993			3,913
Add reinsurance recoverables		31			29				31			29
Unpaid supplemental health claims, end of period		4,024			3,942				4,024			3,942
Unpaid life claims, end of period		682			582				682			582
Total liability for unpaid policy claims		$	4,706		$	4,524			$	4,706		$	4,524

The incurred claims development related to prior years reflects favorable claims experience compared to previous estimates. The favorable claims development of $303 million for the six-month period ended June 30, 2019 comprises approximately $198 million from Japan, which represents approximately 65% of the total. There was no material impact to claims development in Japan from foreign currency exchange from December 31, 2018 to June 30, 2019.

The Company has experienced continued favorable claim trends in 2019 for its core health products in Japan. The Company's experience in Japan related to the average length of stay in the hospital for cancer treatment has shown continued decline in the current period. In addition, cancer treatment patterns in Japan are continuing to be influenced by significant advances in early-detection techniques and by the increased use of pathological diagnosis rather than clinical exams. Additionally, follow-up radiation and chemotherapy treatments are occurring more often on an outpatient basis. Such changes in treatment not only increase the quality of life and initial outcomes for the patients, but also decrease the average length of each hospital stay, resulting in favorable claims development.

The remainder of the favorable claims development related to prior years for the six-month period ended June 30, 2019, reflects Aflac U.S. favorable claims experience compared to previous estimates, primarily in the cancer and accident lines of business.