Losses And Loss Adjustment Expense Reserves

9 Months Ended

Sep. 30, 2017

Losses And Loss Adjustment Expense Reserves

Loss and Loss Adjustment Expense Reserves

The following table presents the activity in loss and loss adjustment expense reserves:



	Nine Months Ended September 30,
	2017			2016

	(Amounts in thousands)
Gross reserves at January 1	$	1,290,248		$	1,146,688
Less reinsurance recoverable	(13,161		)	(14,253		)
Net reserves at January 1	1,277,087			1,132,435
Incurred losses and loss adjustment expenses related to:
Current year	1,772,203			1,696,350
Prior years	18,347			69,134
Total incurred losses and loss adjustment expenses	1,790,550			1,765,484
Loss and loss adjustment expense payments related to:
Current year	1,099,656			1,065,948
Prior years	606,615			601,379
Total payments	1,706,271			1,667,327
Net reserves at September 30	1,361,366			1,230,592
Reinsurance recoverable	10,798			13,961
Gross reserves at September 30	$	1,372,164		$	1,244,553

The increase in the provision for insured events of prior years in 2017 of approximately $18.3 million was primarily attributable to higher than estimated California automobile and property losses.

The increase in the provision for insured events of prior years in 2016 of approximately $69.1 million primarily resulted from the re-estimation of losses for California and Florida automobile liability coverages.

For the nine months ended September 30, 2017 and 2016, the Company recorded catastrophe losses of approximately $59 million and $23 million, respectively. The 2017 catastrophe losses were primarily due to severe rainstorms in California, the impact of Hurricane Harvey in Texas and Hurricane Irma in Florida and Georgia, and storms and tornadoes in Oklahoma and Texas. The Winter of 2017 was extremely wet in California, setting new precipitation records in parts of the state. The 2016 catastrophe losses were primarily attributable to severe storms in Texas and Northern California and claims from the Sand Fire in Southern California.