INSURANCE

12 Months Ended

Oct. 31, 2023

We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks. For the majority of these insurance programs, we retain the initial $1.0 million to $1.5 million of exposure on a per-occurrence basis, either through deductibles or self-insured retentions. Beginning November 1, 2023, retentions will range between $1.0 million and $5.0 million of exposure on a per-occurrence basis. Beyond the retained exposures, we have varying primary policy limits ranging between $1.0 million and $5.0 million per occurrence. To cover general liability and automobile liability losses above these primary limits, we maintain commercial umbrella insurance policies that provide aggregate limits of $200.0 million. Our insurance policies generally cover workers’ compensation losses to the full extent of statutory requirements. Additionally, to cover property damage risks above our retained limits, we maintain policies that provide per occurrence limits of $75.0 million. We are also self-insured for certain employee medical and dental plans. We maintain stop-loss insurance for our self-insured medical plan under which we retain up to $0.5 million of exposure on a per-participant, per-year basis with respect to claims.

We maintain our reserves for workers’ compensation, general liability, automobile liability, and property damage insurance claims based upon known trends and events and the actuarial estimates of required reserves considering the most recently completed actuarial reports. We use all available information to develop our best estimate of insurance claims reserves as information is obtained. The results of actuarial reviews are used to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years.

Insurance Reserve Adjustments

Actuarial Reviews and Updates Performed During 2023

We review our self-insurance liabilities on a quarterly basis and adjust our accruals accordingly. Actual claims activity or development may vary from our assumptions and estimates, which may result in material losses or gains. As we obtain additional information that affects the assumptions and estimates used in our reserve liability calculations, we adjust our self-insurance rates and reserves for future periods and, if appropriate, adjust our reserves for claims incurred in prior accounting periods.

During the first and third quarters of 2023, we performed comprehensive actuarial reviews of the majority of our casualty insurance programs to evaluate changes made to claims reserves and claims payment activity for the periods of May 1, 2022, through October 31, 2022, and November 1, 2022, through April 30, 2023, respectively (the “Actuarial Reviews”). The Actuarial Reviews were comprehensive in nature and were based on loss development patterns, trend assumptions, and underlying expected loss costs during the periods analyzed.

During the second and fourth quarters of 2023, we performed interim actuarial updates of the majority of our casualty insurance programs that considered changes in claims development and claims payment activity for the respective periods analyzed (the “Interim Updates”). These Interim Updates were abbreviated in nature based on actual versus expected development during the periods analyzed and relied on the key assumptions in the Actuarial Reviews (most notably loss development patterns, trend assumptions, and underlying expected loss costs).

Based on the results of the Actuarial Reviews and Interim Updates, we decreased our total reserves related to prior years for known claims as well as our estimate of the loss amounts associated with IBNR Claims during 2023 by $14.8 million. In 2022, we decreased our total reserves related to prior year claims by $36.8 million.

Insurance-Related Balances and Activity


	As of October 31,
(in millions)	2023		2022
Insurance claim reserves, excluding medical and dental	$	555.0	$	551.0
Medical and dental claim reserves and other	9.5		8.1
Insurance recoverables	67.1		71.0

At October 31, 2023 and 2022, insurance recoverables are included in both “Other current assets” and “Other noncurrent assets” on the accompanying Consolidated Balance Sheets.

Casualty Program Insurance Reserves Rollforward


	Years Ended October 31,
(in millions)	2023		2022		2021
Net balance at beginning of year	$	479.9	$	508.3	$	434.8
Change in case reserves plus IBNR Claims — current year	154.2		145.7		117.9
Change in case reserves plus IBNR Claims — prior years	(14.8)		(36.8)		(36.0)
Claims paid	(131.4)		(129.1)		(99.8)
Acquisition(1)	—		(8.2)		91.6
Net balance, October 31(2)	487.9		479.9		508.3
Recoverables	67.1		71.0		66.5
Gross balance, October 31	$	555.0	$	551.0	$	574.8

(1) During 2021, insurance reserves increased as a result of the Able Acquisition.

(2) Includes reserves related to discontinued operations of approximately $0.1 million for 2023, $0.2 million for 2022, and $0.3 million for 2021.

Instruments Used to Collateralize Our Insurance Obligations


	As of October 31,
(in millions)	2023		2022
Standby letters of credit	$	53.5	$	153.7
Surety bonds and surety-backed letters of credit	178.0		73.2
Restricted insurance deposits	3.1		0.9
Total	$	234.7	$	227.8