Unpaid Claims and Claim Expenses

3 Months Ended

Mar. 31, 2020

The following table is a summary reconciliation of the beginning and ending Property and Casualty unpaid claims and claim expense reserves for the periods indicated. The table presents reserves on both a gross and net (after reinsurance) basis. The total net Property and Casualty insurance claims and claim expense incurred amounts are reflected in the Consolidated Statements of Operations. The end of the period gross reserve (before reinsurance) balances and the reinsurance recoverable balances are reflected on a gross basis in the Consolidated Balance Sheets.



($ in thousands)	Three Months Ended March 31,
	2020			2019
Property and Casualty
Beginning gross reserves⁽¹⁾	$	386,976		$	367,180
Less: reinsurance recoverables	120,506			89,725
Net reserves, beginning of period ⁽²⁾	266,470			277,455
Incurred claims and claim expenses:
Claims occurring in the current period	105,454			118,767
Decrease in estimated reserves for claims occurring in prior periods⁽³⁾	(1,000		)	(2,000		)
Total claims and claim expenses incurred ⁽⁴⁾	104,454			116,767
Claims and claim expense payments for claims occurring during:
Current period	43,463			45,714
Prior periods	64,258			67,135
Total claims and claim expense payments	107,721			112,849
Net reserves, end of period⁽²⁾	263,203			281,373
Plus: reinsurance recoverables	119,045			78,328
Ending gross reserves⁽¹⁾	$	382,248		$	359,701


⁽¹⁾	Unpaid claims and claim expenses as reported in the Consolidated Balance Sheets also include reserves for Supplemental, Life and Retirement of $56.2 million and $33.8 million as of March 31, 2020 and 2019, respectively, in addition to Property and Casualty reserves.


⁽²⁾	Reserves net of anticipated reinsurance recoverables.


⁽³⁾	Shows the amounts by which the Company decreased its reserves in each of the periods indicated for claims occurring in previous periods to reflect subsequent information on such claims and changes in their projected final settlement costs.


⁽⁴⁾	Benefits, claims and settlement expenses as reported in the Consolidated Statements of Operations also include amounts for Supplemental, Life and Retirement of $34.2 million and $22.6 million for the three months ended March 31, 2020 and 2019, respectively, in addition to Property and Casualty amounts.

Net favorable development of total reserves for Property and Casualty claims occurring in prior years was $1.0 million and $2.0 million for the three months ended March 31, 2020 and 2019, respectively. The favorable development for the three months ended March 31, 2020 was the result of favorable loss trends in auto liability loss emergence for accident years 2019 and prior. The favorable development for the three months ended March 31, 2019 was predominately the result of favorable loss trends in auto and homeowners loss emergence for accident years 2018 and prior.