INSURANCE CLAIM RESERVES

Claims and claim adjustment expense reserves were as follows:



(in millions)	March 31, 2019		December 31, 2018
Property-casualty	$	50,704	$	50,653
Accident and health	14		15
Total	$	50,718	$	50,668

The following table presents a reconciliation of beginning and ending property casualty reserve balances for claims and claim adjustment expenses:



	Three Months Ended March 31,
(in millions)	2019			2018
Claims and claim adjustment expense reserves at beginning of year	$	50,653		$	49,633
Less reinsurance recoverables on unpaid losses	8,182			8,123
Net reserves at beginning of year	42,471			41,510

Estimated claims and claim adjustment expenses for claims arising in the current year	4,435			4,391
Estimated decrease in claims and claim adjustment expenses for claims arising in prior years	(16		)	(116		)
Total increases	4,419			4,275

Claims and claim adjustment expense payments for claims arising in:
Current year	970			1,009
Prior years	3,320			3,040
Total payments	4,290			4,049
Unrealized foreign exchange (gain) loss	41			(10		)
Net reserves at end of period	42,641			41,726
Plus reinsurance recoverables on unpaid losses	8,063			8,068
Claims and claim adjustment expense reserves at end of period	$	50,704		$	49,794

Gross claims and claim adjustment expense reserves at March 31, 2019 increased by $51 million from December 31, 2018, primarily reflecting the impacts of (i) higher volumes of insured exposures and loss cost trends for the current accident year and (ii) catastrophe losses in the first three months of 2019, partially offset by the impacts of (iii) payments related to catastrophe losses incurred in 2018 and (iv) net favorable prior year reserve development.

Reinsurance recoverables on unpaid losses at March 31, 2019 decreased by $119 million from December 31, 2018, primarily reflecting the impact of cash collections in the first three months of 2019.

Prior Year Reserve Development

The following disclosures regarding reserve development are on a “net of reinsurance” basis.

For the three months ended March 31, 2019 and 2018, estimated claims and claim adjustment expenses incurred included $16 million and $116 million, respectively, of net favorable development for claims arising in prior years, including $51 million and $150 million, respectively, of net favorable prior year reserve development and $12 million and $13 million, respectively, of accretion of discount that impacted the Company's results of operations.

Business Insurance. Net unfavorable prior year reserve development in the first quarter of 2019 totaled $21 million, primarily driven by higher than expected loss experience in the segment's domestic operations in (i) the general liability product line for multiple accident years, primarily for years prior to 2009, due to the enactment by New York State of the Child Victims Act (“CVA”) on February 14, 2019 and (ii) the commercial multi-peril product line for recent accident years, partially offset by (iii) better than expected loss experience in the segment's domestic operations in the workers’ compensation product line for multiple accident years. The CVA extends the statute of limitations for claimants asserting childhood sexual molestation, including a “reviver” component that allows claimants of any age to file a civil claim during a one-year window beginning six months after the CVA took effect. Net favorable prior year reserve development in the first quarter of 2018 totaled $66 million, primarily driven by better than expected loss experience in the segment's domestic operations in (i) the workers’ compensation product line for recent accident years and (ii) the commercial property product line for accident year 2016, partially offset by (iii) higher than expected loss experience in the commercial automobile product line for recent accident years.

Bond & Specialty Insurance. Net favorable prior year reserve development in the first quarter of 2019 of $3 million was not significant. Net favorable prior year reserve development in the first quarter of 2018 totaled $35 million, primarily driven by better than expected loss experience in the segment's domestic operations in the general liability product line for multiple accident years.

Personal Insurance. Net favorable prior year reserve development in the first quarter of 2019 totaled $69 million, primarily driven by better than expected loss experience in the segment's domestic operations in the automobile product line for recent accident years. Net favorable prior year reserve development in the first quarter of 2018 totaled $49 million, primarily driven by better than expected loss experience in the segment's domestic operations in the homeowners and other product line for accident years 2016 and 2017 and in the automobile product line for accident year 2017.