Loss and Loss Expense Reserves (Tables)

12 Months Ended

Dec. 31, 2020

Loss and Loss Expense Reserves [Abstract]

Activity in Reserves for Losses and Loss Expenses

Activity in the reserves for losses and loss expenses for the years ended December 31, 2020, 2019 and 2018 is summarized as follows.  All amounts are shown net of reinsurance, unless otherwise indicated.

	2020			2019			2018
Reserves, gross of reinsurance recoverable, at the beginning of the year	$	988,305		$	865,339		$	680,274
Reinsurance recoverable on unpaid losses at the beginning of the year		398,305			375,935			308,143
Reserves at the beginning of the year		590,000			489,404			372,131
Provision for losses and loss expenses:
Claims occurring during the current year		319,269			349,018			329,078
Claims occurring during prior years		(311	)		(550	)		16,786
Total incurred losses and loss expenses		318,958			348,468			345,864
Loss and loss expense payments:
Claims occurring during the current year		77,880			90,364			84,738
Claims occurring during prior years		165,777			157,508			143,853
Total paid		243,657			247,872			228,591
Reserves at the end of the year		665,301			590,000			489,404
Reinsurance recoverable on unpaid losses at the end of the year		424,368			398,305			375,935
Reserves, gross of reinsurance recoverable, at the end of the year	$	1,089,669		$	988,305		$	865,339

The following table reconciles the triangles presented in this note to the total (savings) / deficiency for the Company of $311 shown in the table above:

	Prior Year (Savings) / Deficiency
	2020			2019			2018
Workers' Compensation	$	1,431		$	(2,733	)	$	(9,601	)
Commercial Auto Liability		10,717			8,893			32,342
Occupational Accident		(7,467	)		688			(4,178	)
Physical Damage		(1,684	)		(4,561	)		(1,066	)
Professional Liability Assumed		189			259			2,343
Other short-duration contracts		(3,497	)		(3,096	)		(3,054	)
Total	$	(311	)	$	(550	)	$	16,786

Incurred Claims Development, Net of Reinsurance

The following is information about incurred and paid claims development as of December 31, 2020, net of reinsurance, as well as cumulative claim frequency and the total of incurred‐but‐not‐reported liabilities plus expected development on reported claims included within the net incurred claims amounts.

Workers' Compensation

																					As of December 31, 2020
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not-Reported Liabilities Plus Expected Development		Number of Reported
Accident Year	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)																				on Reported		Claims
	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		Claims		Per Year
2011	$	26,057	$	26,628	$	26,958	$	26,767	$	25,515	$	27,293	$	26,617	$	26,631	$	26,452	$	26,356	$	1,989		4,547
2012				23,965		25,544		24,887		24,485		25,616		27,020		26,775		25,508		26,397		2,327		4,484
2013						27,619		30,638		29,913		32,121		32,553		31,131		31,066		31,360		3,137		5,282
2014								36,768		36,968		34,009		33,427		31,031		31,579		31,551		3,772		5,413
2015										26,277		23,115		25,889		24,948		25,436		25,167		3,367		6,340
2016												35,240		29,757		29,317		30,060		29,785		3,693		6,087
2017														42,387		37,731		36,211		34,930		5,921		16,469
2018																62,973		61,530		62,451		13,632		14,295
2019																		65,837		67,113		19,079		9,480
2020																				60,204		34,084		7,550
Total																			$	395,314	$	91,001

	Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	4,916	$	11,912	$	15,973	$	18,884	$	20,617	$	21,622	$	22,569	$	22,991	$	23,366	$	23,516
2012				4,597		11,004		14,834		17,415		18,946		20,276		21,157		21,636		21,850
2013						4,880		12,792		18,065		21,655		23,643		24,968		25,847		26,702
2014								5,328		13,665		19,075		22,387		23,968		24,714		25,507
2015										2,918		10,128		15,020		17,487		19,385		20,251
2016												5,784		13,377		18,461		21,304		23,113
2017														6,150		15,811		20,863		23,910
2018																10,987		27,862		36,794
2019																		13,171		31,140
2020																				10,508
Total																			$	243,291
Outstanding liabilities prior to 2011, net of reinsurance																				16,836
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	168,859

Commercial Liability

																					As of December 31, 2020
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not-Reported Liabilities Plus Expected Development		Number of Reported
	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)																				on Reported		Claims
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		Claims		Per Year
2011	$	46,829	$	43,832	$	31,633	$	36,894	$	35,805	$	37,122	$	36,076	$	37,852	$	37,795	$	38,773	$	21		2,902
2012				49,743		54,269		49,743		51,367		48,708		51,475		51,648		51,962		51,830		443		3,131
2013						53,817		39,143		37,701		36,371		46,690		48,857		51,598		51,293		270		3,753
2014								49,971		52,254		52,483		52,964		64,372		70,841		72,636		1,051		3,325
2015										61,420		70,174		64,323		71,088		75,503		77,225		1,736		3,198
2016												61,638		68,974		77,362		79,015		80,788		2,420		3,751
2017														103,126		103,611		99,287		97,663		12,197		5,403
2018																179,589		177,262		186,521		29,518		8,197
2019																		198,022		195,273		53,842		8,313
2020																				173,878		109,654		4,410
Total																			$	1,025,880	$	211,152

	Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	1,809	$	11,350	$	23,615	$	30,795	$	33,255	$	34,009	$	35,561	$	36,400	$	37,263	$	37,267
2012				3,086		23,252		32,942		45,303		47,601		50,036		50,750		50,882		50,908
2013						5,167		15,772		25,270		34,481		44,865		46,084		49,522		49,879
2014								4,023		9,046		28,393		45,075		57,692		68,392		69,183
2015										10,923		27,582		49,267		63,133		71,697		74,276
2016												6,843		30,377		52,764		70,324		74,324
2017														11,415		46,529		58,173		73,496
2018																18,689		66,575		101,803
2019																		19,311		64,294
2020																				13,185
Total																			$	608,615
Outstanding liabilities prior to 2011, net of reinsurance																				3,433
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	420,698

Professional Liability Reinsurance Assumed (in runoff)

																					As of December 31, 2020
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not-Reported Liabilities Plus Expected Development		Number of Reported
Accident Year	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)																				on Reported		Claims
	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		Claims		Per Year
2011	$	10,492	$	8,314	$	9,017	$	9,859	$	10,779	$	12,735	$	12,744	$	12,725	$	13,018	$	13,228	$	219		N/A
2012				10,041		9,276		5,569		10,157		14,605		16,555		14,949		16,013		16,439		489		N/A
2013						14,370		13,034		11,618		17,694		23,256		22,213		23,474		23,381		1,764		N/A
2014								12,675		8,825		7,259		9,837		12,749		10,721		10,619		1,256		N/A
2015										11,638		7,859		7,147		10,422		8,753		8,404		1,959		N/A
2016												6,368		2,482		1,522		2,993		3,090		435		N/A
2017														–		–		–		–		–		N/A
2018																–		–		–		–		N/A
2019																		–		–		–		N/A
2020																				–		–		N/A
Total																			$	75,161	$	6,122

	Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	50	$	637	$	2,061	$	4,983	$	8,104	$	10,404	$	11,679	$	12,280	$	12,404	$	12,629
2012				103		992		2,388		5,077		8,355		11,239		13,091		13,706		14,403
2013						123		1,135		5,088		10,988		14,779		18,229		19,201		20,157
2014								723		761		2,241		3,999		6,627		7,732		8,890
2015										10		390		1,899		3,207		3,964		5,162
2016												–		5		99		2,254		2,496
2017														–		–		–		–
2018																–		–		–
2019																		–		–
2020																				–
Total																			$	63,737
Outstanding liabilities prior to 2011, net of reinsurance																				534
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	11,958

Occupational Accident

																					As of December 31, 2020 2020
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not-Reported Liabilities Plus Expected Development		Number of Reported
Accident Year	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)																				on Reported		Claims
	2011		2012		2013		2014		2015		2016		2017		2018		2018		2020		Claims		Per Year
2011	$	6,249	$	6,937	$	6,485	$	6,283	$	6,151	$	6,297	$	6,264	$	6,263	$	6,287	$	6,275	$	2		472
2012				5,272		4,168		3,908		3,758		3,585		3,566		3,551		3,773		3,758		8		380
2013						6,410		5,044		4,403		4,390		4,166		4,107		4,082		4,082		–		337
2014								5,283		4,865		4,147		4,093		4,031		4,061		4,041		38		325
2015										3,897		3,539		3,715		3,846		3,832		3,698		111		275
2016												6,729		6,312		5,847		5,965		4,894		112		704
2017														17,041		13,334		12,976		11,031		111		1,040
2018																16,365		17,053		12,147		412		892
2018																		10,498		11,134		1,469		882
2020																				12,869		2,508		772
Total																			$	73,929	$	4,771

	Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31 (2011-2019 is Supplementary Information and Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	2,159	$	4,861	$	6,003	$	6,050	$	6,020	$	6,278	$	6,219	$	6,232	$	6,246	$	6,267
2012				1,082		2,648		3,190		3,390		3,377		3,442		3,482		3,521		3,555
2013						1,989		3,565		3,768		4,108		4,110		4,107		4,082		4,082
2014								2,000		3,685		3,861		3,909		3,948		3,968		3,968
2015										739		1,934		2,670		2,988		3,224		3,285
2016												1,596		4,388		4,818		4,807		4,785
2017														3,229		7,756		9,126		9,645
2018																5,324		9,807		10,642
2019																		4,007		7,782
2020																				4,978
Total																			$	58,989
Outstanding liabilities prior to 2011, net of reinsurance																				99
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	15,039

Physical Damage ⁽¹⁾

							As of December 31, 2020
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance						Total of Incurred-but-Not- Reported Liabilities Plus		Number of
	For the Years Ended December 31 (2018-2019 is Supplementary Information and Unaudited)						Expected Development		Reported Claims
Accident Year	2018		2019		2020		on Reported Claims		Per Year
2018	$	53,726	$	50,122	$	49,767	$	22		11,151
2019		–		55,354		54,126		141		10,472
2020				–		56,602		3,233		9,130
Total					$	160,495	$	3,396

	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31 (2018-2019 is Supplementary Information and Unaudited)
Accident Year	2018		2019		2020
2018	$	41,631	$	49,685	$	49,638
2019		–		44,197		53,647
2020				–		42,726
Total					$	146,011
Outstanding liabilities prior to 2018, net of reinsurance						77
Liabilities for claims and claims adjustment expenses, net of reinsurance					$	14,561

⁽¹⁾ The majority of physical damage claims settle within a two-year period. The triangles above have been abbreviated to reflect the short-tail nature of this business.

Reconciliation of Net Incurred and Paid Claims Development

The reconciliation of the net incurred and paid claims development tables to the liability for claims and claim adjustment expenses in the consolidated balance sheet at December 31, 2020 and 2019 is as follows.

	2020		2019
Net outstanding liabilities
Commercial Liability	$	420,698	$	355,148
Workers' Compensation		168,859		154,409
Occupational Accident		15,039		19,840
Physical Damage		14,561		11,676
Professional Liability Assumed		11,958		16,079
Other short-duration insurance lines		10,016		10,478
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		641,131		567,630
Reinsurance recoverable on unpaid claims
Commercial Liability		209,126		209,152
Workers' Compensation		211,421		182,908
Occupational Accident		500		1,979
Physical Damage		1,054		655
Other short-duration insurance lines		2,267		3,611
Reinsurance recoverable on unpaid losses at the end of the year		424,368		398,305
Unallocated claims adjustment expenses		24,170		22,370
Total gross liability for unpaid claims and claims adjustment expense	$	1,089,669	$	988,305

Supplementary Information about Average Historical Claims Duration

The following is supplementary information about average historical claims duration as of December 31, 2020:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited)
Years	1	2	3	4	5	6	7	8	9	10
Commercial Liability	8.8%	25.2%	22.8%	19.8%	8.9%	5.4%	3.3%	0.8%	1.1%	–
Workers' Compensation	16.9%	26.5%	16.1%	10.1%	6.2%	3.8%	3.1%	2.0%	1.1%	0.6%
Occupational Accident	36.2%	40.7%	11.2%	4.1%	1.0%	1.6%	(0.1)%	0.4%	0.6%	0.3%
Physical Damage	81.6%	16.3%	(0.4)%	N/A	N/A	N/A	N/A	N/A	N/A	N/A
Professional Liability Assumed	1.4%	3.2%	11.8%	27.6%	16.9%	14.9%	9.0%	4.1%	2.6%	1.7%