The Company regularly updates its reserve estimates as new information becomes available and further events occur which may impact the resolution of unsettled claims. Reserve adjustments are reflected in results of operations as adjustments to losses and loss adjustment expenses (“LAE”). Often these adjustments are recognized in periods subsequent to the period in which the underlying policy was written and loss event occurred. These types of subsequent adjustments are described as “prior years’ loss reserves.” Such development can be either favorable or unfavorable to the Company’s financial results and may vary by line of business. In this section, all amounts presented include catastrophe losses and LAE, unless otherwise indicated.

The table below provides a reconciliation of the gross beginning and ending reserve for unpaid losses and loss adjustment expenses.

	Three Months Ended
	March 31,
(in millions)	2021			2020
Gross reserve for losses and LAE, beginning of period	$	6,024.0		$	5,654.4
Reinsurance recoverable on unpaid losses		1,641.6			1,574.8
Net reserve for losses and LAE, beginning of period		4,382.4			4,079.6
Net incurred losses and LAE in respect of losses occurring in:
Current year		789.5			730.2
Prior years		(8.2	)		(2.0	)
Total incurred losses and LAE		781.3			728.2
Net payments of losses and LAE in respect of losses occurring in:
Current year		178.5			174.6
Prior years		435.0			484.4
Total payments		613.5			659.0
Net reserve for losses and LAE, end of period		4,550.2			4,148.8
Reinsurance recoverable on unpaid losses		1,673.5			1,576.1
Gross reserve for losses and LAE, end of period	$	6,223.7		$	5,724.9

As a result of continuing trends in the Company’s business, reserves, including catastrophes, have been re-estimated for all prior accident years and were decreased by $8.2 million and $2.0 million in 2021 and 2020, respectively.

For the three months ended March 31, 2021, net favorable loss and LAE development was $8.2 million. This was primarily due to lower than expected losses in the personal automobile line, driven by lower bodily injury and personal injury protection losses primarily in accident year 2020, and in the workers’ compensation line, primarily in accident years 2015 through 2017 and 2019.

For the three months ended March 31, 2020, net favorable loss and LAE development was $2.0 million. Lower than expected losses in the workers’ compensation line, other commercial lines and homeowners line were partially offset by higher than expected losses in the commercial and personal automobile lines, commercial multiple peril line, and in the Company’s run-off voluntary assumed property and casualty reinsurance pools business. Within other commercial lines, lower than expected losses in the Company’s marine line and specialty industrial and commercial property lines were partially offset by higher than expected losses in the general liability lines. The higher than expected losses in the Company’s run-off voluntary assumed property and casualty reinsurance pools business was based on an updated third-party actuarial study received in the first quarter of 2020 for the Excess and Casualty Reinsurance Association (“ECRA”) pool that primarily consists of asbestos and environmental exposures.