Retroactive reinsurance contracts

3 Months Ended

Mar. 31, 2025

Insurance [Abstract]

Retroactive reinsurance contracts

Note 14. Retroactive reinsurance contracts

Retroactive reinsurance policies provide indemnification of losses and loss adjustment expenses of short-duration insurance contracts with respect to underlying loss events that occurred prior to the contract inception date. Exposures include significant asbestos, environmental and other mass tort claims. Retroactive reinsurance contracts are generally subject to aggregate policy limits and thus, our exposure to such claims under these contracts is likewise limited. Reconciliations of the changes in estimated liabilities for retroactive reinsurance unpaid losses and loss adjustment expenses follow (in millions).

	2025			2024
Balance at the beginning of the year	$	32,443		$	34,647
Losses and loss adjustment expenses incurred	2				51
Losses and loss adjustment expenses paid		(511	)		(408	)
Foreign currency effect		40			(45	)
Balance at March 31	$	31,974		$	34,245
Losses and loss adjustment expenses incurred above	$	2		$	51
Deferred charge adjustments		169			177
Losses and loss adjustment expenses incurred, including deferred charge adjustments	$	171		$	228

We classify incurred and paid losses and loss adjustment expenses based on the inception dates of the contracts, which reflect when our exposure to losses began. Substantially all of the losses and loss adjustment expenses incurred and paid related to contracts written in prior years. Losses and loss adjustment expenses incurred include changes in estimated ultimate liabilities and related adjustments to deferred charge assets arising from the changes in the estimated timing and amount of loss payments. Deferred charge assets on retroactive reinsurance contracts were $8.6 billion at March 31, 2025 and $8.8 billion at December 31, 2024.