Losses and Loss Adjustment Expenses

12 Months Ended

Dec. 31, 2019

Insurance [Abstract]

Losses and Loss Adjustment Expenses

10. LOSSES AND LOSS ADJUSTMENT EXPENSES

The liability for losses and loss adjustment expenses ("LAE"), also referred to as loss reserves, represents our gross estimates before reinsurance for unpaid reported losses and losses that have been incurred but not reported ("IBNR") for our Non-life Run-off, Atrium and StarStone segments using a variety of actuarial methods. We recognize an asset for the portion of the liability that we expect to recover from reinsurers. LAE reserves include allocated loss adjustment expenses ("ALAE"), and unallocated loss adjustment expenses ("ULAE"). ALAE are linked to the settlement of an individual claim or loss, whereas ULAE are based on our estimates of future costs to administer the claims. IBNR represents reserves for losses and LAE that have been incurred but not yet reported to us. This includes amounts for unreported claims, development on known claims and reopened claims.

The following table summarizes the liability for losses and LAE by segment and for our other activities as of December 31, 2019 and 2018:

	2019
	Non-life Run-off			Atrium		StarStone			Other		Total
Outstanding losses	$	4,407,082		$	89,141	$	888,794		$	9,512	$	5,394,529
IBNR	3,945,407			136,543		962,353			13,565		5,057,868
Fair value adjustments - acquired companies	(170,689		)	3,700		(522		)	—		(167,511		)
Fair value adjustments - fair value option	(217,933		)	—		—			—		(217,933		)
ULAE	331,494			2,288		28,503			—		362,285
Total	$	8,295,361		$	231,672	$	1,879,128		$	23,077	$	10,429,238
Reconciliation to Consolidated Balance Sheet:
Losses and loss adjustment expenses	$	5,674,239		$	231,672	$	1,879,128		$	23,077	$	7,808,116
Losses and loss adjustment expenses, at fair value	2,621,122			—		—			—		2,621,122
Total	$	8,295,361		$	231,672	$	1,879,128		$	23,077	$	10,429,238

	2018
	Non-life Run-off			Atrium		StarStone			Other		Total
Outstanding losses	$	4,271,769		$	94,885	$	796,194		$	6,052	$	5,168,900
IBNR	3,527,767			140,521		787,894			12,809		4,468,991
Fair value adjustments- acquired companies	(217,527		)	3,476		(467		)	—		(214,518		)
Fair value adjustments - fair value option	(374,752		)	—		—			—		(374,752		)
ULAE	333,405			2,402		25,076			—		360,883
Total	$	7,540,662		$	241,284	$	1,608,697		$	18,861	$	9,409,504
Reconciliation to Consolidated Balance Sheet:
Losses and loss adjustment expenses	$	4,666,607		$	241,284	$	1,608,697		$	18,861	$	6,535,449
Losses and loss adjustment expenses, at fair value	2,874,055			—		—			—		2,874,055
Total	$	7,540,662		$	241,284	$	1,608,697		$	18,861	$	9,409,504

The overall increase in the liability for losses and LAE between December 31, 2018 and December 31, 2019 was primarily attributable to the assumed reinsurance agreements with Zurich, Maiden Re Bermuda, Amerisure and AmTrust, as described in Note 4 - "Significant New Business" in our Non-life Run-off segment.

The table below provides a consolidated reconciliation of the beginning and ending liability for losses and LAE for the years ended December 31, 2019, 2018 and 2017:

	2019			2018			2017
Balance as at January 1	$	9,409,504		$	7,398,088		$	5,987,867
Less: reinsurance reserves recoverable	1,867,841			1,870,033			1,388,193
Less: deferred charge assets on retroactive reinsurance	86,585			80,192			94,551
Net balance as at January 1	7,455,078			5,447,863			4,505,123
Net incurred losses and LAE:
Current period	823,658			689,782			437,853
Prior periods	48,917			(235,757		)	(244,302		)
Total net incurred losses and LAE	872,575			454,025			193,551
Net paid losses:
Current period	(200,264		)	(189,560		)	(82,273		)
Prior periods	(1,669,004		)	(1,194,985		)	(862,921		)
Total net paid losses	(1,869,268		)	(1,384,545		)	(945,194		)
Effect of exchange rate movement	48,695			(145,243		)	158,429
Acquired on purchase of subsidiaries	686			1,310,874			10,251
Assumed business	1,586,307			1,772,104			1,525,703
Ceded business	(47,018		)	—			—
Net balance as at December 31	8,047,055			7,455,078			5,447,863
Plus: reinsurance reserves recoverable	2,109,721			1,867,841			1,870,033
Plus: deferred charge assets on retroactive reinsurance	272,462			86,585			80,192
Balance as at December 31	$	10,429,238		$	9,409,504		$	7,398,088

The tables below provide the components of net incurred losses and LAE by segment and for our other activities for the years ended December 31, 2019, 2018 and 2017:  

	2019
	Non-life Run-off			Atrium			StarStone		Other		Total
Net losses paid	$	1,247,624		$	78,189		$	531,633	$	11,822	$	1,869,268
Net change in case and LAE reserves	(530,891		)	3,534			25,967		3,460		(497,930		)
Net change in IBNR reserves	(813,582		)	(4,782		)	166,427		756		(651,181		)
Increase (reduction) in estimates of net ultimate losses	(96,849		)	76,941			724,027		16,038		720,157
Increase (reduction) in provisions for unallocated LAE	(57,404		)	—			3,441		—		(53,963		)
Amortization of deferred charge assets	38,627			—			—		—		38,627
Amortization of fair value adjustments	50,070			335			168		—		50,573
Changes in fair value - fair value option	117,181			—			—		—		117,181
Net incurred losses and LAE	$	51,625		$	77,276		$	727,636	$	16,038	$	872,575

	2018
	Non-life Run-off			Atrium			StarStone			Other		Total
Net losses paid	$	838,817		$	64,506		$	477,130		$	4,092	$	1,384,545
Net change in case and LAE reserves	(547,420		)	6,331			75,887			4,808		(460,394		)
Net change in IBNR reserves	(565,385		)	4,091			113,879			7,999		(439,416		)
Increase (reduction) in estimates of net ultimate losses	(273,988		)	74,928			666,896			16,899		484,735
Increase (reduction) in provisions for unallocated LAE	(65,401		)	—			6,753			—		(58,648		)
Amortization of deferred charge assets	13,781			—			—			—		13,781
Amortization of fair value adjustments	12,877			(5,118		)	(266		)	—		7,493
Changes in fair value - fair value option	6,664			—			—			—		6,664
Net incurred losses and LAE	$	(306,067	)	$	69,810		$	673,383		$	16,899	$	454,025

	2017
	Non-life Run-off			Atrium			StarStone			Total
Net losses paid	$	581,723		$	55,678		$	307,793		$	945,194
Net change in case and LAE reserves	(381,053		)	8,338			31,685			(341,030		)
Net change in IBNR reserves	(390,727		)	7,679			(23,540		)	(406,588		)
Increase (reduction) in estimates of net ultimate losses	(190,057		)	71,695			315,938			197,576
Increase (reduction) in provisions for bad debt	(1,536		)	159			—			(1,377		)
Increase (reduction) in provisions for unallocated LAE	(53,810		)	285			(187		)	(53,712		)
Amortization of deferred charge assets	14,359			—			—			14,359
Amortization of fair value adjustments	10,114			(2,720		)	(945		)	6,449
Changes in fair value - fair value option	30,256			—			—			30,256
Net incurred losses and LAE	$	(190,674	)	$	69,419		$	314,806		$	193,551

Loss Development Information

Methodology for Establishing Reserves

The liability for losses and LAE includes an amount determined from reported claims and an amount based on historical loss experience and industry statistics for IBNR using a variety of actuarial methods. Our loss reserves cover multiple lines of business, which include workers' compensation, general casualty, asbestos and environmental, marine, aviation and transit, construction defects and other non-life lines of business. Our management, through our loss reserving committees, considers the reasonableness of loss reserves recommended by our actuaries, including actual loss development during the year.

Case reserves are recognized for known claims (including the cost of related litigation) when sufficient information has been reported to us to indicate the involvement of a specific insurance policy. We use considerable judgment in estimating losses for reported claims on an individual claim basis based upon our knowledge of the circumstances surrounding the claim, the severity of the injury or damage, the jurisdiction of the occurrence, the potential for ultimate exposure, the type of loss, and our experience with the line of business and policy provisions relating to the particular type of claim. The reserves for unpaid reported losses and LAE are established by management based on reports from brokers, ceding companies and insureds and represent the estimated ultimate cost of events or conditions that have been reported to, or specifically identified, by us. We also consider facts currently known and the current state of the law and coverage litigation.

IBNR reserves are established by management based on actuarially determined estimates of ultimate losses and loss expenses. We use generally accepted actuarial methodologies to estimate ultimate losses and LAE and those estimates are reviewed by management. In addition, the routine settlement of claims, at either below or above the carried advised loss reserve, updates historical loss development information to which actuarial methodologies are applied, often resulting in revised estimates of ultimate liabilities. On an annual basis, independent actuarial firms are retained by management to provide their estimates of ultimate losses and to review the estimates developed by our actuaries.

Within the annual loss reserve studies produced by either our actuaries or independent actuaries, exposures for each subsidiary are separated into homogeneous reserving categories for the purpose of estimating IBNR. Each reserving category contains either direct insurance or assumed reinsurance reserves and groups relatively similar types of risks and exposures (for example, asbestos, environmental, casualty, property) and lines of business written (for example, marine, aviation, non-marine). Based on the exposure characteristics and the nature of available data for each individual reserving category, a number of methodologies are applied. Recorded reserves for each category are selected from the actuarial indications produced by the various methodologies after consideration of exposure characteristics, data limitations and strengths and weaknesses of each method applied. This approach to estimating IBNR has been consistently adopted in the annual loss reserve studies for each period presented.

The estimation of unpaid claim liabilities at any given point in time is subject to a high degree of uncertainty for a number of reasons. A significant amount of time can lapse between the assumption of risk, the occurrence of a loss event, the reporting of the event to an insurance or reinsurance company and the ultimate payment of the claim on the loss event. Our actuarial methodologies include industry benchmarking which, under certain methodologies, compares the trend of our loss development to that of the industry. To the extent that the trend of our loss development compared to the industry changes in any period, it is likely to have an impact on the estimate of ultimate liabilities. Unpaid claim liabilities for property and casualty exposures in general are impacted by changes in the legal environment, jury awards, medical cost trends and general inflation. Certain estimates for unpaid claim liabilities involve considerable uncertainty due to significant coverage litigation, and it can be unclear whether past claim experience will be representative of future claim experience. Ultimate values for such claims cannot be estimated using reserving techniques that extrapolate losses to an ultimate basis using loss development factors, and the uncertainties surrounding the estimation of unpaid claim liabilities are not likely to be resolved in the near future. In addition, reserves are established to cover loss development related to both known and unasserted claims. Consequently, our subsequent estimates of ultimate losses and LAE, and our liability for losses and LAE, may differ materially from the amounts recorded in the consolidated financial statements.

These estimates are reviewed regularly and, as experience develops and new information becomes known, the reserves are adjusted as necessary. Such adjustments, if any, will be recorded in earnings in the period in which they become known. Prior period development arises from changes to loss estimates recognized in the current year that relate to loss reserves established in previous calendar years.

Asbestos and Environmental

In establishing the reserves for losses and LAE related to asbestos and environmental claims, management considers facts currently known and the current state of the law and coverage litigation. Liabilities are recognized for known claims (including the cost of related litigation) when sufficient information has been developed to indicate the involvement of a specific insurance policy, and management can reasonably estimate its liability. In addition, reserves have been established to cover additional exposures on both known and unreported claims. Estimates of the reserves are reviewed and updated continually. Developed case law and claim histories are still evolving for such claims, especially because significant uncertainty exists about the outcome of coverage litigation and whether past claim experience will be representative of future claim experience. In view of the changes in the legal and tort environment that affect the development of such claims, the uncertainties inherent in valuing asbestos and environmental claims are not likely to be resolved in the near future. Ultimate values for such claims cannot be estimated using traditional reserving techniques and there are significant uncertainties in estimating the amount of our potential losses for these claims. There can be no assurance that the reserves established by us will be adequate or will not be adversely affected by the development of other latent exposures. The net liability for unpaid losses and LAE as of December 31, 2019 and 2018 included $2,078.3 million and $1,703.6 million, respectively, which represented an estimate of the net ultimate liability for asbestos and environmental claims. The gross liability for such claims as of December 31, 2019 and 2018 was $2,259.6 million and $1,839.7 million, respectively. For the years ended December 31, 2019 and 2018, our reserves for asbestos and environmental liabilities increased by $419.9 million and decreased by $152.4 million on a gross

basis, respectively, and increased by $374.7 million and decreased by $159.6 million on a net basis, respectively. The increase in 2019 was primarily due to acquisition activity and the decrease in 2018 was primarily due to net paid losses, foreign exchange and net favorable development, partially offset by acquisition activity.

Disclosures of Incurred and Paid Loss Development, IBNR, Claims Counts and Payout Percentages

The loss development tables disclosed below, sets forth our historic incurred and paid loss development by accident year through December 31, 2019, net of reinsurance, as well as the cumulative number of reported claims, IBNR balances, and other supplementary information.

The loss development tables disclosed below are presented as follows:

• Non-Life Run-off - Presented by acquisition year, if significant, and further disaggregated, if significant, by line of business within that acquisition year. The disaggregated lines of business include General Casualty, Workers’ Compensation, Marine, Aviation and Transportation, Professional Indemnity / Directors & Officers and Motor.

• Atrium - The loss development disclosures for our Atrium segment have not been disaggregated further by line of business as the segment comprised approximately only 2% of our total consolidated liability for losses and LAE as of December 31, 2019 and was, therefore, not considered material for further disaggregation.

•

StarStone - All the lines of business related to the StarStone segment have been included within the loss development disclosures below, namely, Casualty, Marine, Property, Aerospace and Workers’ Compensation.

Incurred and Paid Loss Development and IBNR Disclosures

For each acquisition year and/or line of business for which incurred losses and allocated loss adjustment expenses, net of reinsurance tables have been provided below, the disclosure approach and format adopted reflects the following:

• The incurred loss development tables include both reported case reserves and IBNR liabilities, as well as cumulative paid losses;

• Both the incurred and cumulative paid loss development tables include allocated LAE (i.e. claims handling costs allocated to specific individual claims) but exclude unallocated LAE (i.e. the costs associated with internal claims staff and third party administrators as well as consultants that cannot be allocated to specific individual claims);

• The fair value adjustments related to business acquisitions are excluded from the loss development tables, however the undiscounted incurred losses, cumulative paid losses and allocated LAE related to business acquisitions are included in the loss development tables;

• The fair value adjustments related to retroactive reinsurance agreements for which we have elected the fair value option are excluded from the loss development tables, however the undiscounted incurred losses, cumulative paid losses and allocated LAE related to retroactive reinsurance agreements for which we have elected the fair value option are included in the loss development tables;

• The amounts relating to the amortization of deferred charge assets are excluded from the loss development tables;

• The amounts relating to the increase (reduction) in provisions for unallocated LAE are excluded from the loss development tables;

• In the incurred loss development tables, the incurred effect of agreeing a commutation or policy buyback is included in the period in which the commutation or policy buyback is contractually agreed. We reflect the net incurred loss development arising from a commutation or policy buyback in the fiscal year in which a commutation or policy buyback is contractually agreed, and the net incurred loss development is allocated to the appropriate accident year. The claim will generally have been adjusted throughout its lifetime and the amounts recorded in prior years (supplementary information) remain unchanged in our tables, such that the incurred amount that we recognize in the year in which a commutation or policy buyback is contractually agreed represents the effect of the commutation or policy buyback settlement compared to the carried net loss and LAE reserve balance in the prior year. We do not recast prior years to remove commuted or bought back

claims, as such practice would eliminate any historical favorable or adverse development we may have experienced on our commuted loss and LAE reserves. Reserves that have been commuted or bought back are not adjusted in future years but the commuted or bought back value remains in our total incurred losses;

• In the cumulative paid losses tables, we reflect the amount of the commutation or policy buyback settlements in the year in which they are actually paid or received, and the net payment is allocated to the appropriate accident year. The claim or recoverable may have recorded payments or receipts throughout its lifetime and amounts recorded in prior years (supplementary information) remain unchanged in our tables, such that the amounts paid or received that we recognize in the year in which a commutation or policy buyback is paid or received represents the amount actually paid or received. We do not recast prior years to remove payments or receipts related to commutations or policy buybacks, as we consider commutations and policy buybacks a key component of our business and reflective of our ability to effectively manage acquired losses and LAE liabilities. Payments relating to commutations and policy buybacks are not adjusted in future years but the payments remain in our total cumulative paid losses;

• The amounts included within the loss development tables for the years ended December 31, 2010 through to December 31, 2018 (April 1, 2014 through to December 31, 2018 in the case of StarStone since its date of acquisition), as well as the historical average annual percentage payout ratios as of December 31, 2019, are presented as supplementary information and are therefore unaudited;

• All data presented within the loss development tables is net of reinsurance recoveries, excluding provisions for uncollectible reinsurance recoverables;

• All data presented within the loss development tables is net of intercompany activity, including the Intra-Group Cessions within the StarStone segment. On May 14, 2018, we completed the acquisition of KaylaRe and subsequently eliminated all the related intercompany balances. In the loss development disclosures provided in our Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2017, the StarStone loss triangles were presented net of the external reinsurance provided by KaylaRe since it was not a consolidated subsidiary at that time. However, after the acquisition of KaylaRe in May 2018, the reinsurance arrangement with StarStone became an intercompany transaction and was eliminated on consolidation. In addition, the StarStone loss development disclosures relating to the prior years (supplementary information) were retrospectively recast as if KaylaRe had always been a consolidated subsidiary, to allow for comparability between fiscal years;

• The IBNR reserves included within each incurred loss development table by accident year, reflect the net IBNR recorded as of December 31, 2019, including expected development on reported losses;

• For the Non-life Run-off segment loss development tables, all information for both acquisitions and retroactive reinsurance agreements is presented prospectively. As the reserves are effectively re-underwritten at the date the reserves are acquired or assumed, we believe that the historical loss development prior to being acquired is not relevant to our own experience managing these reserves. In addition, the information required to prepare the loss development disclosures on a retrospective basis is not always available to us and a mixed approach would result in loss development tables that are not entirely reflective of the actual loss development;

• For the Non-life Run-off segment we have also presented the net incurred and paid losses and ALAE information by calendar year as well as IBNR and claim counts for accident years older than 10 years on a single row within the loss development tables. This presentation differs from the typical approach where only the net outstanding losses and LAE reserves are presented as a reconciling item at the bottom of the loss development tables. The additional detailed disclosures are provided on a voluntary basis and the inclusion of the disclosures is to provide additional information to the users of our financial statements and to also enable the reconciliation of our total loss reserves by acquisition year and by significant line of business.

• For the StarStone segment loss development tables, all information has been presented on a prospective basis from the date of our acquisition of StarStone, which was effective on April 1, 2014. Providing pre-acquisition incurred and paid losses by accident year for years prior to 2014 was determined to be impracticable due to significant data limitations; and

• For the Atrium segment loss development tables, all information has been presented on a retrospective basis.

The historical amounts disclosed within the loss development tables for all lines of business presented below

are on a constant-currency basis, which is achieved by using constant foreign exchange rates between periods in the loss development tables, and translating prior period amounts denominated in currencies other than the U.S. dollar, which is our reporting currency, using the closing exchange rates as of December 31, 2019.

The impact of this exchange rate conversion is to show the change between periods exclusive of the effect of exchange rate fluctuations, which would otherwise distort the change in incurred losses and the cash flow patterns associated with those incurred losses shown within the loss development tables. The change in net incurred losses shown within the loss development tables will, however, differ from other U.S. GAAP disclosures of incurred current and prior period reserve development amounts, which include the effect of exchange rate fluctuations.

Establishing an estimate for loss reserves involves various assumptions and judgments, therefore, the information contained within the loss development disclosures only allows readers or users of our consolidated financial statements to understand, at the summary level presented in the development tables, the change over time in our reported incurred loss estimates as well as the nature and patterns of the cash flows associated with those estimates. We, therefore, believe that the information provided within the loss development tables disclosed below is of limited use for independent analysis or application of standard actuarial estimations, and any results obtained from doing so should be interpreted with caution.

Cumulative Number of Reported Claims

Reported claim counts, on a cumulative basis, are provided as supplemental information to each incurred loss development table by accident year. We measure claim frequency information on an individual claim count basis within each of our segments as follows:

• Non-Life Run-off - The claim frequency information for the exposures included within our Non-life Run-off lines of business includes direct and assumed open and closed claims by accident year at the claimant level. Reported claims that are closed without a payment are included within our cumulative number of reported claims because we typically incur claim adjustment expenses on them prior to their closure. The claim count numbers exclude counts related to claims within policy deductibles where the insured is responsible for the payment of losses within the deductible layer. Individual claim counts related to certain assumed reinsurance contracts such as excess-of-loss and quota share treaties are not available to us, and the losses arising from these treaties have been treated as single claims for the purposes of determining claim counts. Therefore, each treaty year within the reinsurance contract is deemed a single claim because the detailed underlying individual claim information is generally not reported to us by our cedents; and

• StarStone and Atrium - The claim frequency information is determined at the claimant level for the exposures within the lines of business related to these segments. Our claims system assigns a unique claim identifier to each reported claim we receive. Each unique claim identifier is deemed to be a single claim, irrespective of whether the claim remains open or has been closed with or without payment. For certain insurance facilities and business produced or managed by managing general agents, coverholders and third party administrators where the underlying claims data is reported to us in an aggregated format, the information necessary to provide cumulative claims frequency is not available. In such cases, we typically record a “block” claim in our system. This also applies to a small amount of assumed reinsurance business that we write where, similarly, the underlying claims data is reported to us in an aggregated format. In such instances, each assumed reinsurance contract is deemed a single claim.

The cumulative number of reported claims for our Atrium segment includes all claim counts for Syndicate 609. Our Atrium segment represents our 25% share of Syndicate 609's underwriting capacity and capital, however, the claims count is the same whether viewed at the 100% Syndicate level or for our 25% share.

Our reported claim frequency information is subject to the following inherent limitations when analyzing our loss experience and severity:

• Claim counts are presented only on a reported and not on an ultimate basis. Therefore, reported claim counts include open claims which have outstanding reserves but exclude IBNR claims. As such the reported claims are consistent with reported losses, which can be calculated by subtracting IBNR losses from incurred losses. However, the reported claim counts are inconsistent with the losses in the incurred loss development tables, which include IBNR losses, and to losses in the paid loss development tables, which exclude outstanding reserves;

• Reported claim counts have not been adjusted for ceded reinsurance, which may distort any measures of frequency or severity;

• For lines of business that have a mix of primary and excess layer exposures, such as our general casualty and workers’ compensation lines of business, the reported claim counts may fluctuate from period to period between exposure layers, thereby distorting any measure of frequency and severity; and

•

The use of our reported claim frequency information to project ultimate loss payouts by disaggregated disclosure category or line of business may not be as meaningful as claim count information related to individual contracts at a more granular level.

Payout Percentages

• Non-life Run-off - The annual percentage payout disclosures for our Non-life Run-off segment are based on the payout of incurred claims by age, net of reinsurance. For our Non-life Run-off segment, claims aging reflects the number of years that have lapsed since the original acquisition of the related net liability for losses and LAE reserves to the date the claim is paid. There may be occasions where, due to our claims management strategies (including commutations and policy buy-backs) or due to the timing of claims payments relative to the associated recovery, the cash received from reinsurance recoveries is greater than the cash paid out to our claimants, (i.e. a net recovery rather than a net payout for a particular calendar year), thereby resulting in a negative annual percentage payout for that calendar year.

•

Atrium and StarStone - The average annual percentage payout disclosures for our Atrium and StarStone segments are based on the payout of incurred claims by age, net of reinsurance.

Non-Life Run-off Segment

The table below provides a reconciliation of the beginning and ending reserves for losses and LAE for the years ended December 31, 2019, 2018 and 2017 for the Non-life Run-off segment:

	2019			2018			2017
Balance as at January 1	$	7,540,662		$	5,949,472		$	4,716,363
Less: reinsurance reserves recoverable	1,366,123			1,377,485			1,000,953
Less: deferred charge assets on retroactive reinsurance	86,585			80,192			94,551
Net balance as at January 1	6,087,954			4,491,795			3,620,859
Net incurred losses and LAE:
Current period	123,559			12,451			5,866
Prior periods	(71,934		)	(318,518		)	(196,540		)
Total net incurred losses and LAE	51,625			(306,067		)	(190,674		)
Net paid losses:
Current period	(64,820		)	(5		)	(2,835		)
Prior periods	(1,182,804		)	(838,812		)	(578,888		)
Total net paid losses	(1,247,624		)	(838,817		)	(581,723		)
Effect of exchange rate movement	47,355			(132,632		)	138,772
Acquired on purchase of subsidiaries	686			1,111,839			10,251
Assumed business	1,586,307			1,761,836			1,494,310
Ceded business	(47,018		)	—			—
Net balance as at December 31	6,479,285			6,087,954			4,491,795
Plus: reinsurance reserves recoverable	1,543,614			1,366,123			1,377,485
Plus: deferred charge assets on retroactive reinsurance	272,462			86,585			80,192
Balance as at December 31	$	8,295,361		$	7,540,662		$	5,949,472

Net incurred losses and LAE in the Non-life Run-off segment for the years ended December 31, 2019, 2018 and 2017 were as follows:

	2019								2018								2017
	Prior Period			Current Period		Total			Prior Period			Current Period		Total			Prior Period			Current Period		Total
Net losses paid	$	1,182,804		$	64,820	$	1,247,624		$	838,812		$	5	$	838,817		$	578,888		$	2,835	$	581,723
Net change in case and LAE reserves	(553,996		)	23,105		(530,891		)	(552,124		)	4,704		(547,420		)	(381,450		)	397		(381,053		)
Net change in IBNR reserves	(848,776		)	35,194		(813,582		)	(573,127		)	7,742		(565,385		)	(393,100		)	2,373		(390,727		)
Increase (reduction) in estimates of net ultimate losses	(219,968		)	123,119		(96,849		)	(286,439		)	12,451		(273,988		)	(195,662		)	5,605		(190,057		)
Reduction in provisions for bad debt	—			—		—			—			—		—			(1,536		)	—		(1,536		)
Increase (reduction) in provisions for unallocated LAE	(57,844		)	440		(57,404		)	(65,401		)	—		(65,401		)	(54,071		)	261		(53,810		)
Amortization of deferred charge assets	38,627			—		38,627			13,781			—		13,781			14,359			—		14,359
Amortization of fair value adjustments	50,070			—		50,070			12,877			—		12,877			10,114			—		10,114
Changes in fair value - fair value option	117,181			—		117,181			6,664			—		6,664			30,256			—		30,256
Net incurred losses and LAE	$	(71,934	)	$	123,559	$	51,625		$	(318,518	)	$	12,451	$	(306,067	)	$	(196,540	)	$	5,866	$	(190,674	)

    

Net change in case and LAE reserves comprises the movement during the year in specific case reserve liabilities as a result of claims settlements or changes advised to us by our policyholders and attorneys, less changes in case reserves recoverable advised by us to our reinsurers as a result of the settlement or movement of assumed claims. Net change in IBNR represents the gross change in our actuarial estimates of IBNR, less amounts recoverable.

Year Ended December 31, 2019

The increase in net incurred losses and LAE for the year ended December 31, 2019 of $51.6 million included net incurred losses and LAE of $123.6 million related to current period net earned premium. Excluding current period net incurred losses and LAE of $123.6 million, the reduction in net incurred losses and LAE liabilities relating to prior periods was $71.9 million, which was attributable to a reduction in estimates of net ultimate losses of $220.0 million, a reduction in provisions for unallocated LAE of $57.8 million relating to 2019 run-off activity, partially offset by the amortization of the deferred charge assets of $38.6 million, amortization of fair value adjustments of $50.1 million and an increase in the fair value of liabilities of $117.2 million related to our assumed retroactive reinsurance agreements for which we have elected the fair value option.

Drivers of the change in estimates of net ultimate losses:

The reduction in estimates of prior period net ultimate losses of $220.0 million for the year ended December 31, 2019 included a net reduction in case and IBNR reserves of $1,402.8 million, partially offset by net losses paid of $1,182.8 million. For the year ended December 31, 2019, the overall change in our estimates of net ultimate losses related to prior periods by line of business within our Non-life Run-off was as presented in the table below:

	Net losses paid		Net change in case and LAE reserves			Net change in IBNR reserves			Increase (reduction) in estimates of net ultimate losses
Asbestos	$	118,557	$	35,003		$	(146,749	)	$	6,811
Environmental	16,899		13,796			(15,707		)	14,988
General Casualty	175,044		(89,968		)	(91,818		)	(6,742		)
Workers' Compensation	208,961		(156,435		)	(188,944		)	(136,418		)
Marine, aviation and transit	82,058		(77,958		)	(24,508		)	(20,408		)
Construction defect	32,078		(8,313		)	(25,025		)	(1,260		)
Professional indemnity/ Directors & Officers	103,413		(36,986		)	(104,984		)	(38,557		)
Motor	276,563		(134,127		)	(179,887		)	(37,451		)
Property	94,093		(73,259		)	(7,358		)	13,476
All Other	75,138		(25,749		)	(63,796		)	(14,407		)
Total	$	1,182,804	$	(553,996	)	$	(848,776	)	$	(219,968	)

The significant drivers of the results in the table above are explained below.

Workers' Compensation

A $136.4 million reduction in estimates of net ultimate losses in our workers' compensation line of business arose across multiple portfolios, where reported loss development was generally significantly less than expected development. The lower than expected actual development was driven by significant proactive settlement activity on individual claimants where we were able to settle claims lower than the case reserve estimates. For example, in two of our portfolios we observed favorable reported loss development, where we paid $39.3 million in loss payments to release a corresponding $53.6 million of associated case reserves for $14.3 million in favorable reported loss development. These settlement activities and the favorable actual loss development versus expected loss development, lead to a change in the actuarial assumptions in the annual reserve study that reflect this favorable loss development. For workers compensation, we paid $209.0 million offset by a reduction in case reserves of $156.4 million and reduction in IBNR reserve of $188.9 million.

We also continue to actively seek to commute policies when possible, and where the commutation of the policy is settled at a level below the carried value of the loss reserves, we record a reduction in our estimates of net ultimate losses. During the year ended December 31, 2019, we completed 6 commutations across several portfolios that contributed to a $6.1 million reduction in estimates of net ultimate losses.

Professional Indemnity/Directors & Officers

A $38.6 million reduction in estimates of net ultimate losses in our professional indemnity/directors’ & officers’ line of business arose based on the annual actuarial analysis which reflected the better than expected loss development during 2019. As part of the reserve analysis, an in-depth review of recently acquired portfolios’ ceded reinsurance program led to an increase in the ceded reinsurance asset of $13.5 million, which is a reduction in net ultimate losses.

Asbestos

A $6.8 million increase in estimates of net ultimate losses in our asbestos line of business arose primarily due to changes in our actuarial assumptions related to dismissal rates. During 2019, the number of new defendants and filed claims was less than expected but this was offset by a lowering of the dismissal rate. In asbestos, the dismissal rates are extremely high as many of the claims do not have merit against the insured. However, we have seen a trend in both US and UK exposure of the dismissal rate trending down in the range of 2 to 3 percentage points.

Similar to workers’ compensation business, during the year ended December 31, 2019, we completed 6 commutations across several portfolios that contributed to a $9.8 million reduction in estimates of net ultimate losses.

All Other

All other line of business changes in estimates of net ultimate losses were primarily due to the application of our reserving methodologies, favorable actual versus expected loss development and proactive claim management.

Other Components of Net incurred Losses and LAE

The reduction of $57.8 million in provisions for unallocated LAE was due to a reduction in our estimate of the total future costs to administer the claims.

The increase in the fair value of liabilities for which we have elected the fair value option of $117.2 million was primarily due to changes in the discount rate and the application of the discount rate to the updated expected cash flow patterns.

The amortization of fair value adjustments of $50.1 million was related to the fair value adjustments associated with the acquisition of companies. On acquisition, we are required to fair value the net assets acquired, including the reinsurance balances recoverable and the liability for losses and LAE. The resulting fair value adjustments are then amortized over the expected life of the reinsurance balances recoverable and the liability for losses and LAE.

The amortization of deferred charge assets of $38.6 million was associated with retroactive reinsurance contracts where, at the inception of the contract, the estimated ultimate losses payable was in excess of premium received. Deferred charge assets are amortized over the estimated claim payment period of the related contract and are adjusted periodically to reflect new estimates of the amount and timing of the remaining loss payments.

Year Ended December 31, 2018

The reduction in net incurred losses and LAE for the year ended December 31, 2018 of $306.1 million included net incurred losses and LAE of $12.5 million related to current period net earned premium from previously acquired businesses that renewed certain policies while being run-off. Excluding current period net incurred losses and LAE of $12.5 million, the reduction in net incurred losses and LAE liabilities relating to prior periods was $318.5 million, which was attributable to a reduction in estimates of net ultimate losses of $286.4 million, and a reduction in provisions for unallocated LAE of $65.4 million, relating to 2018 run-off activity, partially offset by an increase in the fair value of liabilities of $6.7 million related to our assumed retroactive reinsurance agreements for which we have elected the fair value option, the amortization of the deferred charge assets of $13.8 million and the amortization of fair value adjustments over the estimated payout period relating to companies acquired amounting to $12.9 million.

Drivers of the change in estimates of net ultimate losses:

The reduction in estimates of prior period net ultimate losses of $286.4 million for the year ended December 31, 2018 included a net reduction in case and IBNR reserves of $1,125.3 million, partially offset by net losses paid of $838.8 million. For the year ended December 31, 2018, the overall change in our estimates of net ultimate losses related to prior periods by line of business within our Non-life Run-off was as presented in the table below:

	Net losses paid		Net change in case and LAE reserves			Net change in IBNR reserves			Increase (reduction) in estimates of net ultimate losses
Asbestos	$	108,248	$	(21,535	)	$	(151,662	)	$	(64,949	)
Environmental	21,273		479			(7,599		)	14,153
General Casualty	141,624		(115,240		)	(60,828		)	(34,444		)
Workers' Compensation	139,226		(178,138		)	(115,648		)	(154,560		)
Marine, aviation and transit	67,831		(44,200		)	(21,188		)	2,443
Construction defect	22,182		(7,257		)	(33,146		)	(18,221		)
Professional indemnity/ Directors & Officers	161,797		(11,159		)	(130,957		)	19,681
Motor	104,182		(109,962		)	(34,215		)	(39,995		)
Property	22,178		(24,271		)	(11,497		)	(13,590		)
All Other	50,271		(40,841		)	(6,387		)	3,043
Total	$	838,812	$	(552,124	)	$	(573,127	)	$	(286,439	)

The significant drivers of the results in the table above are explained below.

Workers' Compensation

The $154.6 million reduction in estimates of net ultimate losses in our workers' compensation line of business in 2018 arose across multiple portfolios, where reported incurred loss development was generally significantly less than expected. When actual development is less than expected for a sustained period of time across a significant volume of exposures, an updated actuarial analysis tends to indicate reductions in IBNR reserves. Updates to actuarial analysis, factoring in the less-than-expected reported incurred loss development for the year, is the primary driver of the $154.6 million reduction to Workers' Compensation net ultimate loss estimates.

For certain of our portfolios, the lower than expected actual development was driven by significant proactive settlement activity on individual claimants where we were able to close open claims earlier than was indicated by the original payout pattern, and in other portfolios, based on the review of recent loss development activity we revised our actuarial development "tail factor" assumption, which led to a reduction in net ultimate losses. For example, in one portfolio we observed favorable incurred loss development, primarily relating to accident years 1995 through 2005 where we paid $22.7 million in loss payments to release a corresponding $37.0 million of associated case reserves for $14.3 million in favorable incurred loss development.

For recently acquired portfolios of workers' compensation business, we have utilized our subsidiary, Paladin Managed Care Services ("Paladin"), to assist us in reviewing claims. Paladin generally produces savings related to medical expense liabilities over and above savings achieved by prior vendors of such services, and the savings lead to actual development that is less than expected, thereby driving reductions to the estimates of net ultimate losses. In one particular program, our claims personnel pursued a proactive strategy of settling with numerous workers' compensation claimants whose injuries arose in recent accident years. For this portfolio, the claims team reduced the open inventory of claims by 78% during 2018. This reduction in exposure, when incorporated into an updated actuarial analysis, led to a reduction in our estimate of ultimate net losses of $30.2 million, primarily relating to accident years 2010 through 2014.

We also continue to actively seek to commute policies when possible, and where the commutation of the policy is settled at a level below the carried value of the loss reserves, we record a reduction in our estimates of net ultimate losses. During the year ended December 31, 2018, we completed 7 commutations across several portfolios that contributed to an $11.2 million the reduction in estimates of net ultimate losses.

Asbestos

The $64.9 million reduction in estimates of net ultimate losses in our asbestos line of business arose primarily due to one asbestos portfolio where lower than expected volume of claims reported and a lower than expected severity on claims settled in the period, when projected to net ultimate losses through actuarial methodologies, resulted in a significant reduction in estimates of net ultimate losses. The volume of claims reported was 3% less than expected and the average cost per claim was 5% less than expected. Across our other asbestos portfolios, we completed 8 commutations and 2 policy buy-backs contributing to a $9.5 million reduction in estimates of net ultimate losses.

All Other

All other line of business changes in estimates of net ultimate losses were primarily due to the application of our reserving methodologies, favorable actual versus expected loss development, claim management and commutations.

Other Components of Net incurred Losses and LAE

The reduction of $65.4 million in provisions for unallocated LAE was due to a reduction in our estimate of the total future costs to administer the claims.

The amortization of deferred charge assets of $13.8 million was associated with retroactive reinsurance contracts where, at the inception of the contract, the estimated ultimate losses payable were in excess of premium received.

The amortization of fair value adjustments of $12.9 million was related to the fair value adjustments associated with the acquisition of companies. On acquisition, we are required to fair value the net assets acquired, including the reinsurance balances recoverable and the liability for losses and LAE.

The increase in the fair value of liabilities for which we have elected the fair value option of $6.7 million was primarily due to decreases in the estimated duration of the net liabilities, partially offset by changes in the corporate bond yield.

Year Ended December 31, 2017

The reduction in net incurred losses and LAE for the year ended December 31, 2017 of $190.7 million included net incurred losses and LAE of $5.9 million related to current period net earned premium from previously acquired businesses that renewed certain policies while being run-off. Excluding current period net incurred losses and LAE of $5.9 million, the reduction in net incurred losses and LAE liabilities relating to prior periods was $196.5 million, which was attributable to a reduction in estimates of net ultimate losses of $195.7 million, and a reduction in provisions for unallocated LAE of $54.1 million, relating to 2017 run-off activity, partially offset by an increase in the fair value of unallocated liabilities of $30.3 million related to our assumed retroactive reinsurance agreements for which we have elected the fair value option, the amortization of the deferred charge assets of $14.4 million and the amortization of fair value adjustments over the estimated payout period relating to companies acquired amounting to $10.1 million.

Drivers of the change in estimates of net ultimate losses:

The reduction in estimates of prior period net ultimate losses of $195.7 million for the year ended December 31, 2017 included a net reduction in case and IBNR reserves of $774.6 million, partially offset by net losses paid of $578.9 million. For the year ended December 31, 2017, the overall change in our estimates of net ultimate losses related to prior periods by line of business within our Non-life Run-off was as presented in the table below:

	Net losses paid		Net change in case and LAE reserves			Net change in IBNR reserves			Increase (reduction) in estimates of net ultimate losses
Asbestos	$	105,731	$	(1,865	)	$	(76,837	)	$	27,029
Environmental	26,542		(9,438		)	(7,748		)	9,356
General Casualty	94,526		(54,292		)	(49,025		)	(8,791		)
Workers' Compensation	187,712		(190,924		)	(151,797		)	(155,009		)
Marine, aviation and transit	18,272		(9,322		)	(11,517		)	(2,567		)
Construction defect	33,802		(24,023		)	(42,804		)	(33,025		)
Professional indemnity/ Directors & Officers	33,402		(19,054		)	(24,559		)	(10,211		)
Motor	24,391		(15,990		)	(8,513		)	(112		)
Property	13,440		(11,196		)	(5,162		)	(2,918		)
All Other	41,070		(45,346		)	(15,138		)	(19,414		)
Total	$	578,888	$	(381,450	)	$	(393,100	)	$	(195,662	)

The significant drivers of the results in the table above are explained below.

Workers' Compensation

The $155.0 million reduction in estimates of net ultimate losses in our workers' compensation line of business arose primarily in five separate portfolios. Across these five portfolios, the reported incurred loss development was generally significantly lower than expected. When actual development is less than expected for a sustained period of time, across a significant volume of exposures, an updated actuarial analysis tends to indicate reductions in IBNR reserves. In addition, we continue to proactively manage and settle claims where possible, commute policies if appropriate and, through Paladin, we are able to achieve significant savings on medical costs through active claims management strategies over the life of the reported claims. All of these items reduce the estimates of net ultimate losses.

Construction Defect

The $33.0 million reduction in estimates of net ultimate losses in our construction defect line of business arose primarily due to lower than expected actual incurred development in one portfolio. The active claims management approach that our claims team adopted for the assumed exposures within this portfolio led to a significant reduction loss in the inventory of the assumed open claims of 73% during 2017. This reduction in exposure, when incorporated into our updated actuarial analysis, resulted in a reduction in estimates of net ultimate losses for this line of business.

Asbestos

The $27.0 million increase in estimates of net ultimate losses in our asbestos line of business resulted from a ground-up study performed by a consulting actuarial firm on one of our portfolios. This study resulted in the recording of additional reserves of $60.5 million due to a small number of accounts that experienced an increase in the notification of claims which are expected to attach to the excess policies that we reinsure. This increase was partially offset by favorable development of $33.5 million in our other portfolios of asbestos exposures arising primarily from lower than expected claim notifications

All Other

All other line of business changes in estimates of net ultimate losses were primarily due to the application of our reserving methodologies, favorable actual versus expected loss development, claim management and commutations.

Other Components of Net incurred Losses and LAE

The reduction in provisions for bad debt of $1.5 million was a result of the favorable recoveries from reinsurers, the reduction in bad debt provisions for insolvent reinsurers as a result of distributions received and the reduction of specific provisions held for certain reinsurers.

The reduction of $54.1 million in provisions for unallocated LAE was due to a reduction in our estimate of the total future costs to administer the claims.

The amortization of deferred charge assets of $14.4 million was associated with retroactive reinsurance contracts where, at the inception of the contract, the estimated ultimate losses payable were in excess of premium received. Deferred charge assets are amortized over the estimated claim payment period of the related contract and are adjusted periodically to reflect new estimates of the amount and timing of the remaining loss payments.

The amortization of fair value adjustment of $10.1 million was related to the fair value adjustments associated with the acquisition of companies. On acquisition, we are required to fair value the net assets acquired, including the reinsurance balances recoverable and the liability for losses and LAE. The resulting fair value adjustments are then amortized over the expected life of the reinsurance balances recoverable and the liability for losses and LAE.

The increase in the fair value of liabilities for which we have elected the fair value option of $30.3 million was primarily due to decreases in the estimated duration of the net liabilities, partially offset by changes in the corporate bond yield.

Disclosures of Incurred and Paid Loss Development, IBNR, Claims Counts and Payout Percentages

The following tables provides a breakdown of gross and net losses and LAE reserves, consisting of Outstanding Loss Reserve ("OLR") and IBNR by line of business and adjustments for fair value resulting from business combinations, adjustments for where we elected the fair value option, deferred charge assets and ULAE, as of December 31, 2019 and 2018:

	2019
	Gross							Net
	OLR		IBNR		Total			OLR		IBNR		Total
	(in thousands of U.S. dollars)
Asbestos	$	542,681	$	1,373,678	$	1,916,359		$	490,117	$	1,271,982	$	1,762,099
Environmental	187,165		156,121		343,286			173,878		142,351		316,229
General casualty	501,863		489,129		990,992			399,396		421,426		820,822
Workers' compensation/personal accident	1,270,530		977,808		2,248,338			963,578		751,074		1,714,652
Marine, aviation and transit	290,067		121,577		411,644			244,611		100,135		344,746
Construction defect	29,772		98,312		128,084			29,245		94,888		124,133
Professional indemnity/Directors & Officers	693,760		265,490		959,250			485,478		170,926		656,404
Motor	480,668		233,806		714,474			317,829		165,543		483,372
Property	140,620		63,604		204,224			122,010		56,450		178,460
Other	269,956		165,882		435,838			208,647		97,573		306,220
	$	4,407,082	$	3,945,407	$	8,352,489		$	3,434,789	$	3,272,348	$	6,707,137
Fair value adjustments					(170,689		)					(157,036		)
Fair value adjustments - fair value option					(217,933		)					(129,848		)
Deferred charge on retroactive reinsurance					—							(272,462		)
ULAE					331,494							331,494
Total					$	8,295,361						$	6,479,285

	2018
	Gross							Net
	OLR		IBNR		Total			OLR		IBNR		Total
	(in thousands of U.S. dollars)
Asbestos	$	341,544	$	1,275,476	$	1,617,020		$	321,356	$	1,171,754	$	1,493,110
Environmental	96,665		126,035		222,700			93,095		117,384		210,479
General casualty	500,033		379,484		879,517			416,097		298,612		714,709
Workers' compensation/personal accident	1,454,178		832,615		2,286,793			1,115,116		537,782		1,652,898
Marine, aviation and transit	301,783		72,888		374,671			227,994		78,023		306,017
Construction defect	20,712		99,288		120,000			19,310		94,736		114,046
Professional indemnity/Directors & Officers	603,665		216,839		820,504			426,020		166,898		592,918
Motor	564,307		321,992		886,299			414,847		304,874		719,721
Property	168,267		37,631		205,898			160,873		36,817		197,690
Other	220,615		165,519		386,134			175,289		111,453		286,742
	$	4,271,769	$	3,527,767	$	7,799,536		$	3,369,997	$	2,918,333	$	6,288,330
Fair value adjustments					(217,527		)					(203,183		)
Fair value adjustments - fair value option					(374,752		)					(244,013		)
Deferred charge on retroactive reinsurance					—							(86,585		)
ULAE					333,405							333,405
Total					$	7,540,662						$	6,087,954

In addition to the breakdown of our non-life run-off reserves by line of business we also monitor our reserves by acquisition year. The acquisition year is the year in which the net reserves were acquired via a business acquisition or assumed via a retroactive reinsurance agreement. By analyzing the loss development tables by acquisition year on a prospective basis, the impact of the take-on positions from year to year does not distort the loss development tables.

The following table provides a summary of our net loss reserves, prior to provisions for bad debt, fair value adjustments, deferred charge assets and ULAE as of December 31, 2019, by year of acquisition and by significant line of business:

	Acquisition Year
	2009 and Prior		2010		2011		2012		2013		2014		2015		2016		2017		2018		2019		Total
Asbestos	$	180,887	$	36,371	$	—	$	—	$	7,973	$	—	$	673	$	387,808	$	729,749	$	60,424	$	336,925	$	1,740,810
Environmental	44,461		10,364		—		—		—		—		—		101,649		26,798		17,247		108,094		308,613
General casualty	60,400		13,409		24,072		12,082		14,695		30,313		46,838		5,389		59,432		305,370		241,541		813,541
Workers' compensation/personal accident	3,362		49,828		145,975		3,986		58,316		—		331,383		266,932		73,069		385,223		392,454		1,710,528
Marine, aviation and transit	8,890		2,638		3,256		—		—		13,762		1,589		—		81,037		139,908		91,909		342,989
Construction defect	—		18		55		—		—		—		46,906		18,982		22,973		—		35,198		124,132
Professional indemnity/Directors & Officers	9,438		5,021		8,619		28,274		—		35,795		—		77,685		—		326,157		164,271		655,260
Motor	25,131		5,756		217		500		660		250		14,785		203		4,453		406,545		22,099		480,599
Property	3,957		4,058		298		6,199		—		14,127		3,581		—		455		66,755		78,785		178,215
All Other	17,889		13,843		422		6,295		3,361		5,587		7,600		26,528		118,979		16,562		84,344		301,410
Total	$	354,415	$	141,306	$	182,914	$	57,336	$	85,005	$	99,834	$	453,355	$	885,176	$	1,116,945	$	1,724,191	$	1,555,620	$	6,656,097

The table below reconciles the net loss reserves, prior to provisions for bad debt, fair value adjustments, deferred charge assets and ULAE as of December 31, 2019, by significant line of business to the line of business table presented above:

	2019
	Total Net Reserves per all Acquisition Years		Provision for Bad Debt		Total Net Reserves
Asbestos	$	1,740,810	$	21,289	$	1,762,099
Environmental	308,613		7,616		316,229
General casualty	813,541		7,281		820,822
Workers' compensation/personal accident	1,710,528		4,124		1,714,652
Marine, aviation and transit	342,989		1,757		344,746
Construction defect	124,132		1		124,133
Professional indemnity/Directors & Officers	655,260		1,144		656,404
Motor	480,599		2,773		483,372
Property	178,215		245		178,460
All Other	301,410		4,810		306,220
Total	$	6,656,097	$	51,040	$	6,707,137

Loss development tables have been provided for acquisition years 2010 through 2019. In addition, the workers' compensation line of business in the 2015 acquisition year; the workers' compensation line of business in the 2016 acquisition year; the general casualty, workers' compensation, marine, aviation & transit, professional indemnity/directors & officers and motor lines of business in the 2018 acquisition year; and the general casualty, workers' compensation and professional indemnity/directors & officers lines of business in the 2019 acquisition year are significant and we have provided additional loss development tables for those lines of business within those acquisition years.

Our non-life run-off segment is unique within the insurance industry in that legacy reserves are continuously being acquired and added to this segment through business acquisitions or through retroactive reinsurance agreements.

Accordingly, it would not be appropriate to extrapolate redundancies or deficiencies into the future from the loss development tables provided below. Acquired and assumed reserves arising from business acquisitions and retroactive reinsurance agreements are presented on a full prospective basis.

The following tables set forth information about incurred and paid loss development, total IBNR reserves and cumulative loss frequency related to our 2010 through 2019 acquisition years within the Non-Life Run-off segment as of December 31, 2019. In addition, we have also presented loss development tables for the significant lines of business within certain acquisition years. The information related to incurred and paid loss development for the years ended December 31, 2010 through 2018 is presented as supplementary information and is therefore unaudited.

Business Acquired and Contracts Incepting in the Year Ended December 31, 2010

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance																							As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2010 (unaudited)		2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	1,092,197	$	1,086,671	$	1,044,111	$	1,058,458	$	1,012,046	$	929,888	$	903,954	$	839,798	$	800,104	$	800,341	$	788,475	$	42,290	163,994
	$	1,092,197																			$	788,475	$	42,290	163,994
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year			2010 (unaudited)		2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	102,123	$	261,446	$	428,312	$	511,054	$	553,769	$	567,605	$	584,306	$	612,530	$	630,627	$	647,169
																					$	647,169
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance																					$	141,306

Business Acquired and Contracts Incepting in the Year Ended December 31, 2011

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance																									As of December 31, 2019
					For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)			2017 (unaudited)			2018 (unaudited)			2019			IBNR		Cumulative Number of Claims
2009 and Prior	$	596,121	$	621,742	$	586,636	$	490,822	$	424,001	$	370,995	$	315,912		$	270,905		$	256,864		$	235,348		$	23,721	112,787
2010	285		412		449		141		140		140		140			142			142			142			—		26
2011	—		102		36		45		54		61		71			79			86			93			—		19
2012	—				121		10		10		10		10			17			18			17			—		7
2013	—						23		43		15		15			15			15			15			—		16
2014	—								1		3		3			3			18			15			3		14
2015	—										—		(2		)	(2		)	32			24			5		1
2016	—												2			(139		)	(110		)	(99		)	8		2
2017	—															—			21			15			2		2
2018	—																		7			8			2		1
2019	—																					—			—		—
	$	596,406																				$	235,578		$	23,741	112,875
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
					For The Years Ended December 31,
Accident Year			2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)			2017 (unaudited)			2018 (unaudited)			2019
2009 and Prior			$	59,906	$	97,414	$	92,129	$	21,874	$	15,512	$	24,434		$	16,751		$	27,013		$	52,483
2010			$	91	115		140		140		140		140			142			142			142
2011			27		36		45		54		61		71			79			86			93
2012					6		10		10		10		10			17			17			17
2013							6		10		15		15			15			15			15
2014									1		3		3			3			4			7
2015											—		(2		)	(2		)	3			11
2016													2			(153		)	(124		)	(114		)
2017																—			3			6
2018																			1			4
2019																						—
																						$	52,664
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance																						$	182,914

Business Acquired and Contracts Incepting in the Year Ended December 31, 2012

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance																			As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	315,850	$	314,772	$	306,078	$	297,612	$	283,244	$	273,273	$	266,124	$	257,947	$	252,794	$	18,173	47,708
2010	831		920		3,068		2,788		2,400		2,468		1,368		1,242		1,208		64		6
2011	1,360		1,341		1,222		1,081		1,002		981		960		944		944		—		5
2012	50		74		45		332		315		371		363		152		152		—		6
2013	—				866		109		390		396		385		124		124		—		5
2014	—						2,736		2,843		1,420		1,189		1,093		1,048		23		7
2015	—								667		1,388		676		676		676		—		5
2016	—										61		1,158		1,019		969		139		2
2017	—												69		153		91		—		4
2018	—														—		141		18		1
2019	—																251		37		4
	$	318,091															$	258,398	$	18,454	47,753
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year			2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	2,754	$	67,858	$	108,965	$	139,542	$	163,845	$	173,921	$	187,091	$	197,236
2010			$	167	463		618		685		712		748		776		801
2011			110		454		679		792		849		905		944		944
2012			28		45		45		47		152		152		152		152
2013					100		109		124		124		124		124		124
2014							62		205		420		617		791		905
2015									103		107		676		676		676
2016											2		51		89		89
2017													12		39		91
2018															—		27
2019																	17
																	$	201,062
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance																	$	57,336

Business Acquired and Contracts Incepting in the Year Ended December 31, 2013

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance																	As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	207,452	$	227,635	$	233,644	$	225,478	$	218,082	$	212,039	$	200,034	$	188,416	$	15,864	44,881
2010	110,795		118,652		117,915		133,289		135,364		125,148		123,802		122,441		4,635		11,537
2011	96,929		102,288		100,482		100,243		95,848		87,913		86,403		85,920		2,218		11,175
2012	131,119		127,323		121,364		118,085		114,772		110,045		107,853		108,025		2,090		10,420
2013	13,062		90,739		91,634		88,920		85,791		81,732		80,036		80,091		1,277		5,649
2014	—				4,514		3,714		3,425		16,800		16,225		16,304		90		175
2015	—						265		280		982		329		250		54		2
2016	—								103		71		70		69		2		1
2017	—										30		13		13		—		1
2018	—												22		17		—		1
2019	—														13		3		1
	$	559,357													$	601,559	$	26,233	83,843
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year			2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	48,802	$	84,422	$	109,918	$	128,474	$	129,803	$	136,898	$	140,814
2010			$	24,752	48,783		75,351		92,782		98,341		105,023		105,873
2011			30,323		52,455		63,952		70,498		75,055		77,290		79,113
2012			33,361		59,095		74,663		86,916		92,445		96,780		99,781
2013			17,022		37,653		52,638		62,876		68,866		71,487		74,556
2014					993		1,747		2,256		15,804		15,959		16,123
2015							43		102		112		165		190
2016									34		64		65		66
2017											9		13		13
2018													13		17
2019															8
															$	516,554
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance															$	85,005

Business Acquired and Contracts Incepting in the Year Ended December 31, 2014

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance															As of December 31, 2019
					For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	37,554	$	33,315	$	23,192	$	20,933	$	22,105	$	21,089	$	19,229	$	72	6,363
2010	104,408		100,017		100,345		133,784		119,430		115,341		122,063		10,628		6,454
2011	73,942		128,979		153,910		133,521		135,540		140,845		143,664		9,369		6,693
2012	140,683		146,060		177,122		185,261		178,247		165,223		162,068		11,175		5,086
2013	86,920		75,762		93,936		82,344		86,798		86,393		84,590		13,971		3,171
2014	—		12,826		9,503		13,817		7,420		5,765		5,589		1,731		1,113
2015	—				33,545		15,529		20,709		18,616		17,799		73		186
2016	—						330		1,075		4,607		773		89		44
2017	—								5,074		3,920		8,196		423		37
2018	—										6		5		—		17
2019	—												—		899		5
	$	443,507											$	563,976	$	48,430	29,169
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
					For The Years Ended December 31,
Accident Year			2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	7,044	$	13,090	$	15,652	$	16,337	$	16,884	$	16,934
2010			$	29,424	69,414		87,233		102,138		102,128		103,753
2011			84,042		109,574		110,338		113,406		120,564		126,650
2012			47,495		89,618		119,807		128,692		127,958		132,508
2013			21,752		40,237		47,537		55,882		63,256		62,009
2014			1,462		2,494		3,280		3,975		5,994		7,671
2015					1,739		4,295		11,465		13,487		12,774
2016							20		556		571		601
2017									537		1,553		1,237
2018											5		5
2019													—
													$	464,142
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance													$	99,834

Business Acquired and Contracts Incepting in the Year Ended December 31, 2015

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance													As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	953,149	$	877,641	$	585,616	$	536,452	$	508,471	$	467,530	$	51,305	11,285
2010	49,049		53,914		52,889		55,761		51,348		49,031		6,860		2,349
2011	124,400		137,102		130,994		129,386		127,098		127,673		18,940		5,379
2012	178,936		187,288		197,716		200,749		192,896		192,338		23,706		4,714
2013	229,182		189,430		196,205		199,593		188,572		184,189		16,027		5,182
2014	143,623		142,425		137,061		142,332		136,403		151,243		18,617		10,707
2015	22,540		69,067		68,034		65,243		63,776		68,388		5,125		21,014
2016	—				14,172		12,504		12,750		13,837		2,053		3,365
2017	—						4,056		4,497		5,194		453		900
2018	—								2,965		1,845		997		270
2019	—										1,804		1,775		3
	$	1,700,879									$	1,263,072	$	145,858	65,168
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year			2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	23,605	$	67,899	$	114,682	$	140,691	$	165,931
2010			$	9,191	15,301		19,665		25,625		28,455
2011			33,826		55,077		70,975		86,324		97,842
2012			52,728		94,767		119,382		142,165		158,417
2013			46,761		89,868		120,429		145,659		159,626
2014			30,747		64,353		90,738		109,149		125,226
2015			20,653		38,193		46,067		51,315		59,247
2016					5,325		7,038		8,298		9,405
2017							2,311		3,909		4,691
2018									558		835
2019											42
											$	809,717
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance											$	453,355

Business Acquired and Contracts Incepting in the Year Ended December 31, 2015 - Workers' Compensation

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance													As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	921,259	$	834,148	$	538,290	$	488,356	$	462,612	$	418,931	$	43,677	8,129
2010	31,919		34,360		31,402		30,407		27,922		26,913		1,877		471
2011	76,789		73,723		69,009		68,013		66,781		67,236		5,836		1,238
2012	120,298		110,007		108,251		106,625		100,187		98,532		5,774		1,804
2013	146,237		124,726		122,238		121,010		113,056		112,199		6,789		2,379
2014	82,141		86,852		82,038		83,095		78,389		78,457		2,633		3,680
2015	4,089		18,647		12,623		13,488		12,295		11,125		545		2,900
2016	—				873		955		583		536		72		38
2017	—						358		61		41		21		10
2018	—								—		5		3		1
2019	—										1		—		1
	$	1,382,732									$	813,976	$	67,228	20,651
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year			2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	16,278	$	56,563	$	96,000	$	115,884	$	137,417
2010			$	4,352	8,446		11,906		16,141		17,912
2011			16,032		30,462		39,635		50,470		55,595
2012			25,103		52,851		66,092		79,367		88,369
2013			27,737		55,675		75,065		91,559		100,890
2014			17,824		38,051		53,308		65,561		72,696
2015			3,034		5,672		7,917		9,169		9,248
2016					134		363		417		447
2017							2		10		18
2018									—		1
2019											—
											$	482,593
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance											$	331,383

Business Acquired and Contracts Incepting in the Year Ended December 31, 2016

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance											As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	1,263,726	$	1,274,524	$	1,302,307	$	1,282,385	$	1,287,000	$	303,592	22,892
2010	32,571		32,451		32,866		28,093		25,710		5,047		706
2011	17,291		17,291		19,920		19,754		18,829		2,830		789
2012	13,717		13,717		17,020		14,765		12,717		2,012		776
2013	373		373		1,312		1,237		1,120		827		112
2014	391		391		1,380		1,056		869		485		50
2015	—		—		—		—		—		—		—
2016	—		—		—		—		—		—		—
2017	—				—		—		—		—		—
2018	—						—		—		—		—
2019	—								—		—		—
	$	1,328,069							$	1,346,245	$	314,793	25,325
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Years Ended December 31,
Accident Year			2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	96,937	$	213,509	$	317,309	$	428,904
2010			$	2,757	7,111		10,001		14,236
2011			2,758		6,647		8,218		9,691
2012			2,734		5,206		6,461		7,587
2013			145		191		278		285
2014			178		207		284		366
2015			—		—		—		—
2016			—		—		—		—
2017					—		—		—
2018							—		—
2019									—
									$	461,069
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance									$	885,176

Business Acquired and Contracts Incepting in the Year Ended December 31, 2016 - Workers' Compensation

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance											As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	413,381	$	412,474	$	377,285	$	369,093	$	362,905	$	26,747	9,092
2010	24,075		25,330		26,034		22,383		19,541		3,660		323
2011	15,376		15,376		16,399		16,501		16,327		1,456		476
2012	13,074		13,074		15,465		13,276		11,379		1,093		608
2013	—		—		—		—		—		—		—
2014	—		—		—		—		—		—		—
2015	—		—		—		—		—		—		—
2016	—		—		—		—		—		—		—
2017	—				—		—		—		—		—
2018	—						—		—		—		—
2019	—								—		—		—
	$	465,906							$	410,152	$	32,956	10,499
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Years Ended December 31,
Accident Year			2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior			$	33,610	$	59,725	$	83,273	$	117,191
2010			$	1,908	5,539		7,326		9,891
2011			2,631		5,871		7,305		8,756
2012			2,638		5,028		6,247		7,382
2013			—		—		—		—
2014			—		—		—		—
2015			—		—		—		—
2016			—		—		—		—
2017					—		—		—
2018							—		—
2019									—
									$	143,220
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance									$	266,932

Business Acquired and Contracts Incepting in the Year Ended December 31, 2017

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance										As of December 31, 2019
			For the Years Ended December 31,
Accident Year	Total Net Reserves Acquired		2017 (unaudited)			2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	1,449,663	$	1,374,191		$	1,304,002	$	1,313,517	$	776,522	11,481
2010	34,561		28,737			18,908		21,021		8,209		36
2011	36,184		29,273			25,390		27,315		8,573		7
2012	39,449		35,467			31,240		29,452		6,389		11
2013	36,320		30,335			28,140		24,703		1,242		11
2014	31,474		20,315			16,984		15,996		2,195		20
2015	9,207		6,494			7,002		6,295		931		8
2016	1,484		(4		)	125		919		86		3
2017	95		174			—		—		416		1
2018	—					—		—		—		—
2019	—							—		—		—
	$	1,638,437						$	1,439,218	$	804,563	11,578
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Years Ended December 31,
Accident Year			2017 (unaudited)			2018 (unaudited)		2019
2009 and Prior			$	80,189		$	165,471	$	243,621
2010			$	4,287		7,394		9,121
2011			4,125			9,257		12,971
2012			10,348			15,371		18,603
2013			9,508			15,711		21,277
2014			6,482			8,987		11,559
2015			1,361			3,720		4,687
2016			(56		)	66		434
2017			4			—		—
2018						—		—
2019								—
								$	322,273
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance								$	1,116,945

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance							As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	559,105	$	383,948	$	355,392	$	106,822	209,846
2010	88,147		108,810		94,273		23,039		13,799
2011	159,362		147,341		142,391		21,380		14,100
2012	225,177		219,807		211,156		20,218		14,055
2013	263,008		267,132		255,973		54,609		16,251
2014	408,726		453,181		423,289		90,111		18,887
2015	354,692		474,678		467,650		97,189		23,421
2016	170,311		172,245		174,845		55,384		2,094
2017	207,035		207,172		205,460		79,430		4,163
2018	315,659		315,659		285,038		88,411		4,929
2019	—				68,271		19,774		1,634
	$	2,751,222			$	2,683,738	$	656,367	323,179
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)		2019
2009 and Prior			$	41,953	$	36,359
2010			$	11,109	23,761
2011			26,998		47,261
2012			31,845		74,768
2013			42,312		90,716
2014			93,536		181,166
2015			100,598		191,150
2016			6,258		62,658
2017			52		72,794
2018			—		139,815
2019					39,099
					$	959,547
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance					$	1,724,191

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018 - General Casualty

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance							As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	97,189	$	48,898	$	42,901	$	3,969	45,895
2010	30,895		23,086		23,059		7,004		1,885
2011	17,518		15,854		15,532		2,086		1,404
2012	36,536		31,901		27,774		3,716		1,567
2013	42,528		54,061		44,782		5,123		1,571
2014	65,355		80,316		72,333		16,793		2,210
2015	77,011		91,825		102,399		28,926		3,430
2016	28,825		28,825		36,585		14,377		253
2017	37,209		37,209		41,664		20,392		230
2018	39,888		39,888		40,753		20,480		182
2019	—				6,767		2,802		34
	$	472,954			$	454,549	$	125,668	58,661
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)		2019
2009 and Prior			$	3,496	$	7,146
2010			$	5,345	7,835
2011			2,236		6,621
2012			1,104		11,097
2013			10,015		19,756
2014			13,427		28,071
2015			15,163		32,244
2016			—		14,109
2017			—		11,048
2018			—		8,879
2019					2,373
					$	149,179
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance					$	305,370

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018 - Workers' Compensation

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance								As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)			2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	106,230	$	101,016		$	108,435	$	30,391	1,742
2010	24,838		25,149			24,102		8,642		355
2011	29,795		24,877			26,179		12,202		401
2012	28,788		29,174			27,723		12,633		468
2013	37,716		38,309			37,866		16,786		866
2014	65,000		66,305			57,128		24,865		1,335
2015	38,734		39,336			34,649		16,909		1,437
2016	44,686		44,686			38,945		21,267		892
2017	52,360		52,360			49,156		28,222		998
2018	65,075		65,075			60,923		24,137		886
2019	—					20,889		5,472		383
	$	493,222				$	485,995	$	201,526	9,763
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)			2019
2009 and Prior			$	3,633		$	10,643
2010			$	317		4,542
2011			(1,517		)	1,825
2012			521			5,513
2013			1,532			7,743
2014			3,248			14,666
2015			1,355			4,066
2016			—			3,666
2017			—			5,900
2018			—			28,725
2019						13,483
						$	100,772
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance						$	385,223

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018 - Marine, Aviation & Transit

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance									As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)			2019			IBNR			Cumulative Number of Claims
2009 and Prior	$	26,321	$	28,798		$	20,641		$	(1,842	)	57,002
2010	3,324		2,062			(6,710		)	(1,049		)	3,243
2011	8,676		9,472			10,345			1,486			3,966
2012	16,069		12,297			10,151			(6,037		)	4,280
2013	43,798		35,462			29,464			2,404			5,720
2014	62,766		81,126			82,479			14,668			5,862
2015	26,007		65,209			72,055			8,758			6,606
2016	—		—			—			—			—
2017	—		—			—			—			—
2018	—		—			—			—			—
2019	—					—			—			—
	$	186,961				$	218,425		$	18,388		86,679
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)			2019
2009 and Prior			$	3,211		$	(3,789	)
2010			$	(3,689	)	(7,715		)
2011			4,953			5,901
2012			1,180			3,482
2013			5,642			11,734
2014			22,990			40,926
2015			21,956			27,978
2016			—			—
2017			—			—
2018			—			—
2019						—
						$	78,517
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance						$	139,908

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018 - Professional Indemnity/Directors & Officers

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance							As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)		2019		IBNR			Cumulative Number of Claims
2009 and Prior	$	200,658	$	92,577	$	100,687	$	(1,316	)	52,393
2010	25,474		39,710		33,765		8,220			4,259
2011	44,476		50,663		46,111		2,837			3,745
2012	55,366		68,004		65,180		12,943			3,263
2013	56,251		60,010		74,018		9,407			3,223
2014	84,795		106,888		101,771		16,922			3,563
2015	45,515		97,288		79,028		19,285			3,903
2016	—		—		—		—			—
2017	—		—		—		—			—
2018	—		—		—		—			—
2019	—				—		—			—
	$	512,535			$	500,560	$	68,298		74,349
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)		2019
2009 and Prior			$	24,232	$	33,585
2010			$	3,644	12,243
2011			12,453		19,732
2012			15,706		22,837
2013			10,599		18,601
2014			21,640		40,189
2015			13,696		27,216
2016			—		—
2017			—		—
2018			—		—
2019					—
					$	174,403
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance					$	326,157

Business Acquired and Contracts Incepting in the Year Ended December 31, 2018 - Motor

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance							As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2018 (unaudited)		2019		IBNR			Cumulative Number of Claims
2009 and Prior	$	17,648	$	15,490	$	10,781	$	(291	)	356
2010	23,548		13,937		15,187		1,015			922
2011	46,015		36,282		35,843		1,477			1,209
2012	62,432		55,338		60,620		6,949			1,594
2013	74,615		68,022		61,396		14,105			626
2014	111,418		99,140		86,887		10,440			1,140
2015	129,271		127,187		126,345		15,912			1,274
2016	90,166		92,100		93,824		19,439			644
2017	100,316		100,453		99,129		30,312			2,797
2018	180,471		180,471		157,556		42,546			3,731
2019	—				39,757		11,457			1,200
	$	835,900			$	787,325	$	153,361		15,493
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2018 (unaudited)		2019
2009 and Prior			$	2,398	$	5,112
2010			$	4,437	6,911
2011			5,631		12,112
2012			11,520		23,284
2013			10,226		27,839
2014			20,746		46,359
2015			19,857		58,433
2016			6,258		42,527
2017			52		48,655
2018			—		86,861
2019					22,687
					$	380,780
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance					$	406,545

Business Acquired and Contracts Incepting in the Year Ended December 31, 2019

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance					As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	604,631	$	598,841	$	330,575	81,869
2010	35,515		24,353		3,586		21,945
2011	47,718		38,961		1,506		21,380
2012	70,661		51,937		27,520		15,532
2013	110,426		87,708		36,879		19,223
2014	135,465		131,000		76,169		21,224
2015	182,991		186,727		99,838		35,276
2016	238,798		308,254		179,237		39,815
2017	116,386		116,386		116,386		2
2018	162,744		162,744		162,744		2
2019	—		54,601		12,706		85
	$	1,705,335	$	1,761,512	$	1,047,146	256,353
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2019
2009 and Prior			$	21,678
2010			4,923
2011			4,649
2012			6,455
2013			12,893
2014			26,910
2015			34,610
2016			68,179
2017			—
2018			—
2019			25,595
			$	205,892
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance			$	1,555,620

Business Acquired and Contracts Incepting in the Year Ended December 31, 2019 - General Casualty

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance					As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	4,396	$	4,415	$	670	693
2010	7,704		5,426		1,509		1,213
2011	11,381		8,817		2,347		1,148
2012	16,910		13,592		5,262		688
2013	22,355		16,934		7,515		448
2014	32,883		30,337		15,387		456
2015	58,563		45,594		30,556		346
2016	50,518		62,866		44,899		475
2017	32,188		32,188		32,188		1
2018	45,010		45,010		45,010		1
2019	—		1,709		475		3
	$	281,908	$	266,888	$	185,818	5,472
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2019
2009 and Prior			$	1,163
2010			1,031
2011			896
2012			3,136
2013			3,472
2014			4,103
2015			4,552
2016			6,193
2017			—
2018			—
2019			801
			$	25,347
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance			$	241,541

Business Acquired and Contracts Incepting in the Year Ended December 31, 2019 - Workers' Compensation

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance					As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	5,143	$	3,609	$	1,270	11,136
2010	713		726		642		1,352
2011	2,470		2,410		2,334		1,476
2012	6,274		6,173		6,090		2,102
2013	16,686		16,223		14,578		3,726
2014	34,945		35,252		30,998		3,956
2015	57,027		56,158		48,794		6,158
2016	84,171		85,396		73,087		6,612
2017	84,197		84,197		84,197		1
2018	117,734		117,734		117,734		1
2019	—		—		—		—
	$	409,360	$	407,878	$	379,724	36,520
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2019
2009 and Prior			$	577
2010			38
2011			24
2012			24
2013			451
2014			3,076
2015			3,635
2016			7,599
2017			—
2018			—
2019			—
			$	15,424
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance			$	392,454

Business Acquired and Contracts Incepting in the Year Ended December 31, 2019 - Professional Indemnity/Directors & Officers

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance					As of December 31, 2019
			For the Year Ended December 31,
Accident Year	Total Net Reserves Acquired		2019		IBNR		Cumulative Number of Claims
2009 and Prior	$	6,696	$	4,052	$	812	10,399
2010	7,245		4,448		838		5,300
2011	18,093		10,292		1,947		6,511
2012	30,127		18,012		4,348		3,472
2013	46,758		35,881		9,945		4,411
2014	46,557		46,982		17,975		5,361
2015	29,527		32,577		7,665		5,856
2016	2,892		52,708		28,916		5,053
2017	—		—		—		—
2018	—		—		—		—
2019	—		3,251		961		3
	$	187,895	$	208,203	$	73,407	46,366
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the Year Ended December 31,
Accident Year			2019
2009 and Prior			$	1,323
2010			326
2011			3,403
2012			3,216
2013			3,924
2014			14,955
2015			7,193
2016			8,067
2017			—
2018			—
2019			1,525
			$	43,932
Total outstanding liabilities for unpaid losses and LAE, net of reinsurance			$	164,271

Annual Historical Duration of Claims

The following is unaudited supplementary information, which presents the annual percentage payout since the year of acquisition, by year of acquisition and significant line of business within each acquisition year:

	Annual Percentage Payout of Incurred Losses since Year of Acquisition, Net of Reinsurance
Year of Acquisition	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
2010 - All lines of business	12.95	%	20.21	%	21.16	%	10.49	%	5.42	%	1.75	%	2.12	%	3.58	%	2.30	%	2.10	%
2011 - All lines of business	25.48	%	15.94	%	(2.22	)%	(29.82	)%	(2.70	)%	3.79	%	(3.32	)%	4.38	%	10.83	%
2012 - All lines of business	1.18	%	25.49	%	16.08	%	12.00	%	9.56	%	4.26	%	5.22	%	4.02	%
2013 - All lines of business	25.64	%	21.47	%	15.78	%	10.91	%	6.08	%	3.86	%	2.14	%
2014 - All lines of business	33.91	%	23.93	%	10.99	%	7.95	%	3.44	%	2.08	%
2015 - All lines of business	17.22	%	16.89	%	12.71	%	9.69	%	7.60	%
2015 - Workers' compensation	13.56	%	16.89	%	12.58	%	9.62	%	6.64	%
2016 - All lines of business	7.84	%	9.46	%	8.15	%	8.80	%
2016 - Workers' Compensation	9.94	%	8.63	%	6.82	%	9.53	%
2017 - All lines of business	8.08	%	7.62	%	6.69	%
2018 - All lines of business	13.22	%	22.54	%
2018 - General Casualty	11.17	%	21.65	%
2018 - Workers' Compensation	1.87	%	18.87	%
2018 - Marine, Aviation & Transit	25.75	%	10.20	%
2018 - Professional Indemnity/Directors & Officers	20.37	%	14.47	%
2018 - Motor	10.30	%	38.06	%
2019 - All lines of business	11.69	%
2019 - General Casualty	9.50	%
2019 - Workers' Compensation	3.78	%
2019 - Professional Indemnity/Directors & Officers	21.10	%

The negative payout percentages in the table above for years 3, 4, 5 and 7 within the 2011 year of acquisition line were primarily due to ceded paid losses exceeding the assumed paid losses as a result of commutations completed with several reinsurers covering the exposures assumed by one of our reinsurance subsidiaries that we acquired in 2011. For the specific years referenced above, we collected more paid recoveries from our reinsurers than the losses we paid on the assumed exposures, and as such, the calculated annual payout percentages were negative.

Atrium

The table below provides a reconciliation of the beginning and ending liability for losses and LAE for the years ended December 31, 2019, 2018 and 2017:

	2019			2018			2017
Balance as at January 1	$	241,284		$	240,873		$	212,122
Less: reinsurance reserves recoverable	38,768			40,531			30,009
Net balance as at January 1	202,516			200,342			182,113
Net incurred losses and LAE:
Current period	85,027			83,627			90,359
Prior periods	(7,751		)	(13,817		)	(20,940		)
Total net incurred losses and LAE	77,276			69,810			69,419
Net paid losses:
Current period	(34,617		)	(35,537		)	(24,571		)
Prior periods	(43,572		)	(28,969		)	(31,107		)
Total net paid losses	(78,189		)	(64,506		)	(55,678		)
Effect of exchange rate movement	1,253			(3,130		)	4,488
Net balance as at December 31	202,856			202,516			200,342
Plus: reinsurance reserves recoverable	28,816			38,768			40,531
Balance as at December 31	$	231,672		$	241,284		$	240,873

Net incurred losses and LAE in the Atrium segment for the years ended December 31, 2019, 2018 and 2017 were as follows:

	2019								2018								2017
	Prior Period			Current Period		Total			Prior Period			Current Period		Total			Prior Period			Current Period		Total
Net losses paid	$	43,572		$	34,617	$	78,189		$	28,969		$	35,537	$	64,506		$	31,107		$	24,571	$	55,678
Net change in case and LAE reserves	(13,278		)	16,812		3,534			(10,161		)	16,492		6,331			(13,324		)	21,662		8,338
Net change in IBNR reserves	(38,380		)	33,598		(4,782		)	(27,507		)	31,598		4,091			(35,650		)	43,329		7,679
Increase (reduction) in estimates of net ultimate losses	(8,086		)	85,027		76,941			(8,699		)	83,627		74,928			(17,867		)	89,562		71,695
Increase in provisions for bad debt	—			—		—			—			—		—			89			70		159
Increase (reduction) in provisions for unallocated LAE	—			—		—			—			—		—			(442		)	727		285
Amortization of fair value adjustments	335			—		335			(5,118		)	—		(5,118		)	(2,720		)	—		(2,720		)
Net incurred losses and LAE	$	(7,751	)	$	85,027	$	77,276		$	(13,817	)	$	83,627	$	69,810		$	(20,940	)	$	90,359	$	69,419

Disclosures of Incurred and Paid Loss Development, IBNR, Claims Counts and Payout Percentages

The following tables provide a breakdown of the gross and net losses and LAE by line of business and the fair value adjustments resulting from business acquisitions and ULAE as of December 31, 2019 and 2018 for the Atrium segment:

	2019
	Gross						Net
	OLR		IBNR		Total		OLR		IBNR		Total
	(in thousands of U.S. dollars)
Marine, Aviation and Transit	$	24,668	$	34,156	$	58,824	$	21,012	$	24,829	$	45,841
Binding Authorities	31,507		54,039		85,546		29,590		51,984		81,574
Reinsurance	18,385		29,533		47,918		16,209		23,338		39,547
Accident and Health	5,460		7,880		13,340		4,735		7,469		12,204
Non-Marine Direct and Facultative	9,121		10,935		20,056		8,584		9,637		18,221
Total	$	89,141	$	136,543	$	225,684	$	80,130	$	117,257	$	197,387
Fair value adjustments					3,700						3,181
ULAE					2,288						2,288
Total					$	231,672					$	202,856

	2018
	Gross						Net
	OLR		IBNR		Total		OLR		IBNR		Total
	(in thousands of U.S. dollars)
Marine, Aviation and Transit	$	32,999	$	36,011	$	69,010	$	21,460	$	24,207	$	45,667
Binding Authorities	28,512		59,302		87,814		26,601		57,016		83,617
Reinsurance	18,547		27,653		46,200		15,180		24,823		40,003
Accident and Health	4,972		6,348		11,320		4,225		5,837		10,062
Non-Marine Direct and Facultative	9,855		11,207		21,062		8,529		9,389		17,918
Total	$	94,885	$	140,521	$	235,406	$	75,995	$	121,272	$	197,267
Fair value adjustments					3,476						2,847
ULAE					2,402						2,402
Total					$	241,284					$	202,516

The Atrium segment comprises only 2% of the total consolidated gross liability for losses and LAE as of December 31, 2019 and therefore has not been disaggregated further for purposes of presenting the accident year disclosures below.

The following tables set forth information about incurred and paid loss development information for the Atrium segment as of December 31, 2019. The information related to incurred and paid loss development for the years ended December 31, 2010 through 2018 is presented as supplementary information and is therefore unaudited. Information about total IBNR reserves and cumulative loss frequency as of December 31, 2019, including expected development on reported losses included within the net incurred losses and allocated LAE amounts for the Atrium segment, are set forth in the table below.

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the Years Ended December 31,																				As of December 31, 2019
Accident Year	2010 (unaudited)		2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	546,446		609,275		593,467		573,576		569,959		564,128		560,524		558,768		556,252		553,325		2,839		1,381
2010	26,782		64,985		57,835		51,698		47,558		46,024		45,540		44,289		43,739		43,723		518		201
2011			86,326		84,661		72,898		71,104		69,385		68,083		67,358		66,904		66,534		991		252
2012					70,259		57,279		55,903		53,723		51,930		51,012		50,541		50,352		601		385
2013							58,326		63,710		57,798		54,472		51,706		52,049		50,638		1,441		566
2014									69,253		69,500		66,104		60,542		57,667		56,737		3,104		932
2015											69,646		71,498		63,530		60,210		58,785		6,018		1,515
2016													73,190		75,318		70,179		67,031		10,449		2,803
2017															90,247		94,984		91,109		20,400		5,053
2018																	85,044		91,621		37,297		6,644
2019																			86,269		33,598		5,362
																	Total		$	1,216,124	$	117,257	25,094
(1) Total of IBNR plus expected development on reported losses.
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,
Accident Year	2010 (unaudited)		2011 (unaudited)		2012 (unaudited)		2013 (unaudited)		2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior	$	491,683	$	510,113	$	521,740	$	531,928	$	536,706	$	541,597	$	543,591	$	544,954	$	543,253	$	544,625
2010	11,442		25,127		32,223		36,530		39,022		40,049		40,650		41,223		41,386		41,631
2011			17,138		39,997		52,450		58,627		62,560		63,914		65,199		64,669		65,040
2012					11,228		31,474		37,991		42,152		44,430		45,321		46,901		47,598
2013							14,579		32,064		40,443		43,511		45,387		46,099		46,637
2014									17,596		34,368		41,595		46,879		48,542		51,263
2015											12,029		29,687		38,987		44,544		47,704
2016													13,729		34,606		44,273		47,962
2017															14,371		47,723		56,057
2018																	13,130		34,166
2019																			36,054
																	Total		$	1,018,737
					Total outstanding liabilities for unpaid losses and LAE, net of reinsurance														$	197,387

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the Atrium segment for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	197,387
Reinsurance recoverable on unpaid losses	28,297
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	225,684

The following is unaudited supplementary information for average annual historical duration of claims within the Atrium segment:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Atrium	24.69	%	32.30	%	14.57	%	8.25	%	4.69	%	2.47	%	1.88	%	0.63	%	0.47	%	0.56	%

StarStone

The table below provides a reconciliation of the beginning and ending liability for losses and LAE for the years ended December 31, 2019, 2018 and 2017:

	2019			2018			2017
Balance as at January 1	$	1,608,697		$	1,207,743		$	1,059,382
Less: reinsurance reserves recoverable	462,950			452,017			357,231
Net balance as at January 1	1,145,747			755,726			702,151
Net incurred losses and LAE:
Current period	598,468			578,892			341,628
Prior periods	129,168			94,491			(26,822		)
Total net incurred losses and LAE	727,636			673,383			314,806
Net paid losses:
Current period	(96,261		)	(150,778		)	(54,867		)
Prior periods	(435,372		)	(326,352		)	(252,926		)
Total net paid losses	(531,633		)	(477,130		)	(307,793		)
Effect of exchange rate movement	87			(9,481		)	15,169
Acquired on purchase of subsidiaries	—			192,981			—
Assumed business	—			10,268			31,393
Ceded business	—			—			—
Net balance as at December 31	1,341,837			1,145,747			755,726
Plus: reinsurance reserves recoverable	537,291			462,950			452,017
Balance as at December 31	$	1,879,128		$	1,608,697		$	1,207,743

Net incurred losses and LAE in the StarStone segment for the years ended December 31, 2019, 2018 and 2017 were as follows:

	2019							2018								2017
	Prior Period			Current Period		Total		Prior Period			Current Period		Total			Prior Period			Current Period		Total
Net losses paid	$	435,372		$	96,261	$	531,633	$	326,352		$	150,778	$	477,130		$	252,926		$	54,867	$	307,793
Net change in case and LAE reserves	(85,983		)	111,950		25,967		(81,491		)	157,378		75,887			(63,785		)	95,470		31,685
Net change in IBNR reserves	(214,787		)	381,214		166,427		(144,212		)	258,091		113,879			(208,244		)	184,704		(23,540		)
Increase (reduction) in estimates of net ultimate losses	134,602			589,425		724,027		100,649			566,247		666,896			(19,103		)	335,041		315,938
Increase (reduction) in provisions for unallocated LAE	(5,602		)	9,043		3,441		(5,892		)	12,645		6,753			(6,774		)	6,587		(187		)
Amortization of fair value adjustments	168			—		168		(266		)	—		(266		)	(945		)	—		(945		)
Net incurred losses and LAE	$	129,168		$	598,468	$	727,636	$	94,491		$	578,892	$	673,383		$	(26,822	)	$	341,628	$	314,806

Net change in case and LAE reserves comprises the movement during the year in specific case reserve liabilities as a result of claims settlements or changes advised to us by our policyholders and attorneys, less changes in case reserves recoverable advised by us to our reinsurers as a result of the settlement or movement of assumed claims. Net change in IBNR represents the gross change in our actuarial estimates of IBNR, less amounts recoverable.

Disclosures of Incurred and Paid Loss Development, IBNR, Claims Counts and Payout Percentages

The following tables provide a breakdown of the gross and net losses and LAE reserves by line of business and the fair value adjustments resulting from business acquisitions and ULAE as of December 31, 2019 and 2018:

	2019
	Gross							Net
	OLR		IBNR		Total			OLR		IBNR		Total
	(in thousands of U.S. dollars)
Casualty	$	191,317	$	481,473	$	672,790		$	156,086	$	422,186	$	578,272
Marine	195,068		173,319		368,387			162,073		138,586		300,659
Property	367,258		152,514		519,772			158,156		92,655		250,811
Aerospace	79,249		33,000		112,249			47,796		22,862		70,658
Workers' Compensation	55,902		122,047		177,949			36,673		74,661		111,334
Total	$	888,794	$	962,353	$	1,851,147		$	560,784	$	750,950	$	1,311,734
Fair value adjustments					(522		)					1,600
ULAE					28,503							28,503
Total					$	1,879,128						$	1,341,837

	2018
	Gross							Net
	OLR		IBNR		Total			OLR		IBNR		Total
	(in thousands of U.S. dollars)
Casualty	$	177,432	$	331,432	$	508,864		$	137,828	$	282,026	$	419,854
Marine	185,084		182,453		367,537			163,889		133,426		297,315
Property	317,102		123,511		440,613			151,774		65,522		217,296
Aerospace	67,203		40,416		107,619			45,879		36,167		82,046
Workers' Compensation	49,373		110,082		159,455			33,759		68,969		102,728
Total	$	796,194	$	787,894	$	1,584,088		$	533,129	$	586,110	$	1,119,239
Fair value adjustments					(467		)					1,432
ULAE					25,076							25,076
Total					$	1,608,697						$	1,145,747

The following tables set forth information about incurred and paid loss development, total IBNR reserves and cumulative loss frequency related to all the individual lines of business within the StarStone segment as of December 31, 2019. The information related to incurred and paid loss development for the years ended December 31, 2014 through 2018 is presented as supplementary information and is therefore unaudited. The information within the tables below is presented on a prospective basis from the date of our acquisition of StarStone on April 1, 2014 since providing pre-acquisition incurred and paid losses by accident year for years prior to 2014 was determined to be impracticable due to significant data limitations.

Casualty

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,												As of December 31, 2019
Accident Year	2014 (Unaudited)		2015 (Unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	$	82,278	$	82,329	$	82,400	$	82,324	$	82,535	$	82,574	$	—	2,543
2010	16,623		17,769		17,856		18,538		18,556		18,612		119		729
2011	21,101		25,435		25,745		24,971		25,422		26,159		765		2,035
2012	56,891		48,251		43,936		40,095		39,477		42,055		3,059		3,128
2013	72,771		66,888		77,756		76,172		78,788		87,575		9,817		4,998
2014	91,369		92,793		92,812		90,335		90,588		101,748		19,074		5,734
2015			105,135		111,067		110,179		123,208		131,156		22,056		4,744
2016					125,367		129,130		140,601		169,207		39,548		4,467
2017							137,614		162,599		194,259		64,639		4,830
2018									159,324		181,499		90,672		3,902
2019											198,218		172,437		2,780
									Total		$	1,233,062	$	422,186	39,890
(1) Total of IBNR plus expected development on reported losses.
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,
Accident Year	2014 (Unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior	$	82,257	$	82,319	$	82,395	$	82,318	$	82,534	$	82,546
2010	15,555		17,768		17,855		18,537		18,555		18,466
2011	15,745		21,088		23,731		24,294		24,925		25,389
2012	18,412		29,503		32,694		33,943		36,162		36,076
2013	23,054		30,448		50,137		54,688		60,389		69,703
2014	5,769		21,911		37,607		50,767		64,672		68,827
2015			8,088		27,292		49,014		68,194		92,327
2016					4,642		42,935		74,921		97,715
2017							9,997		50,705		107,625
2018									20,649		47,973
2019											8,143
									Total		$	654,790
			Total outstanding liabilities for unpaid losses and LAE, net of reinsurance								$	578,272

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	578,272
Reinsurance recoverable on unpaid losses	94,518
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	672,790

The following is unaudited supplementary information for average annual historical duration of claims:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Casualty	5.87	%	17.83	%	17.73	%	17.98	%	13.06	%	5.94	%	3.72	%	1.44	%	0.71	%	(0.23	)%

Marine

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,										As of December 31, 2019
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	$	27,070	$	27,002	$	27,018	$	27,050	$	27,076	$	27,100	$	—	1,991
2010	22,347		19,270		19,114		19,176		19,040		19,050		144		1,029
2011	29,527		27,753		27,330		27,371		27,715		33,538		514		1,961
2012	47,957		51,418		51,074		49,813		50,618		59,597		405		2,422
2013	62,904		55,154		52,938		53,913		57,224		46,309		243		2,226
2014	50,079		53,452		48,450		54,958		50,576		50,026		833		4,003
2015			71,004		70,033		79,494		81,088		82,698		1,082		5,742
2016					82,486		83,070		87,169		86,774		4,214		6,904
2017							130,700		158,785		166,042		10,802		8,524
2018									167,902		167,565		33,836		9,881
2019											163,412		86,513		5,219
									Total		$	902,111	$	138,586	49,902
(1) Total of IBNR plus expected development on reported losses.
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2008 and Prior	$	26,939	$	26,990	$	27,015	$	27,042	$	27,077	$	27,092
2009	16,300		18,324		18,403		18,372		18,437		18,539
2010	29,395		31,152		32,397		32,643		32,803		32,558
2011	49,727		53,711		55,446		56,589		57,206		57,711
2012	12,529		21,213		25,135		27,237		29,071		38,733
2013	10,878		24,813		32,332		36,773		42,420		43,789
2014			10,871		30,562		50,062		56,154		59,478
2015					12,131		41,696		57,265		72,475
2016							25,258		68,952		108,000
2017									41,427		104,825
2018											38,252
									Total		$	601,452
			Total outstanding liabilities for unpaid losses and LAE, net of reinsurance								$	300,659

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	300,659
Reinsurance recoverable on unpaid losses	67,728
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	368,387

The following is unaudited supplementary information for average annual historical duration of claims:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Marine	18.70	%	29.98	%	19.76	%	9.79	%	5.60	%	3.86	%	4.63	%	0.32	%	(0.09	)%	0.30	%

Property

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,												As of December 31, 2019
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	$	113,828	$	113,118	$	113,206	$	113,696	$	114,633	$	114,991	$	—	2,901
2010	74,893		73,437		72,072		72,134		72,146		72,088		—		1,557
2011	91,161		89,708		89,752		89,441		89,359		89,708		4		1,621
2012	65,824		61,707		60,683		61,637		58,721		58,985		12		1,501
2013	78,145		65,152		64,804		63,959		62,177		60,582		13		1,959
2014	58,975		43,848		43,169		43,603		41,563		40,818		1,082		2,094
2015			78,993		76,550		70,359		70,244		71,189		3,964		5,720
2016					87,562		95,557		95,151		95,038		2,672		6,791
2017							155,484		171,665		183,584		6,554		8,034
2018									165,311		178,800		8,433		6,653
2019											122,118		69,922		3,277
									Total		$	1,087,901	$	92,656	42,108
(1) Total of IBNR plus expected development on reported losses.
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior	$	112,693	$	112,957	$	112,987	$	113,237	$	113,143	$	113,338
2010	69,070		71,958		72,069		72,131		72,148		71,969
2011	87,411		88,608		89,113		89,366		89,345		89,387
2012	48,103		52,168		54,308		55,274		55,474		57,753
2013	30,880		46,285		51,086		53,172		59,277		60,416
2014	5,500		18,830		31,617		34,563		36,106		37,240
2015			10,433		28,652		55,372		63,880		64,764
2016					26,838		58,035		75,387		85,023
2017							37,410		98,267		139,555
2018									59,187		98,065
2019											19,580
									Total		$	837,090
			Total outstanding liabilities for unpaid losses and LAE, net of reinsurance								$	250,811

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	250,811
Reinsurance recoverable on unpaid losses	268,961
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	519,772

The following is unaudited supplementary information for average annual historical duration of claims:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Property	20.98	%	29.19	%	27.01	%	8.82	%	2.69	%	3.22	%	0.54	%	1.04	%	—	%	0.20	%

Aerospace

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,												As of December 31, 2019
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	$	—	$	—	$	—	$	—	$	—	$	—	$	—	—
2010	18,441		18,073		18,382		18,896		18,970		18,772		17		579
2011	58,786		57,257		57,681		58,114		59,647		58,770		61		2,197
2012	55,675		55,370		56,212		56,159		57,450		57,185		125		2,421
2013	72,098		70,180		70,511		74,900		77,393		76,964		274		2,568
2014	65,208		53,541		53,553		52,341		54,408		48,657		464		2,861
2015			66,335		69,499		72,519		73,183		71,196		1,318		2,975
2016					37,741		45,019		48,180		45,380		1,714		2,880
2017							31,380		35,075		56,354		3,142		3,100
2018									59,498		55,986		3,980		2,891
2019											45,483		11,766		1,232
									Total		$	534,747	$	22,861	23,704
(1) Total of IBNR plus expected development on reported losses
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
	For The Years Ended December 31,
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior	$	—	$	—	$	—	$	—	$	—	$	—
2010	15,396		16,539		17,145		18,209		18,494		18,548
2011	53,821		55,179		55,858		56,435		57,028		57,555
2012	45,897		49,332		52,142		53,622		54,812		55,585
2013	50,842		59,850		63,439		68,775		72,770		73,511
2014	17,297		31,147		38,426		40,678		43,801		43,779
2015			32,388		52,185		60,820		64,000		66,293
2016					11,815		31,858		37,037		39,361
2017							10,398		28,221		45,946
2018									25,552		40,304
2019											23,207
									Total		$	464,089
			Total outstanding liabilities for unpaid losses and LAE, net of reinsurance								$	70,658

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	70,658
Reinsurance recoverable on unpaid losses	41,591
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	112,249

The following is unaudited supplementary information for average annual historical duration of claims:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Aerospace	37.03	%	31.40	%	16.33	%	4.98	%	4.76	%	3.00	%	1.81	%	2.68	%	1.21	%	0.29	%

Workers' Compensation

Incurred Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,										As of December 31, 2019
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019		IBNR(1)		Cumulative Number of Claims
2009 and Prior	$	—	$	—	$	—	$	—	$	—	$	—	$	—	—
2010	—		—		—		—		—		—		—		—
2011	—		—		—		—		—		—		—		—
2012	—		—		—		—		—		—		—		—
2013	—		—		—		—		—		—		—		—
2014	15,607		17,199		18,290		15,662		15,203		14,873		1,421		1,062
2015			54,977		55,505		50,103		47,338		45,812		4,905		2,522
2016					62,942		54,121		54,793		55,150		9,101		2,507
2017							43,366		39,089		29,676		6,037		2,110
2018									44,615		39,247		13,672		2,820
2019											56,754		39,525		2,860
									Total		$	241,512	$	74,661	13,881
(1) Total of IBNR plus expected development on reported losses.
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance
			For The Years Ended December 31,
Accident Year	2014 (unaudited)		2015 (unaudited)		2016 (unaudited)		2017 (unaudited)		2018 (unaudited)		2019
2009 and Prior	$	—	$	—	$	—	$	—	$	—	$	—
2010	—		—		—		—		—		—
2011	—		—		—		—		—		—
2012	—		—		—		—		—		—
2013	—		—		—		—		—		—
2014	1,491		6,079		9,279		11,431		12,243		12,617
2015			6,361		20,194		30,439		35,311		37,385
2016					7,953		23,428		32,739		39,333
2017							5,477		13,509		18,899
2018									4,508		15,064
2019											6,880
									Total		$	130,178
					Total outstanding liabilities for unpaid losses and LAE, net of reinsurance						$	111,334

The reconciliation of incurred and paid loss development to the liability for unpaid losses and LAE as presented in the tables above for the year ended December 31, 2019 is set forth below:

	2019
Liabilities for unpaid losses and allocated LAE, net of reinsurance	$	111,334
Reinsurance recoverable on unpaid losses	66,615
Gross liability for unpaid losses and LAE before unallocated loss adjustment expenses and fair value adjustments	$	177,949

The following is unaudited supplementary information for average annual historical duration of claims:

	Average Annual Percentage Payout of Incurred Losses by Age, Net of Reinsurance
	Year 1		Year 2		Year 3		Year 4		Year 5		Year 6		Year 7		Year 8		Year 9		Year 10
Workers' compensation	13.40	%	28.61	%	19.73	%	12.35	%	4.99	%	2.51	%	—	%	—	%	—	%	—	%