Reserve for Losses and Loss Adjustment Expenses

3 Months Ended

Mar. 31, 2020

Liability for Claims and Claims Adjustment Expense [Abstract]

Reserve for Losses and Loss Adjustment Expenses

The following table provides a reconciliation of the beginning and ending reserve balances for losses and loss adjustment expenses, net of reinsurance, to the gross amounts reported in the condensed consolidated balance sheets:



	Three Months Ended March 31,
	2020		2019
	(in thousands)
Reserve for losses and loss adjustment expenses net of reinsurance recoverables at beginning of period	$	1,377,461	$	1,194,088
Add: Incurred losses and loss adjustment expenses net of reinsurance:
Current year	95,982		138,959
Prior years	874		968
Total incurred losses and loss and adjustment expenses	96,856		139,927
Deduct: Loss and loss adjustment expense payments net of reinsurance:
Current year	4,271		4,679
Prior years	118,357		107,684
Total loss and loss adjustment expense payments	122,628		112,363
Reserve for losses and loss adjustment expenses net of reinsurance recoverables at end of period	1,351,689		1,221,652
Add: Reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period	691,669		508,655
Reserve for losses and loss adjustment expenses gross of reinsurance recoverables on unpaid losses and loss adjustment expenses at end of period	$	2,043,358	$	1,730,307

The Company experienced $874,000 of adverse reserve development in the three months ended March 31, 2020 on the reserve for losses and loss adjustment expenses held at December 31, 2019. This reserve development included $3,000 of favorable development in the Excess and Surplus Lines segment, $1.0 million of favorable development in the Specialty Admitted Insurance segment due to favorable development in the workers' compensation business for prior accident years, and $1.9 million of adverse development in the Casualty Reinsurance segment.

The Company experienced $1.0 million of adverse reserve development in the three months ended March 31, 2019 on the reserve for losses and loss adjustment expenses held at December 31, 2018. This reserve development included $10,000 of favorable development in the Excess and Surplus Lines segment. The Specialty Admitted Insurance segment experienced $2.0 million of favorable development due to favorable development in the workers' compensation business for prior accident years. The Company also experienced $3.0 million of adverse development in the Casualty Reinsurance segment primarily related to losses from risk profiles and treaty structures that the Company no longer writes.