INSURANCE LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2019

Claims Development [Line Items]

Schedule of reconciliation of activity in the liability for unpaid claims and claims adjustment expense

The following table presents the roll-forward of activity in Loss Reserves:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in millions)		2019		2018		2019		2018
Liability for unpaid loss and loss adjustment expenses, beginning of period	$	82,496	$	78,098	$	83,639	$	78,393
Reinsurance recoverable		(31,784)		(27,211)		(31,690)		(26,708)
Net Liability for unpaid loss and loss adjustment expenses, beginning of period		50,712		50,887		51,949		51,685
Losses and loss adjustment expenses incurred:
Current year		4,795		4,452		9,600		9,130
Prior years, excluding discount and amortization of deferred gain		(132)		(26)		(147)		(65)
Prior years, discount charge (benefit)		244		9		741		(177)
Prior years, amortization of deferred gain on retroactive reinsurance(a)		(56)		(69)		(142)		(108)
Total losses and loss adjustment expenses incurred		4,851		4,366		10,052		8,780
Losses and loss adjustment expenses paid:
Current year		(1,148)		(910)		(1,492)		(1,520)
Prior years		(4,562)		(4,635)		(10,682)		(9,414)
Total losses and loss adjustment expenses paid		(5,710)		(5,545)		(12,174)		(10,934)
Other changes:
Foreign exchange effect		(209)		(431)		7		(157)
Retroactive reinsurance adjustment (net of discount)(b)		80		30		(110)		(67)
Total other changes		(129)		(401)		(103)		(224)
Liability for unpaid loss and loss adjustment expenses, end of period:
Net liability for unpaid losses and loss adjustment expenses		49,724		49,307		49,724		49,307
Reinsurance recoverable		31,333		27,406		31,333		27,406
Total	$	81,057	$	76,713	$	81,057	$	76,713

(a) Includes $6 million and $8 million for the retroactive reinsurance agreement with NICO covering U.S. asbestos exposures for the three-month periods ended June 30, 2019 and 2018, respectively, and $15 million and $13 million for the six-month periods ended June 30, 2019 and 2018, respectively.

(b) Includes change in discount on retroactive reinsurance of $(125) million and $(20) million for the three-month periods ended June 30, 2019 and 2018, respectively, and $(432) million and $108 million for the six-month periods ended June 30, 2019 and 2018, respectively.

Schedule of loss reserve discount and loss reserve discount benefit (charge)

	June 30, 2019						December 31, 2018
	North						North
	America						America
	Commercial			Legacy			Commercial			Legacy
(in millions)	Insurance			Portfolio		Total	Insurance			Portfolio		Total
U.S. workers' compensation	$	2,258	$	812	$	3,070	$	2,782	$	973	$	3,755
Retroactive reinsurance		(1,288)		-		(1,288)		(1,720)		-		(1,720)
Total reserve discount*	$	970	$	812	$	1,782	$	1,062	$	973	$	2,035

*Excludes $188 million and $163 million of discount related to certain long tail liabilities in the United Kingdom at June 30, 2019 and December 31, 2018, respectively.

Three Months Ended June 30,	2019						2018
	North						North
	America						America
	Commercial			Legacy			Commercial			Legacy
(in millions)	Insurance			Portfolio		Total	Insurance			Portfolio		Total
Current accident year	$	32	$	-	$	32	$	23	$	-	$	23
Accretion and other adjustments
to prior year discount		8		(11)		(3)		(133)		(12)		(145)
Effect of interest rate changes		(170)		(71)		(241)		96		40		136
Net reserve discount
benefit (charge)		(130)		(82)		(212)		(14)		28		14
Change in discount on loss reserves
ceded under retroactive reinsurance		125		-		125		20		-		20
Net change in total reserve
discount(a)	$	(5)	$	(82)	$	(87)	$	6	$	28	$	34
Six Months Ended June 30,	2019						2018
	North						North
	America						America
	Commercial			Legacy			Commercial			Legacy
(in millions)	Insurance			Portfolio		Total	Insurance			Portfolio		Total
Current accident year	$	56	$	-	$	56	$	42	$	-	$	42
Accretion and other adjustments
to prior year discount		(243)		(24)		(267)		(88)		(30)		(118)
Effect of interest rate changes		(337)		(137)		(474)		219		76		295
Net reserve discount
benefit (charge)		(524)		(161)		(685)		173		46		219
Change in discount on loss reserves
ceded under retroactive reinsurance		432		-		432		(108)		-		(108)
Net change in total reserve
discount(b)	$	(92)	$	(161)	$	(253)	$	65	$	46	$	111

(a) Excludes $(9) million and $7 million discount related to certain long tail liabilities in the United Kingdom for the three-month periods ended June 30, 2019 and 2018, respectively.

(b) Excludes $26 million and $3 million discount related to certain long tail liabilities in the United Kingdom for the six-month periods ended June 30, 2019 and 2018, respectively.