Liability for Future Policy Benefits and Unpaid Claims Disclosure [Text Block]

6 Months Ended

Jun. 30, 2017

Notes

Liability for Future Policy Benefits and Unpaid Claims Disclosure

Since unpaid loss and loss adjustment expenses are estimates, actual losses incurred may be more or less than the Company’s previously developed estimates and is referred to as either unfavorable or favorable development, respectively. The overall net favorable development of $7,669,000 in 2017 related to prior years consists of favorable developments of $2,679,000 in the Medical Stop-Loss reserves, $2,793,000 in the group disability reserves and $2,262,000 in the other individual life, annuities and other reserves, partially offset by an unfavorable development of $65,000 in Specialty Health reserves.  The overall net favorable

development of $6,192,000 in 2016 related to prior years primarily consists of favorable developments of $8,888,000 in the group disability reserves, and $494,000 in Medical Stop-Loss reserves, partially offset by an unfavorable development of $3,195,000 in Specialty health reserves.

Included in the preceding rollforward of the Company’s liability for policy benefits and claims are the policy benefits and claims activity associated with the Company’s health insurance lines. These are embedded within the Specialty Health segment. The table below summarizes the components of the change in the liability for policy benefits and claims that are specific to health insurance claims for the periods indicated (in thousands).

		Specialty Health Segment
		Health Insurance Claims
		Six Months Ended
		June 30,
		2017		2016
Balance at beginning of year	$	27,183	$	23,425
Less: reinsurance recoverable		1,179		1,362
Net balance at beginning of year		26,004		22,063
Amount incurred, related to:
Current year		25,514		26,574
Prior years		343		(222)
Total incurred		25,857		26,352
Amount paid, related to:
Current year		2,927		9,281
Prior years		17,355		15,634
Total paid		20,282		24,915
Net balance at end of year		31,579		23,500
Plus:  reinsurance recoverable		666		848
Balance at end of year	$	32,245	$	24,348

The liability for the IBNR plus expected development on reported claims associated with the Company’s health insurance claims was $31,579,000 at June 30, 2017.