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

9 Months Ended

Sep. 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 $9,236,000 in 2017 related to prior years consists of favorable developments of $2,420,000 in the Medical Stop-Loss reserves, $5,406,000 in the group

disability reserves and $2,714,000 in the other individual life, annuities and other reserves, partially offset by an unfavorable development of $1,304,000 in Specialty Health reserves.  The overall net favorable development of $7,048,000 in 2016 related to prior years primarily consists of favorable developments of $2,916,000 in the group disability reserves, $494,000 in Medical Stop-Loss reserves, and $3,769,000 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
		Nine Months Ended
		September 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		40,836		34,598
Prior years		1,144		(6,845)
Total incurred		41,980		27,753
Amount paid, related to:
Current year		13,528		9,541
Prior years		23,797		13,105
Total paid		37,325		22,646
Net balance at end of period		30,659		27,170
Plus:  reinsurance recoverable		814		848
Balance at end of period	$	31,473	$	28,018

The liability for the IBNR plus expected development on reported claims associated with the Company’s health insurance claims was $30,659,000 at September 30, 2017.