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Liability for Loss and LAE
 3 Months Ended
Mar. 31, 2022
Insurance [Abstract]  
Liability for Loss and LAE

5. Liability for Loss and LAE

(a) Liability Rollforward

The following table presents the activity in the liability for loss and LAE for the three months ended March 31, 2022 and 2021:

 

 

 

Three Months Ended
March 31,

 

 

 

2022

 

 

2021

 

 

 

($ in millions)

 

Reserves as of January 1

 

$

14,357.6

 

 

$

12,970.6

 

Less: reinsurance recoverables(1)

 

 

2,026.1

 

 

 

1,703.7

 

Net reserves as of January 1

 

 

12,331.5

 

 

 

11,266.9

 

 

 

 

 

 

 

 

Other adjustments

 

 

(0.1

)

 

 

—

 

 

 

 

 

 

 

 

Incurred loss and LAE, net of reinsurance, related to:

 

 

 

 

 

 

Current year

 

 

995.1

 

 

 

1,168.2

 

Prior years

 

 

(53.3

)

 

 

(56.1

)

Total incurred loss and LAE, net of reinsurance

 

 

941.8

 

 

 

1,112.1

 

 

 

 

 

 

 

 

Paid loss and LAE, net of reinsurance, related to:(2)

 

 

 

 

 

 

Current year

 

 

68.2

 

 

 

87.4

 

Prior years

 

 

902.1

 

 

 

766.8

 

Total paid loss and LAE, net of reinsurance

 

 

970.3

 

 

 

854.2

 

 

 

 

 

 

 

 

Foreign currency exchange rate effect

 

 

(8.8

)

 

 

29.5

 

 

 

 

 

 

 

 

Net reserves as of March 31

 

 

12,294.1

 

 

 

11,554.3

 

Reinsurance recoverables as of March 31(1)

 

 

2,022.3

 

 

 

1,738.7

 

Reserves as of March 31

 

$

14,316.4

 

 

$

13,293.0

 

 

(1)
Reinsurance recoverables in this table include only ceded loss and LAE reserves.
(2)
Includes paid losses and LAE, net of reinsurance, related to commutations.

Gross loss and LAE reserves as of March 31, 2022 approximated gross loss and LAE reserves as of December 31, 2021, primarily reflecting catastrophe losses incurred in first three months of 2022, offset by payments on catastrophe losses incurred in prior years and net favorable prior accident year loss reserve development.

(b) Liability Development

The following table presents the (favorable) unfavorable prior accident year loss reserve development, including from the Pandemic (defined in Note 9(a)), for the three months ended March 31, 2022 and 2021:

 

 

 

Three Months Ended
March 31,

 

 

 

 

2022

 

 

 

2021

 

 

 

 

($ in millions)

Reinsurance Segment

 

 

 

 

 

 

 

 

Property:

 

 

 

 

 

 

 

 

Catastrophe events (excluding Pandemic)

 

$

(2.4

)

(1)

 

$

(4.5

)

(2)

Pandemic

 

 

(4.3

)

 

 

 

29.8

 

 

Non-catastrophe

 

 

(12.4

)

(3)

 

 

(11.5

)

(4)

Total

 

 

(19.1

)

 

 

 

13.8

 

 

Casualty & specialty:

 

 

 

 

 

 

 

 

Catastrophe events (excluding Pandemic)

 

 

(1.7

)

 

 

 

(1.3

)

 

Pandemic

 

 

0.9

 

 

 

 

(11.8

)

 

Non-catastrophe

 

 

(30.0

)

(5)

 

 

(54.2

)

(6)

Total

 

 

(30.8

)

 

 

 

(67.3

)

 

Total Reinsurance Segment

 

 

(49.9

)

 

 

 

(53.5

)

 

 

 

 

 

 

 

 

 

 

Insurance Segment

 

 

 

 

 

 

 

 

RSUI:

 

 

 

 

 

 

 

 

Casualty

 

 

(1.8

)

(7)

 

 

(1.1

)

(8)

Property and other

 

 

(4.5

)

(9)

 

 

(1.6

)

(10)

Total

 

 

(6.3

)

 

 

 

(2.7

)

 

CapSpecialty

 

 

2.9

 

(11)

 

 

0.1

 

(12)

Total incurred related to prior years

 

$

(53.3

)

 

 

$

(56.1

)

 

 

(1)
Primarily reflects favorable prior accident year loss reserve development related to several catastrophic events in the 2018 and 2019 accident years.
(2)
Primarily reflects favorable prior accident year loss reserve development related to Hurricane Michael in the 2018 accident year, partially offset by unfavorable prior accident year loss reserve development related to Hurricane Laura in the 2020 accident year.
(3)
Primarily reflects favorable prior accident year loss reserve development in the 2018 through 2020 accident years.
(4)
Primarily reflects favorable prior accident year loss reserve development in the 2020 accident year.
(5)
Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2008 and prior accident years and shorter-tailed lines of business in the 2019 through 2021 accident years, partially offset by unfavorable prior accident year development in the longer-tailed lines of business in the 2009 through 2018 accident years.
(6)
Primarily reflects favorable prior accident year loss reserve development in the longer-tailed lines of business in the 2016 and earlier accident years and
shorter-tailed lines of business in the 2019 and 2020 accident years, partially offset by unfavorable development in certain longer- and shorter-tailed
lines of business in the 2018 accident year.
(7)
Primarily reflects favorable prior accident year loss reserve development in in the directors' and officers' liability lines of business in the 2018 and earlier accident years and the umbrella/excess lines of business in the 2015 and earlier accident years.
(8)
Primarily reflects favorable prior accident year loss reserve development in the umbrella/excess lines of business in the 2007 through 2014 accident years, partially offset by unfavorable prior accident year loss reserve development in the directors' and officers' liability lines of business in the 2013 accident year.
(9)
Primarily reflects favorable prior accident year loss reserve development related to catastrophe losses in the 2021 accident year and, to a lesser extent, the 2020 accident year.
(10)
Primarily reflects favorable prior accident year loss reserve development related to catastrophes in the 2017 and 2018 accident years, partially offset by unfavorable prior accident year loss reserve development related to catastrophes in the 2020 accident year.
(11)
Primarily reflects unfavorable prior accident year loss reserve development in several casualty liability lines of business in the 2014 through 2018 accident years.
(12)
Primarily reflects unfavorable prior accident year loss reserve development in several casualty lines of business.