Loss and Loss Adjustment Expense Reserves — Activity in the loss and loss adjustment expense reserves is summarized as follows:



	June 30,
(millions)	2018		2017
Balance, Beginning of period	$	13,086.9	$	11,368.0
Less reinsurance recoverables on unpaid losses	2,170.1		1,801.0
Net balance, Beginning of period	10,916.8		9,567.0
Incurred related to:
Current year	10,164.6		8,804.1
Prior years	81.5		74.2
Total incurred	10,246.1		8,878.3
Paid related to:
Current year	5,533.7		4,951.0
Prior years	3,851.5		3,381.8
Total paid	9,385.2		8,332.8
Net balance, End of period	11,777.7		10,112.5
Plus reinsurance recoverables on unpaid losses	2,293.1		1,947.9
Balance, End of period	$	14,070.8	$	12,060.4

We experienced unfavorable reserve development of $81.5 million and $74.2 million for the first six months of 2018 and 2017, respectively, which is reflected as “Incurred related to prior years” in the table above.

Year-to-date June 30, 2018


•	Approximately $72 million of the unfavorable prior year reserve development was attributable to accident years 2017 and 2016.


•	Our personal auto business incurred about $57 million of unfavorable loss and loss adjustment expense (LAE) reserve development, with the Agency and Direct auto businesses contributing about $36 million and $21 million, respectively, of unfavorable development. The unfavorable development was primarily due to an increase in reopened personal injury protection (PIP) claims.


•	Our Commercial Lines business experienced about $17 million of unfavorable development primarily due to late reported losses and higher LAE than anticipated.


•	Our Property business recognized unfavorable development of about $7 million, while our special lines products had minimal development during the first half of the year.

Year-to-date June 30, 2017


•	Approximately $56 million of the unfavorable prior year reserve development was attributable to accident year 2016 with the balance attributable to accident year 2015.


•	Our commercial and personal auto businesses incurred about $102 million of unfavorable loss and LAE reserve development for the first six months of 2017, partially offset by the favorable loss and LAE reserve development of about $28 million in our special lines and Property businesses.


•	Our Agency and Direct personal auto businesses incurred about $65 million and $29 million, respectively, of the total unfavorable reserve development, primarily due to an increase in costs related to property damage, more late reported bodily injury claims than anticipated, and higher LAE costs.


•	Our Property business experienced about $20 million in favorable development primarily due to the identification of prior year losses eligible to be ceded under our catastrophe bond reinsurance program.