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Unpaid losses and loss expenses
 9 Months Ended
Sep. 30, 2022
Liability for Claims and Claims Adjustment Expense [Abstract]  
Liability for Future Policy Benefits and Unpaid Claims Disclosure [Text Block] Unpaid losses and loss expenses
The following table presents a reconciliation of beginning and ending Unpaid losses and loss expenses:
Nine Months Ended
September 30
(in millions of U.S. dollars)20222021
Gross unpaid losses and loss expenses – beginning of period$72,943 $67,811 
Reinsurance recoverable on unpaid losses – beginning of period (1)
(16,184)(14,647)
Net unpaid losses and loss expenses – beginning of period56,759 53,164 
Net losses and loss expenses incurred in respect of losses occurring in:
Current year18,426 17,556 
Prior years (2)
(952)(868)
Total17,474 16,688 
Net losses and loss expenses paid in respect of losses occurring in:
Current year5,104 4,771 
Prior years9,217 7,922 
Total14,321 12,693 
Foreign currency revaluation and other(1,300)(78)
Net unpaid losses and loss expenses – end of period58,612 57,081 
Reinsurance recoverable on unpaid losses (1)
17,380 15,550 
Gross unpaid losses and loss expenses – end of period$75,992 $72,631 
(1)    Net of valuation allowance for uncollectible reinsurance.
(2)    Relates to prior period loss reserve development only and excludes prior period development related to reinstatement premiums, expense adjustments, and earned premiums totaling $243 million and $87 million for the nine months ended September 30, 2022 and 2021, respectively.

Gross and net unpaid losses and loss expenses increased $3,049 million and $1,853 million, respectively, for the nine months ended September 30, 2022, driven by an increase in underlying exposure due to premium growth and net catastrophe losses, partially offset by favorable prior period development, and favorable foreign exchange movement.
Prior Period Development
Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years. Long-tail lines include lines such as workers' compensation, general liability, and financial lines; while short-tail lines include lines such as most property lines, energy, personal accident, and agriculture.


The following table summarizes (favorable) and adverse PPD by segment:
Three Months Ended September 30Nine Months Ended September 30
(in millions of U.S. dollars)Long-tail    Short-tailTotalLong-tail    Short-tailTotal
2022
North America Commercial P&C Insurance$(29)$(137)$(166)$(315)$(246)$(561)
North America Personal P&C Insurance— (133)(133)— (187)(187)
North America Agricultural Insurance— 9 9 — (17)(17)
Overseas General Insurance(5)— (5)(5)(233)(238)
Global Reinsurance— — — (7)29 22 
Corporate73 — 73 272 — 272 
Total$39 $(261)$(222)$(55)$(654)$(709)
2021
North America Commercial P&C Insurance$(101)$(56)$(157)$(243)$(197)$(440)
North America Personal P&C Insurance— (182)(182)— (266)(266)
North America Agricultural Insurance— 7 7 — 5 5 
Overseas General Insurance(13)(15)(28)(8)(201)(209)
Global Reinsurance(4)— (4)(26)15 (11)
Corporate43 — 43 140 — 140 
Total$(75)$(246)$(321)$(137)$(644)$(781)

Significant prior period movements by segment, principally driven by reserve reviews completed during each respective period, are discussed in more detail below. The remaining net development for long-tail lines and short-tail business for each segment and Corporate comprises numerous favorable and adverse movements across a number of lines and accident years, none of which is significant individually or in the aggregate.

North America Commercial P&C Insurance. Net favorable development for the three months ended September 30, 2022, included $164 million from lower than expected loss experience in workers’ compensation lines and $66 million, net of premium adjustments, from lower claims activity in large multi-line loss sensitive accounts. The favorable development was partially offset by net adverse development of $58 million from higher than expected claims severity in commercial auto liability, and $71 million from commercial umbrella/excess portfolios. Net favorable development on our short-tail businesses primarily included $132 million from property and marine portfolios, where paid and reported loss activity for the most recent accident years was lower than expected. Net favorable development for the nine months ended September 30, 2022, also included favorable development in workers’ compensation lines due to updates to loss development factors and our annual assessment of multi-claimant events, including industrial accidents.

Net favorable development for the three and nine months ended September 30, 2021, included $97 million and $255 million from workers' compensation lines due to lower than expected loss experience. This favorable development for the nine months ended September 30, 2021, from workers' compensation lines also included related updates to loss development factors and our annual assessment of multi-claimant events, including industrial accidents. The favorable development for the nine months ended September 30, 2021, was partially offset by net adverse development in commercial auto liability of $74 million and commercial excess and umbrella portfolios of $74 million.

North America Personal P&C Insurance. Net favorable development for the three and nine months ended September 30, 2022, included favorable development in the homeowners and valuables lines of business, driven by lower than expected claims reserve development.
Net favorable development for the three and nine months ended September 30, 2021, included favorable development in homeowners and valuables, which experienced lower than expected loss development.

Overseas General Insurance. Net favorable development for the three months ended September 30, 2022, included lower than expected paid and reported loss activity of $82 million in casualty lines, including primary and excess lines in Continental Europe, the U.K., and Asia Pacific, and $34 million in environmental lines. The favorable development was partially offset by net adverse development of $114 million from financial lines, including Directors and Officers (D&O) due to a combination of higher than expected development on specific claims and increased expected future development in the U.K., Continental Europe, Asia Pacific, and London wholesale business. Net favorable development for the nine months ended September 30, 2022, also included net favorable development of $75 million in A&H lines, $67 million in property lines, and $53 million in personal lines.

Net favorable development for the three months ended September 30, 2021, included favorable development in casualty lines partially offset by adverse development in financial lines, primarily D&O. Net favorable development for the nine months ended September 30, 2021, also included favorable development in A&H and property lines, the latter of which included a $21 million favorable reduction in COVID-19 estimates.

Corporate. Net adverse development for the three months ended September 30, 2022 and 2021, included adverse development for environmental liabilities. Net adverse development for the nine months ended September 30, 2022 and 2021, also included adverse development for molestation claims of $155 million and $68 million, respectively.

Molestation claims
In the third quarter of 2022, the bankruptcy court approved the agreement-in-principle regarding the bankruptcy of the Boy Scouts of America (BSA), which will proceed to further approval before the U.S. District Court. The terms of the agreement are consistent with the 2021 10-K disclosure. Of the $800 million that will be paid per the agreement, we paid $200 million during the third quarter and expect to pay the remaining $600 million liability within the next twelve months. Refer to the 2021 10-K for additional information on molestation claims.