Loss and Loss Expense Reserves (Tables)

12 Months Ended

Dec. 31, 2018

Loss and Loss Expense Reserves [Abstract]

Activity in Reserves for Losses and Loss Expenses

Activity in the reserves for losses and loss expenses for the years ended December 31 is summarized as follows.  All amounts are shown net of reinsurance, unless otherwise indicated.

	2018		2017		2016
Reserves, gross of reinsurance recoverable, at the beginning of the year	$	680,274	$	576,330	$	513,596
Reinsurance recoverable on unpaid losses at the beginning of the year		308,143		251,563		211,843
Reserves at the beginning of the year		372,131		324,767		301,753
Provision for losses and loss expenses:
Claims occurring during the current year		329,078		228,303		172,645
Claims occurring during prior years		16,786		19,215		13,836
Total incurred losses and loss expenses		345,864		247,518		186,481
Loss and loss expense payments:
Claims occurring during the current year		84,738		67,234		54,239
Claims occurring during prior years		143,853		132,920		109,228
Total paid		228,591		200,154		163,467
Reserves at the end of the year		489,404		372,131		324,767
Reinsurance recoverable on unpaid losses at the end of the year		375,935		308,143		251,563
Reserves, gross of reinsurance recoverable, at the end of the year	$	865,339	$	680,274	$	576,330

Incurred Claims Development Net of Reinsurance

The following is information about incurred and paid claims development as of December 31, 2018, net of reinsurance, as well as cumulative claim frequency and the total of incurred‐but‐not‐reported liabilities plus expected development on reported claims included within the net incurred claims amounts.

Workers' Compensation

																					As of December 31, 2018
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not- Reported Liabilities Plus Expected Development on Reported Claims		Number of Reported Claims Per Year
Accident Year	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	17,270	$	20,931	$	21,447	$	21,261	$	21,268	$	20,767	$	20,641	$	20,817	$	20,946	$	21,153	$	985		3,784
2010				20,644		20,111		19,400		19,300		18,849		18,344		19,195		19,541		19,819		1,098		4,223
2011						26,057		26,628		26,958		26,767		25,515		27,293		26,617		26,631		2,179		4,546
2012								23,965		25,544		24,887		24,485		25,616		27,020		26,775		2,824		4,481
2013										27,619		30,638		29,913		32,121		32,553		31,131		3,780		5,275
2014												36,768		36,968		34,009		33,427		31,031		4,482		5,406
2015														26,277		23,115		25,889		24,948		5,328		6,308
2016																35,240		29,757		29,317		6,740		6,059
2017																		42,387		37,731		13,918		16,106
2018																				62,973		36,250		12,893
Total																			$	311,509	$	77,584

	Cumulative Paid Claims and Allocated Claim Adjustment Expense, Net of Reinsurance
	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
Accident Year	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	4,186	$	10,073	$	13,343	$	15,576	$	16,592	$	17,448	$	18,028	$	18,514	$	18,982	$	19,261
2010				3,974		9,134		11,963		13,845		14,966		15,835		16,590		16,789		17,062
2011						4,916		11,912		15,973		18,884		20,617		21,622		22,569		22,991
2012								4,597		11,004		14,834		17,415		18,946		20,276		21,157
2013										4,880		12,792		18,065		21,655		23,643		24,968
2014												5,328		13,665		19,075		22,387		23,968
2015														2,918		10,128		15,020		17,487
2016																5,784		13,377		18,461
2017																		6,150		15,811
2018																				10,987
Total																			$	192,153
Outstanding liabilities prior to 2009 net of reinsurance																				12,640
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	131,996

Commercial Liability

																					As of December 31, 2018
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not- Reported Liabilities Plus Expected Development on Reported Claims		Number of Reported Claims Per Year
	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
Accident Year	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	29,707	$	30,406	$	30,203	$	26,280	$	27,259	$	25,872	$	25,373	$	25,320	$	25,485	$	25,761	$	190		899
2010				31,124		22,161		21,899		19,139		20,300		19,764		19,377		19,081		19,985		112		2,403
2011						46,829		43,832		31,633		36,894		35,805		37,122		36,076		37,852		131		2,901
2012								49,743		54,269		49,743		51,367		48,708		51,475		51,648		135		3,130
2013										53,817		39,143		37,701		36,371		46,690		48,857		663		3,749
2014												49,971		52,254		52,483		52,964		64,372		307		3,320
2015														61,420		70,174		64,323		71,088		2,785		3,185
2016																61,638		68,974		77,362		7,048		3,707
2017																		103,126		103,611		25,527		5,261
2018																				179,589		70,070		6,870
Total																			$	680,125	$	106,968

	Cumulative Paid Claims and Allocated Claim Adjustment Expense, Net of Reinsurance
	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
Accident Year	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	928	$	17,880	$	19,718	$	23,521	$	24,866	$	25,066	$	25,114	$	25,125	$	25,199	$	25,391
2010				1,649		7,166		11,635		16,052		18,627		18,517		18,866		18,662		18,791
2011						1,809		11,350		23,615		30,795		33,255		34,009		35,561		36,400
2012								3,086		23,252		32,942		45,303		47,601		50,036		50,750
2013										5,167		15,772		25,270		34,481		44,865		46,084
2014												4,023		9,046		28,393		45,075		57,692
2015														10,923		27,582		49,267		63,133
2016																6,843		30,377		52,764
2017																		11,415		46,529
2018																				18,689
Total																			$	416,223
Outstanding liabilities prior to 2009 net of reinsurance																				4,621
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	268,523

Professional Liability Reinsurance Assumed (in runoff)

																					As of December 31, 2018
	Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																				Total of Incurred-but-Not- Reported Liabilities Plus Expected Development on Reported Claims		Number of Reported Claims Per Year
Accident Year	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–		N/A
2010				2,196		4,277		7,827		7,946		9,733		10,740		11,689		11,893		11,677		24		N/A
2011						10,492		8,314		9,017		9,859		10,779		12,735		12,744		12,725		116		N/A
2012								10,041		9,276		5,569		10,157		14,605		16,555		14,949		706		N/A
2013										14,370		13,034		11,618		17,694		23,256		22,213		1,847		N/A
2014												12,675		8,825		7,259		9,837		12,749		2,297		N/A
2015														11,638		7,859		7,147		10,422		5,422		N/A
2016																6,368		2,482		1,522		1,035		N/A
2017																		–		–		–		N/A
2018																				–		–		N/A
Total																			$	86,257	$	11,447

	Cumulative Paid Claims and Allocated Claim Adjustment Expense, Net of Reinsurance
	For the Years Ended December 31 (2009-2017 is Supplementary Information and Unaudited)
Accident Year	2009		2010		2011		2012		2013		2014		2015		2016		2017		2018
2009	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–	$	–
2010				41		729		3,505		5,844		7,758		9,904		11,132		11,334		11,334
2011						50		637		2,061		4,983		8,104		10,404		11,679		12,280
2012								103		992		2,388		5,077		8,355		11,239		13,091
2013										123		1,135		5,088		10,988		14,779		18,229
2014												723		761		2,241		3,999		6,627
2015														10		390		1,899		3,207
2016																–		5		99
2017																		–		–
2018																				–
Total																			$	64,867
Outstanding liabilities prior to 2009 net of reinsurance																				–
Liabilities for claims and claims adjustment expenses, net of reinsurance																			$	21,390

Physical Damage ⁽¹⁾

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance							As of December 31, 2018
For the Years Ended December 31 (2016-2017 is Supplementary Information and Unaudited)							Total of Incurred-but-Not-Reported Liabilities Plus Expected Development on Reported Claims		Number of Reported Claims Per Year
Accident Year	2016		2017		2018
2016 and prior	$	40,651	$	39,477	$	39,658	$	5		9,619
2017				48,440		47,193		512		10,517
2018						53,726		4,221		10,186
			Total		$	140,577	$	4,738

Cumulative Paid Claims and Allocated Claim Adjustment Expense, Net of Reinsurance
For the Years Ended December 31 (2016-2017 is Supplementary Information and Unaudited)
Accident Year	2016		2017		2018
2016 and prior	$	34,114	$	39,354	$	39,073
2017				39,517		46,554
2018						41,631
			Total		$	127,258
Outstanding liabilities prior to 2016 net of reinsurance						10
Liabilities for claims and claims adjustment expenses, net of reinsurance					$	13,329

⁽¹⁾ The majority of physical damage claims settle within a two-year period.  The triangles above have been abbreviated to reflect the short-tail nature of this business.

Reconciliation of Net Incurred and Paid Claims Development

The reconciliation of the net incurred and paid claims development tables to the liability for claims and claim adjustment expenses in the consolidated balance sheet at December 31 is as follows.

	2018		2017
Net outstanding liabilities
Commercial Liability	$	268,523	$	162,581
Workers' Compensation		131,996		113,751
Physical Damage		13,329		9,087
Professional Liability Assumed		21,390		28,980
Other short-duration insurance lines		33,716		39,883
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		468,954		354,282
Reinsurance recoverable on unpaid claims
Commercial Liability		194,483		124,695
Workers' Compensation		172,869		170,394
Physical Damage		1,851		51
Other short-duration insurance lines		6,732		13,002
Reinsurance recoverable on unpaid losses at the end of the year		375,935		308,142
Unallocated claims adjustment expenses		20,450		17,850
Total gross liability for unpaid claims and claims adjustment expense	$	865,339	$	680,274

Supplementary Information about Average Historical Claims Duration

The following is supplementary information about average historical claims duration as of December 31, 2018:

	Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited)
Years		1		2		3		4		5		6		7		8		9		10
Commercial Liability		8.5	%	30.5	%	23.7	%	20.6	%	9.9	%	1.9	%	1.9	%	0.5	%	0.5	%	0.7	%
Workers' Compensation		17.3	%	26.3	%	16.3	%	10.4	%	5.7	%	4.3	%	3.3	%	1.6	%	1.8	%	1.3	%
Physical Damage		80.6	%	14.1	%	2.0	%	N/A		N/A		N/A		N/A		N/A		N/A		N/A
Professional Liability Assumed		1.1	%	3.6	%	13.5	%	19.0	%	18.3	%	17.8	%	11.0	%	1.7	%	–		N/A