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Unpaid losses and loss expenses | 12 Months Ended
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Dec. 31, 2019
Liability for Claims and Claims Adjustment Expense [Abstract] |
Unpaid Losses and Loss Expenses | Unpaid losses and loss expenses Chubb establishes reserves for the estimated unpaid ultimate liability for losses and loss expenses under the terms of its policies and agreements. Reserves include estimates for both claims that have been reported and for IBNR claims, and include estimates of expenses associated with processing and settling these claims. Reserves are recorded in Unpaid losses and loss expenses in the consolidated balance sheets. While we believe that our reserves for unpaid losses and loss expenses at December 31, 2019 are adequate, new information or trends may lead to future developments in incurred loss and loss expenses significantly greater or less than the reserves provided. Any such revisions could result in future changes in estimates of losses or reinsurance recoverable and would be reflected in our results of operations in the period in which the estimates are changed. The following table presents a reconciliation of beginning and ending Unpaid losses and loss expenses:
| Year Ended December 31 |
(in millions of U.S. dollars) | 2019 |  |  | 2018 |  |  | 2017 |
Gross unpaid losses and loss expenses, beginning of year | $ | 62,960 |  |  | $ | 63,179 |  |  | $ | 60,540 |
Reinsurance recoverable on unpaid losses (1) | (14,689 | ) |  | (14,014 | ) |  | (12,708 | )
Net unpaid losses and loss expenses, beginning of year | 48,271 |  |  | 49,165 |  |  | 47,832 |
Net losses and loss expenses incurred in respect of losses occurring in: |  |  |  |  |
Current year | 19,575 |  |  | 19,048 |  |  | 19,391 |
Prior years (2) | (845 | ) |  | (981 | ) |  | (937 | )
Total | 18,730 |  |  | 18,067 |  |  | 18,454 |
Net losses and loss expenses paid in respect of losses occurring in: |  |  |  |  |
Current year | 7,894 |  |  | 7,544 |  |  | 6,575 |
Prior years | 10,579 |  |  | 10,796 |  |  | 10,873 |
Total | 18,473 |  |  | 18,340 |  |  | 17,448 |
Foreign currency revaluation and other | (19 | ) |  | (621 | ) |  | 327 |
Net unpaid losses and loss expenses, end of year | 48,509 |  |  | 48,271 |  |  | 49,165 |
Reinsurance recoverable on unpaid losses (1) | 14,181 |  |  | 14,689 |  |  | 14,014 |
Gross unpaid losses and loss expenses, end of year | $ | 62,690 |  |  | $ | 62,960 |  |  | $ | 63,179 |
(1) | Net of provision 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 $53 million, $85 million and $108 million for 2019, 2018, and 2017, respectively.
The increase in net unpaid losses and loss expense in 2019 reflected an increase in underlying reserves, offset by favorable prior period development and payments related to catastrophic events. The decrease in gross and net unpaid losses and loss expenses in 2018 was primarily driven by payments related to the 2017 catastrophic events, favorable prior period development and foreign exchange movement, partially offset by catastrophic events in 2018. The loss development tables under section c) below, present Chubb’s historical incurred and paid claims development by broad product line through December 31, 2019, net of reinsurance, as well as the cumulative number of reported claims, IBNR balances, and other supplementary information. The following table presents a reconciliation of the loss development tables to the liability for unpaid losses and loss expenses in the consolidated balance sheet:
Reconciliation of Reserve Balances to Liability for Unpaid Loss and Loss Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Presented in the loss development tables: |  |
North America Commercial P&C Insurance — Workers' Compensation |  | $ | 9,414 |
North America Commercial P&C Insurance — Liability |  | 16,447 |
North America Commercial P&C Insurance — Other Casualty |  | 1,913 |
North America Commercial P&C Insurance — Non-Casualty |  | 1,759 |
North America Personal P&C Insurance |  | 2,525 |
Overseas General Insurance — Casualty |  | 5,977 |
Overseas General Insurance — Non-Casualty |  | 2,377 |
Global Reinsurance — Casualty |  | 1,177 |
Global Reinsurance — Non-Casualty |  | 255 |
Excluded from the loss development tables: |  |
Other |  | 4,218 |
Net unpaid loss and allocated loss adjustment expense |  | 46,062 |
Ceded unpaid loss and allocated loss adjustment expense: |  |
North America Commercial P&C Insurance — Workers' Compensation |  | $ | 1,657 |
North America Commercial P&C Insurance — Liability |  | 5,400 |
North America Commercial P&C Insurance — Other Casualty |  | 546 |
North America Commercial P&C Insurance — Non-Casualty |  | 1,150 |
North America Personal P&C Insurance |  | 603 |
Overseas General Insurance — Casualty |  | 2,113 |
Overseas General Insurance — Non-Casualty |  | 1,263 |
Global Reinsurance — Casualty |  | 35 |
Global Reinsurance — Non-Casualty |  | 107 |
Other |  | 1,457 |
Ceded unpaid loss and allocated loss adjustment expense |  | 14,331 |
Unpaid loss and loss expense on other than short-duration contracts (1) |  | 873 |
Unpaid unallocated loss adjustment expenses |  | 1,424 |
Unpaid losses and loss expenses |  | $ | 62,690 |
(1) | Primarily includes the claims reserve of our International A&H business and Life Insurance segment reserves.
Business excluded from the loss development tables “Other” shown in the reconciliation table above comprises businesses excluded from the loss development tables below:
• | North America Agricultural Insurance segment business, which is short-tailed with the majority of the liabilities expected to be resolved in the ensuing twelve months;
• | Corporate segment business, which includes run-off liabilities such as asbestos and environmental and other mass tort exposures and which impact accident years older than those shown in the exhibits below;
• | Life Insurance segment business, which is generally written using long-duration contracts; and
• | Certain subsets of our business due to data limitations or unsuitability to the development table presentation, including:
◦ | We underwrite loss portfolio transfers at various times; by convention, all premium and losses associated with these transactions are recorded to the policy period of the transaction, even though the accident dates of the claims covered may be a decade or more in the past. We also underwrite certain high attachment, high limit, multiple-line and excess of aggregate coverages for large commercial clients. Changes in incurred loss and cash flow patterns are volatile and sufficiently different from those of typical insureds. This category includes the loss portfolio transfer of Fireman’s Fund personal lines run-off liabilities and Alternative Risk Solutions business within the North America Commercial P&C segment;
◦ | 2015 and prior paid history on a subset of previously acquired international businesses, within the Overseas General Insurance segment, due to limitations on the data prior to the acquisition;
◦ | Reinsurance recoverable bad debt;
◦ | Purchase accounting adjustments related to unpaid losses and loss expenses for Chubb Corp.
a) Description of Reserving Methodologies Our recorded reserves represent management's best estimate of the provision for unpaid claims as of the balance sheet date. The process of establishing loss and loss expense reserves can be complex and is subject to considerable uncertainty as it requires the use of estimates and judgments based on circumstances underlying the insured loss at the date of accrual. The reserves for our various product lines each require different qualitative and quantitative assumptions and judgments to be made. Management's best estimate is developed after collaboration with actuarial, underwriting, claims, legal, and finance departments and culminates with the input of reserve committees. Each business unit reserve committee includes the participation of the relevant parties from actuarial, finance, claims, and unit senior management and has the responsibility for finalizing, recommending and approving the estimate to be used as management's best estimate. Reserves are further reviewed by Chubb's Chief Actuary and senior management. The objective of such a process is to determine a single estimate that we believe represents a better estimate than any other and which is viewed by management to be the best estimate of ultimate loss settlements. This estimate is based on a combination of exposure and experience-based actuarial methods (described below) and other considerations such as claims reviews, reinsurance recovery assumptions and/or input from other knowledgeable parties such as underwriting. Exposure-based methods are most commonly used on relatively immature origin years (i.e., the year in which the losses were incurred — “accident year” or “report year”), while experience-based methods provide a view based on the projection of loss experience that has emerged as of the valuation date. Greater reliance is placed upon experience-based methods as the pool of emerging loss experience grows and where it is deemed sufficiently credible and reliable as the basis for the estimate. In comparing the held reserve for any given origin year to the actuarial projections, judgment is required as to the credibility, uncertainty and inherent limitations of applying actuarial techniques to historical data to project future loss experience. Examples of factors that impact such judgments include, but are not limited to, the following:
• | nature and complexity of underlying coverage provided and net limits of exposure provided;
• | segmentation of data to provide sufficient homogeneity and credibility for loss projection methods;
• | extent of credible internal historical loss data and reliance upon industry information as required;
• | historical variability of actual loss emergence compared with expected loss emergence;
• | reported and projected loss trends;
• | extent of emerged loss experience relative to the remaining expected period of loss emergence;
• | rate monitor information for new and renewal business;
• | changes in claims handling practice;
• | inflation;
• | the legal environment;
• | facts and circumstances of large claims;
• | terms and conditions of the contracts sold to our insured parties;
• | impact of applicable reinsurance recoveries; and
• | nature and extent of underlying assumptions.
We have actuarial staff within each of our business units who analyze loss reserves (including loss expenses) and regularly project estimates of ultimate losses and the corresponding indications of the required IBNR reserve. Our reserving approach is a comprehensive ground-up process using data at a detailed level that reflects the specific types and coverages of the diverse products written by our various operations. The data presented in this disclosure was prepared on a more aggregated basis and with a focus on changes in incurred loss estimates over time as well as associated cash flows. We note that data prepared on this basis may not demonstrate the full spectrum of characteristics that are evident in the more detailed level studied internally. We perform an actuarial reserve review for each product line at least once a year. For most product lines, one or more standard actuarial reserving methods may be used to determine estimates of ultimate losses and loss expenses, and from these estimates, a single actuarial central estimate is selected. The actuarial central estimate is an input to the reserve committee process described above. For the few product lines that do not lend themselves to standard actuarial reserving methods, appropriate techniques are applied to produce the actuarial central estimates. For example, run-off asbestos and environmental liability estimates are better suited to the application of account-specific exposure-based analyses to best evaluate their associated aggregate reserve levels. b) Standard actuarial reserving methods The judgments involved in projecting the ultimate losses include the use and interpretation of various standard actuarial reserving methods that place reliance on the extrapolation of actual historical data, loss development patterns, industry data, and other benchmarks as appropriate. Standard actuarial reserving methods include, but are not limited to, expected loss ratio, paid and reported loss development, and Bornhuetter-Ferguson methods. A general description of these methods is provided below. In addition to these standard methods, depending upon the product line characteristics and available data, we may use other recognized actuarial methods and approaches. Implicit in the standard actuarial methods that we generally utilize is the need for two fundamental assumptions: first, the pattern by which losses are expected to emerge over time for each origin year, and second the expected loss ratio for each origin year. The expected loss ratio for any particular origin year is selected after consideration of a number of factors, including historical loss ratios adjusted for rate changes, premium and loss trends, industry benchmarks, the results of policy level loss modeling at the time of underwriting, and/or other more subjective considerations for the product line (e.g., terms and conditions) and external environment as noted above. The expected loss ratio for a given origin year is initially established at the start of the origin year as part of the planning process. This analysis is performed in conjunction with underwriters and management. The expected loss ratio method arrives at an ultimate loss estimate by multiplying the expected ultimate loss ratio by the corresponding premium base. This method is most commonly used as the basis for the actuarial central estimate for immature origin periods on product lines where the actual paid or reported loss experience is not yet deemed sufficiently credible to serve as the principal basis for the selection of ultimate losses. The expected loss ratio for a given origin year may be modified over time if the underlying assumptions differ from the original assumptions (e.g., the assessment of prior year loss ratios, loss trend, rate changes, actual claims, or other information). Our selected paid and reported development patterns provide a benchmark against which the actual emerging loss experience can be monitored. Where possible, development patterns are selected based on historical loss emergence by origin year. For product lines where the historical data is viewed to have low statistical credibility, the selected development patterns also reflect relevant industry benchmarks and/or experience from similar product lines written elsewhere within Chubb. This most commonly occurs for relatively new product lines that have limited historical data or for high severity/low frequency portfolios where our historical experience exhibits considerable volatility and/or lacks credibility. The paid and reported loss development methods convert the selected loss emergence pattern to a set of multiplicative factors which are then applied to actual paid or reported losses to arrive at an estimate of ultimate losses for each period. Due to their multiplicative nature, the paid and reported loss development methods will leverage differences between actual and expected loss emergence. These methods tend to be utilized for more mature origin periods and for those portfolios where the loss emergence has been relatively consistent over time. The Bornhuetter-Ferguson method is a combination of the expected loss ratio method and the loss development method, where the loss development method is given more weight as the origin year matures. This approach allows a logical transition between the expected loss ratio method which is generally utilized at earlier maturities and the loss development methods which are typically utilized at later maturities. We usually apply this method using reported loss data although paid data may also be used. Short-tail business Short-tail business generally describes product lines for which losses are typically known and paid shortly after the loss actually occurs. This would include, for example, most property, personal accident, and automobile physical damage policies that we write. Due to the short reporting and development pattern for these product lines, the uncertainty associated with our estimate of ultimate losses for any particular accident period diminishes relatively quickly as actual loss experience emerges. We typically assign credibility to methods that incorporate actual loss emergence, such as the paid and reported loss development and Bornhuetter-Ferguson methods, sooner than would be the case for long-tail lines at a similar stage of development for a given origin year. The reserving process for short-tail losses arising from catastrophic events typically involves an assessment by the claims department, in conjunction with underwriters and actuaries, of our exposure and estimated losses immediately following an event and then subsequent revisions of the estimated losses as our insureds provide updated actual loss information. Long-tail business Long-tail business describes lines of business for which specific losses may not be known/reported for some period and for which claims can take significant time to settle/close. This includes most casualty lines such as general liability, D&O, and workers' compensation. There are various factors contributing to the uncertainty and volatility of long-tail business. Among these are:
• | The nature and complexity of underlying coverage provided and net limits of exposure provided;
• | Our historical loss data and experience is sometimes too immature and lacking in credibility to rely upon for reserving purposes. Where this is the case, in our reserve analysis we may utilize industry loss ratios or industry benchmark development patterns that we believe reflect the nature and coverage of the underwritten business and its future development, where available. For such product lines, actual loss experience may differ from industry loss statistics as well as loss experience for previous underwriting years;
• | The difficulty in estimating loss trends, claims inflation (e.g., medical and judicial) and underlying economic conditions;
• | The need for professional judgment to estimate loss development patterns beyond that represented by historical data using supplemental internal or industry data, extrapolation, or a blend of both;
• | The need to address shifts in business mix or volume over time when applying historical paid and reported loss development patterns from older origin years to more recent origin years. For example, changes over time in the processes and procedures for establishing case reserves can distort reported loss development patterns or changes in ceded reinsurance structures by origin year can alter the development of paid and reported losses;
• | Loss reserve analyses typically require loss or other data be grouped by common characteristics in some manner. If data from two combined lines of business exhibit different characteristics, such as loss payment patterns, the credibility of the reserve estimate could be affected. Additionally, since casualty lines of business can have significant intricacies in the terms and conditions afforded to the insured, there is an inherent risk as to the homogeneity of the underlying data used in performing reserve analyses; and
• | The applicability of the price change data used to estimate ultimate loss ratios for most recent origin years.
As described above, various factors are considered when determining appropriate data, assumptions, and methods used to establish the loss reserve estimates for long-tail product lines. These factors may also vary by origin year for given product lines. The derivation of loss development patterns from data and the selection of a tail factor to project ultimate losses from actual loss emergence require considerable judgment, particularly with respect to the extent to which historical loss experience is relied upon to support changes in key reserving assumptions. c) Loss Development Tables The tables were designed to present business with similar risk characteristics which exhibit like development patterns and generally similar trends, in order to provide insight into the nature, amount, timing and uncertainty of cash flows related to our claims liabilities. Each table follows a similar format and reflects the following:
• | The incurred loss triangle includes both reported case reserves and IBNR liabilities.
• | Both the incurred and paid loss triangles include allocated loss adjustment expense (i.e., defense and investigative costs particular to individual claims) but exclude unallocated loss adjustment expense (i.e., the costs associated with internal claims staff and third-party administrators).
• | The amounts in both triangles for the years ended December 31, 2010, to December 31, 2018 and average historical claim duration as of December 31, 2019, are presented as supplementary information.
• | All data presented in the triangles is net of reinsurance recoverables.
• | The IBNR reserves shown to the right of each incurred loss development exhibit reflect the net IBNR recorded as of December 31, 2019.
• | The tables are presented retrospectively with respect to acquisitions where these are material and doing so is practicable. Most notably, the Chubb Corp acquisition is presented retrospectively. The unaudited consolidated data is presented solely for informational purposes and is not necessarily indicative of the consolidated data that might have been observed had the transactions been completed prior to the date indicated.
Historical dollar amounts are presented in this footnote on a constant-dollar basis, which is achieved by assuming constant foreign exchange rates for all periods in the loss triangles, translating prior period amounts using the same local currency exchange rates as the current year end. The impact of this conversion is to show the change between periods exclusive of the effect of fluctuations in exchange rates, which would otherwise distort the change in incurred loss and cash flow patterns shown. The change in incurred loss shown will differ from other GAAP disclosures of incurred prior period reserve development amounts, which include the effect of fluctuations in exchanges rates. We provided guidance above on key assumptions that should be considered when reviewing this disclosure and information relating to how loss reserve estimates are developed. We believe the information provided in the “Loss Development Tables” section of the disclosure is of limited use for independent analysis or application of standard actuarial estimations. Cumulative Number of Reported Claims Reported claim counts, on a cumulative basis, are provided to the far right of each incurred loss development table. We generally consider a reported claim to be one claim per coverage per claimant. We exclude claims closed without payment. Use of the presented claim counts in analysis of company experience has significant limitations, including:
• | High deductible workers' compensation claim counts include claims below the applicable policy deductible.
• | Professional liability and certain other lines have a high proportion of claims reported which will be closed without any payment; shifts in total reported counts may not meaningfully impact reported and ultimate loss experience.
• | Claims for certain events and/or product lines, such as portions of assumed reinsurance and A&H business, are not reported on an individual basis, but rather in bulk and thus not available for inclusion in this disclosure.
• | Each of the segments below typically has a mixture of primary and excess experience which has shifted over time.
Reported claim counts include open claims which have case reserves and exclude claims that have been incurred but not reported. As such the reported claims are consistent with reported losses, which can be calculated by subtracting incurred but not reported losses from incurred losses. Reported claim counts are inconsistent with losses in the incurred loss triangle, which include incurred but not reported losses, and are also inconsistent with losses in the paid loss triangle, which exclude case reserves. North America Commercial P&C Insurance — Workers' Compensation — Long-tail This product line has a substantial geographic spread and a broad mix across industries. Types of coverage include risk management business predominantly with high deductible policies, loss sensitive business (i.e., retrospectively-rated policies), business fronted for captives, as well as excess and primary guaranteed cost coverages. The triangle below shows all loss and allocated expense development for the workers' compensation product line. In our prior period development disclosure, we exclude any loss development where there is a directly related premium adjustment. For workers' compensation, changes in the exposure base due to payroll audits will drive changes in ultimate losses. In addition, we record involuntary pool assumptions (premiums and losses) on a lagged basis. Both of these items will influence the development in the triangle, particularly the first prior accident year, and are included in the reconciliation table presented on page F-60.
North America Commercial P&C Insurance — Workers' Compensation — Long-tail (continued) |  |
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 1,049 |  |  | $ | 1,037 |  |  | $ | 1,050 |  |  | $ | 1,065 |  |  | $ | 1,064 |  |  | $ | 1,052 |  |  | $ | 1,028 |  |  | $ | 1,020 |  |  | $ | 1,018 |  |  | $ | 999 |  |  | $ | 223 |  |  | 303 |
2011 |  |  | 1,037 |  |  | 1,030 |  |  | 1,046 |  |  | 1,049 |  |  | 1,053 |  |  | 1,022 |  |  | 1,012 |  |  | 1,009 |  |  | 988 |  |  | 233 |  |  | 286 |
2012 |  |  |  |  | 1,050 |  |  | 1,011 |  |  | 1,030 |  |  | 1,040 |  |  | 1,011 |  |  | 989 |  |  | 986 |  |  | 977 |  |  | 275 |  |  | 287 |
2013 |  |  |  |  |  |  | 1,109 |  |  | 1,108 |  |  | 1,122 |  |  | 1,127 |  |  | 1,086 |  |  | 1,073 |  |  | 1,037 |  |  | 309 |  |  | 299 |
2014 |  |  |  |  |  |  |  |  | 1,207 |  |  | 1,201 |  |  | 1,217 |  |  | 1,215 |  |  | 1,163 |  |  | 1,100 |  |  | 395 |  |  | 336 |
2015 |  |  |  |  |  |  |  |  |  |  | 1,282 |  |  | 1,259 |  |  | 1,276 |  |  | 1,279 |  |  | 1,217 |  |  | 500 |  |  | 334 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 1,366 |  |  | 1,361 |  |  | 1,383 |  |  | 1,378 |  |  | 673 |  |  | 304 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,412 |  |  | 1,380 |  |  | 1,399 |  |  | 783 |  |  | 339 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,359 |  |  | 1,360 |  |  | 788 |  |  | 362 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,391 |  |  | 997 |  |  | 246 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 11,846 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 123 |  |  | $ | 300 |  |  | $ | 411 |  |  | $ | 493 |  |  | $ | 551 |  |  | $ | 592 |  |  | $ | 617 |  |  | $ | 641 |  |  | $ | 666 |  |  | $ | 684 |
2011 |  |  |  | 119 |  |  | 294 |  |  | 411 |  |  | 484 |  |  | 533 |  |  | 567 |  |  | 595 |  |  | 616 |  |  | 640 |
2012 |  |  |  |  |  | 111 |  |  | 271 |  |  | 365 |  |  | 436 |  |  | 486 |  |  | 532 |  |  | 574 |  |  | 592 |
2013 |  |  |  |  |  |  |  | 107 |  |  | 286 |  |  | 422 |  |  | 506 |  |  | 553 |  |  | 587 |  |  | 616 |
2014 |  |  |  |  |  |  |  |  |  | 113 |  |  | 295 |  |  | 410 |  |  | 484 |  |  | 532 |  |  | 566 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 116 |  |  | 301 |  |  | 418 |  |  | 501 |  |  | 564 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 122 |  |  | 326 |  |  | 452 |  |  | 529 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 120 |  |  | 313 |  |  | 437 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 130 |  |  | 329 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 143 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,100 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses |  |
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 2,668 |
All Accident years |  | $ | 9,414 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development |  |
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (93 | )
All Accident years |  | $ | (288 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 10 | % |  | 16 | % |  | 10 | % |  | 7 | % |  | 5 | % |  | 4 | % |  | 3 | % |  | 2 | % |  | 2 | % |  | 2 | %
North America Commercial P&C Insurance — Liability — Long-tail This line consists of primary and excess liability exposures, including medical liability and professional lines, including directors and officers (D&O) liability, errors and omissions (E&O) liability, employment practices liability (EPL), fidelity bonds, and fiduciary liability. The primary and excess liability business represents the largest part of these exposures. The former includes both monoline and commercial package liability. The latter includes a substantial proportion of commercial umbrella, excess and high excess business, where loss activity can produce significant volatility in the loss triangles at later ages within an accident year (and sometimes across years) due to the size of the limits afforded and the complex nature of the underlying losses. This line includes management and professional liability products provided to a wide variety of clients, from national accounts to small firms along with private and not-for-profit organizations, distributed through brokers, agents, wholesalers and MGAs. Many of these coverages, particularly D&O and E&O, are typically written on a claims-made form. While most of the coverages are underwritten on a primary basis, there are significant amounts of excess exposure with large policy limits.
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 3,574 |  |  | $ | 3,579 |  |  | $ | 3,597 |  |  | $ | 3,556 |  |  | $ | 3,416 |  |  | $ | 3,247 |  |  | $ | 3,125 |  |  | $ | 3,105 |  |  | $ | 2,993 |  |  | $ | 2,983 |  |  | $ | 202 |  |  | 18 |
2011 |  |  | 3,496 |  |  | 3,582 |  |  | 3,626 |  |  | 3,660 |  |  | 3,590 |  |  | 3,494 |  |  | 3,380 |  |  | 3,312 |  |  | 3,190 |  |  | 299 |  |  | 18 |
2012 |  |  |  |  | 3,548 |  |  | 3,624 |  |  | 3,609 |  |  | 3,560 |  |  | 3,520 |  |  | 3,422 |  |  | 3,326 |  |  | 3,231 |  |  | 430 |  |  | 18 |
2013 |  |  |  |  |  |  | 3,543 |  |  | 3,538 |  |  | 3,538 |  |  | 3,528 |  |  | 3,426 |  |  | 3,212 |  |  | 3,118 |  |  | 500 |  |  | 17 |
2014 |  |  |  |  |  |  |  |  | 3,532 |  |  | 3,582 |  |  | 3,671 |  |  | 3,713 |  |  | 3,652 |  |  | 3,467 |  |  | 792 |  |  | 17 |
2015 |  |  |  |  |  |  |  |  |  |  | 3,556 |  |  | 3,705 |  |  | 3,814 |  |  | 3,971 |  |  | 3,939 |  |  | 1,232 |  |  | 19 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 3,530 |  |  | 3,591 |  |  | 3,688 |  |  | 3,801 |  |  | 1,279 |  |  | 20 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3,319 |  |  | 3,495 |  |  | 3,577 |  |  | 1,818 |  |  | 21 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3,371 |  |  | 3,490 |  |  | 2,170 |  |  | 24 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3,449 |  |  | 3,005 |  |  | 25 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 34,245 |  |  |  |  |
North America Commercial P&C Insurance — Liability — Long-tail (continued)
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 126 |  |  | $ | 611 |  |  | $ | 1,108 |  |  | $ | 1,558 |  |  | $ | 1,892 |  |  | $ | 2,257 |  |  | $ | 2,424 |  |  | $ | 2,525 |  |  | $ | 2,659 |  |  | $ | 2,716 |
2011 |  |  |  | 160 |  |  | 651 |  |  | 1,208 |  |  | 1,803 |  |  | 2,212 |  |  | 2,474 |  |  | 2,657 |  |  | 2,738 |  |  | 2,824 |
2012 |  |  |  |  |  | 166 |  |  | 655 |  |  | 1,171 |  |  | 1,678 |  |  | 2,090 |  |  | 2,324 |  |  | 2,499 |  |  | 2,615 |
2013 |  |  |  |  |  |  |  | 130 |  |  | 547 |  |  | 1,191 |  |  | 1,595 |  |  | 2,005 |  |  | 2,230 |  |  | 2,371 |
2014 |  |  |  |  |  |  |  |  |  | 164 |  |  | 679 |  |  | 1,249 |  |  | 1,802 |  |  | 2,200 |  |  | 2,440 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 138 |  |  | 605 |  |  | 1,205 |  |  | 1,854 |  |  | 2,289 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 171 |  |  | 662 |  |  | 1,335 |  |  | 1,974 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 161 |  |  | 616 |  |  | 1,161 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 189 |  |  | 754 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 176 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 19,320 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 1,522 |
All Accident years |  | $ | 16,447 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (49 | )
All Accident years |  | $ | (273 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 5 | % |  | 14 | % |  | 17 | % |  | 16 | % |  | 12 | % |  | 8 | % |  | 5 | % |  | 3 | % |  | 4 | % |  | 2 | %
North America Commercial P&C Insurance — Other Casualty — Long-tail This product line consists of the remaining commercial casualty coverages such as automobile liability and aviation. There is also a small portion of commercial multi-peril (CMP) business in accident years 2014 and prior. The paid and reported data are impacted by some catastrophe loss activity primarily on the CMP exposures just noted.
North America Commercial P&C Insurance — Other-Casualty — Long-tail (continued) |  |
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 613 |  |  | $ | 607 |  |  | $ | 601 |  |  | $ | 546 |  |  | $ | 506 |  |  | $ | 478 |  |  | $ | 480 |  |  | $ | 493 |  |  | $ | 484 |  |  | $ | 481 |  |  | $ | 16 |  |  | 15 |
2011 |  |  | 580 |  |  | 589 |  |  | 581 |  |  | 548 |  |  | 533 |  |  | 524 |  |  | 516 |  |  | 510 |  |  | 512 |  |  | 24 |  |  | 15 |
2012 |  |  |  |  | 633 |  |  | 605 |  |  | 577 |  |  | 560 |  |  | 520 |  |  | 519 |  |  | 508 |  |  | 507 |  |  | 3 |  |  | 15 |
2013 |  |  |  |  |  |  | 526 |  |  | 530 |  |  | 522 |  |  | 515 |  |  | 468 |  |  | 462 |  |  | 461 |  |  | 29 |  |  | 17 |
2014 |  |  |  |  |  |  |  |  | 594 |  |  | 583 |  |  | 581 |  |  | 596 |  |  | 555 |  |  | 538 |  |  | 45 |  |  | 17 |
2015 |  |  |  |  |  |  |  |  |  |  | 486 |  |  | 470 |  |  | 501 |  |  | 515 |  |  | 458 |  |  | 51 |  |  | 15 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 504 |  |  | 502 |  |  | 527 |  |  | 524 |  |  | 136 |  |  | 15 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 531 |  |  | 566 |  |  | 577 |  |  | 174 |  |  | 16 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 535 |  |  | 563 |  |  | 298 |  |  | 15 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 606 |  |  | 428 |  |  | 14 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 5,227 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 97 |  |  | $ | 236 |  |  | $ | 322 |  |  | $ | 363 |  |  | $ | 392 |  |  | $ | 433 |  |  | $ | 443 |  |  | $ | 449 |  |  | $ | 453 |  |  | $ | 452 |
2011 |  |  |  | 86 |  |  | 235 |  |  | 341 |  |  | 400 |  |  | 437 |  |  | 461 |  |  | 466 |  |  | 480 |  |  | 486 |
2012 |  |  |  |  |  | 69 |  |  | 222 |  |  | 319 |  |  | 386 |  |  | 435 |  |  | 470 |  |  | 486 |  |  | 493 |
2013 |  |  |  |  |  |  |  | 69 |  |  | 197 |  |  | 270 |  |  | 348 |  |  | 385 |  |  | 411 |  |  | 418 |
2014 |  |  |  |  |  |  |  |  |  | 80 |  |  | 220 |  |  | 317 |  |  | 391 |  |  | 454 |  |  | 473 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 47 |  |  | 137 |  |  | 214 |  |  | 304 |  |  | 370 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 52 |  |  | 145 |  |  | 246 |  |  | 323 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 66 |  |  | 175 |  |  | 312 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 74 |  |  | 169 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 70 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 3,566 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 252 |
All Accident years |  | $ | 1,913 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 5 |
All Accident years |  | $ | (36 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 14 | % |  | 24 | % |  | 19 | % |  | 14 | % |  | 9 | % |  | 6 | % |  | 2 | % |  | 2 | % |  | 1 | % |  | — | %
North America Commercial P&C Insurance — Non-Casualty — Short-tail This product line represents first party commercial product lines that are short-tailed in nature, such as property, inland marine, ocean marine, surety and A&H. There is a wide diversity of products, primary and excess coverages, and policy sizes. During this ten-year period, this product line was also impacted by natural catastrophes mainly in the 2012, 2017, and 2018 accident years.
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 1,501 |  |  | $ | 1,537 |  |  | $ | 1,461 |  |  | $ | 1,424 |  |  | $ | 1,422 |  |  | $ | 1,415 |  |  | $ | 1,410 |  |  | $ | 1,404 |  |  | $ | 1,394 |  |  | $ | 1,394 |  |  | $ | 1 |  |  | 1,057 |
2011 |  |  | 1,958 |  |  | 1,932 |  |  | 1,875 |  |  | 1,853 |  |  | 1,833 |  |  | 1,837 |  |  | 1,832 |  |  | 1,832 |  |  | 1,833 |  |  | 10 |  |  | 1,051 |
2012 |  |  |  |  | 2,030 |  |  | 1,913 |  |  | 1,880 |  |  | 1,861 |  |  | 1,856 |  |  | 1,844 |  |  | 1,841 |  |  | 1,847 |  |  | 3 |  |  | 1,035 |
2013 |  |  |  |  |  |  | 1,430 |  |  | 1,420 |  |  | 1,333 |  |  | 1,356 |  |  | 1,337 |  |  | 1,337 |  |  | 1,334 |  |  | 3 |  |  | 1,072 |
2014 |  |  |  |  |  |  |  |  | 1,642 |  |  | 1,658 |  |  | 1,576 |  |  | 1,555 |  |  | 1,546 |  |  | 1,547 |  |  | 7 |  |  | 1,100 |
2015 |  |  |  |  |  |  |  |  |  |  | 1,733 |  |  | 1,742 |  |  | 1,647 |  |  | 1,635 |  |  | 1,602 |  |  | 17 |  |  | 1,170 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 1,907 |  |  | 1,887 |  |  | 1,797 |  |  | 1,778 |  |  | 16 |  |  | 1,291 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,701 |  |  | 2,605 |  |  | 2,503 |  |  | 71 |  |  | 1,374 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,050 |  |  | 2,237 |  |  | 182 |  |  | 1,551 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,049 |  |  | 587 |  |  | 1,446 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 18,124 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 723 |  |  | $ | 1,222 |  |  | $ | 1,320 |  |  | $ | 1,357 |  |  | $ | 1,382 |  |  | $ | 1,391 |  |  | $ | 1,394 |  |  | $ | 1,395 |  |  | $ | 1,391 |  |  | $ | 1,391 |
2011 |  |  |  | 938 |  |  | 1,571 |  |  | 1,715 |  |  | 1,775 |  |  | 1,785 |  |  | 1,808 |  |  | 1,813 |  |  | 1,819 |  |  | 1,822 |
2012 |  |  |  |  |  | 713 |  |  | 1,575 |  |  | 1,696 |  |  | 1,764 |  |  | 1,792 |  |  | 1,819 |  |  | 1,813 |  |  | 1,839 |
2013 |  |  |  |  |  |  |  | 649 |  |  | 1,135 |  |  | 1,234 |  |  | 1,282 |  |  | 1,308 |  |  | 1,321 |  |  | 1,329 |
2014 |  |  |  |  |  |  |  |  |  | 818 |  |  | 1,370 |  |  | 1,481 |  |  | 1,502 |  |  | 1,528 |  |  | 1,543 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 725 |  |  | 1,341 |  |  | 1,486 |  |  | 1,554 |  |  | 1,570 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 845 |  |  | 1,502 |  |  | 1,653 |  |  | 1,729 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 978 |  |  | 2,085 |  |  | 2,301 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,026 |  |  | 1,823 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,029 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 16,376 |
North America Commercial P&C Insurance — Non-Casualty — Short-tail (continued) |  |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses |  |
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 11 |
All Accident years |  | $ | 1,759 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development |  |
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (6 | )
All Accident years |  | $ | 32 |
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 47 | % |  | 39 | % |  | 8 | % |  | 3 | % |  | 1 | % |  | 1 | % |  | — | % |  | 1 | % |  | — | % |  | — | %
North America Personal P&C Insurance — Short-tail Chubb provides personal lines coverages for high-net-worth individuals and families in North America including homeowners, automobile, valuable articles (including fine art), umbrella liability, and recreational marine insurance offered through independent regional agents and brokers. A portfolio acquired from Fireman’s Fund is presented on a prospective basis beginning in May of accident year 2015. Reserves associated with prior accident periods were acquired through a loss portfolio transfer, which does not allow for a retrospective presentation. During this ten-year period, this segment was also impacted by natural catastrophes, mainly in 2012, 2017 and 2018 accident years.
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 1,868 |  |  | $ | 1,876 |  |  | $ | 1,853 |  |  | $ | 1,835 |  |  | $ | 1,832 |  |  | $ | 1,828 |  |  | $ | 1,823 |  |  | $ | 1,820 |  |  | $ | 1,821 |  |  | $ | 1,820 |  |  | $ | 6 |  |  | 146 |
2011 |  |  | 2,205 |  |  | 2,207 |  |  | 2,182 |  |  | 2,170 |  |  | 2,162 |  |  | 2,158 |  |  | 2,157 |  |  | 2,156 |  |  | 2,156 |  |  | 8 |  |  | 166 |
2012 |  |  |  |  | 2,183 |  |  | 2,181 |  |  | 2,181 |  |  | 2,189 |  |  | 2,183 |  |  | 2,184 |  |  | 2,186 |  |  | 2,192 |  |  | 20 |  |  | 170 |
2013 |  |  |  |  |  |  | 1,854 |  |  | 1,882 |  |  | 1,890 |  |  | 1,894 |  |  | 1,918 |  |  | 1,931 |  |  | 1,938 |  |  | 26 |  |  | 122 |
2014 |  |  |  |  |  |  |  |  | 2,202 |  |  | 2,203 |  |  | 2,189 |  |  | 2,142 |  |  | 2,156 |  |  | 2,143 |  |  | 19 |  |  | 132 |
2015 |  |  |  |  |  |  |  |  |  |  | 2,491 |  |  | 2,546 |  |  | 2,557 |  |  | 2,540 |  |  | 2,559 |  |  | 30 |  |  | 135 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 2,436 |  |  | 2,532 |  |  | 2,541 |  |  | 2,479 |  |  | 78 |  |  | 138 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3,031 |  |  | 3,066 |  |  | 2,998 |  |  | 171 |  |  | 142 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3,006 |  |  | 3,033 |  |  | 295 |  |  | 148 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,953 |  |  | 725 |  |  | 116 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 24,271 |  |  |  |  |
North America Personal P&C Insurance — Short-tail (continued)
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 1,151 |  |  | $ | 1,521 |  |  | $ | 1,668 |  |  | $ | 1,727 |  |  | $ | 1,770 |  |  | $ | 1,791 |  |  | $ | 1,803 |  |  | $ | 1,809 |  |  | $ | 1,810 |  |  | $ | 1,812 |
2011 |  |  |  | 1,358 |  |  | 1,833 |  |  | 1,969 |  |  | 2,049 |  |  | 2,103 |  |  | 2,126 |  |  | 2,136 |  |  | 2,143 |  |  | 2,146 |
2012 |  |  |  |  |  | 1,175 |  |  | 1,804 |  |  | 1,955 |  |  | 2,061 |  |  | 2,115 |  |  | 2,147 |  |  | 2,161 |  |  | 2,161 |
2013 |  |  |  |  |  |  |  | 1,040 |  |  | 1,499 |  |  | 1,682 |  |  | 1,781 |  |  | 1,837 |  |  | 1,879 |  |  | 1,890 |
2014 |  |  |  |  |  |  |  |  |  | 1,308 |  |  | 1,762 |  |  | 1,922 |  |  | 2,031 |  |  | 2,076 |  |  | 2,103 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 1,497 |  |  | 2,081 |  |  | 2,267 |  |  | 2,388 |  |  | 2,475 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,451 |  |  | 2,049 |  |  | 2,208 |  |  | 2,311 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,696 |  |  | 2,517 |  |  | 2,664 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,924 |  |  | 2,545 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,666 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 21,773 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses |  |
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 27 |
All Accident years |  | $ | 2,525 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (1 | )
All Accident years |  | $ | (86 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 59 | % |  | 23 | % |  | 7 | % |  | 4 | % |  | 3 | % |  | 1 | % |  | 1 | % |  | — | % |  | — | % |  | — | %
Overseas General Insurance — Casualty — Long-tail This product line is comprised of D&O liability, E&O liability, financial institutions (including crime/fidelity coverages), and non-U.S. general liability as well as aviation and political risk. Exposures are located around the world, including Europe, Latin America, and Asia. Approximately 45 percent of Chubb Overseas General business is generated by European accounts, exclusive of Lloyd's market. There is some U.S. exposure in Casualty from multinational accounts and in financial lines for Lloyd's market. The financial lines coverages are typically written on a claims-made form, while general liability coverages are typically on an occurrence basis and comprised of a mix of primary and excess businesses.
Overseas General Insurance — Casualty — Long-tail (continued) |  |  |  |
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 1,183 |  |  | $ | 1,263 |  |  | $ | 1,308 |  |  | $ | 1,379 |  |  | $ | 1,316 |  |  | $ | 1,265 |  |  | $ | 1,141 |  |  | $ | 1,136 |  |  | $ | 1,142 |  |  | $ | 1,149 |  |  | $ | 68 |  |  | 37 |
2011 |  |  | 1,211 |  |  | 1,218 |  |  | 1,210 |  |  | 1,200 |  |  | 1,117 |  |  | 1,054 |  |  | 1,042 |  |  | 991 |  |  | 988 |  |  | 35 |  |  | 37 |
2012 |  |  |  |  | 1,246 |  |  | 1,217 |  |  | 1,279 |  |  | 1,297 |  |  | 1,294 |  |  | 1,285 |  |  | 1,265 |  |  | 1,255 |  |  | 137 |  |  | 38 |
2013 |  |  |  |  |  |  | 1,237 |  |  | 1,233 |  |  | 1,229 |  |  | 1,272 |  |  | 1,226 |  |  | 1,193 |  |  | 1,136 |  |  | 139 |  |  | 38 |
2014 |  |  |  |  |  |  |  |  | 1,238 |  |  | 1,308 |  |  | 1,317 |  |  | 1,333 |  |  | 1,249 |  |  | 1,167 |  |  | 208 |  |  | 39 |
2015 |  |  |  |  |  |  |  |  |  |  | 1,164 |  |  | 1,259 |  |  | 1,288 |  |  | 1,311 |  |  | 1,286 |  |  | 287 |  |  | 41 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 1,191 |  |  | 1,291 |  |  | 1,357 |  |  | 1,385 |  |  | 428 |  |  | 42 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,185 |  |  | 1,286 |  |  | 1,335 |  |  | 495 |  |  | 41 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,283 |  |  | 1,333 |  |  | 789 |  |  | 40 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,346 |  |  | 1,011 |  |  | 32 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 12,380 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 102 |  |  | $ | 265 |  |  | $ | 462 |  |  | $ | 605 |  |  | $ | 712 |  |  | $ | 801 |  |  | $ | 850 |  |  | $ | 903 |  |  | $ | 946 |  |  | $ | 983 |
2011 |  |  |  | 87 |  |  | 240 |  |  | 384 |  |  | 513 |  |  | 612 |  |  | 691 |  |  | 764 |  |  | 815 |  |  | 848 |
2012 |  |  |  |  |  | 74 |  |  | 245 |  |  | 428 |  |  | 577 |  |  | 689 |  |  | 826 |  |  | 897 |  |  | 939 |
2013 |  |  |  |  |  |  |  | 85 |  |  | 261 |  |  | 414 |  |  | 558 |  |  | 699 |  |  | 798 |  |  | 865 |
2014 |  |  |  |  |  |  |  |  |  | 111 |  |  | 287 |  |  | 461 |  |  | 591 |  |  | 704 |  |  | 786 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 86 |  |  | 281 |  |  | 484 |  |  | 661 |  |  | 780 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 123 |  |  | 316 |  |  | 520 |  |  | 667 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 96 |  |  | 314 |  |  | 520 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 109 |  |  | 325 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 122 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 6,835 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 432 |
All Accident years |  | $ | 5,977 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (18 | )
All Accident years |  | $ | (61 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 8 | % |  | 15 | % |  | 15 | % |  | 12 | % |  | 10 | % |  | 9 | % |  | 6 | % |  | 4 | % |  | 4 | % |  | 3 | %
Overseas General Insurance — Non-Casualty — Short-tail This product line is comprised of commercial fire, marine (predominantly cargo), surety, personal automobile (in Latin America, Asia Pacific and Japan), personal cell phones, personal residential (including high net worth), energy and construction. In general, these lines have relatively stable payment and reporting patterns although they are impacted by natural catastrophes mainly in the 2010, 2011, 2017, and 2018 accident years. Latin America and Europe each make up about 30 percent of the Chubb Overseas General non-casualty book.
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 1,647 |  |  | $ | 1,669 |  |  | $ | 1,643 |  |  | $ | 1,632 |  |  | $ | 1,626 |  |  | $ | 1,612 |  |  | $ | 1,599 |  |  | $ | 1,582 |  |  | $ | 1,584 |  |  | $ | 1,582 |  |  | $ | 6 |  |  | 518 |
2011 |  |  | 1,871 |  |  | 1,956 |  |  | 1,900 |  |  | 1,861 |  |  | 1,843 |  |  | 1,832 |  |  | 1,824 |  |  | 1,814 |  |  | 1,810 |  |  | 3 |  |  | 544 |
2012 |  |  |  |  | 1,696 |  |  | 1,686 |  |  | 1,646 |  |  | 1,591 |  |  | 1,585 |  |  | 1,577 |  |  | 1,561 |  |  | 1,556 |  |  | 14 |  |  | 556 |
2013 |  |  |  |  |  |  | 1,778 |  |  | 1,770 |  |  | 1,703 |  |  | 1,656 |  |  | 1,651 |  |  | 1,621 |  |  | 1,609 |  |  | 27 |  |  | 574 |
2014 |  |  |  |  |  |  |  |  | 1,852 |  |  | 1,920 |  |  | 1,862 |  |  | 1,851 |  |  | 1,814 |  |  | 1,804 |  |  | 15 |  |  | 549 |
2015 |  |  |  |  |  |  |  |  |  |  | 1,952 |  |  | 2,075 |  |  | 2,051 |  |  | 2,017 |  |  | 1,999 |  |  | 38 |  |  | 571 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 2,050 |  |  | 2,052 |  |  | 2,040 |  |  | 2,018 |  |  | 17 |  |  | 567 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,198 |  |  | 2,238 |  |  | 2,220 |  |  | 46 |  |  | 577 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,153 |  |  | 2,244 |  |  | 124 |  |  | 622 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2,181 |  |  | 376 |  |  | 608 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 19,023 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 671 |  |  | $ | 1,226 |  |  | $ | 1,424 |  |  | $ | 1,486 |  |  | $ | 1,524 |  |  | $ | 1,537 |  |  | $ | 1,544 |  |  | $ | 1,545 |  |  | $ | 1,550 |  |  | $ | 1,562 |
2011 |  |  |  | 758 |  |  | 1,460 |  |  | 1,660 |  |  | 1,716 |  |  | 1,746 |  |  | 1,761 |  |  | 1,769 |  |  | 1,773 |  |  | 1,773 |
2012 |  |  |  |  |  | 681 |  |  | 1,226 |  |  | 1,412 |  |  | 1,470 |  |  | 1,493 |  |  | 1,502 |  |  | 1,515 |  |  | 1,517 |
2013 |  |  |  |  |  |  |  | 698 |  |  | 1,273 |  |  | 1,466 |  |  | 1,497 |  |  | 1,534 |  |  | 1,553 |  |  | 1,562 |
2014 |  |  |  |  |  |  |  |  |  | 758 |  |  | 1,423 |  |  | 1,632 |  |  | 1,696 |  |  | 1,727 |  |  | 1,741 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 852 |  |  | 1,546 |  |  | 1,778 |  |  | 1,858 |  |  | 1,881 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,015 |  |  | 1,670 |  |  | 1,865 |  |  | 1,938 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,046 |  |  | 1,830 |  |  | 2,005 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 994 |  |  | 1,726 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,038 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 16,743 |
Overseas General Insurance — Non-Casualty — Short-tail (continued) |  |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 97 |
All Accident years |  | $ | 2,377 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 1 |
All Accident years |  | $ | 1 |
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 45 | % |  | 35 | % |  | 11 | % |  | 3 | % |  | 2 | % |  | 1 | % |  | 1 | % |  | — | % |  | — | % |  | 1 | %
Global Reinsurance Chubb analyzes its Global Reinsurance business on a treaty year basis rather than on an accident year basis. Treaty year data was converted to an accident year basis for the purposes of this disclosure. Mix shifts are an important consideration in these product line groupings. As proportional business and excess of loss business have different earning and loss reporting and payment patterns, this change in mix will affect the cash flow patterns across the accident years. In addition, the shift from excess to proportional business over time will make the cash flow patterns of older and more recent years difficult to compare. In general, the proportional business will pay out more quickly than the excess of loss business, as such, using older years development patterns may overstate the ultimate loss estimates in more recent years. Global Reinsurance — Casualty — Long-tail This product line includes proportional and excess coverages in general, automobile liability, professional liability, medical malpractice, workers' compensation and aviation, with exposures located around the world. In general, reinsurance exhibits less stable development patterns than primary business. In particular, general casualty reinsurance and excess coverages are long-tailed and can be very volatile.
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |
| Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 399 |  |  | $ | 419 |  |  | $ | 430 |  |  | $ | 441 |  |  | $ | 430 |  |  | $ | 424 |  |  | $ | 414 |  |  | $ | 400 |  |  | $ | 387 |  |  | $ | 373 |  |  | $ | 23 |  |  | 0.802 |
2011 |  |  | 407 |  |  | 414 |  |  | 428 |  |  | 432 |  |  | 427 |  |  | 417 |  |  | 413 |  |  | 407 |  |  | 401 |  |  | 27 |  |  | 0.659 |
2012 |  |  |  |  | 385 |  |  | 382 |  |  | 390 |  |  | 393 |  |  | 378 |  |  | 371 |  |  | 370 |  |  | 372 |  |  | 10 |  |  | 0.457 |
2013 |  |  |  |  |  |  | 320 |  |  | 326 |  |  | 328 |  |  | 329 |  |  | 330 |  |  | 323 |  |  | 316 |  |  | 20 |  |  | 0.341 |
2014 |  |  |  |  |  |  |  |  | 332 |  |  | 333 |  |  | 338 |  |  | 341 |  |  | 343 |  |  | 346 |  |  | 39 |  |  | 0.382 |
2015 |  |  |  |  |  |  |  |  |  |  | 284 |  |  | 288 |  |  | 299 |  |  | 300 |  |  | 308 |  |  | 33 |  |  | 0.298 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 222 |  |  | 226 |  |  | 234 |  |  | 233 |  |  | 30 |  |  | 0.341 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 213 |  |  | 214 |  |  | 219 |  |  | 45 |  |  | 0.529 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 244 |  |  | 246 |  |  | 65 |  |  | 0.589 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 238 |  |  | 130 |  |  | 0.219 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 3,052 |  |  |  |  |
Global Reinsurance — Casualty — Long-tail (continued)
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 56 |  |  | $ | 125 |  |  | $ | 179 |  |  | $ | 220 |  |  | $ | 249 |  |  | $ | 274 |  |  | $ | 291 |  |  | $ | 306 |  |  | $ | 315 |  |  | $ | 320 |
2011 |  |  |  | 70 |  |  | 146 |  |  | 195 |  |  | 236 |  |  | 267 |  |  | 291 |  |  | 311 |  |  | 324 |  |  | 331 |
2012 |  |  |  |  |  | 77 |  |  | 167 |  |  | 221 |  |  | 260 |  |  | 292 |  |  | 307 |  |  | 322 |  |  | 334 |
2013 |  |  |  |  |  |  |  | 65 |  |  | 143 |  |  | 186 |  |  | 222 |  |  | 241 |  |  | 259 |  |  | 268 |
2014 |  |  |  |  |  |  |  |  |  | 91 |  |  | 184 |  |  | 217 |  |  | 248 |  |  | 264 |  |  | 276 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 90 |  |  | 159 |  |  | 191 |  |  | 217 |  |  | 232 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 57 |  |  | 113 |  |  | 142 |  |  | 159 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 46 |  |  | 100 |  |  | 122 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 41 |  |  | 96 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 40 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 2,178 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 303 |
All Accident years |  | $ | 1,177 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (50 | )
All Accident years |  | $ | (58 | )
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 21 | % |  | 23 | % |  | 12 | % |  | 10 | % |  | 7 | % |  | 5 | % |  | 4 | % |  | 4 | % |  | 2 | % |  | 2 | %
Global Reinsurance — Non-Casualty — Short-tail This product line includes property, property catastrophe, marine, credit/surety, A&H and energy. This product line is impacted by natural catastrophes, particularly in the 2011, 2017 and 2018 accident years. Of the non-catastrophe book, the mixture of business varies by year with approximately 73 percent of loss on proportional treaties in treaty year 2010 and after. This percentage has increased over time with the proportion being approximately 58 percent for treaty years 2010 to 2012 growing to an average of 80 percent for treaty years 2013 to 2019, with the remainder being written on an excess of loss basis.
Global Reinsurance — Non-Casualty — Short-tail (continued) |  |  |  |
Net Incurred Loss and Allocated Loss Adjustment Expenses |  |  |  |  |  |
|  | Years Ended December 31 |  |  | As of December 31 2019 |
(in millions of U.S. dollars) | Unaudited |  |  |  |  | Net IBNR Reserves |  |  | Reported Claims (in thousands) |
Accident Year | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |
2010 | $ | 194 |  |  | $ | 228 |  |  | $ | 218 |  |  | $ | 212 |  |  | $ | 216 |  |  | $ | 218 |  |  | $ | 218 |  |  | $ | 219 |  |  | $ | 218 |  |  | $ | 217 |  |  | $ | — |  |  | 0.102 |
2011 |  |  | 269 |  |  | 270 |  |  | 268 |  |  | 258 |  |  | 258 |  |  | 260 |  |  | 259 |  |  | 259 |  |  | 259 |  |  | 1 |  |  | 0.132 |
2012 |  |  |  |  | 230 |  |  | 210 |  |  | 200 |  |  | 191 |  |  | 189 |  |  | 187 |  |  | 184 |  |  | 184 |  |  | 1 |  |  | 0.113 |
2013 |  |  |  |  |  |  | 161 |  |  | 159 |  |  | 147 |  |  | 142 |  |  | 143 |  |  | 140 |  |  | 140 |  |  | — |  |  | 0.121 |
2014 |  |  |  |  |  |  |  |  | 164 |  |  | 180 |  |  | 180 |  |  | 183 |  |  | 181 |  |  | 180 |  |  | 3 |  |  | 0.101 |
2015 |  |  |  |  |  |  |  |  |  |  | 146 |  |  | 154 |  |  | 161 |  |  | 161 |  |  | 153 |  |  | 3 |  |  | 0.115 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  | 180 |  |  | 186 |  |  | 188 |  |  | 190 |  |  | 12 |  |  | 0.182 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 396 |  |  | 423 |  |  | 453 |  |  | 10 |  |  | 0.309 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 285 |  |  | 297 |  |  | (6 | ) |  | 0.212 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 141 |  |  | 73 |  |  | 0.032 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 2,214 |  |  |  |  |
Net Cumulative Paid Loss and Allocated Loss Adjustment Expenses
|  |  | Years Ended December 31 |
(in millions of U.S. dollars) | Unaudited |  |  |
Accident Year |  | 2010 |  |  | 2011 |  |  | 2012 |  |  | 2013 |  |  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |
2010 |  | $ | 55 |  |  | $ | 156 |  |  | $ | 182 |  |  | $ | 193 |  |  | $ | 199 |  |  | $ | 209 |  |  | $ | 207 |  |  | $ | 210 |  |  | $ | 210 |  |  | $ | 214 |
2011 |  |  |  | 85 |  |  | 174 |  |  | 204 |  |  | 228 |  |  | 246 |  |  | 251 |  |  | 253 |  |  | 254 |  |  | 256 |
2012 |  |  |  |  |  | 45 |  |  | 130 |  |  | 156 |  |  | 166 |  |  | 172 |  |  | 177 |  |  | 179 |  |  | 180 |
2013 |  |  |  |  |  |  |  | 46 |  |  | 102 |  |  | 120 |  |  | 129 |  |  | 132 |  |  | 135 |  |  | 135 |
2014 |  |  |  |  |  |  |  |  |  | 65 |  |  | 129 |  |  | 152 |  |  | 163 |  |  | 169 |  |  | 171 |
2015 |  |  |  |  |  |  |  |  |  |  |  | 56 |  |  | 103 |  |  | 132 |  |  | 142 |  |  | 146 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  | 56 |  |  | 131 |  |  | 158 |  |  | 169 |
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 191 |  |  | 322 |  |  | 402 |
2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 94 |  |  | 257 |
2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 35 |
Total |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1,965 |
Net Liabilities for Loss and Allocated Loss Adjustment Expenses
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | 6 |
All Accident years |  | $ | 255 |
Supplementary Information: (Favorable)/ Adverse Prior Period Development
(in millions of U.S. dollars) |  | December 31, 2019 |
Accident years prior to 2010 |  | $ | (4 | )
All Accident years |  | $ | 30 |
Supplementary Information: Average Annual Percentage Payout of Net Incurred Claims by Age, as of December 31, 2019 (Unaudited)
Age in Years | 1 |  |  | 2 |  |  | 3 |  |  | 4 |  |  | 5 |  |  | 6 |  |  | 7 |  |  | 8 |  |  | 9 |  |  | 10 |
Percentage | 33 | % |  | 36 | % |  | 15 | % |  | 6 | % |  | 3 | % |  | 2 | % |  | 1 | % |  | 1 | % |  | — | % |  | — | %
Prior Period Development — Supplementary Information The following table presents a reconciliation of the loss development triangles above to prior period development:
| Components of PPD |
Year Ended December 31, 2019 (in millions of U.S. dollars) (favorable)/unfavorable | 2010 - 2018 accident years (implied PPD per loss triangles) |  |  | Accident years prior to 2010 |  |  | Other (1) |  |  | PPD on loss reserves |  |  | RIPs, Expense adjustments, and earned premiums |  |  | Total |
North America Commercial P&C Insurance |  |  |  |  |  |  |  |  |  |  |  |  |
Long-tail | $ | (460 | ) |  | $ | (137 | ) |  | $ | (110 | ) |  | $ | (707 | ) |  | $ | 39 |  |  | $ | (668 | )
Short-tail | 38 |  |  | (6 | ) |  | (8 | ) |  | 24 |  |  | (5 | ) |  | 19 |
| (422 | ) |  | (143 | ) |  | (118 | ) | (2) | (683 | ) |  | 34 |  |  | (649 | )
North America Personal P&C Insurance (Short-tail) | (85 | ) |  | (1 | ) |  | (5 | ) |  | (91 | ) |  | (4 | ) |  | (95 | )
Overseas General Insurance |  |  |  |  |  |  |  |  |  |  |  |  |
Long-tail | (43 | ) |  | (18 | ) |  | (7 | ) |  | (68 | ) |  | — |  |  | (68 | )
Short-tail | — |  |  | 1 |  |  | (26 | ) |  | (25 | ) |  | 1 |  |  | (24 | )
| (43 | ) |  | (17 | ) |  | (33 | ) | (3) | (93 | ) |  | 1 |  |  | (92 | )
Global Reinsurance |  |  |  |  |  |  |  |  |  |  |  |  |
Long-tail | (8 | ) |  | (50 | ) |  | (1 | ) |  | (59 | ) |  | — |  |  | (59 | )
Short-tail | 34 |  |  | (4 | ) |  | 1 |  |  | 31 |  |  | (1 | ) |  | 30 |
| 26 |  |  | (54 | ) |  | — |  |  | (28 | ) |  | (1 | ) |  | (29 | )
Subtotal | $ | (524 | ) |  | $ | (215 | ) |  | $ | (156 | ) |  | $ | (895 | ) |  | $ | 30 |  |  | $ | (865 | )
North America Agricultural Insurance (Short-tail) |  |  |  |  |  |  | $ | (103 | ) |  | $ | 23 |  |  | $ | (80 | )
Corporate (Long-tail) |  |  |  |  |  |  | 153 |  |  | — |  |  | 153 |
Consolidated PPD |  |  |  |  |  |  |  |  |  | $ | (845 | ) |  | $ | 53 |  |  | $ | (792 | )
(1) | Other includes the impact of foreign exchange.
(2) | Includes favorable development of $82 million related to our Alternative Risk Solutions business (U.S. and Bermuda) and an adjustment to exclude $22 million in unfavorable development in the workers' compensation line, associated with an increase in exposure for which additional premiums were collected; the remaining difference relates to a number of other items, none of which are individually material.
(3) | Includes favorable development of $37 million related to International A&H business; the remaining difference relates to a number of other items, none of which are individually material.
Prior Period Development Prior period development 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 professional liability; while short-tail lines include lines such as most property lines, energy, personal accident, and agriculture. The following table summarizes (favorable) and adverse prior period development (PPD) by segment:
Years Ended December 31 (in millions of U.S. dollars, except for percentages) | Long-tail |  |  | Short-tail |  |  | Total |  |  | % of beginning net unpaid reserves (1) |
2019 |  |  |  |  |  |  |
North America Commercial P&C Insurance | $ | (668 | ) |  | $ | 19 |  |  | $ | (649 | ) |  | 1.3 | %
North America Personal P&C Insurance | — |  |  | (95 | ) |  | (95 | ) |  | 0.2 | %
North America Agricultural Insurance | — |  |  | (80 | ) |  | (80 | ) |  | 0.2 | %
Overseas General Insurance | (68 | ) |  | (24 | ) |  | (92 | ) |  | 0.2 | %
Global Reinsurance | (59 | ) |  | 30 |  |  | (29 | ) |  | 0.1 | %
Corporate | 153 |  |  | — |  |  | 153 |  |  | 0.3 | %
Total | $ | (642 | ) |  | $ | (150 | ) |  | $ | (792 | ) |  | 1.6 | %
2018 |  |  |  |  |  |  |
North America Commercial P&C Insurance | $ | (395 | ) |  | $ | (215 | ) |  | $ | (610 | ) |  | 1.2 | %
North America Personal P&C Insurance | — |  |  | 41 |  |  | 41 |  |  | 0.1 | %
North America Agricultural Insurance | — |  |  | (110 | ) |  | (110 | ) |  | 0.2 | %
Overseas General Insurance | (67 | ) |  | (145 | ) |  | (212 | ) |  | 0.4 | %
Global Reinsurance | (69 | ) |  | 19 |  |  | (50 | ) |  | 0.1 | %
Corporate | 45 |  |  | — |  |  | 45 |  |  | 0.1 | %
Total | $ | (486 | ) |  | $ | (410 | ) |  | $ | (896 | ) |  | 1.8 | %
2017 |  |  |  |  |  |  |
North America Commercial P&C Insurance | $ | (562 | ) |  | $ | (184 | ) |  | $ | (746 | ) |  | 1.6 | %
North America Personal P&C Insurance | — |  |  | 69 |  |  | 69 |  |  | 0.1 | %
North America Agricultural Insurance | — |  |  | (119 | ) |  | (119 | ) |  | 0.2 | %
Overseas General Insurance | (71 | ) |  | (181 | ) |  | (252 | ) |  | 0.5 | %
Global Reinsurance | (68 | ) |  | 9 |  |  | (59 | ) |  | 0.1 | %
Corporate | 278 |  |  | — |  |  | 278 |  |  | 0.6 | %
Total | $ | (423 | ) |  | $ | (406 | ) |  | $ | (829 | ) |  | 1.7 | %
(1) | Calculated based on the beginning of period consolidated net unpaid losses and loss expenses.
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 2019 North America Commercial P&C Insurance experienced net favorable PPD of $649 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $668 million in long-tail business, primarily from:
• | Net favorable development of $303 million in workers’ compensation lines. This included favorable development of $61 million related to our annual assessment of multi-claimant events including industrial accidents, in the 2018 accident year. Consistent with prior years, we reviewed these potential exposures after the close of the accident year to allow for late reporting or identification of significant losses. This development in accident year 2018 was partially offset by some higher than expected activity from other claims and from involuntary pools. The remaining overall
favorable development was mainly in accident years 2015 and prior, generally driven by lower than expected loss experience and related updates to loss development factors;
• | Net favorable development of $217 million in management liability portfolios, favorably impacting accident years 2015 and prior where paid and reported loss activity was lower than expected, partially offset by adverse development in the 2016 through 2018 accident years, mostly as a result of higher severity claim costs compared to prior expectations in certain lines or coverages, particularly in our Directors and Officers (D&O) portfolios;
• | Net favorable development of $60 million in professional liability (errors & omissions and cyber), mainly in the 2015 and prior accident years where case activity was less than expected, partially offset by adverse development in the 2016 accident year, which was driven by several large adverse claim developments;
• | Net favorable development of $41 million in commercial excess and umbrella portfolios, mainly in accident years 2013 and prior, driven by lower paid and reported loss activity relative to prior expectations as well as an increase in weighting towards experience-based methods, partly offset by modestly adverse development in more recent accident years, mainly in 2017 and 2018, due to higher than expected large loss activity;
• | Net favorable development of $39 million in foreign casualty business, impacting accident years 2015 and prior, driven by reported loss activity that was generally lower than expected;
• | Net favorable development of $36 million on large multi-line prospective deals in the 2015 and prior accident years, due to lower than expected reported loss activity. These structured deals typically cover large clients for multiple product lines and with varying loss limitations; this development is net of premium returns of $34 million tied to the loss performance of the particular deals;
• | Net favorable development of $24 million in medical and life sciences businesses, mainly impacting accident years 2015 and prior, primarily due to favorable reported experience and an increase in weighting towards experience-based methods;
• | Favorable development of $23 million in political risk and trade credit portfolios, mainly impacting the 2015 accident year, primarily due to favorable reported experience and an increase in weighting towards experience-based methods;
• | Net adverse development of $26 million mainly in products and general liability portfolios, including adverse movements within construction, partly offset by commercial-multi peril (CMP) liability, with older accident years generally experiencing favorable run-off, while more recent accident years developing adversely; and
• | Net adverse development of $38 million in automobile liability, driven by adverse paid and reported loss experience mainly in accident years 2014 through 2018.
• | Net adverse development of $19 million in short-tail business, primarily from:
• | Net adverse development, excluding catastrophes, of $108 million in property and marine portfolios with adverse development of $152 million across our retail, wholesale, and program distribution channels in accident year 2018, primarily due to a higher than expected severity of non-catastrophe claims, partly offset by favorable development of $44 million in 2017 and prior accident years on non-catastrophe claims;
• | Net favorable catastrophe development in property and marine portfolios of $36 million. There was $41 million of favorable development on the 2017 and 2018 natural catastrophes, mostly in 2017, partly offset by some adverse development on older catastrophe events; and
• | Favorable development of $49 million in surety businesses, mainly in accident year 2017, driven by lower than expected reported loss activity.
2018 North America Commercial P&C Insurance experienced net favorable PPD of $610 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $395 million in long-tail business, primarily from:
• | Net favorable development of $199 million in our management liability portfolios, favorably impacting accident years 2013 and prior where paid and reported loss activity was lower than expected, partially offset by adverse development in the 2014 through 2017 accident years, mostly as a result of higher severity claim costs compared to prior expectations in certain lines or coverages, particularly in our Directors and Officers (D&O) portfolio;
• | Net favorable development of $194 million in workers’ compensation lines with favorable development of $56 million in the 2017 accident year mainly related to our annual assessment of multi-claimant events including industrial accidents. Consistent with prior years, we reviewed these potential exposures after the close of the accident year to allow for late reporting or identification of significant losses. The net remaining favorable development of $138 million was principally due to lower than expected loss experience, mainly impacting accident years 2014 and prior;
• | Net favorable development of $100 million in our commercial excess and umbrella portfolios, primarily in accident years 2012 and prior. This was driven by lower than expected reported loss activity, and an increase in weighting towards experience-based methods, partly offset by higher than expected claim activity in the 2014, 2015 and 2017 accident years which led to reserve strengthening in those years;
• | Favorable development of $33 million in a runoff professional liability portfolio, impacting accident years 2002 and prior, owing mainly to the favorable disposition of a specific claim;
• | Net favorable development of $28 million in our foreign casualty lines, primarily impacting accident years 2014 and prior, driven by reported loss activity that was generally lower than expected;
• | Favorable development of $23 million in our political risk and trade credit portfolios, mainly impacting the 2014 accident year, primarily due to favorable reported experience and an increased in weighting towards experience-based methods;
• | Net adverse development of $91 million in our medical portfolios, mainly impacting accident years 2015, 2016 and 2017. The increase was driven by a combination of several large claims and generally higher than expected paid and reported case incurred activity; and
• | Net adverse development of $109 million, mainly in our automobile liability, commercial-multi peril (CMP) liability, products and general liability lines, driven by adverse paid and reported loss activity relative to prior expectations in accident years 2015 through 2017, partly offset by favorable emergence in older accident years.
• | Net favorable development of $215 million in short-tail business, primarily from:
• | Net favorable development of $155 million in our commercial property and marine businesses due to favorable claim development, including $129 million net favorable development on the 2017 natural catastrophes; and
• | Net favorable development of $60 million in other short-tail business, including $19 million in surety and also including several smaller net favorable movements from lower than expected case activity in other classes, such as accident and commercial automobile physical damage, none of which were significant individually or in the aggregate.
2017 North America Commercial P&C Insurance experienced net favorable PPD of $746 million, representing 1.6 percent of the beginning consolidated net unpaid losses and loss expense reserves. North America Personal P&C Insurance 2019 North America Personal P&C Insurance incurred net favorable PPD of $95 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable claim development of $132 million on the 2017 and 2018 natural catastrophes for all lines;
• | Net favorable development of $26 million in our personal excess lines primarily impacting the 2016 accident year, due to lower than expected loss emergence and an increase in weighting towards experience-based methods, partly offset by adverse emergence in accident year 2015;
• | Net favorable development of $16 million, which was the net result of several underlying favorable and adverse movements predominantly in the automobile and recreational marine lines; and
• | Net adverse development of $82 million in our homeowners lines, including valuables, arising from non-catastrophe loss emergence, mainly in the 2018 accident year.
2018 North America Personal P&C Insurance incurred net adverse PPD of $41 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net adverse development of $63 million in our homeowners and valuables lines, primarily impacting the 2017 accident year. Overall, non-catastrophe losses were $136 million higher than expected, partially offset by favorable claim development of $73 million on the 2017 natural catastrophes. The higher than expected non-catastrophe homeowners losses were primarily severity driven and included water-related claims, large fire losses, and non-catastrophe weather claims; and
• | Net favorable development of $24 million in our personal excess lines primarily impacting the 2015 accident year, due to lower than expected loss emergence and an increase in weighting towards experience-based methods.
2017 North America Personal P&C Insurance incurred net adverse PPD of $69 million, representing 0.1 percent of the beginning consolidated net unpaid losses and loss expense reserves. North America Agricultural Insurance North America Agricultural Insurance experienced net favorable PPD of $80 million, $110 million, and $119 million in 2019, 2018, and 2017, respectively. Actual claim development mainly relates to our Multiple Peril Crop Insurance business and was favorable due to better than expected crop yield results in certain states at the prior year-end period (i.e., 2019 results based on crop yield results at year-end 2018). Overseas General Insurance 2019 Overseas General Insurance experienced net favorable PPD of $92 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $68 million in long-tail business, primarily from:
• | Net favorable development of $101 million in casualty lines, including favorable development of $123 million in accident years 2015 and prior, due to lower than expected loss emergence mainly across primary lines in Continental Europe, U.K., and Asia Pacific, partially offset by adverse development of $22 million in accident years 2016 through 2018, primarily due to adverse attritional and large loss experience in Continental Europe; and
• | Net adverse development of $52 million in financial lines, including adverse development of $127 million in accident years 2016 through 2018, primarily due to adverse large loss experience in D&O in the U.K. and Asia Pacific, offset by favorable development of $75 million in accident years 2015 and prior, due to lower than expected loss emergence across most regions in D&O and Professional Indemnity.
• | Net favorable of $24 million in short-tail business, primarily from:
• | Net favorable development of $45 million in A&H, driven by favorable development across Continental Europe, Latin America and Asia Pacific primarily in accident years 2017 and 2018;
• | Net favorable development of $36 million in marine, driven by favorable loss emergence and claim-specific loss settlements across most regions and several accident years, including favorable liability emergence and litigation settlements in accident years 2016 and prior;
• | Net adverse development of $23 million in construction, driven by adverse large loss experience in accident year 2018 for U.K. and Asia Pacific; and
• | Net adverse development of $27 million in Surety, driven by adverse large loss experience across Continental Europe and Latin America in accident years 2017 and 2018.
2018 Overseas General Insurance experienced net favorable PPD of $212 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $67 million in long-tail business, primarily from:
• | Net favorable development of $70 million in casualty lines, with net favorable development of $107 million in accident years 2014 and prior, resulting from lower than expected loss emergence across primary and excess lines, partially offset by adverse development of $38 million in accident years 2015 through 2017, primarily due to large loss experience in U.K. excess lines and wholesale business;
• | Favorable development of $32 million, primarily including $12 million in political risks, $10 million in aviation and $10 million in environmental; and
• | Net adverse development of $38 million in financial lines, with net favorable development of $93 million in accident years 2014 and prior, resulting from lower than expected loss emergence including favorable development due to specific large claim reductions in Asia financial institutions including wholesale bankers D&O and bankers professional indemnity, and adverse development of $131 million in accident years 2015 through 2017, primarily due to adverse large loss experience in specific D&O and financial institutions portfolios in Australia, Continental Europe and the U.K.
• | Net favorable development of $145 million in short-tail business, primarily from:
• | Net favorable development of $99 million in property and marine (excluding technical lines), primarily in accident years 2013 through 2016, driven mainly by favorable loss emergence across all regions, including favorable claim-specific loss settlements and salvage/subrogation recoveries;
• | Net favorable development of $33 million in A&H, primarily in accident years 2015 through 2017, driven by favorable development across Asia Pacific direct marketing and Continental Europe corporate lines.
2017 Overseas General Insurance experienced net favorable PPD of $252 million, representing 0.5 percent of the beginning consolidated net unpaid losses and loss expense reserves. Global Reinsurance 2019 Global Reinsurance experienced net favorable PPD of $29 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $59 million in long-tail business, primarily in our auto, casualty, professional liability, medical malpractice, and workers’ compensation lines primarily from treaty years 2013 and prior principally due to lower than expected loss emergence; and
• | Net adverse development of $30 million in short-tail business, which included $44 million of adverse development on 2017 and 2018 natural catastrophe events.
2018 Global Reinsurance experienced net favorable PPD of $50 million, which was the net result of several underlying favorable and adverse movements, and was driven by the following principal changes:
• | Net favorable development of $69 million in long-tail business, primarily in our casualty, professional liability, medical malpractice, and workers' compensation lines primarily from treaty years 2013 and prior principally resulting from lower than expected loss emergence; and
• | Net adverse development of $19 million in short-tail business, which included $18 million of net adverse claim development on the 2017 natural catastrophes.
2017 Global Reinsurance experienced net favorable PPD of $59 million, representing 0.1 percent of the beginning consolidated net unpaid losses and loss expense reserves. Corporate 2019 Corporate incurred adverse development of $153 million in long-tail lines, driven by the following principal changes:
• | Adverse development of $116 million driven principally by adverse development in asbestos and environmental liabilities due to the emergence of a limited number of excess accounts and somewhat greater than expected defense and indemnity costs (generally impacting larger modeled accounts); and
• | Adverse development of $37 million on unallocated loss adjustment expenses due to run-off operating expenses paid and incurred in 2019.
2018 Corporate incurred adverse development of $45 million in long-tail lines, driven by the following principal changes:
• | Adverse development of $216 million in run-off liabilities, driven primarily by increased exposure on a limited number of direct asbestos claims and environmental sites, somewhat greater than expected defense cost spending and increases in reported claims and settlements with respect to molestation exposures;
• | Adverse development of $35 million on unallocated loss adjustment expenses due to run-off operating expenses paid and incurred in 2018; and
• | Favorable development of $205 million as a result of the settlements of certain previously disputed reinsurance balances.
2017 Corporate incurred adverse PPD of $278 million, representing 0.6 percent of the beginning consolidated net unpaid losses and loss expense reserves. Asbestos and environmental (A&E) Chubb's exposure to A&E claims principally arises out of liabilities acquired when it purchased Westchester Specialty in 1998, CIGNA's P&C business in 1999, and Chubb Corp in 2016. The following table presents a roll-forward of consolidated A&E loss reserves including allocated loss expense reserves for A&E exposures, and the provision for uncollectible paid and unpaid reinsurance recoverables:
|  | Asbestos |  |  | Environmental |  |  | Total |  |
(in millions of U.S. dollars) |  | Gross |  |  | Net |  |  | Gross |  |  | Net |  |  | Gross |  |  | Net |  |
Balance at December 31, 2016 |  | $ | 1,726 |  |  | $ | 1,119 |  |  | $ | 577 |  |  | $ | 490 |  |  | $ | 2,303 |  |  | $ | 1,609 |  |
Incurred activity |  | 228 |  |  | 104 |  |  | 199 |  |  | 113 |  |  | 427 |  |  | 217 |  | (1)
Paid activity |  | (333 | ) |  | (172 | ) |  | (169 | ) |  | (127 | ) |  | (502 | ) |  | (299 | ) |
Balance at December 31, 2017 |  | 1,621 |  |  | 1,051 |  |  | 607 |  |  | 476 |  |  | 2,228 |  |  | 1,527 |  |
Incurred activity |  | 136 |  |  | 75 |  |  | 101 |  |  | (97 | ) |  | 237 |  |  | (22 | ) | (1)
Paid activity |  | (265 | ) |  | (162 | ) |  | (83 | ) |  | 104 |  |  | (348 | ) |  | (58 | ) |
Balance at December 31, 2018 |  | 1,492 |  |  | 964 |  |  | 625 |  |  | 483 |  |  | 2,117 |  |  | 1,447 |  |
Incurred activity |  | 129 |  |  | 70 |  |  | 46 |  |  | 28 |  |  | 175 |  |  | 98 |  | (1)
Paid activity |  | (162 | ) |  | (118 | ) |  | (142 | ) |  | (101 | ) |  | (304 | ) |  | (219 | ) |
Balance at December 31, 2019 |  | $ | 1,459 |  |  | $ | 916 |  |  | $ | 529 |  |  | $ | 410 |  |  | $ | 1,988 |  |  | $ | 1,326 |  |
(1) | Excludes unallocated loss expenses and the net activity reflects third-party reinsurance other than the aggregate excess of loss reinsurance provided by National Indemnity Company (NICO) to Westchester Specialty (see Westchester Specialty section below).
The A&E net loss reserves including allocated loss expense reserves and provision for uncollectible reinsurance at December 31, 2019 and 2018 shown in the table above is comprised of:
| December 31 |
(in millions of U.S. dollars) | 2019 |  |  | 2018 |
Brandywine operations | $ | 754 |  |  | $ | 807 |
Westchester Specialty | 117 |  |  | 120 |
Chubb Corp | 381 |  |  | 442 |
Other, mainly Overseas General Insurance | 74 |  |  | 78 |
Total | $ | 1,326 |  |  | $ | 1,447 |
Brandywine Run-off entities – The Restructuring Plan and uncertainties relating to Chubb's ultimate Brandywine exposure In 1996, the Pennsylvania Insurance Commissioner approved a plan to restructure INA Financial Corporation and its subsidiaries (the Restructuring) which included the division of Insurance Company of North America (INA) into two separate corporations: (1) An active insurance company that retained the INA name and continued to write P&C business; and (2) An inactive run-off company, now called Century Indemnity Company (Century). As a result of the division, predominantly all A&E and certain other liabilities of INA were ascribed to Century and extinguished, as a matter of Pennsylvania law, as liabilities of INA. As part of the Restructuring, most A&E liabilities of various U.S. affiliates of INA were reinsured to Century. Century and certain other run-off companies having A&E and other liabilities were contributed to Brandywine Holdings. The U.S.-based Chubb INA companies assumed two contractual obligations in respect of the Brandywine operations in connection with the Restructuring: a surplus maintenance obligation in the form of the excess of loss (XOL) agreement and a dividend retention fund obligation. XOL Agreement In 1996, in connection with the Restructuring, a Chubb INA insurance subsidiary provided reinsurance coverage to Century in the amount of $800 million under an Aggregate Excess of Loss Reinsurance Agreement (XOL Agreement), triggerable if the statutory capital and surplus of Century falls below $25 million or if Century lacks liquid assets with which to pay claims as they become due. Dividend Retention Fund INA Financial Corporation established and funded a dividend retention fund (the Dividend Retention Fund) consisting of $50 million plus investment earnings. The full balance of the Dividend Retention Fund was contributed to Century as of December 31, 2002. Under the Restructuring Order, while any obligation to maintain the Dividend Retention Fund is in effect, to the extent dividends are paid by INA Holdings Corporation to its parent, INA Financial Corporation, and to the extent INA Financial Corporation then pays such dividends to INA Corporation, a portion of those dividends must be withheld to replenish the principal of the Dividend Retention Fund to $50 million. During 2019, 2018, 2011 and 2010, $90 million, $50 million, $35 million and $15 million, respectively, were withheld from such dividends and deposited into the Dividend Retention Fund as a result of dividends paid up to the INA Corporation. Pursuant to a 2011 amendment to the Restructuring Order, capital contributions from the Dividend Retention Fund to Century are not required until the XOL Agreement has less than $200 million of capacity remaining on an incurred basis for statutory reporting purposes. The amount of the capital contribution shall be the lesser of the amount necessary to restore the XOL Agreement remaining capacity to $200 million or the Dividend Retention Fund balance. In 2019 and 2018, the Pennsylvania Department of Insurance approved a capital contribution of $64 million and $39 million, respectively, from the Dividend Retention Fund to Century in order to restore the XOL capacity to $200 million. The Dividend Retention Fund may not be terminated without prior written approval from the Pennsylvania Insurance Commissioner. Effective December 31, 2004, Chubb INA contributed $100 million to Century in exchange for a surplus note. After giving effect to the contribution and issuance of the surplus note, the statutory surplus of Century at December 31, 2019 was $25 million and $622 million in statutory-basis losses have been ceded to the XOL Agreement on an inception-to-date basis. Century reports the amount ceded under the XOL Agreement in accordance with statutory accounting principles, which differ from GAAP by, among other things, allowing Century to discount its liabilities, including certain asbestos related and environmental pollution liabilities and Century's reinsurance payable to active companies. For GAAP reporting purposes, intercompany reinsurance recoverables related to the XOL are eliminated upon consolidation. While Chubb believes it has no legal obligation to fund Century losses above the XOL limit of coverage, Chubb's consolidated results would nevertheless continue to include any losses above the limit of coverage for so long as the Brandywine companies remain consolidated subsidiaries of Chubb. Certain active Chubb companies are primarily liable for asbestos, environmental, and other exposures that they have reinsured to Century. Accordingly, if Century were to become insolvent and placed into rehabilitation or liquidation, some or all of the recoverables due to these active Chubb companies from Century could become uncollectible. At both December 31, 2019 and 2018, the aggregate reinsurance recoverables owed by Century to certain active Chubb companies were approximately $1.5 billion, on an undiscounted basis. Chubb believes the active company intercompany reinsurance recoverables, which relate to direct liabilities payable over many years, are not impaired. At December 31, 2019 and 2018, Century's carried gross reserves (including reserves assumed from the active Chubb companies) were $1.8 billion and $2.0 billion, respectively. Should Century's loss reserves experience adverse development in the future and should Century be placed into rehabilitation or liquidation, the reinsurance recoverables due from Century to certain active Chubb companies would be payable only after the payment in full of certain expenses and liabilities, including administrative expenses and direct policy liabilities. Thus, the intercompany reinsurance recoverables would be at risk to the extent of the shortage of assets remaining to pay these recoverables. Westchester Specialty – impact of NICO contracts on Chubb’s run-off entities As part of the Westchester Specialty acquisition in 1998, NICO provided a 75 percent pro-rata share of $1.0 billion of reinsurance protection on losses and loss adjustment expenses incurred on or before December 31, 1996, in excess of a retention of $721 million. At December 31, 2019, the remaining unused incurred limit under the Westchester NICO agreement was $384 million.

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