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Unpaid losses and loss expenses | 3 Months Ended
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Mar. 31, 2021
Liability for Claims and Claims Adjustment Expense [Abstract] |
Liability for Future Policy Benefits and Unpaid Claims Disclosure [Text Block] | Unpaid losses and loss expenses The following table presents a reconciliation of beginning and ending Unpaid losses and loss expenses:
| Three Months Ended
| March 31
(in millions of U.S. dollars) | 2021 |  | 2020
Gross unpaid losses and loss expenses – beginning of period | $ | 67,811 |  |  | $ | 62,690 |
Reinsurance recoverable on unpaid losses – beginning of period (1) | (14,647) |  |  | (14,181) |
Net unpaid losses and loss expenses – beginning of period | 53,164 |  |  | 48,509 |
Net losses and loss expenses incurred in respect of losses occurring in: |  |  |
Current year | 5,249 |  |  | 4,605 |
Prior years (2) | (196) |  |  | (120) |
Total | 5,053 |  |  | 4,485 |
Net losses and loss expenses paid in respect of losses occurring in: |  |  |
Current year | 732 |  |  | 920 |
Prior years | 3,161 |  |  | 3,335 |
Total | 3,893 |  |  | 4,255 |
Foreign currency revaluation and other | 71 |  |  | (565) |
Net unpaid losses and loss expenses – end of period | 54,395 |  |  | 48,174 |
Reinsurance recoverable on unpaid losses (1) | 14,860 |  |  | 14,040 |
Gross unpaid losses and loss expenses – end of period | $ | 69,255 |  |  | $ | 62,214 |
(1) Net of valuation allowance for uncollectible reinsurance. (2) Relates to prior period loss reserve development only and excludes prior period development related to reinstatement premiums, expense adjustments and earned premiums totaling $4 million and $2 million for the three months ended March 31, 2021 and 2020, respectively. Gross and net unpaid losses and loss expenses increased $1,444 million and $1,231 million, respectively, for the three months ended March 31, 2021, reflecting an increase in underlying exposure due to premium growth and catastrophe losses incurred, partially offset by favorable prior period development. Prior Period Development Prior period development (PPD) arises from changes to loss estimates recognized in the current year that relate to loss events that occurred in previous calendar years and excludes the effect of losses from the development of earned premium from previous accident years. Long-tail lines include lines such as workers' compensation, general liability, and 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 PPD by segment.
|  |  | Three Months Ended March 31
(in millions of U.S. dollars) |  |  |  |  |  |  | Long-tail |  | Short-tail |  | Total
2021 |  |  |  |  |  |  |  |  |  |  |
North America Commercial P&C Insurance |  |  |  |  |  |  | $ | (46) |  |  | $ | (81) |  |  | $ | (127) |
North America Personal P&C Insurance |  |  |  |  |  |  | — |  |  | (40) |  |  | (40) |
North America Agricultural Insurance |  |  |  |  |  |  | — |  |  | (2) |  |  | (2) |
Overseas General Insurance |  |  |  |  |  |  | — |  |  | (25) |  |  | (25) |
Global Reinsurance |  |  |  |  |  |  | — |  |  | (7) |  |  | (7) |
Corporate |  |  |  |  |  |  | 9 |  |  | — |  |  | 9 |
Total |  |  |  |  |  |  | $ | (37) |  |  | $ | (155) |  |  | $ | (192) |
2020 |  |  |  |  |  |  |  |  |  |  |
North America Commercial P&C Insurance |  |  |  |  |  |  | $ | (43) |  |  | $ | (62) |  |  | $ | (105) |
North America Personal P&C Insurance |  |  |  |  |  |  | — |  |  | 1 |  |  | 1 |
North America Agricultural Insurance |  |  |  |  |  |  | — |  |  | (14) |  |  | (14) |
Overseas General Insurance |  |  |  |  |  |  | — |  |  | (4) |  |  | (4) |
Global Reinsurance |  |  |  |  |  |  | — |  |  | (7) |  |  | (7) |
Corporate |  |  |  |  |  |  | 11 |  |  | — |  |  | 11 |
Total |  |  |  |  |  |  | $ | (32) |  |  | $ | (86) |  |  | $ | (118) |
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 2021 For the three months ended March 31, 2021, net favorable PPD was $127 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 $46 million in long-tail business, primarily from: •Net favorable development of $51 million in professional liability (errors & omissions and third-party cyber risk), driven by accident years 2016 and 2017, which saw lower than expected loss emergence, partly offset by higher than expected development in accident year 2019; •Net favorable development of $35 million in voluntary environmental lines, driven by accident years 2017 and prior, which saw lower than expected loss emergence, partly offset by higher than expected development in accident year 2019; and •Net adverse development of $57 million in excess and umbrella portfolios, with accident years 2015 through 2019 continuing to experience higher than expected loss development, partly offset by favorable development in accident years 2014 and prior. •Net favorable development of $81 million in short-tail business, primarily from: •Net favorable development of $49 million in surety, mainly in accident years 2018 and 2019, driven by lower than expected loss emergence; •Net favorable development of $48 million in accident & health, driven by accident years 2019 and 2020, where loss emergence was lower than expected; •Net favorable development of $25 million in property and marine coverages in accident year 2020, driven by lower than expected non-catastrophe loss development; and •Net adverse development of $41 million in first-party cyber risk, driven by accident years 2019 and 2020, which experienced higher than expected loss development as well as heightened frequency and severity. 2020 For the three months ended March 31, 2020, net favorable PPD was $105 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 $43 million in long-tail business, primarily from: •Net favorable development of $66 million in professional liability (errors & omissions and third-party cyber risk), driven by accident years 2016 and prior, which saw lower than expected emergence; •Net favorable development of $43 million in voluntary environmental lines, driven by accident years 2016 and prior, which saw lower than expected emergence and a favorable revision to loss development patterns; •Net favorable development of $28 million in construction workers’ compensation, mainly in accident years 2016 and prior, which saw lower than expected reported loss emergence and a favorable revision to loss development patterns; •Net adverse development of $49 million in excess and umbrella portfolios, with accident years 2015 through 2019 experiencing higher than expected reported development, partially offset by lower than expected emergence in accident years 2014 and prior; and •Net adverse development of $23 million in wholesale general liability coverages, driven by higher than expected reported loss emergence in accident years 2014 through 2019. •Net favorable development of $62 million in short-tail business, primarily from: •Net favorable development of $36 million, in accident & health, mainly in accident years 2018 and 2019, driven by lower than expected paid loss emergence; and •Net favorable development of $31 million in surety, driven by accident year 2018, where loss emergence was lower than expected. North America Personal P&C Insurance 2021 For the three months ended March 31, 2021, net favorable PPD was $40 million, driven by accident year 2020, which experienced better than expected non-catastrophe loss development in homeowners and valuables. Overseas General Insurance 2021 For the three months ended March 31, 2021, net favorable PPD was $25 million, which reflects favorable loss experience across several lines, mainly in accident year 2020, none of which were significant individually or in the aggregate.

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- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -URI http://asc.fasb.org/subtopic&trid=2560295 + Details
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