Reserves are discounted at rates in effect at the time claims were incurred, ranging from 0.83% for accident year 2020 to 14.03% for accident year 1981.

The reserves recorded for the Company’s property and casualty insurance products at December 31, 2020 represent the Company’s best estimate of its ultimate liability for losses and loss adjustment expenses related to losses covered by policies written by the Company. However, because of the significant uncertainties surrounding reserves it is possible that management’s estimate of the ultimate liabilities for these claims

may change and that the required adjustment to recorded reserves could exceed the currently recorded reserves by an amount that could be material to the Company’s results of operations or cash flows.

Losses and loss adjustment expenses are also impacted by trends including frequency and severity as well as changes in the legislative and regulatory environment. In the case of the reserves for asbestos exposures, factors contributing to the high degree of uncertainty in the ultimate settlement of the liabilities gross of reinsurance include inadequate loss development

patterns, plaintiffs’ expanding theories of liability, the risks inherent in major litigation, and inconsistent emerging legal doctrines. In the case of the reserves for environmental exposures before reinsurance, factors contributing to the high degree of uncertainty in gross reserves include expanding theories of liabilities and damages, the risks inherent in major litigation, inconsistent decisions concerning the existence and scope of coverage for environmental claims, and uncertainty as to the monetary amount being sought by the claimant from the insured.

(Favorable) Unfavorable Prior Accident Year Development


	For the years ended December 31,
	2020		2019		2018
Workers’ compensation	$	(110)	$	(120)	$	(164)

Workers’ compensation discount accretion	35		33		40
General liability	237		61		52
Marine	3		8		—
Package business	(58)		(47)		(26)
Commercial property	(4)		(11)		(12)
Professional liability	(14)		29		(12)
Bond	(19)		(3)		2
Assumed reinsurance	(6)		3		—
Automobile liability - Commercial Lines	27		27		(15)
Automobile liability - Personal Lines	(61)		(38)		(18)
Homeowners	7		3		(25)
Net asbestos reserves	(2)		—		—
Net environmental reserves	—		—		—

Catastrophes	(529)		(42)		(49)
Uncollectible reinsurance	(8)		(30)		22
Other reserve re-estimates, net	54		46		38

Prior accident year development, including full benefit for the ADC cession	(448)		(81)		(167)
Change in deferred gain on retroactive reinsurance included in other liabilities [1]	312		16		—
Total prior accident year development	$	(136)	$	(65)	$	(167)

[1] The change in deferred gain for the year ended December 31, 2020 included $210 of adverse development on A&E reserves in excess of ceded premium paid and included $102 of adverse development on Navigators 2018 and prior accident year reserves, within professional liability, marine, general liability, prior accident year catastrophes, and assumed reinsurance.

2020 re-estimates of prior accident year reserves

Workers’ compensation reserves were reduced on national account business within middle & large commercial, driven by lower than previously estimated claim severity for the 2015 and prior accident years, including on captives business, and were reduced in small commercial due to lower than expected claim severity for the 2013 to 2018 accident years.

General liability reserves were increased primarily due to a $254 increase in reserves for sexual molestation and sexual

abuse claims related to cases brought against religious and other organizations that were insureds of the Company, partly offset by a decrease in reserves for other mass torts and extra contractual liability claims. The sexual molestation and sexual abuse exposures may involve potentially long latency periods and may implicate coverage in multiple policy periods, which can raise complex coverage issues with significant effects on the ultimate scope of coverage. This increase in reserves reflects an increase in claim incidence largely due to reviver statutes, which is legislation passed in a number of states that provides an opportunity for claimants to file claims for a period of time despite the fact that the original statute of limitations had expired. The reserve increase in 2020 was principally from claims asserted against the Boy Scouts of America (“Boy Scouts”). The reserve increase for Boy Scouts was partially driven by the impact of claim filings on and around the November 16, 2020 deadline to file claims in the Boy Scouts’ Chapter 11 bankruptcy. Various subsidiaries of the Company issued primary, umbrella and excess general liability policies to the Boy Scouts for various policies periods between 1971 and 1983, including seven years of primary coverage from 1971 through 1977. However, it is the Company’s position that the 1976 and 1977 primary policy years were fully released and all the Company’s obligations extinguished by virtue of a prior settlement agreement with Boy Scouts. Further, the Company disputes the extent of its obligations to Boy Scouts and the validity of certain claims filed against Boy Scouts in the bankruptcy. As such, there are significant uncertainties regarding the ultimate number and severity of the claims against Boy Scouts, the potential for additional reviver activity, and the inherent risks associated with legal determinations to be made by the bankruptcy court and in coverage litigation.

In addition, general liability reserve increases on construction account business were largely offset by decreases in ULAE reserves. Reserves were increased for guaranteed cost construction business for accident years 2014 to 2019 as incurred losses are developing higher than previously expected for premises and operations claims and product liability claims, partly due to a change in industry mix and a heavier concentration of losses in California than initially assumed, as well as increased reserves for middle market and complex liability claims for accident year 2018 largely due to higher than expected severity. Also contributing were increases in reserves on primary layer construction account business within global specialty, mainly related to accident years 2015 to 2017, which is included as a component of the change in deferred gain under retroactive reinsurance in the above table.

Marine reserves were increased principally due to an increase in domestic marine liability, mostly in accident years 2017 and 2018 due to a higher number of large losses. The increase in marine reserves is included as a component of the change in deferred gain under retroactive reinsurance in the above table.

Package business reserves decreased for accident years 2014 to 2017 largely due to lower estimates of allocated loss adjustment expenses.

Commercial property reserves were decreased for accident year 2019 due to favorable developments on marine and middle market property claims.

Professional liability reserves were decreased primarily due to lower estimated severity on non-security class action D&O claims and fewer than expected E&O claims with financial institutions for the 2011 to 2018 accident years, partially offset by an increase in D&O reserves for the 2019 accident year driven by higher frequency of class action lawsuits and an increase in large Syndicate D&O losses for the 2016 and 2017 accident years. These Syndicate reserve increases within global specialty are included as a component of the change in deferred gain under retroactive reinsurance in the above table.

Bond reserves were reduced within contract surety driven by both favorable loss development on the 2015 to 2017 accident years and higher than expected loss recoveries on older accident years

Assumed reinsurance reserves were increased for accident year 2018 mostly due to higher accident and health reserve estimates for medical professionals on assumed casualty business. These reserve increases are included as a component of the change in deferred gain under retroactive reinsurance in the above table.

Automobile liability reserves were decreased in Personal Lines principally due to lower than previously expected AARP Direct automobile liability claim severity for the 2017 to 2019 accident years. Automobile liability reserves were increased in Commercial Lines primarily due to higher than expected large losses within middle & large commercial, predominantly within the 2015 to 2019 accident years.

Catastrophes reserves were reduced, primarily due to a reduction in estimated reserves for 2017 and 2018 California wildfires and a reduction in estimated catastrophes for wind and hail events in the 2017 to 2019 accident years, partially offset by an increase in reserves for 2019 typhoons Hagibis and Faxai in Asia. The reduction in reserves for the 2017 and 2018 wildfires was largely due to recognizing a $289 subrogation benefit in the second quarter of 2020 from PG&E Corporation and Pacific Gas and Electric Company (together, “PG&E”) as well as a reduction in gross estimated losses on those wildfires.

In December, 2019, the judge overseeing the bankruptcy of PG&E approved an $11 billion settlement of insurance subrogation claims to resolve all such claims arising from the 2017 Northern California wildfires and 2018 Camp wildfire. That settlement was contingent upon, among other things, the judge entering an order confirming PG&E’s chapter 11 bankruptcy plan (“PG&E Plan”) incorporating the settlement agreement. On June 20, 2020, the bankruptcy court judge approved the PG&E Plan and PG&E subsequently transferred the $11 billion settlement amount to a trust designed to allocate and distribute the settlement among subrogation holders, including certain of the Company’s insurance subsidiaries. In the second quarter of 2020, the Company recorded an estimated $289 subrogation benefit though the ultimate amount it collects will depend on how the Company’s ultimate paid claims subject to subrogation compare to other insurers’ ultimate paid claims subject to subrogation.

Uncollectible reinsurance reserves were reduced due to higher than expected recoveries from reinsurers in older accident years.

Asbestos and environmental reserves were reviewed in fourth quarter 2020 resulting in a $218 increase in reserves before ADC reinsurance, including $127 for asbestos and $91 for environmental. Of the $218 increase in A&E reserves, the Company ceded $220 to the A&E ADC resulting in a net reserve release of $2. Of the $220 of adverse development ceded to the A&E ADC, the Company recognized a $210 deferred gain on retroactive reinsurance, representing the amount of losses ceded to the ADC in excess of ceded premium paid. For additional information related to the adverse development cover with NICO, see the Adverse Development Covers section below and Note 15 - Commitments and Contingencies.

Other reserve re-estimates, net, primarily represents an increase in unallocated loss adjustment expense ('ULAE") reserves in Property & Casualty Other Operations that was largely driven by an increase in gross asbestos and environmental reserves.

2019 re-estimates of prior accident year reserves

Workers’ compensation reserves were reduced, principally in small commercial driven by lower than previously estimated claim severity for the 2014 through 2017 accident years and, to a lesser extent, in national accounts due to lower estimated claim severity, primarily for accident years 2013 and prior.

General liability reserves were increased, primarily due to reserve increases in small commercial for accident years 2017 and 2018 due to higher frequency of high-severity bodily injury claims, reserve increases in middle & large commercial for accident years 2015 to 2018 due to higher estimated severity, as well as increased estimated severity on the acquired Navigators Group book of business related to U.S. construction, premises liability, products liability and excess casualty, mostly related to accident years 2014 to 2017. In addition, an increase in reserves for mass torts for 2009 and prior accident years was offset by a decrease in reserves for extra contractual liability claims for more recent accident years, including the 2018 accident year.

Marine reserves were increased, principally related to pollution exposure from the 1980s and 1990s related to the Navigators Group book of business.

Package business reserves were decreased, primarily due to favorable emergence on property claims related to accident years 2016 through 2018 and due to favorable development of loss adjustment expenses on general liability claims for 2017 and prior accident years.

Commercial property reserves were decreased, principally due to favorable emergence of reported losses, including on the acquired Navigators Group book of business, related to offshore energy in accident years 2017 to 2018 and construction engineering across accident years 2015 to 2018.

Professional liability reserves were increased, primarily due to increased securities litigation and large loss activity, including wrongful termination and discrimination claims, related to accident years 2017 and 2018 and increased estimated frequency and severity of directors’ and officers’ reserves on the Navigators Group book of business, principally

for the 2014 to 2018 accident years. Partially offsetting the increase was a decrease in average severity on public company directors’ and officers’ claim reserves and errors and omissions claim reserves for accident years 2014 and prior.

Automobile liability reserves were decreased in Personal Lines and increased in Commercial Lines. The decrease in Personal Lines was due to the emergence of lower estimated severity in automobile liability for accident year 2017. The increase in Commercial Lines was due to higher estimated severity on national accounts, principally in accident years 2017 and 2018, and higher estimated severity for accident year 2018 in small commercial and middle market, partially offset by lower estimated severity for 2017 and prior accident years in small commercial and middle market.

Catastrophes reserves were reduced, primarily as a result of lower estimated net losses from 2017 hurricanes Harvey and Irma and the 2017 California wildfires. While gross loss reserve estimates for the 2018 California wildfires were also reduced, this was largely offset by a reduction in reinsurance recoverables resulting in very little change to estimated net losses from those wildfires.

Uncollectible reinsurance reserves were reduced due to higher than expected recoveries from reinsurers in older accident years.

Other reserve re-estimates, net, primarily represents an increase in unallocated loss adjustment expense ('ULAE") reserves in Property & Casualty Other Operations that was driven by an increase in gross asbestos and environmental reserves, as well as higher than anticipated ULAE costs in recent years, prompting an increase in the projected ULAE run rate.

2018 re-estimates of prior accident year reserves

Workers’ compensation reserves were reduced in small commercial and middle market, primarily for accident years 2014 and 2015, as claim severity has emerged favorably compared to previous reserve estimates. Also contributing was a reduction in estimated reserves for ULAE.

General liability reserves were increased, primarily due to an increase in reserves for higher hazard general liability exposures in middle market for accident years 2009 to 2017, partially offset by a decrease in reserves for other lines within middle market, including premises and operations, umbrella and products liability, principally for accident years 2015 and prior. Contributing to the increase in reserves for higher hazard general liability exposures was an increase in average claim severity, including from large losses and, in more recent accident years, an increase in claim frequency. Contributing to the reduction in reserves for other middle market lines were more favorable outcomes due to initiatives to reduce legal expenses. In addition, reserve increases for claims with lead paint exposure were offset by reserve decreases for other mass torts and extra-contractual liability claims.

Package business reserves were reduced, primarily due to lower reserve estimates for both liability and property for accident years 2010 and prior, including a recovery of loss adjustment expenses for the 2005 accident year.

Commercial property reserves were reduced, driven by an increase in estimated reinsurance recoverables on middle market property losses from the 2017 accident year.

Professional liability reserves were reduced, principally for accident years 2014 and prior, for directors and officers liability claims principally due to a number of older claims closing with limited or no payment.

Automobile liability reserves were reduced, primarily driven by reduced estimates of loss adjustment expenses in small commercial for recent accident years and favorable development in personal automobile liability for accident years 2014 to 2017, principally due to lower severity, including with uninsured and underinsured motorist claims.

Homeowners reserves were reduced, primarily in accident years 2013 to 2017, driven by lower than expected severity across multiple perils.

Asbestos and environmental reserves were unchanged as $238 of adverse development arising from the fourth quarter 2018 comprehensive annual review was offset by a $238 recoverable from NICO. For additional information related to the adverse development cover with NICO, see the Adverse Development Covers section below and Note 15 - Commitments and Contingencies.

Catastrophe reserves were reduced, primarily as a result of lower estimated net losses from 2017 catastrophes, principally related to hurricanes Harvey and Irma. Before reinsurance, estimated losses for 2017 catastrophe events decreased by $133, resulting in a decrease in reinsurance recoverables of $90 as the Company no longer expects to recover under the 2017 Property Aggregate reinsurance treaty as aggregate ultimate losses for 2017 catastrophe events are now projected to be less than $850.

Uncollectible reinsurance reserves were increased due to lower anticipated recoveries related to older accident years.

Other reserve re-estimates, net, primarily represents an increase in ULAE reserves in Property & Casualty Other Operations that was principally driven by an increase in expected claim handling costs associated with asbestos and environmental and mass tort claims.

Adverse Development Covers

The Company has an adverse development cover reinsurance agreement with NICO, a subsidiary of Berkshire Hathaway Inc., to reinsure loss development after 2016 on substantially all of the Company’s asbestos and environmental reserves (the “A&E ADC”). Under the A&E ADC, the Company paid a reinsurance premium of $650 for NICO to assume adverse net loss reserve development up to $1.5 billion above the Company’s existing net A&E reserves as of December 31, 2016 of approximately $1.7 billion including reserves for A&E exposure for accident years prior to 1986 that are reported in Property & Casualty Other Operations ("Run-off A&E") and reserves for A&E exposure for accident years 1986 and subsequent from policies underwritten prior to 2016 that are reported in ongoing Commercial Lines and Personal Lines. The $650 reinsurance premium was placed into a collateral trust account as security for NICO’s claim payment obligations to the Company. The Company has retained the risk of collection on amounts due from other third-party reinsurers and continues to be responsible for claims handling and other administrative services, subject to certain conditions. The A&E ADC covers substantially all the Company’s A&E reserve development up to the reinsurance limit.

Under retroactive reinsurance accounting, net adverse A&E reserve development after December 31, 2016 will result in an offsetting reinsurance recoverable up to the $1.5 billion limit. Cumulative ceded losses up to the $650 reinsurance premium paid have been recognized as a dollar-for-dollar offset to direct losses incurred. Cumulative ceded losses exceeding the $650 reinsurance premium paid result in a deferred gain. As of December 31, 2020, the Company has incurred $860 in cumulative adverse development on asbestos and environmental reserves that have been ceded under the A&E ADC treaty with NICO with $640 of available limit remaining under the A&E ADC. As a result, the Company has recorded a $210 deferred gain

within other liabilities, representing the difference between the reinsurance recoverable of $860 and ceded premium paid of $650. The deferred gain is recognized over the claim settlement period in the proportion of the amount of cumulative ceded losses collected from the reinsurer to the estimated ultimate reinsurance recoveries. Consequently, until periods when the deferred gain is recognized as a benefit to earnings, cumulative adverse development of asbestos and environmental claims will result in charges against earnings, which may be significant. Immediately after closing on the acquisition of Navigators Group, effective May 23, 2019, the Company purchased the Navigators ADC, an aggregate excess of loss reinsurance agreement covering adverse reserve development, from NICO on behalf of Navigators Insurers. Under the Navigators ADC, the Navigators Insurers paid NICO a reinsurance premium of $91 in exchange for reinsurance coverage of $300 of adverse net loss reserve development that attaches $100 above the Navigators Insurers' existing net loss and allocated loss adjustment reserves as of December 31, 2018 subject to the treaty of $1.816 billion for accidents and losses prior to December 31, 2018.

As of December 31, 2020, the Company has recorded a reinsurance recoverable under the Navigators ADC of $209 as estimated cumulative loss development on the 2018 and prior accident year reserves of $309 exceed the $100 deductible. While the reinsurance recoverable is $209, the Company has also recorded a $118 cumulative deferred gain within other liabilities since, under retroactive reinsurance accounting, ceded losses in excess of the $91 of ceded premium paid must be recognized as a deferred gain. Of the $118 of cumulative ceded losses in excess of ceded premium paid, $102 was recognized as a deferred gain in 2020 and $16 was recognized as a deferred gain in 2019. As the Company has ceded $209 of the $300 available limit, there is $91 of remaining limit available as of December 31, 2020.

Reconciliation of Loss Development to Liability for Unpaid Losses and Loss Adjustment Expenses As of December 31, 2020


	Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance										Subtotal
Reserve Line	Cumulative Incurred for Accident Years Displayed in Triangles		Cumulative Paid for Accident Years Displayed in Triangles		Unpaid for Accident Years not Displayed in Triangles		Unpaid Unallocated Loss Adjustment Expenses, Net of Reinsurance		Discount			Unpaid Losses and Loss Adjustment Expenses, Net of Reinsurance		Reinsurance and Other Recoverables		Liability for Unpaid Losses and Loss Adjustment Expenses
Workers' compensation	$	18,864	$	(10,633)	$	2,671	$	336	$	(352)		$	10,886	$	1,970	$	12,856
General liability	6,201		(2,946)		713		137		—			4,105		740		4,845
Marine	1,379		(1,128)		18		10		—			279		216		495
Package business	6,940		(5,248)		66		94		—			1,852		17		1,869
Commercial property	3,365		(2,936)		28		18		—			475		221		696
Commercial automobile liability	3,804		(2,775)		16		21		—			1,066		78		1,144
Commercial automobile physical damage	176		(167)		4		—		—			13		(1)		12
Professional liability	2,164		(1,080)		65		35		—			1,184		689		1,873
Bond	635		(310)		28		28		—			381		13		394
Assumed Reinsurance	1,198		(986)		3		3		—			218		41		259
Personal automobile liability	11,463		(10,153)		29		60		—			1,399		28		1,427
Personal automobile physical damage	1,279		(1,262)		5		3		—			25		—		25
Homeowners	6,770		(6,435)		6		31		—			372		3		375
Other ongoing business					208		(2)		(15)			191		294		485
Asbestos and environmental [1]					938		—		—			938		1,429		2,367
Other operations [1]					349		164		—			513		(13)		500
Total P&C	$	64,238	$	(46,059)	$	5,147	$	938	$	(367)		$	23,897	$	5,725	$	29,622

[1]Asbestos and environmental and other operations include asbestos, environmental and other latent exposures not foreseen when coverages were written, including, but not limited to, potential liability for pharmaceutical products, silica, talcum powder, head injuries, lead paint, construction defects, sexual molestation and sexual abuse and other long-tail liabilities. These reserve lines do not have significant paid or incurred loss development for the most recent ten accident years and therefore do not have loss development displayed in triangles.

The reserve lines in the above table and the loss triangles that follow represent the significant lines of business for which the Company regularly reviews the appropriateness of reserve levels. These reserve lines differ from the reserve lines reported on a statutory basis, as prescribed by the National Association of Insurance Commissioners ("NAIC"). The cumulative incurred losses displayed in the above table include the full reinsurance benefit of ceding $209 of losses to the Navigators ADC even though $118 of that benefit has been recorded as a deferred gain within other liabilities and recognized as a charge to earnings within incurred loss and loss adjustment expenses included in the consolidated statement of operations. The $209 of Navigators Insurers losses ceded to the Navigators ADC included in the following triangles $53 for general liability, $53 for professional liability, $24 for assumed reinsurance, $12 for commercial automobile, $38 for marine and $5 for commercial property and included $24 for older accident years and lines of business that are not in the following triangles.

The following loss triangles present historical loss development for incurred and paid claims by accident year, including loss development on Navigators Insurers reserves prior to and after the May 23, 2019 acquisition date. Because the loss triangles include pre-acquisition date changes in ultimate incurred loss

estimates for Navigators Insurers’ reserves, changes in reserve development evident in the incurred loss triangles may differ from prior accident year development recorded by the Company as shown in the (Favorable) Unfavorable Prior Accident Year Development table above as that only includes changes in Navigators Insurers’ reserves post acquisition. In addition, the incurred loss triangles include reserve development on both catastrophe and non-catastrophe claims whereas the (Favorable) Unfavorable Prior Accident Year Development table above shows the total amount of catastrophe reserve development across all lines of business on a single line.

Triangles are limited to the number of years for which claims incurred typically remain outstanding, not exceeding ten years. Short-tail lines, which represent claims generally expected to be paid within a few years, have three years of claim development displayed. For marine, commercial property, professional liability and assumed reinsurance lines, the Company has provided nine years of claims development as data for earlier periods was not available for the Lloyds syndicate. IBNR reserves shown in loss triangles include reserve for incurred but not reported claims as well as reserves for expected development on reported claims. Incurred and cumulative paid losses in currencies other than the

U.S. dollar have been converted into U.S. dollars using the exchange rates as of December 31, 2020.

Workers' Compensation


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	2,013	$	2,099	$	2,204	$	2,206	$	2,221	$	2,224	$	2,232	$	2,242	$	2,239	$	2,235	$	291	177,961
2012			2,185		2,207		2,207		2,181		2,168		2,169		2,154		2,146		2,135		325		171,494
2013					2,020		1,981		1,920		1,883		1,861		1,861		1,850		1,831		378		151,422
2014							1,869		1,838		1,789		1,761		1,713		1,692		1,679		437		126,217
2015									1,873		1,835		1,801		1,724		1,714		1,699		477		113,966
2016											1,772		1,772		1,780		1,767		1,748		574		112,058
2017													1,862		1,869		1,840		1,822		753		111,510
2018															1,916		1,917		1,915		854		117,999
2019																	1,937		1,935		1,033		117,698
2020																			1,865		1,412		84,062
Total																			$	18,864


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	371	$	841	$	1,156	$	1,368	$	1,518	$	1,622	$	1,690	$	1,746	$	1,786	$	1,811
2012			359		809		1,106		1,313		1,436		1,529		1,587		1,644		1,678
2013					304		675		917		1,071		1,175		1,260		1,304		1,339
2014							275		598		811		960		1,041		1,099		1,137
2015									261		576		778		909		1,004		1,068
2016											255		579		779		908		1,003
2017													261		575		778		900
2018															283		624		837
2019																	291		637
2020																			223
Total																			$	10,633

General Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	431	$	420	$	408	$	405	$	404	$	416	$	417	$	426	$	420	$	416	$	40	22,394
2012			423		402		399		392		410		408		421		413		407		50		16,597
2013					455		442		456		484		488		502		505		508		62		13,867
2014							506		475		481		494		513		522		515		78		14,722
2015									556		560		554		594		633		647		110		15,382
2016											613		583		607		633		632		176		16,479
2017													626		614		613		616		258		15,943
2018															692		669		697		395		16,881
2019																	821		826		638		15,191
2020																			937		850		9,265
Total																			$	6,201


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	15	$	61	$	123	$	200	$	255	$	303	$	330	$	348	$	362	$	368
2012			13		55		101		170		233		280		305		323		332
2013					13		53		141		233		320		372		398		422
2014							15		42		130		214		304		358		402
2015									10		55		156		278		409		477
2016											12		52		131		283		368
2017													15		67		156		255
2018															21		83		177
2019																	29		100
2020																			45
Total																			$	2,946

Marine


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves [1]		Claims Reported
2012	$	195	$	220	$	180	$	169	$	163	$	164	$	168	$	164	$	164	$	2	6,782
2013			149		152		134		136		140		135		138		140		(3)		6,623
2014					163		160		158		165		164		169		167		(3)		7,122
2015							158		146		146		148		133		138		(5)		10,114
2016									140		143		138		148		150		(7)		13,112
2017											160		187		175		174		(12)		15,498
2018													144		161		154		(12)		13,808
2019															144		142		20		7,989
2020																	150		76		3,451
Total																	$	1,379

[1]IBNR reserves are negative for some accident years as all losses ceded to the Navigators ADC are ceded as IBNR even though the gross losses being ceded include both reported losses and IBNR components. In addition, the collection of subrogation lags payment of the losses.


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020
2012	$	51	$	101	$	125	$	139	$	148	$	152	$	155	$	159	$	158
2013			42		82		100		112		119		121		126		133
2014					41		81		116		131		151		156		159
2015							40		85		116		126		134		139
2016									35		80		106		122		132
2017											48		111		142		154
2018													37		104		138
2019															36		83
2020																	32
Total																	$	1,128

Package Business


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	810	$	792	$	790	$	800	$	808	$	814	$	813	$	812	$	807	$	807	$	24	61,097
2012			736		725		728		731		736		735		739		732		732		30		59,871
2013					579		565		573		585		586		592		586		587		29		43,620
2014							566		578		601		602		603		603		593		44		43,207
2015									582		588		585		583		588		581		56		42,121
2016											655		638		632		625		611		78		43,922
2017													695		702		692		657		114		46,366
2018															719		724		688		169		44,273
2019																	813		769		256		41,800
2020																			915		412		56,548
Total																			$	6,940


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	377	$	555	$	621	$	684	$	727	$	748	$	762	$	772	$	774	$	776
2012			286		486		560		616		652		673		687		694		697
2013					225		339		414		467		504		522		541		549
2014							226		345		416		468		507		525		535
2015									212		332		383		445		486		505
2016											225		353		410		465		500
2017													235		372		447		496
2018															237		402		451
2019																	254		413
2020																			326
Total																			$	5,248

Commercial Property


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported

2012	$	369	$	333	$	334	$	335	$	337	$	335	$	334	$	333	$	332	$	—	26,860
2013			268		252		254		252		249		248		247		247		—		21,610
2014					293		281		282		280		279		280		280		—		21,025
2015							299		301		302		301		305		304		1		21,020
2016									406		420		399		406		408		1		23,758
2017											577		516		455		438		6		24,332
2018													450		437		424		26		21,630
2019															476		437		21		20,791
2020																	495		162		18,628
Total																	$	3,365


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020

2012	$	182	$	296	$	317	$	326	$	331	$	331	$	331	$	330	$	330
2013			161		223		238		243		242		244		245		245
2014					170		250		270		279		279		279		280
2015							179		257		285		296		302		303
2016									215		342		378		396		401
2017											229		379		412		428
2018													188		344		379
2019															214		349
2020																	221
Total																	$	2,936

Commercial Automobile Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	272	$	310	$	356	$	356	$	366	$	365	$	363	$	362	$	363	$	363	$	6	39,302
2012			311		377		391		402		395		389		387		388		388		6		36,052
2013					311		318		334		341		340		339		335		334		8		32,239
2014							309		317		331		337		341		334		333		8		29,609
2015									308		358		372		356		356		359		12		28,541
2016											385		393		390		391		392		25		29,145
2017													372		383		379		383		37		26,279
2018															349		396		405		86		24,402
2019																	417		431		194		24,604
2020																			416		321		14,930
Total																			$	3,804


Cumulative Paid Losses & Allocated Loss Adjustment Expense, Net of Reinsurance
	For the years ended December 31
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	63	$	133	$	211	$	274	$	316	$	339	$	348	$	353	$	354	$	355
2012			65		143		234		307		346		359		372		376		378
2013					62		130		202		259		295		311		321		323
2014							59		131		197		252		299		309		318
2015									62		142		207		267		314		335
2016											65		147		232		303		339
2017													60		134		211		285
2018															62		153		239
2019																	63		153
2020																			50
Total																			$	2,775

Commercial Automobile Physical Damage


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2018		2019		2020		IBNR Reserves		Claims Reported
2018	$	62	$	62	$	61	$	1	20,561
2019			63		64		1		19,828
2020					51		2		13,796
Total					$	176


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2018		2019		2020
2018	$	54	$	60	$	60
2019			56		62
2020					45
Total					$	167

Professional Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Claims Made Year	2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported

2012	$	242	$	238	$	238	$	218	$	221	$	221	$	219	$	225	$	217	$	11	7,036
2013			207		195		187		174		174		173		171		171		22		5,972
2014					187		183		181		178		179		182		183		26		6,717
2015							164		174		179		190		214		207		40		7,215
2016									183		176		203		197		196		53		8,345
2017											205		203		232		226		63		9,362
2018													248		281		277		101		9,913
2019															298		317		196		9,297
2020																	370		325		6,236
Total																	$	2,164


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Claims Made Year	2012		2013		2014		2015		2016		2017		2018		2019		2020

2012	$	17	$	67	$	100	$	139	$	155	$	168	$	172	$	175	$	175
2013			10		44		67		88		116		131		137		143
2014					8		38		74		108		131		135		146
2015							9		40		85		107		125		141
2016									8		51		88		112		125
2017											11		48		88		123
2018													15		73		130
2019															21		78
2020																	19
Total																	$	1,080

Bond


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	74	$	78	$	78	$	76	$	71	$	71	$	71	$	71	$	72	$	71	$	9	2,135
2012			71		70		61		55		49		49		45		48		48		13		1,728
2013					64		58		55		48		49		39		35		34		14		1,463
2014							71		67		66		67		59		59		60		13		1,386
2015									67		67		63		60		54		48		17		1,394
2016											61		61		61		56		52		29		1,335
2017													63		90		101		94		34		1,682
2018															68		68		72		37		1,573
2019																	72		73		60		1,514
2020																			83		77		1,505
Total																			$	635


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	12	$	40	$	52	$	57	$	58	$	60	$	60	$	60	$	61	$	62
2012			12		25		26		24		26		26		34		35		35
2013					3		9		17		19		19		19		20		20
2014							18		31		40		43		43		45		46
2015									9		20		24		31		34		32
2016											2		12		15		20		22
2017													5		46		55		53
2018															6		16		23
2019																	3		13
2020																			4
Total																			$	310

Assumed Reinsurance


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2012	$	107	$	99	$	93	$	88	$	115	$	120	$	119	$	120	$	120	$	—	1,441
2013			115		119		103		105		102		102		103		104		—		1,647
2014					119		142		122		118		115		116		116		—		1,760
2015							102		92		94		94		95		96		—		1,497
2016									89		91		98		100		102		(1)		1,626
2017											129		153		162		157		—		1,966
2018													129		128		130		(14)		1,960
2019															181		190		38		2,025
2020																	183		110		833
Total																	$	1,198


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2012		2013		2014		2015		2016		2017		2018		2019		2020
2012	$	38	$	77	$	83	$	85	$	112	$	118	$	118	$	119	$	119
2013			53		83		91		98		100		101		103		103
2014					66		119		106		109		112		113		114
2015							42		65		77		83		91		94
2016									36		66		84		90		95
2017											44		116		135		145
2018													25		112		134
2019															62		132
2020																	50
Total																	$	986

Personal Automobile Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	1,181	$	1,170	$	1,180	$	1,173	$	1,166	$	1,154	$	1,154	$	1,153	$	1,153	$	1,153	$	4	221,891
2012			1,141		1,149		1,146		1,142		1,133		1,130		1,130		1,130		1,129		5		210,757
2013					1,131		1,145		1,144		1,153		1,152		1,153		1,157		1,156		7		205,480
2014							1,146		1,153		1,198		1,200		1,199		1,202		1,201		8		209,013
2015									1,195		1,340		1,338		1,330		1,331		1,328		15		216,871
2016											1,407		1,402		1,393		1,397		1,395		28		215,797
2017													1,277		1,275		1,228		1,214		50		187,408
2018															1,108		1,104		1,072		105		155,821
2019																	1,018		1,010		220		138,430
2020																			805		400		90,933
Total																			$	11,463


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	447	$	826	$	1,006	$	1,088	$	1,126	$	1,140	$	1,145	$	1,146	$	1,146	$	1,148
2012			441		818		986		1,067		1,104		1,114		1,120		1,122		1,123
2013					442		816		1,002		1,091		1,121		1,135		1,142		1,144
2014							430		843		1,032		1,125		1,165		1,182		1,186
2015									475		935		1,142		1,243		1,292		1,304
2016											505		968		1,188		1,308		1,345
2017													441		836		1,033		1,123
2018															359		710		888
2019																	323		654
2020																			238
Total																			$	10,153

Personal Automobile Physical Damage


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2018		2019		2020		IBNR Reserves		Claims Reported
2018	$	509	$	498	$	488	$	1	305,389
2019			445		442		—		276,688
2020					349		(6)		199,623
Total					$	1,279


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2018		2019		2020
2018	$	474	$	491	$	488
2019			427		441
2020					333
Total					$	1,262

Homeowners


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	955	$	920	$	919	$	916	$	914	$	911	$	908	$	907	$	907	$	907	$	—	179,405
2012			774		741		741		741		739		738		738		738		737		—		142,855
2013					673		638		637		634		632		630		629		630		1		113,546
2014							710		707		702		700		698		698		698		—		121,914
2015									690		703		690		684		684		684		1		119,981
2016											669		673		663		658		658		2		119,742
2017													866		889		884		783		6		124,581
2018															903		910		673		(11)		102,603
2019																	501		475		27		83,915
2020																			525		89		82,246
Total																			$	6,770


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	709	$	871	$	891	$	899	$	903	$	905	$	908	$	907	$	908	$	907
2012			547		696		719		727		731		734		735		736		736
2013					467		590		611		622		626		627		628		628
2014							526		663		684		691		695		697		697
2015									487		645		665		674		680		681
2016											481		621		640		649		653
2017													538		747		795		757
2018															484		712		616
2019																	318		425
2020																			335
Total																			$	6,435

Property and casualty reserves, including IBNR reserves

The Company estimates ultimate losses and allocated loss adjustment expenses by accident year. IBNR represents the excess of estimated ultimate loss reserves over case reserves. The process to estimate ultimate losses and loss adjustment expenses is an integral part of the Company's reserve setting. Reserves for allocated and unallocated loss adjustment expenses are generally established separate from the reserves for losses.

Reserves for losses are set by line of business within the reporting segments. Case reserves are established by a claims handler on each individual claim and are adjusted as new information becomes known during the course of handling the claim. Lines of business for which reported losses emerge over a long period of

time are referred to as long-tail lines of business. Lines of business for which reported losses emerge more quickly are referred to as short-tail lines of business. The Company’s shortest tail lines of business are homeowners, commercial property and automobile physical damage. The longest tail lines of business include workers’ compensation, general liability and professional liability. For short-tail lines of business, emergence of paid loss and case reserves is credible and likely indicative of ultimate losses. For long-tail lines of business, emergence of paid losses and case reserves is less credible in the early periods after a given accident year and, accordingly, may not be indicative of ultimate losses.

The Company’s reserving actuaries regularly review reserves for both current and prior accident years using the most current claim data. A variety of actuarial methods and judgments are used for most lines of business to arrive at selections of estimated

ultimate losses and loss adjustment expenses. The reserve selections incorporate input, as appropriate, from claims personnel, pricing actuaries and operating management about reported loss cost trends and other factors that could affect the reserve estimates.

For both short-tail and long-tail lines of business, an expected loss ratio is used to record initial reserves. This expected loss ratio is determined by starting with the average loss ratio of recent prior accident years and adjusting that ratio for the effect of expected changes to earned pricing, loss frequency and severity, mix of business, ceded reinsurance and other factors. For short-tail lines, IBNR for the current accident year is initially recorded as the product of the expected loss ratio for the period, earned premium for the period and the proportion of losses expected to be reported in future calendar periods for the current accident period. For long-tailed lines, IBNR reserves for the current accident year are initially recorded as the product of the expected loss ratio for the period and the earned premium for the period, less reported losses for the period. For certain short-tailed lines of business, IBNR amounts in the above loss development triangles are negative due to anticipated salvage and subrogation recoveries on paid losses.

As losses for a given accident year emerge or develop in subsequent periods, reserving actuaries use other methods to estimate ultimate unpaid losses in addition to the expected loss ratio method. These primarily include paid and reported loss development methods, frequency/severity techniques and the Bornhuetter-Ferguson method (a combination of the expected loss ratio and paid development or reported development method). Within any one line of business, the methods that are given more weight vary based primarily on the maturity of the accident year, the mix of business and the particular internal and external influences impacting the claims experience or the methods. The output of the reserve reviews are reserve estimates that are referred to as actuarial indications.

Paid development and reported development techniques are used for most lines of business though more weight is given to the reported development method for some of the long-tailed lines like general liability. In addition, for long-tailed lines of business, the Company relies on the expected loss ratio method for immature accident years. Frequency/severity techniques are used predominantly for professional liability and are also used for

automobile liability. The Berquist-Sherman technique is also used for automobile liability, marine and assumed reinsurance. For most lines, reserves for allocated loss adjustment expenses ("ALAE", or those expenses related to specific claims) are analyzed using paid development techniques and an analysis of the relationship between ALAE and loss payments. For most of the lines acquired through the Navigators Group book of business, loss and ALAE are reviewed on a combined basis. Reserves for ULAE are determined using the expected cost per claim year and the anticipated claim closure pattern as well as the ratio of paid ULAE to paid losses.

In the final step of the reserve review process, senior reserving actuaries and senior management apply their judgment to determine the appropriate level of reserves considering the actuarial indications and other factors not contemplated in the actuarial indications. Those factors include, but are not limited to, the assessed reliability of key loss trends and assumptions used in the current actuarial indications, the maturity of the accident year, pertinent trends observed over the recent past, the level of volatility within a particular line of business, and the improvement or deterioration of actuarial indications. The Company also considers the magnitude of the difference between the actuarial indication and the recorded reserves.

Cumulative number of reported claims

For most property and casualty lines, claim counts represent the number of claim features on a reported claim where a claim feature is each separate coverage for each claimant affected by the claim event. For example, one car accident that results in two bodily injury claims and one automobile damage liability claim would be counted as three claims within the personal automobile liability triangle. Similarly, a fire that impacts one commercial building may result in multiple claim features due to the potential for claims related to business interruption, structural damage, and loss of the physical contents of the building. Claim features that result in no paid losses are included in the reported claim counts. For some property and casualty lines, such as marine and assumed reinsurance, a claim count represents each reported claim regardless of the number of features. For assumed bordereau business and business written on binders, one claim count is posted for each bordereau received, which could account for multiple claims.


Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
	(Unaudited)
Reserve Line	1st Year		2nd Year		3rd Year		4th Year		5th Year		6th Year		7th Year		8th Year		9th Year		10th Year
Workers' compensation	15.2	%	19.1	%	12.4	%	8.3	%	5.7	%	4.2	%	2.6	%	2.3	%	1.7	%	1.1	%
General liability	2.9	%	8.2	%	14.6	%	18.4	%	16.2	%	10.9	%	6.6	%	4.5	%	2.8	%	1.5	%
Marine	26.1	%	32.4	%	18.4	%	8.4	%	7.0	%	2.8	%	2.2	%	3.9	%	(0.5	%)
Package business	37.5	%	21.7	%	10.0	%	8.6	%	6.0	%	2.9	%	2.1	%	1.2	%	0.3	%	0.3	%
Commercial property	53.6	%	30.9	%	7.6	%	3.2	%	0.9	%	0.3	%	0.2	%	(0.1	%)	(0.1	%)
Commercial automobile liability	16.2	%	20.8	%	20.9	%	17.7	%	11.4	%	4.9	%	2.7	%	1.1	%	0.5	%	0.2	%
Commercial automobile physical damage	88.2	%	10.1	%	(0.5	%)
Professional liability	5.4	%	19.0	%	18.2	%	14.5	%	10.4	%	6.3	%	3.9	%	2.0	%	—	%
Bond	12.7	%	24.3	%	11.7	%	4.9	%	2.4	%	0.1	%	5.3	%	1.2	%	0.1	%	2.1	%
Assumed Reinsurance	36.3	%	38.7	%	8.8	%	4.9	%	8.0	%	2.5	%	1.0	%	0.3	%	(0.1	%)
Personal automobile liability	35.5	%	33.2	%	15.8	%	7.6	%	3.1	%	1.1	%	0.5	%	0.1	%	0.1	%	0.1	%
Personal automobile physical damage	96.5	%	3.2	%	(0.7	%)
Homeowners	71.8	%	22.7	%	1.2	%	0.4	%	0.6	%	0.3	%	0.1	%	0.1	%	—	%	—	%

Group Life, Disability and Accident Products

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses


	For the years ended December 31,
	2020		2019		2018
Beginning liabilities for unpaid losses and loss adjustment expenses, gross	$	8,256	$	8,445	$	8,512
Reinsurance recoverables [1]	247		239		209
Beginning liabilities for unpaid losses and loss adjustment expenses, net	8,009		8,206		8,303
Aetna U.S. group life and disability business acquisition [2]	—		—		42
Provision for unpaid losses and loss adjustment expenses
Current incurral year	4,511		4,385		4,470
Prior year's discount accretion	209		219		227
Prior incurral year development [3]	(445)		(410)		(324)
Total provision for unpaid losses and loss adjustment expenses [4]	4,275		4,194		4,373
Payments
Current incurral year	(2,288)		(2,277)		(2,377)
Prior incurral years	(2,000)		(2,114)		(2,135)
Total payments	(4,288)		(4,391)		(4,512)
Ending liabilities for unpaid losses and loss adjustment expenses, net	7,996		8,009		8,206
Reinsurance recoverables	237		247		239
Ending liabilities for unpaid losses and loss adjustment expenses, gross	$	8,233	$	8,256	$	8,445

[1] Includes a cumulative effect adjustment of $(1) representing an adjustment to the ACL recorded on adoption of accounting guidance for credit losses on January 1, 2020. See Note 1 - Basis of Presentation and Significant Accounting Policies.

[2]Amount recognized in 2018 represents an adjustment to Aetna U.S. group life and disability business reserves, net of reinsurance as of the acquisition date, upon finalization of the opening balance sheet.

[3]Prior incurral year development represents the change in estimated ultimate incurred losses and loss adjustment expenses for prior incurral years on a discounted basis.

[4]Includes unallocated loss adjustment expenses of $178, $178 and $194 for the years ended December 31, 2020, 2019 and 2018, respectively, that are recorded in insurance operating costs and other expenses in the Consolidated Statements of Operations.

Group Life, Disability and Accident Products Reserves, Net of Reinsurance, that are Discounted


	For the years ended December 31,
	2020						2019						2018
Liability for unpaid losses and loss adjustment expenses, at undiscounted amounts	$	8,380					$	8,636					$	8,957
Amount of discount	(1,353)						(1,401)						(1,505)
Carrying value of liability for unpaid losses and loss adjustment expenses	$	7,027					$	7,235					$	7,452
Weighted average discount rate	3.4					%	3.4					%	3.4					%
Range of discount rate	2.1		%	-	8.0	%	2.1		%	-	8.0	%	2.1		%	-	8.0	%

Reserves are discounted at rates in effect at the time claims were incurred, ranging from 2.1% for life and disability reserves acquired from Aetna based on interest rates in effect at the acquisition date of November 1, 2017, to 8.0% for the Company’s pre-acquisition reserves for incurral year 1990, and vary by product. Prior year's discount accretion has been calculated as the average reserve balance for the year times the weighted average discount rate.

2020 re-estimates of prior incurral year reserves

Group disability- Prior period reserve estimates decreased by approximately $365 largely driven by group long-term disability lower claim incidence and higher recoveries on prior incurral year claims, and a refund on the New York Paid Family Leave program.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $65 largely driven by lower-than-previously expected claim incidence in group life premium waiver.

Supplemental Accident & Health- Prior period reserve estimates decreased by approximately $15 driven by lower-than-expected emergence of prior year claims, especially for voluntary critical Illness and voluntary accident products.

2019 re-estimates of prior incurral year reserves

Group disability- Prior period reserve estimates decreased by approximately $340 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims, including the impact of updating long-term disability ("LTD") recovery probabilities to be based on more recent experience. New York Paid Family Leave also experienced favorable claim emergence including an experience refund.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $60 largely driven by lower-than-previously expected claim incidence in group life premium waiver.

2018 re-estimates of prior incurral year reserves

Group disability- Prior period reserve estimates decreased by approximately $230 largely driven by group long-term disability claim recoveries higher than prior reserve assumptions and, primarily for the 2017 incurral year, claim incidence lower than prior assumptions. Short-term disability also experienced favorable claim recoveries.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $90 largely driven by lower-than-previously expected claim incidence inclusive of group life, group life premium waiver, and group accidental death & dismemberment, principally for the 2017 incurral year.

Reconciliation of Loss Development to Liability for Unpaid Losses and Loss Adjustment Expenses as of December 31, 2020


	Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance										Subtotal
Reserve Line	Cumulative Incurred for Incurral Years Displayed in Triangles		Cumulative Paid for Incurral Years Displayed in Triangles		Unpaid for Incurral Years not Displayed in Triangles		Unpaid Unallocated Loss Adjustment Expenses, Net of Reinsurance		Discount		Unpaid Losses and Loss Adjustment Expenses, Net of Reinsurance		Reinsurance and Other Recoverables		Liability for Unpaid Losses and Loss Adjustment Expenses
Group long-term disability	$	14,411	$	(8,420)	$	1,554	$	182	$	(1,233)	$	6,494	$	227	$	6,721
Group life and accident, excluding premium waiver	5,888		(5,283)		163		4		(17)		755		3		758
Group short-term disability					117		4		—		121		—		121
Group life premium waiver					688		10		(103)		595		2		597
Group supplemental health					31		—		—		31		5		36
Total Group Benefits	$	20,299	$	(13,703)	$	2,553	$	200	$	(1,353)	$	7,996	$	237	$	8,233

The following loss triangles present historical loss development for incurred and paid claims by the year the insured claim occurred, referred to as the incurral year. Triangles are limited to the number of years for which claims incurred typically remain

outstanding, not exceeding ten years. Short-tail lines, which represent claims generally expected to be paid within a few years, have three years of claim development displayed.

Group Long-Term Disability


Undiscounted Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the years ended December 31,
			(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		IBNR Reserves		Claims Reported
2011	$	1,917	$	1,761	$	1,660	$	1,659	$	1,669	$	1,660	$	1,649	$	1,638	$	1,631	$	1,615	$	—	37,347
2012			1,829		1,605		1,539		1,532		1,530		1,515		1,504		1,486		1,479		—		35,626
2013					1,660		1,479		1,429		1,429		1,416		1,413		1,399		1,385		—		30,611
2014							1,636		1,473		1,430		1,431		1,431		1,408		1,395		—		31,756
2015									1,595		1,442		1,422		1,420		1,401		1,385		—		32,527
2016											1,651		1,481		1,468		1,437		1,417		1		33,244
2017													1,597		1,413		1,358		1,316		2		30,883
2018															1,647		1,387		1,309		6		28,364
2019																	1,650		1,424		38		27,136
2020																			1,686		885		15,861
Total																			$	14,411


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the years ended December 31,
			(Unaudited)
Incurral Year	2011		2012		2013		2014		2015		2016		2017		2018		2019		2020
2011	$	118	$	508	$	743	$	886	$	996	$	1,087	$	1,167	$	1,231	$	1,286	$	1,324
2012			108		483		708		835		933		1,014		1,080		1,138		1,185
2013					102		443		664		791		881		954		1,016		1,067
2014							103		448		675		801		884		960		1,025
2015									108		460		687		806		891		962
2016											112		479		705		819		907
2017													109		452		658		757
2018															105		447		639
2019																	101		454
2020																			100
Total																			$	8,420

Group Life and Accident, excluding Premium Waiver


Undiscounted Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Incurral Year	2018		2019		2020		IBNR Reserves		Claims Reported
2018	$	1,952	$	1,940	$	1,950	$	10	52,500
2019			1,902		1,866		19		57,109
2020					2,072		401		46,597
Total					$	5,888


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Incurral Year	2018		2019		2020
2018	$	1,532	$	1,916	$	1,929
2019			1,471		1,830
2020					1,524
Total					$	5,283

Group life, disability and accident reserves, including IBNR

The majority of Group Benefits’ reserves are for LTD claimants who are known to be disabled and are currently receiving benefits. A Disabled Life Reserve ("DLR") is calculated for each

LTD claim. The DLR for each claim is the expected present value of all estimated future benefit payments and includes estimates of claim recovery, investment yield, and offsets from other income, including offsets from Social Security benefits and workers’ compensation. Estimated future benefit payments represent the monthly income benefit that is paid until recovery, death or expiration of benefits. Claim recoveries are estimated based on claim characteristics such as age and diagnosis and represent an estimate of benefits that will terminate, generally as a result of the claimant returning to work or being deemed able to return to work. The DLR also includes a liability for payments to claimants who have not yet been approved for LTD either because they have not yet satisfied the waiting (or elimination) period or because the approval or denial decision has not yet been made. In these cases, the present value of future benefits is reduced for the likelihood of claim denial based on Company experience. For claims recently closed due to recovery, a portion of the DLR is retained for the possibility that the claim reopens upon further evidence of disability. In addition, a reserve for estimated unpaid claim expenses is included in the DLR.

For incurral years with IBNR claims, estimates of ultimate losses are made by applying completion factors to the dollar amount of claims reported or expected depending on the market segment. IBNR represents estimated ultimate losses less both DLR and cumulative paid amounts for all reported claims. Completion factors are derived using standard actuarial techniques using triangles that display historical claim count emergence by incurral month. These estimates are reviewed for reasonableness and are adjusted for current trends and other factors expected to cause a change in claim emergence. The IBNR includes an estimate of unpaid claim expenses, including a provision for the cost of initial set-up of the claim once reported.

For all products, including LTD, there is a period generally ranging from two to twelve months, depending on the product and market segment, where emerged claim information for an incurral year is not yet credible enough to be a basis for an IBNR projection. In these cases, the ultimate losses and allocated loss adjustment expenses are estimated using earned premium multiplied by an expected loss ratio.

The Company also records reserves for future death benefits under group term life policies that provide for premiums to be waived in the event the insured is unable to work due to disability and has satisfied an elimination period, which is typically nine months (premium waiver reserves). The death benefit reserve for these group life premium waiver claims is estimated for a known disabled claimant equal to the present value of expected future cash outflows (typically a lump sum face amount payable at death plus claim expenses) with separate estimates for claimant recovery (when no death benefit is payable) and for death before recovery or benefit expiry (when death benefit is payable). The IBNR for premium waiver death benefits is estimated with standard actuarial development methods.

In addition, the Company also records reserves for group term life, accidental death & dismemberment, short term disability, and other group products that have short claim payout periods. For these products, reserves are determined using paid or reported actuarial development methods. The resulting claim triangles produce a completion pattern and estimate of ultimate loss. IBNR for these lines of business equals the estimated ultimate losses and loss adjustment expenses less the amount of paid or reported claims depending on whether the paid or reported development method was used. Estimates are reviewed for reasonableness and are adjusted for current trends or other factors that affect the development pattern.

Cumulative number of reported claims

For group life, disability and accident coverages, claim counts include claims that are approved, pending approval and terminated and exclude denied claims. Due to the nature of the claims, one claimant represents one event.


Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
	(Unaudited)
	1st Year		2nd Year		3rd Year		4th Year		5th Year		6th Year		7th Year		8th Year		9th Year		10th Year
Group long-term disability	7.4	%	25.2	%	15.6	%	8.5	%	6.4	%	5.4	%	4.6	%	3.9	%	3.3	%	2.3	%
Group life and accident, excluding premium waiver	77.0	%	19.5	%	0.7	%

13. RESERVE FOR FUTURE POLICY BENEFITS


Changes in Reserves for Future Policy Benefits [1]
Liability balance, as of January 1, 2020	$	635

Incurred	85
Paid	(85)
Change in unrealized investment gains and losses	3
Liability balance, as of December 31, 2020	$	638
Reinsurance recoverable asset, as of January 1, 2020	$	31
Incurred	(2)
Paid	(1)
Reinsurance recoverable asset, as of December 31, 2020	$	28


Liability balance, as of January 1, 2019	$	642

Incurred	86
Paid	(102)
Change in unrealized investment gains and losses	9
Liability balance, as of December 31, 2019	$	635
Reinsurance recoverable asset, as of January 1, 2019	$	27
Incurred	4
Paid	—
Reinsurance recoverable asset, as of December 31, 2019	$	31

[1]Reserves for future policy benefits includes paid-up life insurance and whole-life policies resulting from conversion from group life policies included within the Group Benefits segment and reserves for run-off structured settlement and terminal funding agreement liabilities which are in the Corporate category.