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, 2022 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,
	2022		2021		2020
Workers’ compensation	$	(204)	$	(190)	$	(110)
Workers’ compensation discount accretion	36		35		35
General liability	56		454		237
Marine	2		1		3
Package business	(39)		(91)		(58)
Commercial property	(11)		(26)		(4)
Professional liability	(11)		(2)		(14)
Bond	(32)		(26)		(19)
Assumed reinsurance	19		(6)		(6)
Automobile liability - Commercial Lines	38		9		27
Automobile liability - Personal Lines	(14)		(90)		(61)
Homeowners	(1)		3		7


Net asbestos and environmental reserves	—		—		(2)
Catastrophes	(62)		(154)		(529)
Uncollectible reinsurance	3		(6)		(8)
Other reserve re-estimates, net	27		42		54
Prior accident year development, including full benefit for the ADC cession	(193)		(47)		(448)
Change in deferred gain on retroactive reinsurance included in other liabilities [1]	229		246		312
Total prior accident year development	$	36	$	199	$	(136)

[1]The change in deferred gain for the years ended December 31, 2022, 2021 and 2020 included $229, $155 and $210, respectively of adverse development on A&E reserves in excess of ceded premium paid and included $0, $91 and $102 respectively, of adverse development on Navigators 2018 and prior accident year reserves ceded to NICO, primarily within professional liability, general liability and marine.

2022 re-estimates of prior accident year reserves

Workers’ compensation reserves were decreased for the 2014 through 2018 accident years, predominately within small commercial, and to a lesser extent in middle and large commercial, driven by lower than previously estimated claim

severity and, to a lesser extent, a $14 reduction of COVID-19 related claims from 2020.

General liability reserves were increased, driven by an increase in the estimated cost to settle large individual claims in middle and large commercial for the 2016 to 2019 accident years, an increase in excess casualty and environmental in recent accident years, and increases in primary construction on older accident years, partially offset by a decrease in reserves for other mass torts.

Package business reserves decreased due to lower estimated severity and lower estimated loss adjustment expenses for accident years 2018 and prior, and a reduction in property reserves for the 2020 and 2021 accident years.

Commercial property reserves were decreased primarily due to favorable development for the 2020 accident year in middle & large commercial related to COVID-19 claims.

Professional liability reserves were decreased primarily due to favorable development on directors’ and officers’ claims for the 2018 to 2020 accident years and on errors and omissions claims for the 2013 to 2017 accident years, partially offset by large losses related to 2018 and prior accident years for primary and excess directors’ and officers’ claims.

Bond reserves were decreased primarily in contract surety due to favorable development on older accident years.

Assumed reinsurance reserves were increased primarily due to higher reserve estimates for syndicate property claims, including higher expected COVID-19 property losses in the 2020 accident year and increased reserves for international agriculture related to drought claims. Also contributing were reserve increases for Latin America P&C and specialty casualty business in recent accident years.

Automobile liability reserves were decreased in Personal Lines principally due to lower estimated severity on AARP Direct claims, primarily within accident years 2015 to 2020 and were increased in Commercial Lines principally due to a higher number of large claims in accident years 2017 to 2019, along with decreasing settlement rates and increasing attorney rep rates.

Catastrophe reserves were decreased in both Commercial and Personal Lines with the largest reduction related to 2019 and 2020 wind and hail events.

Asbestos and environmental reserves were reviewed in fourth quarter 2022 resulting in a $229 increase in reserves before ADC reinsurance, including $162 for asbestos and $67 for environmental. The Company recognized a $229 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 14 - Commitments and Contingencies.

Other reserve re-estimates, net, were increased primarily due to an increase in unallocated loss adjustment expense ("ULAE") reserves within P&C Other Operations driven by an increase in gross asbestos and environmental reserves, as well as unfavorable development from participation in involuntary market pools, and increased automobile physical damage severity.

2021 re-estimates of prior accident year reserves

Workers’ compensation reserves were decreased within small commercial and middle & large commercial for the 2013 through 2018 accident years driven by lower than previously estimated claim severity.

General liability reserves were increased including an increase for sexual molestation and sexual abuse claims above the amount of reserves previously recorded for this exposure, primarily to reflect an increase in reserves for claims made against the Boy Scouts of America ("BSA") as discussed further below, partially offset by reserve decreases for other mass torts and extra contractual liability claims. In addition, the Company recognized reserve increases on Navigators’ wholesale construction business for 2018 and prior accident years, largely included within the change in deferred gain on retroactive reinsurance in the above table.

Package business reserves decreased largely due to lower estimated loss adjustment expenses for accident years 2014 to 2018 and a reduction in estimated reserves for extra contractual liability claims.

Commercial property reserves were decreased primarily due to favorable development for the 2020 accident year in both middle & large commercial and global specialty.

Professional liability reserves were decreased due to lower estimated severity in both large and middle market directors’ and officers’ (“D&O”) insurance for older accident years. More than offsetting this favorable reserve development were reserve increases on legacy Navigators public company directors’ and officers’ insurance for 2019 and prior accident years, a portion of which is reflected within the change in deferred gain on retroactive reinsurance in the above table.

Bond reserves were reduced mostly due to favorable emergence on contract surety claims driven by higher than previously anticipated recoveries, largely for the 2016 to 2017 accident years.

Automobile liability reserves were decreased in Personal Lines principally due to lower estimated severity on AARP Direct and Agency claims, primarily within accident years 2017 to 2020, and a reduction in estimated reserves for extra contractual liability claims.

Catastrophes reserves were decreased in both Commercial and Personal Lines primarily driven by a reduction in reserves for 2018 and 2019 wind and hail events, lower estimated losses from 2018 and 2020 hurricanes, a reduction in estimated losses from the 2017 and 2018 California wildfires, including an expected recovery of subrogation from a utility related to the 2018 Woolsey wildfire in California, and a reduction in losses relating to the 2020 civil unrest.

Asbestos and environmental reserves were reviewed in fourth quarter 2021 resulting in a $155 increase in reserves before ADC reinsurance, including $106 for asbestos and $49 for environmental. The Company recognized a $155 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 14 - Commitments and Contingencies.

Other reserve re-estimates, net, were increased primarily due to an increase in reserves for sexual molestation and sexual abuse claims within P&C Other Operations, principally on assumed reinsurance, as well as an increase in ULAE reserves within P&C Other Operations driven by an increase in gross asbestos and environmental reserves.

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”).

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 ("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 14 - Commitments and Contingencies.

Other reserve re-estimates, net, primarily represents an increase in ULAE reserves in Property & Casualty Other Operations that was largely driven by an increase in gross asbestos and environmental reserves.

Settlement Agreement with Boy Scouts of America

On September 14, 2021, the Company announced that it entered into a new agreement-in-principle with the BSA, related to sexual molestation and sexual abuse claims associated with liability policies issued by various Hartford writing companies in the 1970s and early 1980s, with the agreement in-principle including the BSA, its local councils and the representatives of a majority of the sexual abuse claimants. As part of the agreement-in-principle, The Hartford will pay $787, before tax, for claims associated with these policies. In exchange for The Hartford’s payment, the BSA and its local councils will fully release The Hartford from any obligation under policies The Hartford issued to the BSA and its local councils. In addition, the representatives for the claimants joining this agreement-in-principle will support a plan of reorganization which incorporates the settlement.

The agreement-in-principle was reached in connection with the BSA’s Chapter 11 bankruptcy and a written settlement agreement (the "Settlement") was executed on February 14, 2022. The Settlement will become final upon the occurrence of certain conditions, including, but not limited to, confirmation of the BSA’s plan of reorganization by both the bankruptcy and district courts, receipt of executed releases from the local councils, and approval of the Settlement as part of the confirmation of the BSA's plan of reorganization by the bankruptcy and district courts. On September 8, 2022, the bankruptcy court approved the BSA's plan of reorganization, including the Settlement. The BSA's plan of reorganization is now before the civil district court for approval. Upon civil district court approval, the Company will pay the settlement amount of $787. However, no assurance can be given that all the conditions precedent to the Settlement will be satisfied or that final court approval, if obtained, will not be delayed for various procedural reasons.

If the conditions precedent to the Settlement are not satisfied or the requisite court approvals for the BSA’s plan of reorganization are not obtained, it is possible that adverse outcomes, if any, could have a material adverse effect on the Company’s consolidated operating results.

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 results 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, 2022, the Company has incurred $1,244 in cumulative adverse development on asbestos and environmental reserves that have been ceded under the A&E ADC treaty with NICO with $256 of available limit remaining under the A&E ADC. As a result, the Company has recorded a $594 deferred gain within other liabilities, representing the difference between the reinsurance recoverable of $1,244 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 Insurance Company and certain of its affiliates (collectively, “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, 2022, the Company has recorded a reinsurance recoverable under the Navigators ADC of $300 as estimated cumulative loss development on the 2018 and prior accident year reserves has exhausted the treaty limit. While the

reinsurance recoverable is $300, the Company has recorded a $209 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 $209 of cumulative ceded losses in excess of ceded premium paid, $91 and $102 were recognized as changes in deferred gain in 2021 and 2020, respectively.

Reconciliation of Loss Development to Liability for Unpaid Losses and Loss Adjustment Expenses As of December 31, 2022


	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	$	17,911	$	(9,516)	$	3,295	$	372	$	(333)		$	11,729	$	1,648	$	13,377
General liability	7,509		(3,486)		1,238		153		—			5,414		1,070		6,484
Marine	1,476		(1,192)		14		14		—			312		266		578
Package business	7,218		(5,288)		87		112		—			2,129		72		2,201
Commercial property	3,922		(3,383)		26		20		—			585		329		914
Commercial automobile liability	4,025		(2,824)		22		26		—			1,249		88		1,337
Commercial automobile physical damage	181		(169)		4		1		—			17		(1)		16
Professional liability	2,609		(1,403)		67		43		—			1,316		734		2,050
Bond	635		(260)		43		34		—			452		15		467
Assumed Reinsurance	1,541		(1,133)		2		4		—			414		50		464
Personal automobile liability	10,887		(9,584)		31		60		—			1,394		23		1,417
Personal automobile physical damage	1,288		(1,250)		6		4		—			48		—		48
Homeowners	6,063		(5,728)		3		36		—			374		8		382
Other ongoing business					178		6		(14)			170		333		503
Asbestos and environmental [1]					495		—		—			495		1,789		2,284
Other operations [1]					362		158		—			520		41		561
Total P&C	$	65,265	$	(45,216)	$	5,873	$	1,043	$	(347)		$	26,618	$	6,465	$	33,083

[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 $300 of losses to the Navigators ADC even though $209 of that benefit has been recorded as a deferred gain within other liabilities. The $300 of Navigators Insurers losses ceded to the Navigators ADC and reflected in the following triangles include $95 for professional liability,$105 for general liability, $38 for marine, $27 for assumed reinsurance, $14 for commercial automobile, $3 for commercial property, and $1 for bond. The triangles do not include $17of losses ceded to the Navigators ADC related to older accident years and lines of business not in the 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. Incurred but not reported ("IBNR") reserves shown in loss triangles include reserves 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, 2022.

Workers' Compensation


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	2,020	$	1,981	$	1,920	$	1,883	$	1,861	$	1,861	$	1,850	$	1,831	$	1,811	$	1,809	$	337	151,592
2014			1,869		1,838		1,789		1,761		1,713		1,692		1,679		1,654		1,637		353		126,371
2015					1,873		1,835		1,801		1,724		1,714		1,699		1,667		1,645		376		114,224
2016							1,772		1,772		1,780		1,767		1,748		1,708		1,670		419		112,486
2017									1,862		1,869		1,840		1,822		1,757		1,665		504		112,070
2018											1,916		1,917		1,915		1,904		1,870		608		119,284
2019													1,937		1,935		1,934		1,934		722		120,104
2020															1,865		1,864		1,849		937		91,187
2021																	1,831		1,832		1,012		100,954
2022																			2,000		1,414		105,013
Total																			$	17,911


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	304	$	675	$	917	$	1,071	$	1,175	$	1,260	$	1,304	$	1,339	$	1,361	$	1,382
2014			275		598		811		960		1,041		1,099		1,137		1,167		1,191
2015					261		576		778		909		1,004		1,068		1,117		1,151
2016							255		579		779		908		1,003		1,064		1,110
2017									261		575		778		900		977		1,035
2018											283		624		837		983		1,090
2019													291		637		856		1,007
2020															223		507		695
2021																	254		562
2022																			293
Total																			$	9,516

General Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	455	$	442	$	456	$	484	$	488	$	502	$	505	$	508	$	500	$	503	$	36	15,217
2014			506		475		481		494		513		522		515		505		510		50		16,445
2015					556		560		554		594		633		647		637		647		67		16,621
2016							613		583		607		632		632		620		636		58		17,666
2017									626		614		613		615		613		615		105		17,168
2018											692		669		697		703		728		212		18,502
2019													822		827		822		840		379		17,914
2020															938		923		923		625		13,204
2021																	1,002		991		804		10,791
2022																			1,116		1,045		8,186
Total																			$	7,509


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	13	$	53	$	141	$	233	$	320	$	372	$	398	$	422	$	442	$	457
2014			15		42		130		214		304		358		402		423		437
2015					10		55		156		278		409		477		524		547
2016							12		52		131		283		368		446		513
2017									15		67		156		255		344		441
2018											21		83		177		288		409
2019													29		100		192		339
2020															45		110		202
2021																	34		115
2022																			26
Total																			$	3,486

Marine


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves [1]		Claims Reported
2013	$	147	$	151	$	133	$	134	$	138	$	133	$	136	$	138	$	137	$	137	$	(2)	7,362
2014			162		158		155		162		161		166		164		168		167		3		7,493
2015					157		144		144		146		131		136		137		140		1		10,353
2016							138		141		136		145		147		144		146		(15)		13,592
2017									159		185		172		171		177		180		(5)		16,109
2018											143		159		152		159		165		(16)		14,165
2019													143		141		139		134		3		8,562
2020															149		141		137		12		5,019
2021																	129		128		40		4,847
2022																			142		83		3,549
Total																			$	1,476

[1]Contributing to the negative IBNR reserves for some accident years is a lag in the timing of expected reinsurance recoveries under the Navigators ADC with NICO. Recoveries from NICO will not be collected until the Company has cumulative loss payments for all covered lines of more than the attachment point.


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	41	$	81	$	99	$	110	$	117	$	119	$	124	$	131	$	132	$	133
2014			40		80		115		129		149		154		157		159		162
2015					39		84		114		124		132		138		139		140
2016							35		79		104		120		130		138		141
2017									47		109		140		151		160		172
2018											36		103		137		146		154
2019													35		82		100		110
2020															31		68		90
2021																	25		63
2022																			27
Total																			$	1,192

Package Business


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	579	$	565	$	573	$	585	$	586	$	592	$	586	$	587	$	583	$	582	$	20	43,716
2014			566		578		601		602		603		603		593		581		576		24		43,483
2015					582		588		585		583		588		581		567		564		22		42,330
2016							655		638		632		625		611		595		591		36		44,224
2017									695		702		692		657		644		637		48		46,771
2018											719		724		688		667		655		78		45,088
2019													813		769		749		744		116		43,573
2020															915		893		877		245		62,208
2021																	946		954		309		46,012
2022																			1,038		532		37,966
Total																			$	7,218


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	225	$	339	$	414	$	467	$	504	$	522	$	541	$	549	$	552	$	556
2014			226		345		416		468		507		525		535		542		545
2015					212		332		383		445		486		505		513		530
2016							225		353		410		465		500		521		540
2017									235		372		447		496		534		561
2018											237		402		451		498		537
2019													254		413		488		571
2020															326		493		573
2021																	368		556
2022																			319
Total																			$	5,288

Commercial Property


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	267	$	252	$	254	$	252	$	249	$	247	$	247	$	247	$	247	$	247	$	—	21,690
2014			293		281		282		279		279		280		280		279		279		(1)		21,119
2015					298		301		302		301		305		303		301		301		1		21,143
2016							405		418		398		405		407		407		404		—		24,085
2017									576		515		455		438		440		437		2		24,719
2018											450		436		423		403		400		4		21,907
2019													480		439		418		420		(3)		21,098
2020															501		468		439		64		20,511
2021																	530		499		74		18,188
2022																			496		183		15,326
Total																			$	3,922


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	161	$	223	$	238	$	243	$	242	$	244	$	245	$	245	$	244	$	244
2014			170		250		270		279		279		279		279		280		280
2015					178		257		284		295		301		303		301		301
2016							214		341		377		394		400		405		405
2017									228		377		411		426		432		438
2018											187		344		378		385		393
2019													215		351		383		405
2020															221		336		355
2021																	241		382
2022																			180
Total																			$	3,383

Commercial Automobile Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	311	$	318	$	334	$	341	$	340	$	339	$	336	$	334	$	333	$	332	$	5	34,172
2014			309		317		331		337		341		334		333		332		332		5		30,096
2015					308		358		372		356		356		359		360		358		7		28,587
2016							385		393		390		391		391		395		395		7		29,201
2017									372		383		379		383		381		394		4		26,384
2018											349		396		405		406		424		27		24,733
2019													425		439		450		460		61		28,473
2020															428		424		419		149		21,963
2021																	440		443		252		19,623
2022																			468		341		17,849
Total																			$	4,025


Cumulative Paid Losses & Allocated Loss Adjustment Expense, Net of Reinsurance
	For the years ended December 31
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	62	$	130	$	202	$	259	$	295	$	311	$	320	$	323	$	324	$	326
2014			59		131		197		252		299		309		318		320		325
2015					62		142		207		267		314		335		344		348
2016							65		147		232		303		339		357		379
2017									60		134		211		285		328		368
2018											62		153		238		305		360
2019													67		160		247		327
2020															55		119		200
2021																	55		127
2022																			64
Total																			$	2,824

Commercial Automobile Physical Damage


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2020		2021		2022		IBNR Reserves		Claims Reported







2020	$	51	$	51	$	50	$	1	14,727
2021			58		62		1		15,436
2022					69		4		15,100
Total					$	181


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2020		2021		2022







2020	$	45	$	50	$	49
2021			51		61
2022					59
Total					$	169

Professional Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Claims Made Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	207	$	195	$	186	$	174	$	173	$	173	$	171	$	170	$	168	$	165	$	11	5,983
2014			187		183		181		177		178		181		181		172		168		9		6,740
2015					164		174		179		189		212		205		198		195		(3)		7,254
2016							183		176		202		195		193		194		192		13		8,421
2017									205		202		230		224		238		242		37		9,527
2018											247		278		274		274		269		24		10,138
2019													297		315		333		350		115		9,809
2020															369		364		337		185		7,945
2021																	339		343		262		6,728
2022																			348		306		5,896
Total																			$	2,609


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Claims Made Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	10	$	44	$	67	$	87	$	116	$	131	$	137	$	142	$	147	$	148
2014			7		38		74		107		130		134		146		145		150
2015					9		40		85		107		124		140		163		174
2016							8		50		88		110		123		146		165
2017									11		48		87		122		150		179
2018											15		72		128		163		197
2019													21		77		148		199
2020															19		71		118
2021																	15		55
2022																			18
Total																			$	1,403

Bond


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	64	$	58	$	55	$	48	$	49	$	39	$	35	$	34	$	34	$	29	$	9	1,470
2014			71		67		66		67		59		59		60		60		64		12		1,389
2015					67		67		63		60		54		48		47		42		17		1,404
2016							61		61		61		55		51		45		37		16		1,341
2017									63		90		101		94		79		70		26		1,775
2018											68		68		72		71		70		40		1,714
2019													72		73		74		73		57		1,860
2020															83		84		79		54		2,101
2021																	85		85		67		2,561
2022																			86		73		1,991
Total																			$	635


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	3	$	9	$	17	$	19	$	19	$	19	$	20	$	20	$	20	$	20
2014			18		31		40		43		43		44		46		47		52
2015					9		20		24		31		34		32		30		25
2016							2		12		15		20		22		22		22
2017									5		46		55		54		42		43
2018											6		16		23		24		29
2019													3		13		15		16
2020															4		12		21
2021																	8		21
2022																			11
Total																			$	260

Assumed Reinsurance


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves [1]		Claims Reported
2013	$	115	$	119	$	102	$	105	$	102	$	102	$	103	$	103	$	103	$	103	$	—	1,668
2014			119		142		121		118		115		116		116		115		115		(1)		1,814
2015					102		91		94		94		95		96		95		95		—		1,585
2016							88		90		98		100		101		101		102		(5)		1,766
2017									129		153		161		156		152		155		(2)		2,213
2018											128		126		128		133		135		(14)		2,412
2019													181		188		185		189		19		2,804
2020															183		180		186		55		2,157
2021																	191		195		49		1,484
2022																			266		154		712
Total																			$	1,541


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	53	$	83	$	91	$	98	$	100	$	101	$	102	$	102	$	103	$	103
2014			66		119		106		109		112		113		114		115		115
2015					42		64		77		83		91		93		94		95
2016							36		66		84		90		95		97		98
2017									44		116		135		144		147		149
2018											25		111		132		138		141
2019													62		131		152		158
2020															49		89		113
2021																	46		101
2022																			60
Total																			$	1,133

Personal Automobile Liability


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	1,131	$	1,145	$	1,144	$	1,153	$	1,152	$	1,153	$	1,157	$	1,156	$	1,155	$	1,155	$	5	205,487
2014			1,146		1,153		1,198		1,200		1,199		1,202		1,201		1,199		1,199		5		209,024
2015					1,195		1,340		1,338		1,330		1,331		1,328		1,324		1,320		3		216,901
2016							1,407		1,402		1,393		1,397		1,395		1,386		1,384		5		215,855
2017									1,277		1,275		1,228		1,214		1,200		1,198		9		187,545
2018											1,108		1,104		1,072		1,058		1,056		28		156,258
2019													1,018		1,010		991		986		52		139,641
2020															805		782		775		106		96,438
2021																	881		886		224		100,945
2022																			928		423		99,686
Total																			$	10,887


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	442	$	816	$	1,002	$	1,091	$	1,121	$	1,135	$	1,142	$	1,144	$	1,148	$	1,149
2014			430		843		1,032		1,125		1,165		1,182		1,186		1,190		1,192
2015					475		935		1,142		1,243		1,292		1,304		1,310		1,313
2016							505		968		1,188		1,308		1,345		1,363		1,373
2017									441		836		1,033		1,123		1,161		1,180
2018											359		710		888		965		1,011
2019													323		654		816		897
2020															238		486		615
2021																	247		553
2022																			301
Total																			$	9,584

Personal Automobile Physical Damage


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2020		2021		2022		IBNR Reserves		Claims Reported







2020	$	349	$	346	$	342	$	1	211,066
2021			412		413		2		225,425
2022					533		(5)		224,117
Total					$	1,288


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2020		2021		2022







2020	$	333	$	341	$	341
2021			388		411
2022					498
Total					$	1,250

Homeowners


Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	673	$	638	$	637	$	634	$	632	$	630	$	629	$	630	$	629	$	629	$	1	113,556
2014			710		707		702		700		698		698		698		698		698		—		121,927
2015					690		703		690		684		684		684		684		684		1		120,010
2016							669		673		663		658		658		658		658		1		119,810
2017									866		889		884		783		775		774		7		124,761
2018											903		910		673		642		639		(1)		102,870
2019													501		475		470		468		6		84,721
2020															525		512		513		20		88,347
2021																	502		501		28		76,720
2022																			499		113		57,936
Total																			$	6,063


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Accident Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	467	$	590	$	611	$	622	$	626	$	627	$	628	$	628	$	628	$	629
2014			526		663		684		691		695		697		697		698		698
2015					487		645		665		674		680		681		681		682
2016							481		621		640		649		653		655		656
2017									538		747		795		757		761		762
2018											484		712		616		619		627
2019													318		425		445		458
2020															335		454		478
2021																	305		440
2022																			298
Total																			$	5,728

Property and casualty reserves, including IBNR

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 ("ELR") is used to record initial reserves. This ELR 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 ELR 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 ELR for the period and the earned premium for the period, less reported losses for the period. For certain short-tailed lines of business, including commercial property, homeowners, and automobile physical damage, IBNR amounts in the above loss development triangles are negative in certain accident years 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 ELR method. These primarily include paid and reported loss development methods, frequency/severity techniques and the Bornhuetter-Ferguson method (a combination of the ELR 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 ELR 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.

The recorded reserve for losses and loss adjustment expenses represents the Company's best estimate of the ultimate settlement amount of unpaid losses and loss adjustment expenses. In applying judgment, the best estimate is selected after considering the estimates derived from a number of actuarial methods, giving more weight to those methods

deemed more predictive of ultimate unpaid losses and loss adjustment expenses. The Company does not produce a statistical range or confidence interval of reserve estimates and, since reserving methods with more credibility are given greater weight, the selected best estimate may differ from the mid-point of the various estimates produced by the actuarial methods used.

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 [1]
	(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	15.1	%	18.4	%	12.0	%	8.0	%	5.4	%	3.8	%	2.6	%	2.0	%	1.3	%	1.2	%
General liability	2.8	%	7.5	%	13.9	%	18.0	%	16.6	%	11.9	%	7.9	%	4.2	%	3.4	%	2.8	%
Marine	24.2	%	31.3	%	17.5	%	7.7	%	6.4	%	4.1	%	2.0	%	2.7	%	1.0	%	0.6	%
Package business	36.8	%	21.1	%	10.3	%	9.2	%	6.4	%	3.4	%	2.4	%	1.9	%	0.5	%	0.7	%
Commercial property	52.4	%	30.1	%	7.4	%	3.4	%	1.1	%	0.8	%	0.1	%	—	%	—	%	—	%
Commercial automobile liability	15.4	%	19.7	%	19.9	%	17.2	%	11.8	%	5.8	%	3.4	%	0.9	%	0.8	%	0.5	%
Commercial automobile physical damage	85.3	%	12.7	%	(0.4	%)
Professional liability	5.0	%	17.4	%	18.6	%	13.9	%	11.7	%	8.7	%	8.1	%	2.7	%	3.2	%	0.3	%
Bond	11.3	%	22.6	%	12.3	%	6.1	%	0.4	%	(0.4	%)	(0.1	%)	(2.9	%)	4.1	%	(1.1	%)
Assumed Reinsurance	34.1	%	36.0	%	9.9	%	5.1	%	3.5	%	1.6	%	1.4	%	0.3	%	0.4	%	0.2	%
Personal automobile liability	34.1	%	33.5	%	16.2	%	7.8	%	3.3	%	1.3	%	0.6	%	0.2	%	0.3	%	0.1	%
Personal automobile physical damage	94.9	%	4.0	%	(0.1	%)
Homeowners	69.3	%	24.4	%	1.6	%	0.5	%	0.7	%	0.2	%	0.1	%	—	%	0.1	%	—	%

[1]Negative percentages are generally due to salvage, subrogation or other recoveries.

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses


	For the years ended December 31,
	2022		2021		2020
Beginning liabilities for unpaid losses and loss adjustment expenses, gross	$	8,210	$	8,233	$	8,256
Reinsurance recoverables [1]	245		237		247
Beginning liabilities for unpaid losses and loss adjustment expenses, net	7,965		7,996		8,009
Provision for unpaid losses and loss adjustment expenses
Current incurral year	4,853		5,021		4,511
Prior year's discount accretion	202		201		209
Prior incurral year development [2]	(381)		(458)		(445)
Total provision for unpaid losses and loss adjustment expenses [3]	4,674		4,764		4,275
Payments
Current incurral year	(2,456)		(2,631)		(2,288)
Prior incurral years	(2,268)		(2,164)		(2,000)
Total payments	(4,724)		(4,795)		(4,288)
Ending liabilities for unpaid losses and loss adjustment expenses, net	7,915		7,965		7,996
Reinsurance recoverables	245		245		237
Ending liabilities for unpaid losses and loss adjustment expenses, gross	$	8,160	$	8,210	$	8,233

[1]Includes a cumulative effect adjustment of $(1) in 2020 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]Prior incurral year development represents the change in estimated ultimate incurred losses and loss adjustment expenses for prior incurral years on a discounted basis.

[3]Includes unallocated loss adjustment expenses of $185, $179 and $178 for the years ended December 31, 2022, 2021 and 2020, 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,
	2022						2021						2020
Liability for unpaid losses and loss adjustment expenses, at undiscounted amounts	$	8,124					$	8,176					$	8,380
Amount of discount	(1,205)						(1,304)						(1,353)
Carrying value of liability for unpaid losses and loss adjustment expenses	$	6,919					$	6,872					$	7,027
Weighted average discount rate	3.2					%	3.3					%	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.

2022 re-estimates of prior incurral year reserves

Group disability- Prior period reserve estimates decreased by approximately $325 largely driven by group long-term disability claim incidence lower than prior assumptions, strong recoveries on prior incurral year claims and higher estimated claim termination rates.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $50 largely driven by continued low incidence in group life premium waiver as well as a reduction in estimated excess mortality losses incurred in fourth quarter 2021.

Supplemental Accident & Health- Prior period reserve estimates decreased by approximately $6 driven by lower-than-previously expected claim incidence.

2021 re-estimates of prior incurral year reserves

Group disability- Prior period reserve estimates decreased by approximately $380 largely driven by group long-term disability claim incidence lower than prior assumptions together with strong recoveries on prior incurral year claims, and by a New York Paid Family Leave risk adjustment benefit.

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 both group life premium waiver and group accidental death and dismemberment.

Supplemental Accident & Health- Prior period reserve estimates decreased by approximately $10 driven by lower-than-previously expected claim incidence during the pandemic.

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 New York Paid Family Leave risk adjustment benefit.

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.

Reconciliation of Loss Development to Liability for Unpaid Losses and Loss Adjustment Expenses as of December 31, 2022


	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	$	14,081	$	(8,142)	$	1,510	$	193	$	(1,107)	$	6,535	$	231	$	6,766
Group life and accident, excluding premium waiver	6,509		(5,946)		161		5		(15)		714		7		721
Group short-term disability					126		8		—		134		—		134
Group life premium waiver					565		13		(83)		495		2		497
Group supplemental health					37		—				37		5		42
Total Group Benefits	$	20,590	$	(14,088)	$	2,399	$	219	$	(1,205)	$	7,915	$	245	$	8,160

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.

Changes in reserve development evident in the incurred loss triangles differ from prior accident year development recorded by the Company as shown in the reserve rollforward above as the triangles are presented on an undiscounted basis and exclude ULAE.

Group Long-Term Disability


Undiscounted Incurred Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the years ended December 31,
			(Unaudited)
Incurral Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		IBNR Reserves		Claims Reported
2013	$	1,660	$	1,479	$	1,429	$	1,429	$	1,416	$	1,413	$	1,399	$	1,385	$	1,378	$	1,376	$	—	30,655
2014			1,636		1,473		1,430		1,431		1,431		1,408		1,395		1,389		1,382		—		31,808
2015					1,595		1,442		1,422		1,420		1,401		1,385		1,380		1,380		—		32,597
2016							1,651		1,481		1,468		1,437		1,417		1,409		1,401		—		33,313
2017									1,597		1,413		1,358		1,316		1,304		1,296		—		30,996
2018											1,647		1,387		1,309		1,277		1,276		1		28,428
2019													1,650		1,424		1,327		1,284		1		27,436
2020															1,686		1,407		1,323		5		25,793
2021																	1,768		1,521		31		26,754
2022																			1,842		962		16,039
Total																			$	14,081


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
			For the years ended December 31,
			(Unaudited)
Incurral Year	2013		2014		2015		2016		2017		2018		2019		2020		2021		2022
2013	$	102	$	443	$	664	$	791	$	881	$	954	$	1,016	$	1,067	$	1,113	$	1,153
2014			103		448		675		801		884		960		1,025		1,079		1,122
2015					108		460		687		806		891		962		1,025		1,078
2016							112		479		705		819		907		981		1,043
2017									109		452		658		757		842		911
2018											105		447		639		743		827
2019													101		454		650		751
2020															100		458		663
2021																	101		493
2022																			101
Total																			$	8,142

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	2020		2021		2022		IBNR Reserves		Claims Reported
2020	$	2,072	$	2,072	$	2,083	$	11	61,848
2021			2,384		2,365		30		68,539
2022					2,061		375		56,171
Total					$	6,509


Cumulative Paid Losses & Allocated Loss Adjustment Expenses, Net of Reinsurance
	For the years ended December 31,
	(Unaudited)
Incurral Year	2020		2021		2022
2020	$	1,524	$	2,033	$	2,064
2021			1,764		2,320
2022					1,562
Total					$	5,946

Group life, disability and accident reserves, including IBNR

The majority of Group Benefits’ reserves are for long-term disability ("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. 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	7.5	%	26.1	%	15.8	%	8.4	%	6.4	%	5.3	%	4.5	%	3.8	%	3.2	%	2.9	%
Group life and accident, excluding premium waiver	74.6	%	24.0	%	1.4	%

12. RESERVE FOR FUTURE POLICY BENEFITS


Changes in Reserves for Future Policy Benefits [1]
	For the years ended December 31,
	2022		2021
Beginning liability balance	$	596	$	638
Incurred	102		61
Paid	(119)		(94)
Change in unrealized investment gains and losses	(18)		(9)
Ending liability balance	$	561	$	596



Ending reinsurance recoverable asset	$	29	$	22

[1]Reserve 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.