We use actuarial methods, models, assumptions and judgment to estimate, as of a financial statement date, the property casualty loss and loss expense reserves required to pay for and settle all outstanding insured claims, including IBNR claims, as of that date. The actuarial estimate is subject to review and adjustment by an inter-departmental committee that includes actuarial, claims, underwriting, loss prevention and finance management. This committee is familiar with relevant company and industry business, claims and underwriting trends, as well as general economic and legal trends that could affect future loss and loss expense payments. The amount we will actually have to pay for claims can be highly uncertain. This uncertainty, together with the size of our reserves, makes the loss and loss expense reserves our most significant estimate.

Our reserving process takes into account known facts and interpretations of circumstances and factors including the type of claim, policy provisions pertaining to each claim, potential subrogation or salvage recoverable, large loss activity and trends, new business activity, judicial decisions, economic conditions, changes in law and regulation and product and underwriting changes. There have been no significant changes in methodologies and assumptions used in calculating loss and loss expense reserves for all years presented. There were no material additional premiums or return premiums accrued for as a result of prior-year effects.

For events designated as natural catastrophes resulting in losses incurred related to direct premiums, we calculate IBNR reserves directly as a result of an estimated claim counts and estimated average dollar amount per claim for each event. Once individual case reserves are established for a catastrophe event, we reduce the IBNR reserves.

Due to the uncertainties inherent with loss reserves, our ultimate loss experience could prove better or worse than what our carried reserves reflect. To the extent that reserves are inadequate and are required to be increased, the amount of the increase is a charge in that period, raising our loss and loss expense ratio and reducing earnings. To the extent that reserves are redundant and are required to be released, the amount of the release is a credit in that period, reducing our loss and loss expense ratio and increasing earnings.


(Dollars in millions)	Years ended December 31,
	2024		2023		2022
Gross loss and loss expense reserves, January 1	$	8,975	$	8,336	$	7,229
Less reinsurance recoverable	362		405		327
Net loss and loss expense reserves, January 1	8,613		7,931		6,902



Net incurred loss and loss expenses related to:
Current accident year	5,672		5,173		4,875
Prior accident years	(236)		(215)		(159)
Total incurred	5,436		4,958		4,716
Net paid loss and loss expenses related to:
Current accident year	1,951		1,875		1,592
Prior accident years	2,430		2,401		2,095
Total paid	4,381		4,276		3,687

Net loss and loss expense reserves, December 31	9,668		8,613		7,931
Plus reinsurance recoverable	269		362		405
Gross loss and loss expense reserves, December 31	$	9,937	$	8,975	$	8,336

The reserve for loss and loss expense in the consolidated balance sheets also included $66 million, $75 million and $64 million, at December 31, 2024, 2023 and 2022, respectively, for certain life and health loss and loss expense reserves. Additional disclosures for reserves related to these health claims are not material and therefore not provided.

We experienced $236 million of favorable development on prior accident years including $138 million of favorable development in commercial lines, $26 million of favorable development in personal lines and $8 million of unfavorable development in excess and surplus lines during 2024. Within commercial lines, we recognized favorable development of $83 million for the workers' compensation line and $74 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss expense for these lines. This was partially offset by unfavorable development of $26 million for the commercial casualty line. Within personal lines, we recognized favorable reserve development of $54 million for the homeowner line of business and unfavorable reserve development of $20 million in personal auto.

We experienced $215 million of favorable development on prior accident years including $123 million of favorable development in commercial lines, $64 million of favorable development in personal lines and $11 million of favorable development in excess and surplus lines during 2023. Within commercial lines, we recognized favorable development of $66 million for the workers' compensation line and $55 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss expense for these lines. This was partially offset by unfavorable development of $15 million for the commercial casualty line. Within personal lines, we recognized favorable reserve development of $53 million for the homeowner line of business and $15 million in personal auto.

We experienced $159 million of favorable development on prior accident years including $76 million of favorable development in commercial lines, $61 million of favorable development in personal lines and $9 million of favorable development in excess and surplus lines during 2022. Within commercial lines, we recognized favorable development of $63 million for the workers' compensation line and $44 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss expense for these lines. This was partially offset by unfavorable development of $25 million for the commercial casualty line and $23 million for the commercial auto line. Within personal lines, we recognized favorable reserve development of $54 million for the homeowner line of business.

Included in our lines of business are asbestos and environmental claims. We carried $119 million and $98 million of net loss and loss expense reserves for asbestos and environmental claims at December 31, 2024 and 2023, respectively. The asbestos and environmental claims amounts for each respective year constituted less than 2.0% of total net loss and loss expense reserves at these year-end dates. We believe our exposure to asbestos and environmental claims is limited, largely because our reinsurance retention was $500,000 or below prior to 1987. We also were predominantly a personal lines company in the 1960s and 1970s. During the 1980s and early 1990s, commercial lines grew as a percentage of our overall business and our exposure to asbestos and environmental claims grew accordingly. Over that period, we included an asbestos and environmental exclusion in almost all policies or endorsed the exclusion to the policies. We have no exposure to asbestos and environmental claims related to our acquisition of Cincinnati Global. We continue to monitor our claims for evidence of material exposure to other mass tort classes but have found no such credible evidence to date.

The following table provides a reconciliation of the property casualty incurred losses and allocated loss adjustment expenses (ALAE) development and paid losses and ALAE development information at December 31, 2024.


(Dollars in millions)	Cumulative incurred losses and ALAE as reported within the triangles, net of reinsurance		Cumulative paid losses and ALAE as reported within the triangles, net of reinsurance		Liabilities for loss and ALAE for accident years not presented in the triangles, net of reinsurance		Total liabilities for loss and ALAE, net of reinsurance		Reinsurance recoverable on unpaid losses		Total liabilities for gross loss and loss expense reserves




Commercial casualty	$	7,025	$	3,921	$	124	$	3,228	$	20	$	3,248
Workers' compensation	1,746		1,105		326		967		53		1,020
Commercial auto	2,514		1,683		40		871		3		874
Commercial property	3,589		3,134		14		469		24		493
Personal auto	2,115		1,739		13		389		21		410
Homeowner	2,946		2,540		8		414		9		423
Excess and surplus	1,862		855		6		1,013		30		1,043
Other lines											1,905
Total liabilities for loss and ALAE reserves											9,416
Unallocated loss adjustment expense reserves											521
Gross loss and loss expense reserves											$	9,937

For all lines of business, the claim counts reported are primarily measured by insurance coverages that are triggered when a loss occurs and a reserve is established. For this purpose, coverages are defined as unique combinations of certain attributes such as line of business and cause of loss. Claims that are opened and closed without payment are included in the reported claim counts. Claim counts are presented on a direct basis only and do not reflect any assumed or ceded reinsurance.

In the following tables, commercial casualty, workers' compensation and excess and surplus lines each disclose 10 accident years of loss and ALAE reserves and the cumulative number of reported claims. Commercial auto, commercial property, personal auto and homeowner each disclose five accident years of loss and ALAE reserves and the cumulative number of reported claims consistent with the number of years for which claims incurred typically remain outstanding.

The following table shows the commercial casualty incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)																					As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,																						Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2015		2016		2017		2018		2019		2020		2021		2022		2023		2024
2015	$	533	$	526	$	529	$	516	$	508	$	502	$	504	$	496	$	513	$	520		$	14	22
2016			563		574		557		555		554		538		531		525		538			24		22
2017					610		597		577		571		555		554		553		575			37		22
2018							650		641		622		588		612		618		638			63		23
2019									672		643		607		669		682		718			89		21
2020											674		629		606		593		619			79		15
2021													714		697		697		694			184		15
2022															924		902		876			297		14
2023																	950		843			469		11
2024																			1,004			792		8
Total																			$	7,025

Cumulative paid losses and ALAE, net of reinsurance
2015	$	38	$	108	$	200	$	287	$	362	$	404	$	424	$	453	$	471	$	487
2016			46		126		228		331		395		434		466		485		498
2017					48		122		234		320		392		437		486		512
2018							44		148		253		345		441		505		542
2019									39		134		259		394		503		576
2020											33		102		242		345		437
2021													31		123		251		370
2022															37		141		311
2023																	46		146
2024																			42
Total																			3,921
All outstanding liabilities before 2015, net of reinsurance																			124
Liabilities for loss and ALAE, net of reinsurance																			$	3,228

The following table shows the average annual percentage payout of incurred losses for the commercial casualty line of business:


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5	6	7	8	9	10
Average annual percentage payout	6.0%	13.2%	18.8%	16.8%	14.0%	8.7%	6.0%	4.6%	3.0%	2.9%

The following table shows the workers’ compensation incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)																					As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,																						Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2015		2016		2017		2018		2019		2020		2021		2022		2023		2024
2015	$	246	$	220	$	208	$	195	$	179	$	173	$	173	$	171	$	167	$	168		$	22	17
2016			230		218		206		188		183		183		183		181		182			24		16
2017					218		208		190		183		172		167		160		159			22		15
2018							222		207		199		186		179		175		174			28		15
2019									224		215		202		188		178		174			31		14
2020											204		190		172		153		148			37		11
2021													202		190		183		174			39		11
2022															209		205		182			53		11
2023																	221		188			68		9
2024																			197			84		7
Total																			$	1,746

Cumulative paid losses and ALAE, net of reinsurance
2015	$	47	$	93	$	115	$	129	$	134	$	137	$	139	$	139	$	140	$	141
2016			46		97		119		131		141		146		148		150		152
2017					45		88		106		114		119		122		126		127
2018							48		95		115		127		133		135		138
2019									49		94		115		122		129		132
2020											37		68		82		96		101
2021													37		82		100		113
2022															37		76		94
2023																	36		71
2024																			36
Total																			1,105
All outstanding liabilities before 2015, net of reinsurance																			326
Liabilities for loss and ALAE, net of reinsurance																			$	967

The following table shows the average annual percentage payout of incurred losses for the workers’ compensation line of business:


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5	6	7	8	9	10
Average annual percentage payout	24.1%	24.8%	11.2%	6.7%	3.8%	2.0%	1.5%	0.7%	0.8%	0.3%

The following table shows the commercial auto incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)											As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,												Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2020		2021		2022		2023		2024
2020	$	424	$	391	$	384	$	377	$	382		$	7	36
2021			470		477		465		463			23		39
2022					558		569		560			60		41
2023							550		544			98		37
2024									565			252		31
Total									$	2,514

Cumulative paid losses and ALAE, net of reinsurance
2020	$	154	$	214	$	280	$	328	$	357
2021			179		278		346		398
2022					217		332		410
2023							216		322
2024									196
Total									1,683
All outstanding liabilities before 2020, net of reinsurance									40
Liabilities for loss and ALAE, net of reinsurance									$	871

The following table shows the average annual percentage payout of incurred losses for the commercial auto line of business. Commercial auto includes both physical damage and liability losses. A majority of the incurred losses paid after year 2 are the result of liability losses.


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5
Average annual percentage payout	38.5%	19.3%	15.2%	11.8%	7.6%

The following table shows the commercial property incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)											As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,												Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2020		2021		2022		2023		2024
2020	$	855	$	742	$	719	$	716	$	713		$	18	24
2021			607		586		576		575			6		14
2022					813		779		752			9		16
2023							833		786			14		14
2024									763			182		11
Total									$	3,589

Cumulative paid losses and ALAE, net of reinsurance
2020	$	489	$	637	$	672	$	687	$	695
2021			326		527		558		564
2022					393		691		727
2023							506		719
2024									429
Total									3,134
All outstanding liabilities before 2020, net of reinsurance									14
Liabilities for loss and ALAE, net of reinsurance									$	469

The following table shows the average annual percentage payout of incurred losses for the commercial property line of business:


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5
Average annual percentage payout	59.6%	30.6%	5.1%	1.6%	1.1%

The following table shows the personal auto incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)											As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,												Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2020		2021		2022		2023		2024
2020	$	305	$	281	$	277	$	277	$	276		$	1	71
2021			350		343		342		344			3		80
2022					427		418		429			10		86
2023							466		474			25		92
2024									592			106		100
Total									$	2,115

Cumulative paid losses and ALAE, net of reinsurance
2020	$	186	$	225	$	248	$	264	$	271
2021			219		278		304		325
2022					277		349		382
2023							304		389
2024									372
Total									1,739
All outstanding liabilities before 2020, net of reinsurance									13
Liabilities for loss and ALAE, net of reinsurance									$	389

The following table shows the average annual percentage payout of incurred losses for the personal auto line of business. Personal auto includes both physical damage and liability losses. A majority of the incurred losses paid after year 2 are the result of liability losses.


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5
Average annual percentage payout	64.5%	16.6%	8.0%	5.8%	2.6%

The following table shows the homeowner incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)											As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,												Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2020		2021		2022		2023		2024
2020	$	497	$	475	$	470	$	471	$	471		$	2	23
2021			495		449		440		440			3		19
2022					552		505		500			7		20
2023							742		693			20		24
2024									842			144		22
Total									$	2,946

Cumulative paid losses and ALAE, net of reinsurance
2020	$	326	$	434	$	453	$	464	$	468
2021			285		405		424		431
2022					299		461		481
2023							468		637
2024									523
Total									2,540
All outstanding liabilities before 2020, net of reinsurance									8
Liabilities for loss and ALAE, net of reinsurance									$	414

The following table shows the average annual percentage payout of incurred losses for the homeowner line of business:


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5
Average annual percentage payout	64.7%	26.7%	4.2%	1.9%	0.8%

The following table shows the excess and surplus lines incurred and paid losses and ALAE development by accident year. The table also shows the IBNR reserves plus expected development on reported losses and claim frequency:


(Dollars in millions, reported claims in thousands)																			As of December 31, 2024
Incurred losses and ALAE, net of reinsurance for the years ended December 31,																						Total of incurred but not reported liabilities plus expected development on reported losses		Cumulative number of reported claims

Accident	Unaudited
Year	2015		2016		2017		2018		2019		2020		2021		2022		2023			2024
2015	$	96	$	81	$	73	$	67	$	65	$	66	$	65	$	61	$	65		$	66	$	2	2
2016			93		87		84		82		90		91		88		89			91		4		3
2017					104		95		95		94		94		91		94			98		6		3
2018							116		109		110		108		107		105			111		7		3
2019									137		135		141		139		142			149		15		3
2020											172		172		160		152			165		24		4
2021													217		235		233			253		60		4
2022															294		280			285		103		4
2023																	328			276		146		3
2024																				368		267		2
Total																				$	1,862

Cumulative paid losses and ALAE, net of reinsurance
2015	$	8	$	19	$	29	$	41	$	51	$	54	$	56	$	58	$	62		$	63
2016			10		21		39		51		62		75		81		83			84
2017					11		23		41		57		68		77		88			90
2018							11		26		50		62		75		88			95
2019									13		34		55		79		102			116
2020											16		37		56		86			118
2021													17		45		82			132
2022															21		46			85
2023																	15			43
2024																				29
Total																				855
All outstanding liabilities before 2015, net of reinsurance																				6
Liabilities for loss and ALAE, net of reinsurance																				$	1,013

The following table shows the average annual percentage payout of incurred losses for the excess and surplus lines insurance segment. Excess and surplus lines consist mostly of commercial casualty and commercial property coverages. A majority of the incurred losses paid after year 2 are the result of commercial casualty losses.


Average annual percentage payout of incurred losses by age, net of reinsurance (unaudited)
Years	1	2	3	4	5	6	7	8	9	10
Average annual percentage payout	9.0%	12.3%	16.2%	15.7%	14.3%	10.3%	6.3%	2.7%	3.8%	2.0%