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Reserve For Losses, LAE And Future Policy Benefit Reserve

6 Months Ended

Jun. 30, 2019

Reserve For Losses LAE And Future Policy Benefit Reserve [Abstract]

Reserve For Losses LAE And Future Policy Benefit Reserve

4. RESERVE FOR LOSSES, LAE AND FUTURE POLICY BENEFIT RESERVE

Activity in the reserve for losses and LAE is summarized for the periods indicated:

	Six Months Ended
	June 30,
(Dollars in thousands)	2019		2018
Gross reserves beginning of period	$	13,119,090	$	11,884,321
Less reinsurance recoverables		(1,619,641)		(1,212,649)
Net reserves beginning of period		11,499,449		10,671,672

Incurred related to:
Current year		2,135,335		1,963,766
Prior years		7,845		434,725
Total incurred losses and LAE		2,143,180		2,398,491

Paid related to:
Current year		374,123		490,884
Prior years		1,598,544		2,089,606
Total paid losses and LAE		1,972,667		2,580,490

Foreign exchange/translation adjustment		(57,392)		(67,978)

Net reserves end of period		11,612,570		10,421,695
Plus reinsurance recoverables		1,636,918		1,621,639
Gross reserves end of period	$	13,249,488	$	12,043,334

(Some amounts may not reconcile due to rounding.)

Incurred prior years losses increased slightly by $7,845 thousand for the six months ended June 30, 2019 and increased by $,434725 thousand for the six months ended June 30, 2018. The increase for the six months ended June 30, 2018 was mainly due to $532,155 thousand of adverse development on prior years catastrophe losses, primarily related to Hurricanes Harvey, Irma and Maria, as well as the 2017 California wildfires. The increase in loss estimates for Hurricanes Harvey, Irma and Maria was mostly driven by re-opened claims, loss inflation from higher than expected loss adjustment expenses and in particular, their impact on aggregate covers. This reserve increase was partially offset by $97,430 thousand of favorable development on prior years attritional losses which mainly related to U.S. and international property and casualty reinsurance business.