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RESERVE FOR LOSSES AND LAE
 6 Months Ended
Jun. 30, 2025
Insurance [Abstract]  
RESERVE FOR LOSSES AND LAE RESERVE FOR LOSSES AND LAE
The following table provides a roll forward of the Company’s beginning and ending reserve for losses and LAE and is summarized for the periods indicated:
Six Months Ended
June 30,
20252024
(Dollars in millions)
Gross reserves beginning of period$29,889 $24,604 
Less reinsurance recoverables on unpaid losses(2,915)(2,098)
Net reserves beginning of period26,975 22,506 
Incurred related to:
Current year5,307 4,548 
Prior years59 — 
Total incurred losses and LAE5,366 4,548 
Paid related to:
Current year621 1,068 
Prior years3,107 2,145 
Total paid losses and LAE3,728 3,213 
Foreign exchange/translation adjustment655 (139)
Net reserves end of period29,267 23,702 
Plus reinsurance recoverables on unpaid losses3,209 2,151 
Gross reserves end of period$32,476 $25,853 
(Some amounts may not reconcile due to rounding.)
Current year incurred losses were $5.3 billion and $4.5 billion for the six months ended June 30, 2025 and 2024, respectively. Gross and net reserves increased for the six months ended June 30, 2025, reflecting an increase in underlying exposure due to earned premium growth, year over year, amounting to approximately $441 million of current year attritional losses in 2025 compared to 2024, which includes $83 million of losses from the Washington D.C. aviation accident, as well as an increase of $318 million in 2025 current year catastrophe losses.
The net unfavorable development on prior year reserves of $59 million was primarily related to aviation losses associated with the Russia/Ukraine war of $98 million, partially offset by net favorable prior year development of $39 million, driven by the release of reserves from prior underwriting years for the property line of business. The net unfavorable prior year loss development was recorded in the Reinsurance segment.
In the second quarter of 2025, the United Kingdom’s High Court concluded that that the confiscation of certain aircraft was covered under the war provision within certain reinsurance contracts. As a result of the court’s decision, the Company increased its net ultimate loss reserve for contracts that were exposed to the war in the Ukraine by $98 million ($84 million net of reinstatement premiums).