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RESERVE FOR LOSSES AND LOSS EXPENSES | 12 Months Ended
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Dec. 31, 2017
Insurance Loss Reserves [Abstract] |
RESERVE FOR LOSSES AND LOSS EXPENSES | Reserving Methodology The reserving process begins with the collection and analysis of paid and incurred claim data for each of the Company's segments. The segmental data is disaggregated by reserving class and further disaggregated by underwriting year (i.e. the year in which the contract generating the premium and losses incepted). Underwriting year information is used to analyze business and subsequently allocate reserves to the respective accident years. Reserve classes are selected to ensure that the underlying contracts have homogeneous loss development characteristics, while remaining large enough to make the estimation of trends credible. This data, in addition to industry benchmarks, serves as a key input to many of the methods employed by the Company's actuaries. The relative weights assigned to its own historical loss data versus industry data vary according to the length of the development profile for the reserving class being evaluated. (See 'Net Incurred and Paid Claims Development Tables By Accident Year' below for further details by reserve class.) The following tables reconcile reserve classes to the lines of business categories and the expected claim tails:
Insurance Segment |  |  |  |  |  |  |  |
|  | Reported Lines of Business
Reserve Classes | Tail | Property | Marine | Terrorism | Aviation | Credit and Political Risk | Professional Lines | Liability | Accident and Health | Discontinued lines - Novae
Property and Other | Short | X |  | X |  |  |  |  | X | X
Marine | Short |  | X |  |  |  |  |  |  |
Aviation | Short |  |  |  | X |  |  |  |  |
Credit and Political Risk | Medium |  |  |  |  | X |  |  |  |
Professional Lines | Medium |  |  |  |  |  | X |  |  | X
Liability | Long |  |  |  |  |  |  | X |  | X
Reinsurance Segment |  |  |  |  |  |  |  |  |
|  | Reported Lines of Business
Reserve Classes | Tail | Catastrophe | Property | Credit and Surety | Professional Lines | Motor | Liability | Engineering | Agriculture | Marine and Other | Discontinued lines - Novae
Property and Other | Short | X | X |  |  |  |  | X | X | X | X
Credit and Surety | Medium |  |  | X |  |  |  |  |  |  |
Professional Lines | Medium |  |  |  | X |  |  |  |  |  |
Motor | Long |  |  |  |  | X |  |  |  |  | X
Liability | Long |  |  |  |  |  | X |  |  |  | X
The Company has presented separate loss development tables for the Aviabel and Novae business prospectively from the date of acquisition. Multiple actuarial methods are available to estimate ultimate losses. Each method has its own assumptions and its own advantages and disadvantages, with no single estimation method being better than the others in all situations and no one set of assumption variables being meaningful for all reserve classes. The relative strengths and weaknesses of the particular estimation methods when applied to a particular group of claims can also change over time. The following is a brief description of the reserve estimation methods commonly employed by the Company's actuaries:
• | Expected Loss Ratio Method ("ELR Method"): This method estimates ultimate losses for an accident year or underwriting year by applying an expected loss ratio to the earned or written premium for that year. Generally, expected loss ratios are based on one or more of (a) an analysis of historical loss experience to date, (b) pricing information and (c) industry data, adjusted as appropriate, to reflect changes in rates and terms and conditions. This method is insensitive to actual incurred losses for the accident year or underwriting year in question and is, therefore, often useful in the early stages of development when very few losses have been incurred. Conversely, the lack of sensitivity to incurred/paid losses for the accident year or underwriting year in question means that this method is usually inappropriate in later stages of an accident year or underwriting year’s development.
• | Loss Development Method (also referred to as the Chain Ladder Method or Link Ratio Method): This method assumes that the losses incurred/paid for each accident year or underwriting year at a particular development stage follow a relatively similar pattern. It assumes that on average, every accident year or underwriting year will display the same percentage of ultimate losses incurred/paid at the same point in time after the inception of that year. The percentages incurred/paid are established for each development stage (e.g. 12 months, 24 months, etc.) after examining historical averages from historical loss development data and/or external industry benchmark information. Ultimate losses are then estimated by multiplying the actual incurred/paid losses by the reciprocal of the established incurred/paid percentage. The strengths of this method are that it reacts to loss emergence/payments and that it makes full use of historical claim emergence/payment experience. However, this method has weaknesses when the underlying assumption of stable loss development/payment patterns is not valid. This could be the consequence of changes in business mix, claim inflation trends or claim reporting practices and/or the presence of large claims, amongst other things. Furthermore, this method tends to produce volatile estimates of ultimate losses where there is volatility in the underlying incurred/paid patterns. In particular, where the expected percentage of incurred/paid losses is low, small deviations between actual and expected claims can lead to very volatile estimates of ultimate losses. As a result, this method is often unsuitable at early development stages for an accident year or underwriting year.
• | Bornhuetter-Ferguson Method ("BF Method"): This method can be seen as a combination of the ELR and Loss Development Methods, under which the Loss Development Method is given progressively more weight as an accident year or underwriting year matures. The main advantage of the BF Method is that it provides a more stable estimate of ultimate losses than the Loss Development Method at earlier stages of development, while remaining more sensitive to emerging loss development than the ELR Method. In addition, the BF Method allows for the incorporation of external market information through the use of expected loss ratios, whereas the Loss Development Method does not incorporate such information.
As part of the loss reserve review process, the Company's actuaries employ the estimation method(s) that they believe will produce the most reliable estimate of ultimate losses, at that particular evaluation date, for each reserve class and accident year or underwriting year combination. Often, this is a blend (i.e. weighted average) of the results of two or more appropriate actuarial methods. These ultimate loss estimates are generally utilized to evaluate the adequacy of ultimate loss estimates for previous accident or underwriting years, as established in the prior reporting period. For the initial estimate of the current accident or underwriting year, the available claim data is typically insufficient to produce a reliable estimate of ultimate losses. As a result, initial estimates for an accident or underwriting year are generally based on the ELR Method for longer tailed lines and a BF Method for shorter tailed lines. The initial ELR for each reserve class is established collaboratively by actuaries, underwriters and management at the start of the year as part of the planning process, taking into consideration prior accident years’ or underwriting years' experience and industry benchmarks, adjusted after considering factors such as exposure trends, rate differences, changes in contract terms and conditions, business mix changes and other known differences between the current year and prior accident or underwriting years. The initial expected loss ratios for a given accident or underwriting year may be modified over time if the underlying assumptions, such as loss development or premium rate changes, differ from the original assumptions. The use of the above actuarial methods requires the Company to make certain explicit assumptions, the most significant of which are: (1) expected loss ratios and (2) loss development patterns. In earlier years, significant reliance was placed on industry benchmarks in establishing expected loss ratios and loss development patterns. Over time, more reliance has been placed on historical loss experience in establishing these ratios and patterns where the Company believes the weight of its own actual experience has become sufficiently credible for consideration. In establishing expected loss ratios for the insurance segment, consideration is given to a number of other factors, including exposure trends, rate adequacy on new and renewal business, ceded reinsurance costs, changes in claims emergence and underwriters’ view of terms and conditions in the market environment. For the reinsurance segment, expected loss ratios are based on a contract-by-contract review, which considers information provided by clients together with estimates provided by underwriters and actuaries about the impact of changes in pricing, terms and conditions and coverage. Market experience of some classes of business as compiled and analyzed by an independent actuarial firm has also been considered, as appropriate. The weight given to experience differs for each of the three claim tails. Short-tail business generally includes exposures for which losses are usually known and paid within a relatively short period of time after the underlying loss event has occurred. The majority of development for an accident year or underwriting year is expected to be recognized in the subsequent one to three years. The key actuarial assumptions for short-tail business in early accident years were primarily developed with reference to industry benchmarks for both expected loss ratios and loss development patterns. As the Company's own historical loss experience amassed, it gained credibility and became relevant for consideration in establishing these key actuarial assumptions. As a result, the Company gradually increased the weighting assigned to its own historical experience in selecting the expected loss ratios and loss development patterns utilized to establish estimates of ultimate losses for an accident year. Due to the relatively short reporting and settlement patterns for short-tail business, more weight is generally placed upon experience-based methods and other qualitative considerations in establishing reserves for both recent and more mature accident years. Medium-tail business generally has claim reporting and settlement periods longer than those of short-tail reserve classes. For the Company's earliest accident and underwriting years, initial key actuarial expected loss ratio and loss development assumptions were established utilizing industry benchmarks. Due to the longer claim tail, the length of time required to develop its own credible loss history for use in the reserve process is greater for medium-tail business than for short-tail business. As a result, the number of years where the Company has relied heavily on industry benchmarks to establish its key actuarial assumptions is greater for medium-tail business. The claim tails for long-tail business, in contrast to short and medium-tail business, is expected to be notably longer, as claims are often reported and ultimately paid or settled years, or even decades, after the related loss events occur. As a general rule, estimates of accident year or underwriting year ultimate losses for long-tail business are notably more uncertain than those for short and medium-tail business. To date, key actuarial assumptions for long-tail business have been derived extensively from industry benchmarks supplemented with the Company own historical experience. Given the Company's relatively short operating history in comparison to the development tail for this business, the Company does not believe that its own historical loss development for long-tail business has amassed an appropriate volume to serve as a fully credible input into the key actuarial assumptions previously outlined. While industry benchmarks that the Company believes reflect the nature and coverage of its business are considered, actual loss experience may differ from the benchmarks based on industry averages. Due to the length of the development tail for this business, reserve estimates for most accident years and underwriting years are predominantly based on the BF or ELR method and the consideration of qualitative factors. The Company cannot estimate losses from widespread catastrophic events, such as hurricanes and earthquakes, using the traditional actuarial methods described above. Rather, loss reserves for such events are estimated by management in collaboration with actuaries, claim handlers and underwriters after a catastrophe occurs by completing an in-depth analysis of individual contracts which may potentially be impacted by the catastrophic event. This in-depth analysis may rely on several sources of information, including:
• | estimates of the size of insured industry losses from the catastrophic event and the Company's corresponding market share;
• | a review of portfolio of contracts performed to identify those contracts which may be exposed to the catastrophic event;
• | a review of modeled loss estimates based on information previously reported by customers and brokers, including exposure data obtained during the underwriting process;
• | discussions of the impact of the event with customers and brokers and
• | catastrophe bulletins published by various independent statistical reporting agencies.
A blend of these information sources is generally used to arrive at aggregate estimates of the ultimate losses arising from the catastrophic event. In subsequent reporting periods, changes in paid and incurred losses in relation to each significant catastrophe are reviewed and adjustments are made to estimates of ultimate losses for each event if there are developments that are different from previous expectations. Adjustments are recorded in the period in which they are identified. The Company's reserving process involves the collaboration of underwriting, claims, actuarial, legal, ceded reinsurance and finance departments, includes various segmental committee meetings and culminates with the approval of a single point best estimate by the Company's Group Reserving Committee, which comprises senior management. In selecting this best estimate, management considers actuarial estimates and applies informed judgment regarding qualitative factors that may not be fully captured in these actuarial estimates. Such factors include, but are not limited to: the timing of the emergence of claims, volume and complexity of claims, social and judicial trends, potential severity of individual claims and the extent of internal historical loss data versus industry information. While these qualitative factors are considered in arriving at the point estimate, no specific provisions for qualitative factors are established. Reserve for Losses and Loss Expenses Gross reserve for losses and loss expenses comprise the following:
| As of December 31, | 2017 |  | 2016 |
| Reserve for reported losses and loss expenses | $ | 5,137,659 |  |  | $ | 3,358,514 |  |
| Reserve for losses incurred but not reported | 7,859,894 |  |  | 6,339,313 |  |
| Reserve for losses and loss expenses | $ | 12,997,553 |  |  | $ | 9,697,827 |  |
Reserve Roll-Forward The following table presents a reconciliation of beginning and ending gross reserve for losses and loss expenses and net reserve for unpaid losses and loss expenses for the years indicated:
| Year ended December 31, | 2017 |  | 2016 |  | 2015 |
| Gross reserve for losses and loss expenses, beginning of year | $ | 9,697,827 |  |  | $ | 9,646,285 |  |  | $ | 9,596,797 |  |
| Less reinsurance recoverable on unpaid losses, beginning of year | (2,276,109 | ) |  | (2,031,309 | ) |  | (1,890,280 | ) |
| Net reserve for unpaid losses and loss expenses, beginning of year | 7,421,718 |  |  | 7,614,976 |  |  | 7,706,517 |  |
| Net incurred losses and loss expenses related to: |  |  |  |  |  |
| Current year | 3,487,826 |  |  | 2,496,574 |  |  | 2,419,247 |  |
| Prior years | (200,054 | ) |  | (292,377 | ) |  | (243,048 | ) |
|  | 3,287,772 |  |  | 2,204,197 |  |  | 2,176,199 |  |
| Net paid losses and loss expenses related to: |  |  |  |  |  |
| Current year | (703,796 | ) |  | (428,153 | ) |  | (343,063 | ) |
| Prior years | (1,880,882 | ) |  | (1,763,696 | ) |  | (1,709,659 | ) |
|  | (2,584,678 | ) |  | (2,191,849 | ) |  | (2,052,722 | ) |
| Foreign exchange and other | 1,713,227 |  |  | (205,606 | ) |  | (215,018 | ) |
| Net reserve for unpaid losses and loss expenses, end of year | 9,838,039 |  |  | 7,421,718 |  |  | 7,614,976 |  |
| Reinsurance recoverable on unpaid losses, end of year | 3,159,514 |  |  | 2,276,109 |  |  | 2,031,309 |  |
| Gross reserve for losses and loss expenses, end of year | $ | 12,997,553 |  |  | $ | 9,697,827 |  |  | $ | 9,646,285 |  |
The Company writes business with loss experience generally characterized as low frequency and high severity in nature, which can result in volatility in its financial results. During 2017, 2016 and 2015, respectively, the Company recognized net losses and loss expenses, net of reinstatement premiums, of $835 million, $204 million and $100 million attributable to catastrophe and weather-related events. The transfer of the insurance business of AXIS Specialty Australia to a reinsurer was approved by the Irish High Court on February 1, 2017 and the Federal Court of Australia of February 10, 2017. Consequently, the insurance policies, assets and liabilities of AXIS Specialty Australia were transferred to the reinsurer with effect from February 13, 2017. This resulted in the reduction of reserves for losses and loss expenses by $223 million and a reduction in reinsurance recoverables on unpaid and paid losses by $223 million. On April 1, 2017, the Company acquired 100% ownership interest in Aviabel. At December 31, 2017, foreign exchange and other included reserves for losses and loss expenses of $79 million and reinsurance recoverables on unpaid and paid losses of $5 million related to this acquisition. On October 2, 2017, the Company acquired 100% ownership interest in Novae. At December 31, 2017, foreign exchange and other included reserves for losses and loss expenses of $2,126 million and reinsurance recoverables on unpaid and paid losses of $788 million related to this acquisition. During April 2016, the Company entered into a quota share and adverse development cover reinsurance agreement, a retroactive contract which was deemed to have met the established criteria for retroactive reinsurance accounting. At December 31, 2016, foreign exchange and other included reinsurance recoverables of $150 million related to this reinsurance agreement. Prior Year Development Prior year reserve development arises from changes to loss and loss expense estimates related to loss events that occurred in previous calendar years. Such development is summarized by segment in the following table:
|  | Insurance |  | Reinsurance |  | Total |
| Year ended December 31, 2017 | $ | 48,969 |  |  | $ | 151,085 |  |  | $ | 200,054 |  |
| Year ended December 31, 2016 | 55,905 |  |  | 236,472 |  |  | 292,377 |  |
| Year ended December 31, 2015 | 23,447 |  |  | 219,601 |  |  | 243,048 |  |
Short-tail business Short-tail business includes the underlying exposures in property and other, marine and aviation reserve classes within the insurance segment and the property and other reserve class within the reinsurance segment. Development from these classes contributed $60 million, $148 million and $152 million total net favorable prior year reserve development in 2017, 2016 and 2015, respectively, and primarily reflected the recognition of better than expected loss emergence in the years. Medium-tail business Medium-tail business consists primarily of insurance and reinsurance professional reserve classes, credit and political risk insurance reserve class, and credit and surety reinsurance reserve class. The reinsurance professional reserve class recognized $44 million, $30 million and $38 million of net favorable prior year development in 2017, 2016 and 2015, respectively. The net favorable prior year loss developments on this reserve class continued to reflect the generally favorable experience on earlier accident years as the Company continued to transition to more experience based methods. As loss experience on these accident years has generally been better than expected, this resulted in the recognition of net favorable prior year reserve development. The insurance professional reserve class recorded net favorable prior year development of $26 million in 2017 reflecting the generally favorable experience on earlier accident years as the Company transitions to more experienced based methods. As loss experience has generally been better than expected, this resulted in the recognition of net favorable prior year reserve development. The insurance professional reserve class recorded net favorable prior year reserve development of $14 million in 2016, also driven by overall better than expected development. The insurance professional reserve class recorded adverse prior year development of $14 million in 2015 due to reserve strengthening on the Australian book of business during the three months ended September 30, 2015. The reinsurance credit and surety reserve class recorded net favorable prior year reserve development of $33 million, $10 million, and $27 million in 2017, 2016, and 2015, respectively due to the recognition of generally better than expected loss emergence. The credit and political risk reserve class recorded net adverse development of $15 million in 2015 primarily related to an increase in loss estimates for one specific claim. Long-tail business Long-tail business consists primarily of liability and motor reserve classes. The motor reserve class contributed net favorable prior year reserve development of $1 million, $55 million and $37 million, in 2017, 2016 and 2015, respectively. The net favorable prior year reserve development on the motor reserve class in 2016 and 2015 related to favorable loss emergence trends on several classes of business spanning multiple accident years. Net favorable prior year development in 2017 was impacted by the U.K. Ministry of Justice's announcement of a decrease in the discount rate used to calculate lump sum awards in U.K. bodily injury cases, known as the Ogden Rate. Effective March 20, 2017, the Ogden rate changed from plus 2.5% to minus 0.75%. The reinsurance liability reserve classes contributed net favorable prior year development of $43 million, $44 million and $46 million in 2017, 2016 and 2015, respectively. The net favorable prior year development primarily reflected the progressively increased weight given by management to the generally favorable emerging loss experience on earlier accident years. This favorable prior year development was partially offset by net adverse prior year development in the insurance liability reserve class of $8 million, $8 million and $27 million in 2017, 2016 and 2015, respectively, primarily related to reserve strengthening within the excess casualty book. In particular, the adverse development during 2015 was mainly driven by a higher frequency of large auto liability claims. At December 31, 2017 net reserve for losses and loss expenses includes estimated amounts for numerous catastrophe events. The magnitude and/or complexity of losses arising from certain of these events, in particular Hurricanes Harvey, Irma and Maria, the two earthquakes in Mexico and the wildfires in Northern and Southern California in 2017, inherently increases the level of uncertainty and, therefore, the level of management judgment involved in arriving at estimated net reserves for losses and loss expenses. As a result, actual losses for these events may ultimately differ materially from current estimates. Net Incurred and Paid Claims Development Tables By Accident Year The following tables present net incurred and paid claims development by accident year, total incurred-but-not-reported liabilities plus expected development on reported claims, cumulative reported claims frequency and claims duration for each reserve class. The development triangles are presented on an accident year basis for both the insurance and reinsurance segments. The Company does not discount unpaid losses and loss expense reserves. Non-U.S. dollar denominated loss data is converted to U.S. dollar at the rates of exchange in effect at the balance sheet date for material underlying currencies. Fluctuations in currency exchange rates may cause material shifts in loss development. Reserves for losses and loss expenses, disclosed in the Consolidated Balance Sheets, are also revalued using the exchange rate at the balance sheet date. The Company has presented separate loss development tables for the Aviabel and Novae business prospectively from the date of acquisition. The prospective treatment for the acquisition of Aviabel and Novae was adopted primarily due to the data necessary to produce the loss development tables by accident year not being available prior to the acquisition date. With regard to establishing the fair value of reserves for losses and loss expenses for Novae at the acquisition date, weight was given to the observable value of these reserves based on a Reinsurance to Close (“RITC”) transaction of the Syndicate’s 2015 and prior years of account, which was completed prior to the allocation of purchase price. Management made no change to the initial estimate when establishing its best estimate of reserves for losses and loss expenses at December 31, 2017. This is consistent with the Company's general approach of recognizing all or part of the anticipated cost of third party liability commutations if the transaction has either completed or is considered sufficiently likely to be completed in the near term. To the extent that the Company enters into a disposition, the effects of the disposition are reported on a retrospective basis by removing the balances associated with the disposed of business. There are many considerations in establishing loss reserves and an attempt to evaluate loss reserves using solely the data presented in these tables could be misleading. The Company cautions against mechanical application of standard actuarial methodologies to project ultimate losses using data presented in this disclosure. Insurance Segment The reporting of cumulative claims frequency for the reserve classes within the insurance segment has been measured by counting the number of unique claim references including claim references assigned to nil and nominal case reserves. Claim references are grouped by claimant by loss event for each class of business. For certain insurance facilities and business produced by managing general agents where underlying data is reported to the Company in an aggregated format, the information necessary to provide cumulative claims frequency is not available therefore reporting of claims frequency is deemed to be impracticable. Insurance Property and Other This reserve class includes property, terrorism as well as accident and health. The property line of business provides physical loss or damage, business interruption and machinery breakdown cover for virtually all types of property, including commercial buildings, residential premises, construction projects and onshore energy installations. This line of business includes both primary and excess risks, some of which are catastrophe-exposed. The terrorism line of business provides cover for physical damage and business interruption of an insured following an act of terrorism and includes kidnap & ransom, and crisis management insurance. The accident and health line of business includes accidental death, travel insurance and specialty health products for employer and affinity groups, as well as accident and health reinsurance for catastrophic or per life events on a quota share and/or excess of loss basis, with aggregate and/or per person deductibles. The accident and health line of business has contributed an increasing portion of the premium earned within this reserve class since 2010 with a large increase in reported claims observed from 2012. In particular, an increase in limited benefits medical business written in 2017 has resulted in a significant increase in reported claims observed in that year. In general, reporting and payment patterns are relatively short-tailed although they can be volatile due to the incidence of catastrophe events.
Insurance Property and Other
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 312,164 |  | $ | 260,206 |  | $ | 251,722 |  | $ | 242,139 |  | $ | 226,472 |  | $ | 225,007 |  | $ | 220,616 |  | $ | 218,851 |  | $ | 217,846 |  | $ | 216,806 |  | $ | 982 |  | 1,573
2009 |  | 117,662 |  | 99,367 |  | 89,993 |  | 82,683 |  | 80,718 |  | 78,501 |  | 78,720 |  | 78,368 |  | 78,623 |  | 971 |  | 1,483
2010 |  |  | 175,554 |  | 155,343 |  | 147,881 |  | 122,472 |  | 116,888 |  | 116,020 |  | 115,740 |  | 115,289 |  | 687 |  | 2,310
2011 |  |  |  | 380,921 |  | 356,524 |  | 333,911 |  | 313,281 |  | 310,404 |  | 309,197 |  | 309,638 |  | 2,836 |  | 3,737
2012 |  |  |  |  | 461,790 |  | 472,088 |  | 448,763 |  | 428,524 |  | 424,475 |  | 418,869 |  | 9,739 |  | 27,701
2013 |  |  |  |  |  | 419,392 |  | 414,394 |  | 387,093 |  | 381,550 |  | 380,800 |  | 6,117 |  | 51,238
2014 |  |  |  |  |  |  | 463,732 |  | 459,996 |  | 436,130 |  | 417,691 |  | 6,539 |  | 60,151
2015 |  |  |  |  |  |  |  | 373,256 |  | 373,071 |  | 355,883 |  | 12,284 |  | 43,790
2016 |  |  |  |  |  |  |  |  | 523,086 |  | 574,267 |  | 40,961 |  | 66,488
2017 |  |  |  |  |  |  |  |  |  | 939,565 |  | 333,630 |  | 237,332
|  |  |  |  |  |  |  |  | Total | $ | 3,807,431 |  |  |
Insurance Property and Other
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 76,558 |  | $ | 150,470 |  | $ | 172,320 |  | $ | 184,038 |  | $ | 211,002 |  | $ | 213,569 |  | $ | 215,628 |  | $ | 215,121 |  | $ | 215,071 |  | $ | 214,663 |
2009 |  | 31,379 |  | 60,166 |  | 68,768 |  | 72,622 |  | 73,538 |  | 74,636 |  | 76,865 |  | 77,187 |  | 77,466 |
2010 |  |  | 48,624 |  | 87,059 |  | 95,747 |  | 106,593 |  | 110,785 |  | 110,934 |  | 110,709 |  | 110,763 |
2011 |  |  |  | 87,525 |  | 217,578 |  | 277,260 |  | 299,567 |  | 298,766 |  | 298,559 |  | 299,248 |
2012 |  |  |  |  | 107,358 |  | 278,870 |  | 343,503 |  | 366,854 |  | 374,485 |  | 379,696 |
2013 |  |  |  |  |  | 129,157 |  | 304,207 |  | 347,531 |  | 361,209 |  | 372,338 |
2014 |  |  |  |  |  |  | 169,961 |  | 341,023 |  | 393,868 |  | 401,482 |
2015 |  |  |  |  |  |  |  | 123,126 |  | 281,377 |  | 317,850 |
2016 |  |  |  |  |  |  |  |  | 174,455 |  | 442,007 |
2017 |  |  |  |  |  |  |  |  |  | 314,839 |
Total |  | 2,930,352 |
All outstanding liabilities before 2008, net of reinsurance |  | 3,875 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 880,954 |
Insurance Property and Other
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
34.4% | 40.6% | 12.2% | 5.4% | 3.6% | 0.8% | 0.9% | 0.1% | 0.2% | (0.2)%
Insurance Marine This reserve class includes the marine line of business which provides cover for traditional marine classes, including offshore energy, cargo, liability, recreational marine, fine art, specie as well as hull and war. Offshore energy includes physical damage, business interruption, operators extra expense and liability coverage for all aspects of offshore upstream energy, from exploration and construction through the operation and distribution phases. The complex nature of claims arising under marine policies tends to result in reporting and payment patterns that are longer than those of the property and other class. Exposure to natural perils such as windstorm and earthquake can result in volatility.
Insurance Marine
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 99,618 |  | $ | 106,731 |  | $ | 101,872 |  | $ | 100,793 |  | $ | 93,587 |  | $ | 87,201 |  | $ | 83,432 |  | $ | 83,051 |  | $ | 82,789 |  | $ | 82,848 |  | $ | 381 |  | 516
2009 |  | 80,665 |  | 74,298 |  | 69,932 |  | 64,601 |  | 57,213 |  | 55,027 |  | 53,622 |  | 52,523 |  | 52,428 |  | 528 |  | 477
2010 |  |  | 68,603 |  | 70,685 |  | 66,639 |  | 53,574 |  | 51,663 |  | 48,823 |  | 47,397 |  | 45,785 |  | 735 |  | 472
2011 |  |  |  | 90,659 |  | 78,611 |  | 72,463 |  | 65,697 |  | 65,707 |  | 65,919 |  | 68,008 |  | 1,549 |  | 603
2012 |  |  |  |  | 89,703 |  | 82,729 |  | 68,842 |  | 70,942 |  | 71,917 |  | 74,541 |  | 12,824 |  | 700
2013 |  |  |  |  |  | 80,034 |  | 101,276 |  | 96,722 |  | 97,777 |  | 83,064 |  | 4,121 |  | 733
2014 |  |  |  |  |  |  | 59,665 |  | 44,562 |  | 48,471 |  | 44,439 |  | 7,167 |  | 799
2015 |  |  |  |  |  |  |  | 158,697 |  | 139,931 |  | 136,608 |  | 16,023 |  | 915
2016 |  |  |  |  |  |  |  |  | 86,324 |  | 78,864 |  | 19,460 |  | 1,372
2017 |  |  |  |  |  |  |  |  |  | 74,639 |  | 48,739 |  | 1,772
|  |  |  |  |  |  |  |  | Total | $ | 741,224 |  |  |
Insurance Marine
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 14,357 |  | $ | 52,697 |  | $ | 69,114 |  | $ | 77,203 |  | $ | 78,313 |  | $ | 82,043 |  | $ | 82,128 |  | $ | 82,259 |  | $ | 82,339 |  | $ | 82,344 |
2009 |  | 17,431 |  | 30,364 |  | 39,699 |  | 43,243 |  | 45,286 |  | 45,896 |  | 48,430 |  | 48,712 |  | 49,060 |
2010 |  |  | 18,062 |  | 28,771 |  | 33,392 |  | 42,554 |  | 45,373 |  | 46,150 |  | 47,088 |  | 43,587 |
2011 |  |  |  | 26,417 |  | 44,168 |  | 54,874 |  | 57,972 |  | 59,816 |  | 60,523 |  | 64,750 |
2012 |  |  |  |  | 10,730 |  | 38,560 |  | 44,858 |  | 49,631 |  | 50,448 |  | 52,833 |
2013 |  |  |  |  |  | 19,313 |  | 44,437 |  | 55,414 |  | 63,637 |  | 66,326 |
2014 |  |  |  |  |  |  | 6,363 |  | 15,277 |  | 26,831 |  | 26,977 |
2015 |  |  |  |  |  |  |  | 21,467 |  | 54,845 |  | 108,071 |
2016 |  |  |  |  |  |  |  |  | 12,497 |  | 32,038 |
2017 |  |  |  |  |  |  |  |  |  | 10,061 |
Total |  | 536,047 |
All outstanding liabilities before 2008, net of reinsurance |  | 8,213 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 213,390 |
Insurance Marine
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
22.6% | 28.6% | 18.8% | 8.3% | 3.1% | 2.3% | 3.3% | (2.3)% | 0.4% | —%
Insurance Aviation This reserve class includes the aviation line of business which provides cover for hull and liability, and specific war covers primarily for passenger airlines but also for cargo operations, general aviation operations, airports, aviation authorities, security firms and product manufacturers. The claims reporting pattern varies by insurance coverage provided. Losses arising from war or terrorism and damage to hulls of aircraft are generally reported quickly compared with liability claims which involve passengers and third parties which generally exhibit longer reporting and payment patterns. To date, the claims reported to the Company have predominantly related to damage to hulls, therefore reporting and payment patterns have typically exhibited a relatively short tail.
Insurance Aviation
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 14,485 |  | $ | 12,021 |  | $ | 8,516 |  | $ | 8,354 |  | $ | 8,256 |  | $ | 7,108 |  | $ | 5,937 |  | $ | 5,851 |  | $ | 5,996 |  | $ | 5,905 |  | $ | 42 |  | 187
2009 |  | 17,505 |  | 14,608 |  | 18,800 |  | 18,146 |  | 16,974 |  | 16,674 |  | 15,494 |  | 14,661 |  | 14,388 |  | 68 |  | 317
2010 |  |  | 12,939 |  | 11,729 |  | 11,460 |  | 9,791 |  | 8,807 |  | 8,739 |  | 8,784 |  | 8,574 |  | 131 |  | 521
2011 |  |  |  | 17,725 |  | 15,400 |  | 12,791 |  | 9,568 |  | 8,437 |  | 7,290 |  | 7,257 |  | 218 |  | 734
2012 |  |  |  |  | 12,788 |  | 10,681 |  | 10,807 |  | 8,724 |  | 7,775 |  | 7,730 |  | 320 |  | 874
2013 |  |  |  |  |  | 15,656 |  | 16,344 |  | 15,221 |  | 15,264 |  | 15,579 |  | 542 |  | 1,027
2014 |  |  |  |  |  |  | 20,437 |  | 23,046 |  | 24,368 |  | 21,859 |  | 982 |  | 1,324
2015 |  |  |  |  |  |  |  | 29,772 |  | 28,512 |  | 29,965 |  | 2,646 |  | 1,917
2016 |  |  |  |  |  |  |  |  | 29,178 |  | 33,641 |  | 5,145 |  | 1,692
2017 |  |  |  |  |  |  |  |  |  | 24,752 |  | 12,737 |  | 1,177
|  |  |  |  |  |  |  |  | Total | $ | 169,650 |  |  |
Insurance Aviation
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 488 |  | $ | 2,063 |  | $ | 3,084 |  | $ | 3,666 |  | $ | 4,216 |  | $ | 4,487 |  | $ | 4,663 |  | $ | 5,269 |  | $ | 5,526 |  | $ | 5,519 |
2009 |  | 2,118 |  | 3,628 |  | 7,071 |  | 12,834 |  | 13,957 |  | 14,322 |  | 14,258 |  | 13,755 |  | 13,547 |
2010 |  |  | 1,053 |  | 4,156 |  | 6,341 |  | 6,920 |  | 7,586 |  | 7,708 |  | 8,152 |  | 8,247 |
2011 |  |  |  | 639 |  | 2,830 |  | 4,521 |  | 5,040 |  | 5,576 |  | 5,826 |  | 6,056 |
2012 |  |  |  |  | 957 |  | 2,868 |  | 4,159 |  | 5,958 |  | 6,836 |  | 7,070 |
2013 |  |  |  |  |  | 4,402 |  | 7,336 |  | 9,757 |  | 11,462 |  | 13,551 |
2014 |  |  |  |  |  |  | 3,989 |  | 8,033 |  | 11,706 |  | 13,914 |
2015 |  |  |  |  |  |  |  | 8,090 |  | 16,177 |  | 21,095 |
2016 |  |  |  |  |  |  |  |  | 10,421 |  | 19,403 |
2017 |  |  |  |  |  |  |  |  |  | 6,459 |
Total |  | 114,861 |
All outstanding liabilities before 2008, net of reinsurance |  | 1,611 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 56,400 |
Insurance Aviation
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
18.7% | 24.4% | 19.4% | 15.5% | 9.5% | 3.0% | 2.8% | 2.6% | 1.5% | (0.1)%
Insurance Credit and Political Risk This reserve class includes the credit and political risk line of business which provides credit and political risk insurance products for banks, commodity traders, corporations and multilateral and export credit agencies. Cover is provided for a range of risks including sovereign default, credit default, political violence, currency inconvertibility and non-transfer, expropriation, aircraft non-repossession and contract frustration due to political events. The credit insurance coverage is primarily for lenders seeking to mitigate the risk of non-payment from their borrowers. In order to claim compensation under a credit insurance contract, the insured (most often a bank) cannot assign, without the Company's prior agreement, the insured contract (most often a loan) to any third party and is normally obliged to hold a material portion of insured asset on their own books, unhedged and uninsured. Claims for this business tend to be characterized by their severity risk, as opposed to their frequency risk. Claim reporting and payment patterns are anticipated to be volatile. Under the notification provisions of credit insurance policies issued by the Company, it anticipates being advised of an insured event within a relatively short time period. As a result, the Company generally estimates ultimate losses based on a contract-by-contract analysis which considers the contracts’ terms, the facts and circumstances of underlying loss events and qualitative input from claims managers.
Insurance Credit and Political Risk
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 52,993 |  | $ | 63,552 |  | $ | 48,715 |  | $ | 45,554 |  | $ | 45,551 |  | $ | 45,551 |  | $ | 45,600 |  | $ | 45,200 |  | $ | 44,410 |  | $ | 44,408 |  | $ | — |  | 9
2009 |  | 248,084 |  | 305,292 |  | 326,037 |  | 335,558 |  | 335,435 |  | 335,295 |  | 335,315 |  | 339,595 |  | 339,558 |  | 2,040 |  | 24
2010 |  |  | 62,415 |  | 63,179 |  | 63,259 |  | 65,598 |  | 64,981 |  | 65,015 |  | 72,105 |  | 90,885 |  | 13,200 |  | 6
2011 |  |  |  | 58,154 |  | 48,665 |  | 47,706 |  | 48,361 |  | 48,333 |  | 45,036 |  | 33,604 |  | 5,973 |  | 4
2012 |  |  |  |  | 32,602 |  | 15,672 |  | 12,435 |  | 12,447 |  | 10,322 |  | 47 |  | 5 |  | 4
2013 |  |  |  |  |  | 26,439 |  | 25,684 |  | 9,759 |  | 9,880 |  | 14,941 |  | 6,662 |  | 1
2014 |  |  |  |  |  |  | 38,825 |  | 70,713 |  | 67,109 |  | 68,321 |  | 10,466 |  | 6
2015 |  |  |  |  |  |  |  | 30,329 |  | 30,368 |  | 27,513 |  | 4,215 |  | 2
2016 |  |  |  |  |  |  |  |  | 47,250 |  | 43,983 |  | 20,194 |  | 1
2017 |  |  |  |  |  |  |  |  |  | 21,237 |  | 17,958 |  | 2
|  |  |  |  |  |  |  |  | Total | $ | 684,497 |  |  |
Insurance Credit and Political Risk
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | — |  | $ | 69,217 |  | $ | 45,625 |  | $ | 45,638 |  | $ | 45,379 |  | $ | 45,379 |  | $ | 44,410 |  | $ | 44,410 |  | $ | 44,410 |  | $ | 44,161 |
2009 |  | 92,844 |  | 344,658 |  | 346,267 |  | 346,243 |  | 341,600 |  | 345,545 |  | 345,545 |  | 345,592 |  | 340,809 |
2010 |  |  | 50,000 |  | 85,418 |  | 90,729 |  | 106,769 |  | 101,790 |  | 101,952 |  | 102,158 |  | 102,200 |
2011 |  |  |  | 32,788 |  | 37,205 |  | 27,636 |  | 27,636 |  | 27,636 |  | 27,636 |  | 27,631 |
2012 |  |  |  |  | — |  | — |  | — |  | — |  | 40 |  | 42 |
2013 |  |  |  |  |  | 745 |  | 2,235 |  | 3,726 |  | 5,216 |  | 11,768 |
2014 |  |  |  |  |  |  | 1,924 |  | 39,952 |  | 61,108 |  | 57,855 |
2015 |  |  |  |  |  |  |  | — |  | 23,309 |  | 23,298 |
2016 |  |  |  |  |  |  |  |  | — |  | 23,789 |
2017 |  |  |  |  |  |  |  |  |  | — |
Total |  | 631,553 |
All outstanding liabilities before 2008, net of reinsurance |  | (1,475 | )
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 51,469 |
Insurance Credit and Political Risk
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
18.8% | 54.1% | (4.3)% | 3.3% | 20.3% | 1.1% | (0.5)% | —% | (0.7)% | (0.6)%
Insurance Professional Lines This reserve class includes the professional line of business which provides directors’ and officers’ liability, errors and omissions liability, employment practices liability, fiduciary liability, crime, professional indemnity, cyber and privacy insurance, medical malpractice and other financial insurance related covers for commercial enterprises, financial institutions and not-for-profit organizations. This business is predominantly written on a claims-made basis. Typically this reserve class is anticipated to exhibit medium to long tail claim reporting and payment patterns. With respect to key actuarial assumptions, the Company is progressively giving more weight to its own experience when establishing expected loss ratios and selected loss development patterns, though it continues to consider industry benchmarks. Loss reporting patterns for professional lines business tend to be volatile, causing instability in actuarial indications based on incurred loss data until an accident year matures for a number of years. Consequently, initial loss reserves for an accident year are generally based upon an ELR method and the consideration of relevant qualitative factors. As accident years mature, the Company increasingly gives more weight to methods that reflect its actual experience until its selections are based almost exclusively on experience-based methods. The Company evaluates the appropriateness of the transition to experience-based methods at the reserve class level, commencing this transition when it believes that its incurred loss development is sufficient to produce meaningful actuarial indications. The rate at which the Company transitions fully to sole reliance on experience-based methods can vary, depending on its assessment of the stability and relevance of such indications. For some professional lines in the insurance segment, the Company also relies upon the evaluation of the open claim inventory in addition to the commonly employed actuarial methods when establishing reserves.
Insurance Professional Lines
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 238,550 |  | $ | 278,691 |  | $ | 280,842 |  | $ | 298,905 |  | $ | 296,499 |  | $ | 309,642 |  | $ | 329,458 |  | $ | 327,240 |  | $ | 326,192 |  | $ | 325,573 |  | $ | 9,175 |  | 4,558
2009 |  | 240,818 |  | 244,150 |  | 244,751 |  | 245,319 |  | 256,295 |  | 238,902 |  | 239,428 |  | 215,732 |  | 223,737 |  | 13,584 |  | 5,882
2010 |  |  | 231,232 |  | 236,578 |  | 234,334 |  | 205,801 |  | 182,713 |  | 158,946 |  | 181,232 |  | 168,632 |  | 26,396 |  | 5,669
2011 |  |  |  | 313,858 |  | 315,654 |  | 333,321 |  | 326,255 |  | 330,562 |  | 343,782 |  | 352,406 |  | 50,239 |  | 7,211
2012 |  |  |  |  | 329,769 |  | 375,557 |  | 377,277 |  | 376,604 |  | 364,423 |  | 366,725 |  | 70,219 |  | 8,279
2013 |  |  |  |  |  | 384,755 |  | 397,852 |  | 398,578 |  | 365,818 |  | 355,777 |  | 95,220 |  | 9,371
2014 |  |  |  |  |  |  | 411,690 |  | 412,288 |  | 423,087 |  | 394,470 |  | 157,747 |  | 9,650
2015 |  |  |  |  |  |  |  | 377,652 |  | 377,725 |  | 383,959 |  | 186,383 |  | 9,862
2016 |  |  |  |  |  |  |  |  | 349,268 |  | 352,414 |  | 220,770 |  | 10,728
2017 |  |  |  |  |  |  |  |  |  | 346,582 |  | 302,135 |  | 9,984
|  |  |  |  |  |  |  |  | Total | $ | 3,270,275 |  |  |
Insurance Professional Lines
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 4,068 |  | $ | 22,325 |  | $ | 68,197 |  | $ | 124,681 |  | $ | 167,828 |  | $ | 189,339 |  | $ | 214,481 |  | $ | 249,321 |  | $ | 267,611 |  | $ | 268,487 |
2009 |  | 1,689 |  | 20,670 |  | 44,312 |  | 69,050 |  | 97,061 |  | 107,421 |  | 127,033 |  | 167,129 |  | 179,770 |
2010 |  |  | 7,857 |  | 27,880 |  | 53,738 |  | 72,840 |  | 89,051 |  | 99,554 |  | 110,156 |  | 115,204 |
2011 |  |  |  | 6,782 |  | 32,351 |  | 74,224 |  | 108,470 |  | 165,755 |  | 238,523 |  | 283,718 |
2012 |  |  |  |  | 7,824 |  | 41,545 |  | 100,526 |  | 185,059 |  | 231,963 |  | 255,140 |
2013 |  |  |  |  |  | 17,739 |  | 73,334 |  | 130,342 |  | 176,899 |  | 214,534 |
2014 |  |  |  |  |  |  | 23,665 |  | 71,510 |  | 131,610 |  | 194,294 |
2015 |  |  |  |  |  |  |  | 20,403 |  | 68,400 |  | 138,967 |
2016 |  |  |  |  |  |  |  |  | 16,010 |  | 71,619 |
2017 |  |  |  |  |  |  |  |  |  | 19,524 |
Total |  | 1,741,257 |
All outstanding liabilities before 2008, net of reinsurance |  | 30,546 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 1,559,564 |
Insurance Professional Lines
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
3.7% | 10.9% | 14.7% | 14.5% | 12.5% | 8.9% | 8.9% | 10.5% | 5.6% | 0.3%
Insurance Liability This reserve class includes the liability line of business which primarily targets primary and low/mid-level excess and umbrella commercial liability risks in the U.S. wholesale markets in addition to primary and excess of loss employers, public, and products liability predominately in the U.K. Target industry sectors include construction, manufacturing, transportation and trucking and other services. The delay between the writing of a contract, notification and subsequent settlement of a claim in respect of that contract results in claim reporting and payment patterns that are typically long tail in nature. A consequence of the claim development tail is that this line of business is particularly exposed, amongst a number of uncertainties, to the potential for unanticipated levels of claim inflation relative to that assumed when the contracts were written. Factors influencing claim inflation on this class can include, but are not limited to, underlying economic and medical inflation, judicial inflation, mass tort and changing social trends.
Insurance Liability
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 82,969 |  | $ | 79,836 |  | $ | 80,947 |  | $ | 81,785 |  | $ | 82,225 |  | $ | 81,949 |  | $ | 101,589 |  | $ | 102,444 |  | $ | 108,189 |  | $ | 94,165 |  | $ | 11,783 |  | 3,790
2009 |  | 61,469 |  | 64,017 |  | 67,410 |  | 67,869 |  | 76,431 |  | 83,282 |  | 101,180 |  | 98,384 |  | 98,999 |  | 10,895 |  | 2,777
2010 |  |  | 79,401 |  | 94,231 |  | 98,648 |  | 98,134 |  | 99,596 |  | 98,086 |  | 105,145 |  | 104,296 |  | 12,681 |  | 2,206
2011 |  |  |  | 72,584 |  | 75,329 |  | 83,118 |  | 87,060 |  | 85,243 |  | 83,731 |  | 82,128 |  | 19,227 |  | 1,788
2012 |  |  |  |  | 70,877 |  | 70,645 |  | 73,282 |  | 70,770 |  | 68,181 |  | 75,342 |  | 27,824 |  | 1,240
2013 |  |  |  |  |  | 92,153 |  | 94,182 |  | 94,258 |  | 87,502 |  | 93,221 |  | 24,296 |  | 1,562
2014 |  |  |  |  |  |  | 106,166 |  | 122,686 |  | 128,568 |  | 130,035 |  | 41,151 |  | 2,440
2015 |  |  |  |  |  |  |  | 127,321 |  | 126,047 |  | 136,615 |  | 61,944 |  | 3,317
2016 |  |  |  |  |  |  |  |  | 123,259 |  | 129,225 |  | 90,482 |  | 3,811
2017 |  |  |  |  |  |  |  |  |  | 141,644 |  | 129,373 |  | 2,519
|  |  |  |  |  |  |  |  | Total | $ | 1,085,670 |  |  |
Insurance Liability
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 1,906 |  | $ | 8,796 |  | $ | 18,507 |  | $ | 27,861 |  | $ | 37,408 |  | $ | 47,447 |  | $ | 51,776 |  | $ | 55,314 |  | $ | 61,618 |  | $ | 87,159 |
2009 |  | 726 |  | 4,646 |  | 13,305 |  | 26,754 |  | 31,865 |  | 41,323 |  | 44,105 |  | 83,991 |  | 84,427 |
2010 |  |  | 1,029 |  | 15,986 |  | 30,809 |  | 53,604 |  | 61,055 |  | 66,140 |  | 71,814 |  | 86,471 |
2011 |  |  |  | 2,761 |  | 10,540 |  | 20,190 |  | 38,377 |  | 46,074 |  | 54,996 |  | 60,263 |
2012 |  |  |  |  | 1,631 |  | 5,515 |  | 15,412 |  | 30,146 |  | 37,140 |  | 42,745 |
2013 |  |  |  |  |  | 2,363 |  | 23,285 |  | 33,324 |  | 42,055 |  | 60,021 |
2014 |  |  |  |  |  |  | 1,419 |  | 18,662 |  | 49,858 |  | 71,630 |
2015 |  |  |  |  |  |  |  | 5,439 |  | 22,474 |  | 39,767 |
2016 |  |  |  |  |  |  |  |  | 6,332 |  | 23,335 |
2017 |  |  |  |  |  |  |  |  |  | 4,243 |
Total |  | 560,061 |
All outstanding liabilities before 2008, net of reinsurance |  | 44,150 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 569,759 |
Insurance Liability
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
2.5% | 11.3% | 13.2% | 16.2% | 10.1% | 8.7% | 4.8% | 19.4% | 3.6% | 27.1%
Reinsurance Segment The presentation of net incurred and paid claims development tables by accident year for the reinsurance segment is challenging due to need to the allocate loss information related to proportional treaties to the appropriate accident years. Information related to proportional treaty reinsurance contracts are generally submitted to the Company using quarterly bordereau reporting by underwriting year, with a supplemental listing of large losses. The large losses can be allocated to the corresponding accident years accurately. However, the remaining losses can generally only be allocated to accident years based on estimated premiums earned and loss reporting patterns. To the extent management’s assumptions and allocation procedures differ from the actual loss development patterns, the actual loss development may differ materially from the net incurred and paid claims development presented in the tables below. The reporting of cumulative claims frequency for the reserve classes within the reinsurance segment is deemed to be impracticable. The information necessary to provide cumulative claims frequency for these reserve classes is not available to the Company. Reinsurance Property and Other This reserve class includes property, catastrophe, engineering, agriculture, as well as marine and other. The catastrophe line of business provides protection for most catastrophic losses that are covered in the underlying policies written by the Company's cedants. The exposure in the underlying policies is principally property exposure but also covers other exposures including workers compensation, personal accident and life. The principal perils in this portfolio are hurricane and windstorm, earthquake, flood, tornado, hail and fire. In some instances, terrorism may be a covered peril or the only peril. The Company underwrites catastrophe reinsurance business principally on an excess of loss basis. The property line of business provides protection for property damage and related losses resulting from natural and man-made perils contained in underlying personal and commercial policies. While the predominant exposure is to property damage, other risks, including business interruption and other non-property losses, may also be covered when arising from a covered peril. While the most significant exposures typically relate to losses from windstorms, tornadoes and earthquakes, the Company is also exposed to other perils such as freezes, riots, floods, industrial explosions, fires, hail and a number of other loss events. The Company underwrites property reinsurance business on both a proportional and excess of loss basis. The agriculture line of business provides protection for risks associated with the production of food and fiber on a global basis for primary insurance companies writing multi-peril crop insurance, crop hail, and named peril covers, as well as custom risk transfer mechanisms for agricultural dependent industries with exposures to crop yield and/or price deviations. The Company underwrites agriculture reinsurance business on both a proportional and aggregate stop loss basis. The engineering line of business provides protection for all types of construction risks and risks associated with erection, testing and commissioning of machinery and plants during the construction stage. This line of business also includes coverage for losses arising from operational failures of machinery, plant and equipment and electronic equipment as well as business interruption. The marine and other line of business includes marine, aviation and personal accident reinsurance. In general, reporting and payment patterns are relatively short-tailed and can be volatile due to the incidence of catastrophe events such as hurricanes and earthquakes.
Reinsurance Property and Other
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 677,556 |  | $ | 577,309 |  | $ | 593,015 |  | $ | 571,142 |  | $ | 557,060 |  | $ | 546,034 |  | $ | 529,918 |  | $ | 524,422 |  | $ | 523,154 |  | $ | 523,591 |  | $ | (224 | )
2009 |  | 344,543 |  | 288,510 |  | 250,630 |  | 237,339 |  | 230,351 |  | 209,335 |  | 203,261 |  | 205,145 |  | 202,300 |  | 1,018 |
2010 |  |  | 619,241 |  | 610,563 |  | 580,601 |  | 594,238 |  | 597,427 |  | 591,331 |  | 583,563 |  | 581,616 |  | 4,587 |
2011 |  |  |  | 1,092,977 |  | 1,105,962 |  | 1,105,415 |  | 1,064,864 |  | 1,047,944 |  | 1,022,452 |  | 1,020,771 |  | 8,207 |
2012 |  |  |  |  | 488,776 |  | 456,173 |  | 445,932 |  | 415,327 |  | 399,193 |  | 394,332 |  | 6,544 |
2013 |  |  |  |  |  | 475,162 |  | 452,433 |  | 422,160 |  | 403,217 |  | 397,673 |  | 4,083 |
2014 |  |  |  |  |  |  | 441,147 |  | 461,961 |  | 448,887 |  | 438,815 |  | 45,519 |
2015 |  |  |  |  |  |  |  | 386,614 |  | 368,320 |  | 369,734 |  | 27,033 |
2016 |  |  |  |  |  |  |  |  | 452,342 |  | 452,169 |  | 96,090 |
2017 |  |  |  |  |  |  |  |  |  | 870,456 |  | 488,104 |
|  |  |  |  |  |  |  |  | Total | $ | 5,251,457 |  |
Reinsurance Property and Other
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 158,206 |  | $ | 316,280 |  | $ | 444,047 |  | $ | 497,078 |  | $ | 510,305 |  | $ | 514,696 |  | $ | 514,765 |  | $ | 519,711 |  | $ | 519,391 |  | $ | 517,657 |
2009 |  | 57,796 |  | 132,309 |  | 164,047 |  | 182,556 |  | 193,309 |  | 192,746 |  | 195,614 |  | 197,310 |  | 193,973 |
2010 |  |  | 119,385 |  | 318,198 |  | 412,731 |  | 444,822 |  | 491,817 |  | 521,377 |  | 546,253 |  | 551,588 |
2011 |  |  |  | 242,494 |  | 561,377 |  | 769,142 |  | 872,086 |  | 902,188 |  | 976,120 |  | 991,307 |
2012 |  |  |  |  | 93,847 |  | 231,961 |  | 305,020 |  | 327,361 |  | 341,925 |  | 351,558 |
2013 |  |  |  |  |  | 55,047 |  | 223,666 |  | 336,940 |  | 365,089 |  | 374,944 |
2014 |  |  |  |  |  |  | 65,848 |  | 274,886 |  | 351,496 |  | 369,000 |
2015 |  |  |  |  |  |  |  | 48,116 |  | 190,057 |  | 282,967 |
2016 |  |  |  |  |  |  |  |  | 78,916 |  | 231,682 |
2017 |  |  |  |  |  |  |  |  |  | 172,937 |
Total |  | 4,037,613 |
All outstanding liabilities before 2008, net of reinsurance |  | 6,225 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 1,220,069 |
Reinsurance Property and Other
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
20.6% | 36.6% | 20.8% | 7.4% | 4.2% | 3.0% | 1.8% | 0.9% | (0.9)% | (0.3)%
Reinsurance Credit and Surety This reserve class includes the credit and surety line of business which provides reinsurance of trade credit insurance products and includes both proportional and excess of loss structures. The underlying insurance indemnifies sellers of goods and services in the event of a payment default by the buyer of those goods and services. The Company provides credit insurance cover to mortgage guaranty insurers and government sponsored entities. Coverages for losses arising from a broad array of surety bonds issued by insurers to satisfy regulatory demands or contract obligations in a variety of jurisdictions around the world are also offered. Initial and most recent underwriting year loss projections are generally based on the ELR method, with consideration given to qualitative factors. Given that there is a quicker and more stable reporting pattern for trade credit business, the Company generally commences the transition to experience-based methods sooner for trade credit business than for the surety business.
Reinsurance Credit and Surety
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 87,400 |  | $ | 116,362 |  | $ | 107,787 |  | $ | 105,765 |  | $ | 106,950 |  | $ | 105,698 |  | $ | 101,903 |  | $ | 100,674 |  | $ | 100,277 |  | $ | 98,714 |  | $ | 1,231 |
2009 |  | 147,192 |  | 125,656 |  | 109,211 |  | 108,442 |  | 108,149 |  | 102,079 |  | 98,845 |  | 98,469 |  | 96,783 |  | 1,874 |
2010 |  |  | 121,893 |  | 103,332 |  | 96,821 |  | 93,648 |  | 89,657 |  | 82,003 |  | 80,680 |  | 78,645 |  | 5,222 |
2011 |  |  |  | 124,030 |  | 112,031 |  | 110,294 |  | 117,586 |  | 115,523 |  | 106,804 |  | 104,997 |  | 7,464 |
2012 |  |  |  |  | 163,535 |  | 152,873 |  | 155,634 |  | 152,678 |  | 144,084 |  | 135,845 |  | 11,848 |
2013 |  |  |  |  |  | 168,361 |  | 157,311 |  | 148,080 |  | 144,095 |  | 139,679 |  | 17,857 |
2014 |  |  |  |  |  |  | 138,056 |  | 139,449 |  | 146,647 |  | 142,909 |  | 27,627 |
2015 |  |  |  |  |  |  |  | 163,467 |  | 170,980 |  | 165,822 |  | 36,473 |
2016 |  |  |  |  |  |  |  |  | 144,583 |  | 144,741 |  | 50,815 |
2017 |  |  |  |  |  |  |  |  |  | 135,562 |  | 74,667 |
|  |  |  |  |  |  |  |  | Total | $ | 1,243,697 |  |
Reinsurance Credit and Surety
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 20,891 |  | $ | 70,349 |  | $ | 71,501 |  | $ | 86,796 |  | $ | 88,604 |  | $ | 91,014 |  | $ | 93,282 |  | $ | 94,040 |  | $ | 94,446 |  | $ | 94,601 |
2009 |  | 32,888 |  | 78,254 |  | 80,744 |  | 83,138 |  | 87,079 |  | 89,736 |  | 89,921 |  | 89,894 |  | 89,986 |
2010 |  |  | 28,387 |  | 50,148 |  | 61,983 |  | 62,586 |  | 64,455 |  | 65,722 |  | 67,252 |  | 68,294 |
2011 |  |  |  | 22,640 |  | 56,106 |  | 74,037 |  | 82,015 |  | 86,653 |  | 88,944 |  | 91,307 |
2012 |  |  |  |  | 50,516 |  | 88,092 |  | 102,976 |  | 108,858 |  | 112,423 |  | 114,251 |
2013 |  |  |  |  |  | 32,708 |  | 78,976 |  | 94,347 |  | 101,104 |  | 108,839 |
2014 |  |  |  |  |  |  | 35,839 |  | 62,900 |  | 88,668 |  | 97,957 |
2015 |  |  |  |  |  |  |  | 33,064 |  | 84,077 |  | 103,123 |
2016 |  |  |  |  |  |  |  |  | 42,348 |  | 75,170 |
2017 |  |  |  |  |  |  |  |  |  | 34,758 |
Total |  | 878,286 |
All outstanding liabilities before 2008, net of reinsurance |  | 10,351 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 375,762 |
Reinsurance Credit and Surety
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
27.3% | 32.2% | 10.9% | 6.0% | 3.5% | 2.0% | 1.7% | 0.7% | 0.3% | 0.2%
Reinsurance Professional Lines This reserve class includes the professional line of business which provides cover for directors' and officers' liability, employment practices liability, medical malpractice, professional indemnity, environmental liability and miscellaneous errors and omissions insurance risks. The underlying business is predominantly written on a claims-made basis. Business is written on both a proportional and excess of loss basis. Typically, this reserve class is anticipated to exhibit medium to long-tail claim reporting and payment patterns. With respect to key actuarial assumptions, the Company is progressively giving more weight to its own experience when establishing expected loss ratios and selected loss development patterns, though it continues to consider industry benchmarks. Loss reporting patterns for professional lines business tend to be volatile, causing instability in actuarial indications based on incurred loss data until an accident year matures for a number of years. Consequently, initial loss reserves for an accident year or underwriting year are generally based upon an ELR method and the consideration of relevant qualitative factors. As accident and underwriting years mature, the Company increasingly gives more weight to methods that reflect its actual experience until its selections are based almost exclusively on experience-based methods. The Company evaluates the appropriateness of the transition to experience-based methods at the reserve class level, commencing this transition when it believes that its incurred loss development is sufficient to produce meaningful actuarial indications. The rate at which the Company transitions fully to sole reliance on experience-based methods can vary, depending on its assessment of the stability and relevance of such indications.
Reinsurance Professional Lines
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 176,166 |  | $ | 183,064 |  | $ | 182,587 |  | $ | 178,530 |  | $ | 176,767 |  | $ | 173,316 |  | $ | 174,286 |  | $ | 173,217 |  | $ | 172,937 |  | $ | 169,515 |  | $ | 6,938 |
2009 |  | 212,285 |  | 212,046 |  | 216,737 |  | 219,447 |  | 210,084 |  | 209,625 |  | 194,753 |  | 190,811 |  | 181,665 |  | 11,657 |
2010 |  |  | 211,273 |  | 211,397 |  | 212,359 |  | 215,298 |  | 215,043 |  | 197,548 |  | 189,880 |  | 180,219 |  | 24,929 |
2011 |  |  |  | 202,504 |  | 202,676 |  | 203,706 |  | 212,439 |  | 209,837 |  | 208,973 |  | 201,077 |  | 51,009 |
2012 |  |  |  |  | 210,612 |  | 217,184 |  | 222,600 |  | 224,737 |  | 223,492 |  | 213,601 |  | 75,647 |
2013 |  |  |  |  |  | 210,196 |  | 215,425 |  | 216,528 |  | 214,855 |  | 214,477 |  | 101,607 |
2014 |  |  |  |  |  |  | 219,927 |  | 219,966 |  | 219,960 |  | 219,968 |  | 85,643 |
2015 |  |  |  |  |  |  |  | 212,536 |  | 212,852 |  | 215,178 |  | 124,029 |
2016 |  |  |  |  |  |  |  |  | 195,527 |  | 196,852 |  | 140,194 |
2017 |  |  |  |  |  |  |  |  |  | 155,882 |  | 144,098 |
|  |  |  |  |  |  |  |  | Total | $ | 1,948,434 |  |
Reinsurance Professional Lines
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 373 |  | $ | 6,465 |  | $ | 21,736 |  | $ | 49,393 |  | $ | 70,815 |  | $ | 92,320 |  | $ | 109,093 |  | $ | 124,658 |  | $ | 133,596 |  | $ | 139,917 |
2009 |  | 914 |  | 8,589 |  | 32,327 |  | 63,180 |  | 83,946 |  | 108,787 |  | 128,608 |  | 138,823 |  | 143,634 |
2010 |  |  | 1,759 |  | 12,037 |  | 31,269 |  | 52,187 |  | 76,931 |  | 107,534 |  | 124,158 |  | 130,837 |
2011 |  |  |  | 1,506 |  | 11,829 |  | 30,326 |  | 57,402 |  | 85,052 |  | 103,309 |  | 120,076 |
2012 |  |  |  |  | 780 |  | 10,441 |  | 29,730 |  | 53,801 |  | 86,211 |  | 107,581 |
2013 |  |  |  |  |  | 1,068 |  | 12,121 |  | 30,666 |  | 65,195 |  | 81,940 |
2014 |  |  |  |  |  |  | 2,020 |  | 13,085 |  | 48,930 |  | 74,748 |
2015 |  |  |  |  |  |  |  | 3,134 |  | 13,507 |  | 41,610 |
2016 |  |  |  |  |  |  |  |  | 1,782 |  | 20,624 |
2017 |  |  |  |  |  |  |  |  |  | 2,815 |
Total |  | 863,782 |
All outstanding liabilities before 2008, net of reinsurance |  | 34,882 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 1,119,534 |
Reinsurance Professional Lines
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
0.8% | 5.3% | 11.1% | 13.9% | 12.4% | 12.5% | 9.6% | 6.2% | 4.0% | 3.7%
Reinsurance Motor This reserve class includes the motor line of business which provides cover to insurers for motor liability and motor property damage losses arising from any one occurrence. A loss occurrence can involve one or many claimants where the ceding insurer aggregates the claims from the occurrence. The Company offers traditional proportional and non-proportional reinsurance as well as structured solutions predominantly relating to European exposures. The business written on a proportional basis has expanded significantly since 2010 and now represents the majority of the premium written within this line of business. Most of the premium relates to a relatively small number of large United Kingdom ("U.K.") and, to a lesser extent, Greek quota share treaties. The motor proportional class generally has a significantly shorter reported and payment pattern relative to the motor non-proportional class. The motor non-proportional business consists of standard excess of loss contracts written for cedants in several European countries with most of the premium related to two major markets, U.K. and France. Since 2009/2010, an increasing number of large bodily injury settlements in the U.K. market were settled using indexed annuities (Periodical Payment Orders "PPOs"). This led to a materially longer development tail on the older accident years for the U.K. non-proportional motor book. This also resulted in a move towards generally lower treaty attachment points and the inclusion of capitalization clauses on a number of U.K. motor treaties to help mitigate the lengthening of the development tail on more recent accident years. Despite the trend toward a greater number of claims settlements using PPOs, there has been a trend towards generally quicker and more adequate reporting of losses in recent years.
Reinsurance Motor
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 74,058 |  | $ | 78,924 |  | $ | 78,193 |  | $ | 80,897 |  | $ | 77,937 |  | $ | 77,027 |  | $ | 72,330 |  | $ | 65,983 |  | $ | 61,702 |  | $ | 62,557 |  | $ | 20,916 |
2009 |  | 85,779 |  | 83,784 |  | 91,915 |  | 93,917 |  | 96,069 |  | 97,089 |  | 87,995 |  | 82,093 |  | 84,458 |  | 21,053 |
2010 |  |  | 103,990 |  | 112,528 |  | 113,304 |  | 112,285 |  | 106,058 |  | 100,707 |  | 90,839 |  | 87,253 |  | 24,419 |
2011 |  |  |  | 160,444 |  | 164,579 |  | 168,734 |  | 175,021 |  | 171,007 |  | 161,958 |  | 150,818 |  | 33,732 |
2012 |  |  |  |  | 186,033 |  | 176,870 |  | 164,734 |  | 156,957 |  | 151,820 |  | 141,923 |  | 25,982 |
2013 |  |  |  |  |  | 169,876 |  | 168,554 |  | 156,692 |  | 146,799 |  | 143,186 |  | 26,041 |
2014 |  |  |  |  |  |  | 190,363 |  | 193,691 |  | 188,725 |  | 185,570 |  | 24,003 |
2015 |  |  |  |  |  |  |  | 231,614 |  | 229,110 |  | 233,172 |  | 37,198 |
2016 |  |  |  |  |  |  |  |  | 255,354 |  | 276,126 |  | 55,173 |
2017 |  |  |  |  |  |  |  |  |  | 348,068 |  | 170,065 |
|  |  |  |  |  |  |  |  | Total | $ | 1,713,131 |  |
Reinsurance Motor
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 3,093 |  | $ | 6,371 |  | $ | 6,625 |  | $ | 7,910 |  | $ | 9,491 |  | $ | 12,088 |  | $ | 14,897 |  | $ | 15,570 |  | $ | 17,231 |  | $ | 17,657 |
2009 |  | 2,819 |  | 7,134 |  | 8,428 |  | 10,020 |  | 13,627 |  | 20,029 |  | 22,446 |  | 27,248 |  | 30,378 |
2010 |  |  | 7,406 |  | 13,316 |  | 19,189 |  | 22,873 |  | 26,489 |  | 30,942 |  | 34,342 |  | 35,444 |
2011 |  |  |  | 21,274 |  | 46,277 |  | 61,691 |  | 72,663 |  | 79,729 |  | 85,995 |  | 90,871 |
2012 |  |  |  |  | 29,727 |  | 55,282 |  | 70,634 |  | 80,891 |  | 87,658 |  | 91,896 |
2013 |  |  |  |  |  | 34,607 |  | 56,009 |  | 70,849 |  | 81,419 |  | 87,407 |
2014 |  |  |  |  |  |  | 44,225 |  | 77,736 |  | 98,483 |  | 107,090 |
2015 |  |  |  |  |  |  |  | 58,884 |  | 97,495 |  | 118,902 |
2016 |  |  |  |  |  |  |  |  | 61,938 |  | 109,559 |
2017 |  |  |  |  |  |  |  |  |  | 71,052 |
Total |  | 760,256 |
All outstanding liabilities before 2008, net of reinsurance |  | 129,548 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 1,082,423 |
Reinsurance Motor
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
16.8% | 13.2% | 7.6% | 5.0% | 4.1% | 4.8% | 3.6% | 2.7% | 3.2% | 0.7%
Reinsurance Liability This reserve class includes the liability line of business which provides cover to insurers of standard casualty business, excess and surplus casualty business and specialty casualty programs. The primary focus of the underlying business is general liability, although workers' compensation and auto liability are also covered. Claim reporting and payment patterns are typically long-tail in nature and, therefore, subject to increased uncertainty surrounding future loss development. In particular, claims can be subject to inflation from a number of sources including, but not limited to, economic and medical inflation, judicial inflation and changing social trends.
Reinsurance Liability
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
| For the Years Ended December 31, | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 140,069 |  | $ | 140,460 |  | $ | 141,152 |  | $ | 141,553 |  | $ | 139,564 |  | $ | 133,917 |  | $ | 111,873 |  | $ | 106,942 |  | $ | 95,649 |  | $ | 86,008 |  | $ | 10,016 |
2009 |  | 175,100 |  | 176,187 |  | 182,970 |  | 180,596 |  | 188,090 |  | 208,301 |  | 195,679 |  | 181,488 |  | 171,979 |  | 23,215 |
2010 |  |  | 173,358 |  | 172,261 |  | 183,773 |  | 184,180 |  | 202,649 |  | 192,051 |  | 182,794 |  | 166,533 |  | 29,101 |
2011 |  |  |  | 174,125 |  | 173,815 |  | 175,279 |  | 193,228 |  | 200,190 |  | 196,948 |  | 196,277 |  | 34,097 |
2012 |  |  |  |  | 168,641 |  | 164,742 |  | 168,956 |  | 173,596 |  | 174,765 |  | 172,124 |  | 43,129 |
2013 |  |  |  |  |  | 173,966 |  | 177,606 |  | 183,683 |  | 185,689 |  | 185,321 |  | 71,652 |
2014 |  |  |  |  |  |  | 201,355 |  | 204,323 |  | 206,100 |  | 202,130 |  | 91,483 |
2015 |  |  |  |  |  |  |  | 216,076 |  | 216,518 |  | 217,480 |  | 125,377 |
2016 |  |  |  |  |  |  |  |  | 241,952 |  | 247,768 |  | 171,869 |
2017 |  |  |  |  |  |  |  |  |  | 266,945 |  | 226,036 |
|  |  |  |  |  |  |  |  | Total | $ | 1,912,565 |  |
Reinsurance Liability
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| For the Years Ended December 31,
Accident Year | 2008 Unaudited | 2009 Unaudited | 2010 Unaudited | 2011 Unaudited | 2012 Unaudited | 2013 Unaudited | 2014 Unaudited | 2015 Unaudited | 2016 | 2017
2008 | $ | 2,160 |  | $ | 9,952 |  | $ | 21,953 |  | $ | 30,028 |  | $ | 36,567 |  | $ | 43,509 |  | $ | 51,922 |  | $ | 53,882 |  | $ | 58,022 |  | $ | 63,903 |
2009 |  | 1,705 |  | 17,104 |  | 44,552 |  | 56,730 |  | 73,521 |  | 105,410 |  | 125,329 |  | 129,644 |  | 135,031 |
2010 |  |  | 2,484 |  | 17,659 |  | 46,207 |  | 62,300 |  | 83,976 |  | 97,617 |  | 108,938 |  | 119,872 |
2011 |  |  |  | 5,191 |  | 21,297 |  | 40,021 |  | 70,283 |  | 92,696 |  | 112,581 |  | 123,719 |
2012 |  |  |  |  | 3,542 |  | 12,809 |  | 28,418 |  | 58,855 |  | 78,368 |  | 101,343 |
2013 |  |  |  |  |  | 5,978 |  | 22,259 |  | 52,360 |  | 69,098 |  | 88,327 |
2014 |  |  |  |  |  |  | 7,117 |  | 28,699 |  | 48,498 |  | 70,389 |
2015 |  |  |  |  |  |  |  | 7,273 |  | 27,473 |  | 54,646 |
2016 |  |  |  |  |  |  |  |  | 11,891 |  | 37,819 |
2017 |  |  |  |  |  |  |  |  |  | 12,073 |
Total |  | 807,122 |
All outstanding liabilities before 2008, net of reinsurance |  | 42,182 |
Liabilities for claims and claim adjustment expenses, net of reinsurance |  | $ | 1,147,625 |
Reinsurance Liability
Average annual percentage payout of incurred claims by age, net of reinsurance
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10
2.9% | 8.9% | 13.0% | 11.3% | 10.6% | 11.6% | 8.5% | 3.8% | 4.0% | 6.8%
Aviabel Aviation In April 2017, the Company acquired Aviabel, an insurance and reinsurance operation founded in 1935 with headquarters in Europe. Aviabel’s main lines of business consist of general aviation, airlines, products and manufacturers, airports and treaty reinsurance. With regards to airlines, manufactures and airports, Aviabel focuses on smaller operators rather than the large players. The claims reporting pattern varies by coverage provided but are typically short tailed in nature.
Aviabel
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
Accident Year | Net claim and allocated claim adjustment expense reserves at the Acquisition Date | Net incurred claims and allocated claim adjustment expenses from the Acquisition Date to December 31, 2017 | Total acquired net claim and allocated claim adjustment expense reserves and net incurred claims and allocated claim adjustment expenses from the Acquisition Date to December 31, 2017 | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims
2008 | $ | 998 |  | $ | (293 | ) | $ | 705 |  | $ | 30 |  | 1,066
2009 | 842 |  | 82 |  | 924 |  | 25 |  | 1,347
2010 | 1,516 |  | (39 | ) | 1,477 |  | 46 |  | 1,452
2011 | 1,418 |  | (423 | ) | 995 |  | 43 |  | 1,420
2012 | 5,248 |  | (1,066 | ) | 4,183 |  | 177 |  | 1,380
2013 | 5,702 |  | 956 |  | 6,658 |  | 200 |  | 1,286
2014 | 10,589 |  | (1,636 | ) | 8,953 |  | 804 |  | 1,373
2015 | 15,004 |  | (1,575 | ) | 13,429 |  | 1,650 |  | 1,475
2016 | 19,388 |  | 2,134 |  | 21,522 |  | 4,278 |  | 1,535
2017 | 7,666 |  | 27,096 |  | 34,762 |  | 7,180 |  | 1,114
| $ | 68,371 |  | $ | 25,237 |  | $ | 93,608 |  |  |
Aviabel
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
| From the Acquisition Date to December 31, 2017
Accident Year |  |
2008 |  | $ | (33 | )
2009 |  | 1 |
2010 |  | 97 |
2011 |  | 20 |
2012 |  | 661 |
2013 |  | 425 |
2014 |  | 1,944 |
2015 |  | 3,291 |
2016 |  | 5,453 |
2017 |  | 14,970 |
Total |  | 26,830 |
| All outstanding liabilities before 2008, net of reinsurance | 10,626 |
| Liabilities for claims and claim adjustment expenses, net of reinsurance | $ | 77,405 |
Novae In October 2017, the Company acquired Novae, a diversified property and casualty (re)insurance business operating through Syndicate 2007 at Lloyd’s. Novae writes a wide range of property, marine, aviation, credit and political risk, professional lines, motor and liability business on a worldwide basis. In addition, cover is also offered for various other lines of business, including agriculture reinsurance, bloodstock, construction, accident and health, political violence and engineering reinsurance. The Company has determined that reporting of cumulative claims frequency for direct insurance lines of business is impracticable as data by accident year is not available. Further for certain insurance facilities and business produced by managing general agents where underlying data is reported to the Company in an aggregated format, the information necessary to provide cumulative claims frequency is not available therefore reporting of claims frequency is deemed to be impracticable. In addition, the information necessary to provide cumulative claims frequency for reinsurance lines of business is not available to the Company, therefore reporting of claims frequency is deemed to be impracticable. Property: The property line of business includes exposures related to worldwide direct property facilities for retail and small commercial risks, worldwide catastrophe reinsurance written on a proportional and excess of loss basis, and worldwide direct and facultative cover of larger commercial risks. In general, reporting and payment patterns are relatively short-tailed although they can be volatile due to the incidence of catastrophe events. Marine: The marine line of business covers marine liability, energy, hull, cargo, specie and war exposures and includes risks which are mostly written on a direct basis. In addition, a relatively small amount of marine business is written on an excess of loss basis. The complex nature of claims arising under marine policies tends to result in reporting and payment patterns that are longer than those of the property lines of business. Aviation: The aviation line of business provides hull, liability, and war cover and predominantly relates to an excess of loss reinsurance account, with a smaller amount of satellite and general aviation business written on a proportional basis. Payments relating to hull damage can settle relatively quickly but an element of the claims profile will often be longer tail due to liability exposures. Credit & political risk: International trade credit and political risks business was written from 2000 onwards. Typically this business is anticipated to exhibit medium to long tail claim reporting and payment patterns. Professional Lines: Professional lines business provides cover for directors’ and officers’ liability, errors and omissions liability, crime, professional indemnity, cyber and medical malpractice and includes risks which are mainly written on a direct basis. Most professional lines business written from 2002 onwards relates to non-U.S. exposures. Typically, this business is anticipated to exhibit medium to long tail claim reporting and payment patterns. Motor: Motor line of business was written on a direct basis until this business was discontinued in 2015. Motor business has been written on an excess of loss basis since 2010. The business predominantly covers U.K. based risks. Typically, this business is anticipated to exhibit long-tail claim reporting and payment patterns. Liability: The general liability reinsurance line of business provides cover for directors’ and officers’ liability, errors and omissions liability, crime, professional indemnity, cyber and medical malpractice written on an excess of loss basis from 2010 onwards. Most general liability reinsurance business written relates to non-U.S. commercial liability insurance but also includes U.S. casualty excess of loss reinsurance from 2015. Claim reporting and payment patterns are typically long-tail in nature and, therefore, subject to increased uncertainty surrounding future loss development. In particular, claims can be subject to inflation from a number of sources including, but not limited to, economic and medical inflation, judicial inflation and changing social trends.
Novae
| Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance | At December 31, 2017
Accident Year | Net claim and allocated claim adjustment expense reserves at the Acquisition Date | Net incurred claims and allocated claim adjustment expenses from the Acquisition Date to December 31, 2017 | Total acquired net claim and allocated claim adjustment expense reserves and net incurred claims and allocated claim adjustment expenses from the Acquisition Date to December 31, 2017 | Total of Incurred-But-Not-Reported Liabilities Plus Expected Development on Reported Claims
2008 | $ | 20,515 |  | $ | — |  | $ | 20,515 |  | $ | 3,552 |
2009 | 25,486 |  | — |  | 25,486 |  | 714 |
2010 | 23,308 |  | — |  | 23,308 |  | 2,781 |
2011 | 59,648 |  | — |  | 59,648 |  | 11,204 |
2012 | 87,292 |  | — |  | 87,292 |  | 8,695 |
2013 | 76,786 |  | — |  | 76,786 |  | 12,504 |
2014 | 123,955 |  | — |  | 123,955 |  | 17,024 |
2015 | 184,606 |  | — |  | 184,606 |  | 36,619 |
2016 | 307,014 |  | — |  | 307,014 |  | 54,356 |
2017 | 293,520 |  | 135,493 |  | 429,013 |  | 222,330 |
| $ | 1,202,130 |  | $ | 135,493 |  | $ | 1,337,624 |  |
Novae
| Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance |
| From the Acquisition Date to December 31, 2017 |
Accident Year |  |
2008 |  | $ | 1,458 |
2009 |  | 1,147 |
2010 |  | 3,197 |
2011 |  | 4,332 |
2012 |  | 7,352 |
2013 |  | 5,878 |
2014 |  | 12,370 |
2015 |  | 19,349 |
2016 |  | 51,065 |
2017 |  | 33,278 |
Total | 139,427 |
| All outstanding liabilities before 2008, net of reinsurance | 102,164 |
| Liabilities for claims and claim adjustment expenses, net of reinsurance | $ | 1,300,361 |
Reconciliation of Development Tables to Consolidated Balance Sheet The following table reconciles the reserves for loss and loss expenses as of December 31, 2017 as reported in the Consolidated Balance Sheet to the reserves for loss and loss expenses included in the development tables:
Reconciliation of the Disclosure of Incurred and Paid Claims Development to the Liability for Unpaid Claims and Claim Adjustment Expenses
|  | At December 31, 2017
|  | Net outstanding liabilities |  | Reinsurance recoverable on unpaid claims |  | Gross outstanding liabilities
Insurance Segment |  |  |  |  |  |
Property and Other |  | $ | 880,954 |  |  | $ | 181,101 |  |  | $ | 1,062,055 |
Marine |  | 213,390 |  |  | 106,466 |  |  | 319,856 |
Aviation |  | 56,400 |  |  | 8,945 |  |  | 65,345 |
Credit and Political Risk |  | 51,469 |  |  | 1,384 |  |  | 52,853 |
Professional Lines |  | 1,559,564 |  |  | 853,130 |  |  | 2,412,694 |
Liability |  | 569,759 |  |  | 896,266 |  |  | 1,466,025 |
Total Insurance Segment |  | 3,331,536 |  |  | 2,047,292 |  |  | 5,378,828 |
Reinsurance Segment |  |  |  |  |  |
Property and Other |  | 1,220,069 |  |  | 214,394 |  |  | 1,434,463 |
Credit and Surety |  | 375,762 |  |  | 13,061 |  |  | 388,823 |
Professional Lines |  | 1,119,534 |  |  | 37,822 |  |  | 1,157,356 |
Motor |  | 1,082,423 |  |  | 3,666 |  |  | 1,086,089 |
Liability |  | 1,147,625 |  |  | 66,692 |  |  | 1,214,317 |
Total Reinsurance Segment |  | 4,945,413 |  |  | 335,635 |  |  | 5,281,048 |
Aviabel |  | 77,405 |  |  | 5,329 |  |  | 82,734 |
Novae |  | 1,300,361 |  |  | 771,258 |  |  | 2,071,619 |
Total |  | $ | 9,654,715 |  |  | $ | 3,159,514 |  |  | 12,814,229 |
Unallocated claims adjustment expenses |  |  |  |  |  | 170,168 |
Foreign exchange and other(1) |  |  |  |  |  | (45,262 | )
Assumed reserves related to retroactive transactions |  |  |  |  |  | 58,418 |
Total liability for unpaid claims and claims adjustment expense |  |  |  |  |  | $ | 12,997,553 |
(1) | Non-U.S. dollar denominated loss data is converted to U.S dollar at the rates of exchange in effect at the balance sheet date for material underlying currencies. Fluctuations in currency exchange rates cause material shifts in loss development. Reserves for losses and loss expenses, disclosed in the Consolidated Balance Sheets, are also revalued using the exchange rate at the balance sheet date.

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- Definition The entire disclosure for liabilities related to future policy benefits and unpaid claims and claim adjustments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -URI http://asc.fasb.org/subtopic&trid=2560295 + Details
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