ACCRUED WORKERS' COMPENSATION COSTS

The following table summarizes the accrued workers’ compensation cost activity for the years ended December 31, 2018, 2017 and 2016:



	Year Ended December 31,
(in millions)	2018			2017			2016
Total accrued costs, beginning of year	$	255		$	255		$	190
Incurred
Current year	80			98			113
Prior years	(28		)	(6		)	28
Total incurred	52			92			141
Paid
Current year	(12		)	(14		)	(14		)
Prior years	(57		)	(78		)	(62		)
Total paid	(69		)	(92		)	(76		)
Total accrued costs, end of year	$	238		$	255		$	255

The following table summarizes workers' compensation liabilities on the consolidated balance sheets:



(in millions)	December 31, 2018			December 31, 2017
Total accrued costs, end of year	$	238		$	255
Collateral paid to carriers and offset against accrued costs	(13		)	(23		)
Total accrued costs, net of carrier collateral offset	$	225		$	232

Payable in less than 1 year (net of collateral paid to carriers of $3 and $6 as of December 31, 2018 and 2017, respectively)	67			67
Payable in more than 1 year (net of collateral paid to carriers of $10 and $17 as of December 31, 2018 and 2017, respectively)	158			165
Total accrued costs, net of carrier collateral offset	$	225		$	232

Incurred claims related to prior years represent changes in estimates for ultimate losses on workers' compensation claims. For the year ended December 31, 2018, the favorable development was primarily due to lower than expected severity development on claims that had previously been reported, as well as a lower than expected reported claim frequency during 2018. For the year ended December 31, 2017, the favorable development was primarily due to lower than expected severity of reported claims associated with office worker WSEs in recent accident years. For the year ended December 31, 2016, the adverse development was primarily due to higher than expected severity of reported claims associated with non-office WSEs in recent accident years.

As of December 31, 2018 and 2017, we had $57 million and $63 million, respectively, of collateral held by insurance carriers of which $13 million and $23 million was offset against accrued workers' compensation costs as the agreements permit and are net settled of insurance obligations against collateral held.