Accrued Workers' Compensation Cost

9 Months Ended

Sep. 30, 2020

The following table summarizes the accrued workers’ compensation cost activity for the three and nine months ended September 30, 2020 and 2019:


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2020		2019		2020		2019
Total accrued costs, beginning of period	$	211	$	224	$	214	$	238
Incurred
Current year	15		19		48		54
Prior years	(3)		(6)		(12)		(22)
Total incurred	12		13		36		32
Paid
Current year	(2)		(5)		(5)		(8)
Prior years	(11)		(11)		(35)		(41)
Total paid	(13)		(16)		(40)		(49)
Total accrued costs, end of period	$	210	$	221	$	210	$	221

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


(in millions)	September 30, 2020		December 31, 2019
Total accrued costs, end of period	$	210	$	214
Collateral paid to carriers and offset against accrued costs	(8)		(9)
Total accrued costs, net of carrier collateral offset	$	202	$	205

Payable in less than 1 year (net of collateral paid to carriers of $3 at September 30, 2020 and December 31, 2019)	$	60	$	61
Payable in more than 1 year (net of collateral paid to carriers of $5 and $6 at September 30, 2020 and December 31, 2019, respectively)	142		144
Total accrued costs, net of carrier collateral offset	$	202	$	205

Incurred claims related to prior years represent changes in estimates for ultimate losses on workers' compensation claims. For the three and nine months ended September 30, 2020, the change was primarily due to a decrease in estimate of ultimate losses related to older plan years and recognition of current year development of ultimate loss.

As of September 30, 2020 and December 31, 2019, we had $46 million and $46 million, respectively, of collateral held by insurance carriers of which $8 million and $9 million, respectively, was offset against accrued workers' compensation costs as the agreements permit and are net settled against collateral held.