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Insurance | 6 Months Ended
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Apr. 30, 2018
Insurance [Abstract] |
Insurance | 8. INSURANCE
We use a combination of insured and self-insurance programs to cover workers’ compensation, general liability, automobile liability, property damage, and other insurable risks. For the majority of these insurance programs, we retain the initial $1.0 million of exposure on a per-occurrence basis, either through deductibles or self-insured retentions. Beyond the retained exposures, we have varying primary policy limits ranging between $1.0 million and $5.0 million per occurrence. To cover general liability and automobile liability losses above these primary limits, we maintain commercial umbrella insurance policies that provide aggregate limits of $200.0 million. Our insurance policies generally cover workers’ compensation losses to the full extent of statutory requirements. Additionally, to cover property damage risks above our retained limits, we maintain policies that provide per occurrence limits of $75.0 million. We are also self-insured for certain employee medical and dental plans. We maintain stop-loss insurance for our self-insured medical plan under which we retain up to $0.4 million of exposure on a per-participant, per-year basis with respect to claims. The adequacy of our reserves for workers’ compensation, general liability, automobile liability, and property damage insurance claims is based upon known trends and events and the actuarial estimates of required reserves considering the most recently completed actuarial reports. We use all available information to develop our best estimate of insurance claims reserves as information is obtained. The results of actuarial studies are used to estimate our insurance rates and insurance reserves for future periods and to adjust reserves, if appropriate, for prior years. Actuarial Review Performed During the First Quarter of 2018 During the three months ended January 31, 2018, we performed an actuarial review of the majority of our casualty insurance programs that considered changes in claim developments and claim payment activity for the period commencing May 1, 2017 and ending October 31, 2017 for all policy years in which open claims existed. The actuarial review indicated the claims reduction and safety initiatives we implemented have had a positive impact on our claims costs in the most recent years. Most notably, over the past two years there has been a decrease in claim frequency for workers’ compensation lost-time claims and general liability bodily injury claims. However, there have been unfavorable developments in ultimate losses beyond our estimates for general liability and workers’ compensation claims related to prior years, as described below. The actuarial review indicated a continued decrease over the most recent years in the total number of reported claims related to our general liability program, particularly with respect to bodily injury claims. However, in prior year claims we experienced adverse developments that are largely attributable to adjustments related to certain bodily injury claims and to losses for property damage. We are experiencing a reduced frequency of claims in our workers’ compensation program. However, due to increases in projected costs and severity of claims in certain prior fiscal years, in the first quarter of 2018 we increased our estimate of ultimate losses for workers’ compensation claims. Statutory, regulatory, and legal developments have contributed to the increase in our estimated losses. Based on the results of the actuarial review and subsequent developments, at January 31, 2018 we increased our total reserves for known claims as well as our estimate of the loss amounts associated with incurred but not reported claims for prior periods by $2.0 million. As we continue to see a similar trend in adverse developments, at April 30, 2018 we increased our reserves by an additional $2.0 million. For the six months ended April 30, 2018, the total increase to our reserves for claims related to prior periods was $4.0 million. This adjustment was $6.0 million lower than the total adjustment related to prior year claims of $10.0 million during the six months ended April 30, 2017. During the third quarter of 2018, comprehensive actuarial evaluations are expected to be completed for our significant insurance programs using updated claims data, and these evaluations may lead to further adjustments to our insurance reserves. Insurance Related Balances and Activity
(in millions) | April 30, 2018 |  | October 31, 2017
Insurance claim reserves excluding medical and dental | $ | 495.7 |  |  | $ | 485.6 |
Medical and dental claim reserves | 10.0 |  |  | 9.8 |
Insurance recoverables | 74.9 |  |  | 73.1 |
At April 30, 2018 and October 31, 2017, insurance recoverables are included in “Other current assets” and “Other noncurrent assets” on the accompanying unaudited consolidated balance sheets. Instruments Used to Collateralize Our Insurance Obligations
(in millions) | April 30, 2018 |  | October 31, 2017
Standby letters of credit | $ | 136.7 |  |  | $ | 137.6 |
Surety bonds | 78.2 |  |  | 77.5 |
Restricted insurance deposits | 10.4 |  |  | 11.2 |
Total | $ | 225.3 |  |  | $ | 226.3 |

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- Definition The entire disclosure for the types of coverages and products sold, and the assets, obligations, recorded liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -URI http://asc.fasb.org/topic&trid=2303980 + Details
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