The Hartford 2014 Annual Report Download - page 51

Prior accident years development recorded in 2013
Included within prior accident years development were the following loss and loss adjustment expense reserve strengthenings (releases):
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 




Auto liability $ 141 $ 3 $ — $ 144
Homeowners — (6) — (6)
Professional liability (29) — — (29)
Package business 2 — — 2
General liability (75) — — (75)
Bond (8) — — (8)
Commercial property (7) — — (7)
Net asbestos reserves — — 130 130
Net environmental reserves — — 12 12
Uncollectible reinsurance (25) — — (25)
Workers’ compensation (2) — — (2)
Workers’ compensation - NY 25a Fund for Reopened Cases 80 — — 80
Change in workers’ compensation discount, including accretion 30 — — 30
Catastrophes (24) (39) — (63)
Other reserve re-estimates, net — 3 6 9
        
During 2013, the Company’s re-estimates of prior accident years reserves included the following significant reserve changes:
• Strengthened reserves in commercial auto liability, primarily related to specialty lines claims, arising from a higher frequency of large loss bodily
injury claims in accident years 2010 through 2012.
• Released reserves in professional liability for accident years 2008 through 2012 due to lower than expected claim severity, primarily for large-sized
accounts.
• Released reserves in general liability in accident years 2006 through 2011. The emergence of claim severity as well as the frequency of late reported
claims for these years was lower than expected and management has placed more weight on the emerged experience.
• The Company reviewed its allowance for uncollectible reinsurance in the second quarter of 2013 and reduced its allowance as a result of favorable
collections compared to expectations.
• Release in workers’ compensation is the net of releases for accident year 2009 and prior reflecting favorable development in average severity, the
result of a speed up in settlements and the result of moving to an enhanced state-level analysis of loss experience, offset by strengthening workers’
compensation for accident years 2010 through 2012 reflecting the emergence of a higher mix of more severe claims.
• Reserve strengthening related to the closing of the New York Section 25A Fund for Reopened Cases (the "Fund"). These claims were previously
funded through assessments and paid by the Fund. The claims will become payable by the Company effective January 1, 2014.
• Released reserves for catastrophes primarily related to Storm Sandy.
• Other reserve re-estimates, net includes an $18 recovery related to a class action settlement with American International Group involving prior
accident years involuntary workers compensation pool loss and loss adjustment expense.
• Refer to the Property & Casualty Other Operations Claims section for further discussion of the increase to net asbestos and net environmental
reserves.
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