The Hartford 2014 Annual Report Download - page 53

Prior accident years development recorded in 2012
Included within prior accident years development were the following loss and loss adjustment expense reserve strengthenings (releases):
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 




Auto liability $ 56 $ (81) $ — $ (25)
Homeowners — (32) — (32)
Professional liability 40 — — 40
Package business (20) — — (20)
General liability (87) — — (87)
Bond (9) — — (9)
Commercial property (8) — — (8)
Net asbestos reserves — — 48 48
Net environmental reserves — — 10 10
Workers’ compensation 78 — — 78
Change in workers’ compensation discount, including
accretion 52 — — 52
Catastrophes (37) (29) — (66)
Other reserve re-estimates, net 7 1 7 15
        
During 2012, the Company’s re-estimates of prior accident years reserves included the following significant reserve changes:
• Released reserves for personal auto liability claims, primarily for accident years 2008 through 2011. As these accident years matured, favorable
bodily injury severity trends were observed and management placed more weight on the emerged experience. Management has adjusted trend
assumptions accordingly.
• Released reserves for homeowners claims, primarily for accident year 2011 as a result of favorable large loss frequency and lower than expected
severity.
• Strengthened reserves for commercial auto liability claims, primarily for accident year 2010 and 2011. Higher than expected bodily injury severity,
driven by large loss activity, has been observed for these accident years.
• Strengthened reserves for professional liability directors and officers claims for accident years 2011 and prior as a result of higher severity, primarily
for mid- and large-sized accounts.
• Released reserves in package business liability coverages and general liability, primarily for accident years 2006 through 2011. Claim severity
emergence for these years was lower than expected and management has placed more weight on the emerged experience. In addition, older years
have improved due to favorable emergence of larger claims.
• Strengthened reserves in workers' compensation primarily due to the emergence of lost time claims from 2011.
• The change in workers’ compensation discount, including accretion, primarily reflects a decrease in the number of tabular claims, and to a lesser
extent, the decrease in interest rates.
• Reserve releases on certain prior year catastrophes, primarily related to 2001 World Trade Center worker's compensation claims.
• 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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