The Hartford 2014 Annual Report Download - page 57

The following table displays gross asbestos and environmental reserves by category as of December 31, 2014:

  

Direct $ 1,640 $ 196 $ 1,836
Assumed Reinsurance
289
22
311
London Market
264
49
313
Total
2,193
267
2,460




      
[1] The one year gross paid amount for total asbestos claims is $304, resulting in a one year gross survival ratio of 7.2. The three year average gross paid amount for total
asbestos claims is $263, resulting in a three year gross survival ratio of 8.3.
[2] The one year gross paid amount for total environmental claims is $83, resulting in a one year gross survival ratio of 3.2. The three year average gross paid amount for total
environmental claims is $58, resulting in a three year gross survival ratio of 4.6.
The Company provides an allowance for uncollectible reinsurance, reflecting management’s best estimate of reinsurance cessions that may be uncollectible
in the future due to reinsurers’ unwillingness or inability to pay. During the second quarters of 2014, 2013 and 2012, the Company completed its annual
evaluations of the collectability of the reinsurance recoverables and the adequacy of the allowance for uncollectible reinsurance associated with older, long-
term casualty liabilities reported in the Property & Casualty Other Operations. In conducting this evaluation, the Company used its most recent detailed
evaluations of ceded liabilities reported in the segment. The Company analyzed the overall credit quality of the Company’s reinsurers, recent trends in
arbitration and litigation outcomes in disputes between cedants and reinsurers, and recent developments in commutation activity between reinsurers and
cedants. The evaluation in the second quarters of 2014, 2013, and 2012 resulted in no adjustments to the allowance for uncollectible reinsurance. As of
December 31, 2014, 2013, and 2012, the allowance for uncollectible reinsurance for Property & Casualty Other Operations totaled $225, $202, and $203.
The Company currently expects to perform its regular comprehensive review of Property & Casualty Other Operations reinsurance recoverables annually. Due
to the inherent uncertainties as to collection and the length of time before reinsurance recoverables become due, particularly for older, long-term casualty
liabilities, it is possible that future adjustments to the Company’s reinsurance recoverables, net of the allowance, could be required.
Consistent with the Company’s long-standing reserving practices, the Company will continue to review and monitor its reserves in Property & Casualty
Other Operations regularly, including its annual reviews of asbestos liabilities, reinsurance recoverables and allowance for uncollectible reinsurance, and
environmental liabilities, and where future developments indicate, make appropriate adjustments to the reserves. The company will complete both its annual
ground-up asbestos and environmental reserve studies during the second quarter of 2015.
57