The Hartford 2015 Annual Report Download - page 57

57
Assumed insurance exposures are less predictable than direct insurance exposures because the Company does not generally receive
notice of a reinsurance claim until the underlying direct insurance claim is mature. This causes a delay in the receipt of information at
the reinsurer level and adds to the uncertainty of estimating related reserves.
London Market exposures are the most uncertain of the three categories of claims. As a participant in the London Market (comprised of
both Lloyd’s of London and London Market companies), certain subsidiaries of the Company wrote business on a subscription basis,
with those subsidiaries’ involvement being limited to a relatively small percentage of a total contract placement. Claims are reported, via
a broker, to the “lead” underwriter and, once agreed to, are presented to the following markets for concurrence. This reporting and claim
agreement process makes estimating liabilities for this business the most uncertain of the three categories of claims.
The following table sets forth paid and incurred loss activity by the three categories of claims for asbestos and environmental.
Paid and Incurred Losses and Loss Adjustment Expenses (“LAE”) Development — Asbestos and Environmental
Asbestos [1] Environmental [1]
Paid Losses &
LAE Incurred Losses & LAE Paid Losses & LAE Incurred Losses & LAE
2015
Gross
Direct $ 145 $ 190 $ 44 $ 67
Assumed Reinsurance 57 (1) 5 (4)
London Market 17 62 16 18
Total 219 251 65 81
Ceded (65)(95)(13) (23)
Net $ 154 $ 156 $ 52 $ 58
2014
Gross
Direct $ 201 $ 206 $ 55 $ 23
Assumed Reinsurance 72 70 12 —
London Market 17 28 6 7
Total 290 304 73 30
Ceded (74)(92)(14) —
Net $ 216 $ 212 $ 59 $ 30
2013
Gross
Direct $ 159 $ 72 $ 23 $ 6
Assumed Reinsurance 68 50 4 6
London Market 16 8 6 —
Total 243 130 33 12
Ceded (51) — (1) —
Net $ 192 $ 130 $ 32 $ 12
[1] Excludes asbestos and environmental paid and incurred loss and LAE reported in Ongoing Operations. Total gross losses and LAE incurred in
Ongoing Operations for the years ended December 31, 2015, 2014 and 2013 includes $16, $19 and $15, respectively, related to asbestos and
environmental claims. Total gross losses and LAE paid in Ongoing Operations for the years ended December 31, 2015, 2014 and 2013 includes
$16, $21 and $14, respectively, related to asbestos and environmental claims.