
	Six Months Ended June 30,
(in millions)	2024		2023
Claims and claim adjustment expense reserves at beginning of year	$	61,621	$	58,643
Less reinsurance recoverables on unpaid losses	7,817		7,790

Net reserves at beginning of year	53,804		50,853
Estimated claims and claim adjustment expenses for claims arising in the current year	14,213		13,260
Estimated decrease in claims and claim adjustment expenses for claims arising in prior years	(232)		(118)
Total increases	13,981		13,142
Claims and claim adjustment expense payments for claims arising in:
Current year	3,953		3,898
Prior years	7,750		7,466
Total payments	11,703		11,364
Unrealized foreign exchange (gain) loss	(75)		104
Net reserves at end of period	56,007		52,735
Plus reinsurance recoverables on unpaid losses	7,845		7,829
Claims and claim adjustment expense reserves at end of period	$	63,852	$	60,564

Gross claims and claim adjustment expense reserves at June 30, 2024 increased by $2.23 billion from December 31, 2023, primarily reflecting the impacts of (i) catastrophe losses in the first six months of 2024, (ii) higher volumes of insured exposures and (iii) loss cost trends for the current accident year, partially offset by (iv) claim payments made during the first six months of 2024 and (v) net favorable prior year reserve development.

For the six months ended June 30, 2024 and 2023, estimated claims and claim adjustment expenses incurred included $232 million and $118 million, respectively, of net favorable development for claims arising in prior years, including $321 million and $165 million, respectively, of net favorable prior year reserve development, and $22 million and $23 million, respectively, of accretion of discount.

Business Insurance. Net favorable prior year reserve development in the second quarter of 2024 totaled $34 million, primarily driven by better than expected loss experience in the domestic operations’ workers’ compensation product line for multiple accident years, partially offset by higher than expected loss experience in the general liability product line for recent accident years, driven by excess coverages, as well as an addition to reserves related to run-off operations. Net unfavorable prior year reserve development in the second quarter of 2023 totaled $101 million, primarily driven by higher than expected loss experience in the domestic operations’ (i) general liability product line for primary and excess coverages for multiple accident years, (ii) commercial multi-peril product line for multiple accident years and (iii) commercial automobile product line for recent accident years, partially offset by (iv) better than expected loss experience in the workers’ compensation product line for multiple accident years.

Net favorable prior year reserve development in the first six months of 2024 totaled $34 million, primarily driven by better than expected loss experience in the domestic operations’ workers’ compensation product line for multiple accident years, partially offset by higher than expected loss experience in the general liability product line for recent accident years, as well as an addition to reserves related to run-off operations. Net unfavorable prior year reserve development in the first six months of 2023 totaled $82 million, primarily driven by higher than expected loss experience in the domestic operations’ (i) general liability product line for primary and excess coverages for multiple accident years, (ii) commercial automobile product line for multiple accident years and (iii) commercial multi-peril product line for recent accident years, partially offset by (iv) better than expected loss experience in the workers’ compensation product line for multiple accident years. The first six months of 2024 and 2023 also included an increase to environmental reserves.

Bond & Specialty Insurance. Net favorable prior year reserve development in the second quarter and first six months of 2024 totaled $24 million and $48 million, respectively, primarily driven by better than expected loss experience in the domestic operations’ fidelity and surety product lines for recent accident years. Net favorable prior year reserve development in the second quarter and first six months of 2023 totaled $119 million and $177 million, respectively, primarily driven by better than expected loss experience in the domestic operations’ general liability product line for management liability coverages and in the fidelity and surety product lines for recent accident years.

Personal Insurance. Net favorable prior year reserve development in the second quarter and first six months of 2024 totaled $172 million and $239 million, respectively, primarily driven by better than expected loss experience in the domestic operations in both the homeowners and other and automobile product lines for recent accident years. Net favorable prior year reserve development in the second quarter and first six months of 2023 totaled $42 million and $70 million, respectively, primarily driven by better than expected loss experience in the domestic operations’ homeowners and other product line for recent accident years.