v3.25.4
RESERVE FOR LOSSES AND LAE (Tables)
 12 Months Ended
Dec. 31, 2025
Insurance [Abstract]  
Schedule of Roll Forward of the Company’s Beginning and Ending Reserve for Losses and LAE
The following table provides a roll forward of the Company’s beginning and ending reserve for losses and LAE and is summarized for the periods indicated:
Years Ended December 31,
(Dollars in millions)202520242023
Gross reserves beginning of period$29,889 $24,604 $22,065 
Less reinsurance recoverables on unpaid losses(2,915)(2,098)(2,105)
Net reserves beginning of period26,975 22,506 19,960 
Incurred related to:
Current year10,202 9,967 8,432 
Prior years, excluding impact from retroactive reinsurance535 1,337 (5)
Prior years, impact from retroactive reinsurance (1)
122 — — 
Total incurred losses and LAE10,859 11,305 8,427 
Paid related to:
Current year1,253 1,258 1,379 
Prior years6,525 5,279 4,731 
Total paid losses and LAE7,778 6,537 6,110 
Foreign exchange/translation adjustment663 (298)229 
Retroactive reinsurance adjustment (1)
(122)— — 
Net reserves end of period30,597 26,975 22,506 
Plus reinsurance recoverables on unpaid losses (2)
3,715 2,915 2,098 
Gross reserves end of period$34,312 $29,889 $24,604 
(Some amounts may not reconcile due to rounding.)
(1) The consideration paid ($1,372 million) exceeds the ceded loss reserves at the inception of the Agreement ($1,250 million), as a result the Company recognized an immediate pre-tax loss of $122 million in earnings, in accordance with retroactive reinsurance accounting guidance. The Company recognized the loss by writing off the reinsurance recoverable of $122 million, which represents excess compensation for the uncertainty of future claims development, and is not a component of our best estimate of loss reserves.
(2) This amount excludes the unpaid recoverable of the adverse development reinsurance agreements of $1,253 million as of December 31, 2025.
Schedule of Reconciliation of the Net Incurred and Paid Claims Development
The reconciliation of the net incurred and paid claims development tables to the liability for claims and claim adjustment expenses in the consolidated statement of financial position is as follows:
December 31, 2025
(Dollars in millions)
Net outstanding liabilities
Reinsurance Casualty$14,048 
Reinsurance Property7,423 
Insurance Casualty6,597 
Insurance Property983 
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance (1)
29,052 
Reinsurance recoverable on unpaid claims
Reinsurance Casualty152 
Reinsurance Property901 
Insurance Casualty2,094 
Insurance Property314 
Total reinsurance recoverable on unpaid claims (1), (3)
3,461 
Unallocated claims adjustment expenses360 
Other (2)
1,439 
1,799 
Total gross liability for unpaid claims and claim adjustment expense$34,312 
(Some amounts may not reconcile due to rounding.)
(1) Amounts disclosed are for reinsurance and insurance reportable segments.
(2) The other amount is primarily comprised of the Other segment, which includes the results of our sports and leisure business sold in October 2024, consisting of policies written prior to the sale and polices renewed and certain new business written on the Company’s paper post-sale. It also includes run-off A&E exposures, certain discontinued insurance programs primarily written prior to 2012 and certain discontinued insurance and reinsurance coverage classes. The Other segment does not generally sell insurance or reinsurance products but is responsible for the management of existing policies and settlement of related losses.
(3) This amount excludes the unpaid recoverable of the adverse development reinsurance agreements of $1,253 million as of December 31, 2025.
The following tables present the ultimate loss and allocated LAE and the paid loss and allocated LAE, net of reinsurance for casualty and property, as well as the average annual percentage payout of incurred claims by age, net of reinsurance for each of our disclosed lines of business.
Reinsurance - Casualty Business
At December 31, 2025
Ultimate Incurred Loss and Allocated Loss Adjustment Expenses, Net of reinsurance
Years Ended December 31,		Total of
IBNR Liabilities
Plus Expected
Development
on Reported
Claims		Cumulative
Number of
Reported
Claims
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$798 $880 $877 $872 $947 $949 $980 $1,009 $1,032 $1,055 $37  N/A
2017880 840 847 928 936 992 1,056 1,084 1,156 50  N/A
20181,464 1,462 1,539 1,569 1,638 1,734 1,791 1,686 93  N/A
20191,785 1,850 1,853 1,877 1,918 1,978 1,980 255  N/A
20201,977 1,949 1,928 1,889 1,932 1,899 349  N/A
20212,505 2,501 2,441 2,532 2,370 748  N/A
20222,959 2,917 2,968 3,098 1,439  N/A
20232,993 3,158 3,276 1,927  N/A
20243,143 3,237 2,434  N/A
20253,228 2,760  N/A
$22,986 
(Some amounts may not reconcile due to rounding.)
Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
Years Ended December 31,
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$93 $195 $330 $437 $552 $627 $706 $775 $840 $903 
201783 192 325 466 582 692 802 931 1,020 
2018200 304 507 665 837 1,017 1,224 1,347 
2019251 375 548 740 969 1,240 1,424 
2020210 323 505 740 1,009 1,246 
2021229 327 552 858 1,194 
2022220 388 693 1,104 
2023211 433 832 
2024236 485 
2025268 
$9,824 
All outstanding liabilities prior to 2016, net of reinsurance886 
Liabilities for claims and claim adjustment expenses, net of reinsurance$14,048 
(Some amounts may not reconcile due to rounding.)
Reinsurance - Property Business
At December 31, 2025
Ultimate Incurred Loss and Allocated Loss Adjustment Expenses, Net of reinsurance
Years Ended December 31,		Total of
IBNR Liabilities
Plus Expected
Development
on Reported
Claims		Cumulative
Number of
Reported
Claims
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$1,711 $1,539 $1,574 $1,568 $1,546 $1,547 $1,543 $1,545 $1,539 $1,542 $3  N/A
20172,802 3,425 3,536 3,664 3,710 3,720 3,734 3,753 3,817 5  N/A
20182,641 2,516 2,518 2,456 2,409 2,394 2,429 2,532 60  N/A
20192,111 2,142 2,087 1,972 1,975 2,026 2,107 62  N/A
20202,448 2,521 2,465 2,437 2,439 2,582 65  N/A
20212,802 2,828 2,750 2,639 2,749 83  N/A
20223,313 2,991 2,697 2,601 97  N/A
20232,870 2,493 2,217 256  N/A
20244,056 3,763 1,254  N/A
20254,505 2,354  N/A
$28,415 
(Some amounts may not reconcile due to rounding.)
Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
Years Ended December 31,
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$445 $855 $1,130 $1,239 $1,289 $1,312 $1,320 $1,332 $1,345 $1,346 
2017905 1,581 1,843 2,064 2,171 2,203 2,248 2,377 2,384 
20181,254 2,847 3,566 3,969 4,179 4,324 4,511 4,511 
2019465 1,077 1,374 1,501 1,601 1,733 1,748 
2020272 992 1,409 1,676 1,967 2,059 
2021630 1,362 1,825 2,153 2,360 
2022769 1,613 2,177 2,419 
2023609 1,297 1,721 
2024761 1,443 
20251,020 
$21,011 
All outstanding liabilities prior to 2016, net of reinsurance20 
Liabilities for claims and claim adjustment expenses, net of reinsurance$7,423 
(Some amounts may not reconcile due to rounding.)
Insurance - Casualty Business
At December 31, 2025
Ultimate Incurred Loss and Allocated Loss Adjustment Expenses, Net of reinsurance
Years Ended December 31,		2025 Prior Year Development Excluding the Impact of ADCTotal of
IBNR Liabilities
Plus Expected
Development
on Reported
Claims		Cumulative
Number of
Reported
Claims		Incurred Impact of ADCIBNR Impact of ADC2025 (Net of Impact of ADC)Total of IBNR Liabilities Net of Impact of ADC
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$509 $495 $539 $558 $489 $474 $478 $488 $493 $507 $13 $17 31,277 $9 $3 $498 $14 
2017551 558 568 585 559 559 584 580 596 15 31 34,849 11 5 584 26 
2018644 649 679 685 697 772 810 832 21 43 34,920 16 6 816 37 
2019776 778 798 804 954 1,089 1,080 (9)98 37,936 37 19 1,044 79 
2020913 990 978 975 1,095 1,080 (15)163 39,683 53 32 1,027 131 
20211,119 1,161 1,154 1,353 1,343 (10)310 44,838 102 63 1,241 246 
20221,243 1,241 1,597 1,720 124 591 48,143 191 130 1,530 460 
20231,425 1,739 1,931 191 891 47,258 274 191 1,657 701 
20241,792 1,935 143 1,251 43,636 322 257 1,612 994 
20251,698 — 1,458 30,732 — — 1,698 1,458 
$12,721 $474 $4,853 $1,015 $706 $11,706 $4,148 
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance from the table below(6,227)— (6,227)
Liabilities for losses and loss adjustment expenses and prior year development before accident year 2016, net of reinsurance104 — 27 32 7 72 20 
Liabilities for losses and loss adjustment expenses and prior year loss development, net of reinsurance$6,597 $474 $4,880 $1,046 $713 $5,551 $4,167 
(Some amounts may not reconcile due to rounding.)
Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
Years Ended December 31,
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$53 $149 $253 $314 $362 $398 $430 $448 $460 $471 
201749 165 263 343 404 467 493 526 537 
201861 196 296 407 539 623 678 722 
201969 218 364 498 646 828 901 
202063 229 372 531 659 808 
2021105 246 428 654 855 
202279 282 577 859 
202393 308 642 
202485 347 
202586 
$6,227 
All outstanding liabilities prior to 2016, net of reinsurance104 
Liabilities for claims and claim adjustment expenses, net of reinsurance$6,597 
Insurance - Property Business
At December 31, 2025
Ultimate Incurred Loss and Allocated Loss Adjustment Expenses, Net of reinsurance
Years Ended December 31,		2025 Prior Year Development Excluding the Impact of ADCTotal of
IBNR Liabilities
Plus Expected
Development
on Reported
Claims		Cumulative
Number of
Reported
Claims		Incurred Impact of ADCIBNR Impact of ADC2025 (Net of Impact of ADC)Total of IBNR Liabilities Net of Impact of ADC
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$289 $280 $284 $292 $297 $299 $300 $302 $302 $300 $(2)$—  N/A $— $— $300 $— 
2017486 494 486 494 496 508 509 506 505 (1)—  N/A — — 505 — 
2018403 399 401 410 428 436 435 432 (3)1  N/A — — 432 1 
2019348 352 350 365 380 375 372 (3)2  N/A — — 372 1 
2020602 508 498 503 492 490 (2)6  N/A 1 — 489 6 
2021647 586 602 628 603 (25)13  N/A 2 1 601 11 
2022771 797 698 661 (37)19  N/A 4 2 656 16 
2023717 669 635 (35)33  N/A 7 4 628 29 
2024598 592 (6)53  N/A 14 6 578 46 
2025900 — 410  N/A — — 900 410 
$5,490 $(113)$536 $29 $14 $5,461 $522 
Cumulative Paid Losses and Allocated Loss Adjustment Expenses, Net of Reinsurance from the table below(4,507)— (4,507)
Liabilities for losses and loss adjustment expenses and prior year development before accident year 2016, net of reinsurance— — — — — — — 
Liabilities for losses and loss adjustment expenses and prior year loss development, net of reinsurance$983 $(113)$537 $29 $14 $954 $522 
(Some amounts may not reconcile due to rounding.)
Cumulative Paid Loss and Allocated Loss Adjustment Expenses, Net of Reinsurance
Years Ended December 31,
Accident Year2016201720182019202020212022202320242025
(Dollars in millions)(Unaudited)
2016$167 $248 $272 $290 $296 $297 $299 $300 $300 $300 
2017176 416 452 477 493 505 504 505 505 
2018240 356 376 407 424 429 431 431 
2019226 313 335 355 363 368 370 
2020292 413 450 465 473 478 
2021325 482 544 565 576 
2022377 567 594 615 
2023400 503 565 
2024200 379 
2025289 
$4,507 
All outstanding liabilities prior to 2016, net of reinsurance— 
Liabilities for claims and claim adjustment expenses, net of reinsurance983 
Schedule of Average Annual Percentage Payout Incurred Loss by Age, Net of Reinsurance
Average Annual Percentage Payout of Incurred Loss by Age, Net of Reinsurance (unaudited)
Years12345678910
Casualty8.7 %6.5 %10.6 %11.7 %12.2 %11.2 %9.9 %8.2 %6.9 %6.0 %
Average Annual Percentage Payout of Incurred Loss by Age, Net of Reinsurance (unaudited)
Years12345678910
Property25.1 %29.1 %17.0 %9.5 %6.3 %3.4 %2.6 %1.8 %0.4 %— %
Average Annual Percentage Payout of Incurred Loss by Age, Net of Reinsurance (unaudited)
Years12345678910
Casualty6.4 %14.3 %15.3 %14.2 %12.7 %11.5 %6.1 %4.6 %2.6 %1.9 %
Average Annual Percentage Payout of Incurred Loss by Age, Net of Reinsurance (unaudited)
Years12345678910
Property54.0 %30.1 %7.2 %4.5 %2.5 %1.4 %0.3 %— %— %— %
Schedule of Incurred Losses with Respect to A&E Reserve on both Gross and Net of Reinsurance Basis The following table summarizes incurred losses with respect to A&E reserves on both a gross and net of reinsurance basis for the periods indicated:
At December 31,
(Dollars in millions)202520242023
Gross basis:
Beginning of period reserves$260 $247 $278 
Incurred losses2 62 — 
Paid losses(52)(49)(31)
End of period reserves$209 $260 $247 
Net basis:
Beginning of period reserves$242 $232 $257 
Incurred losses— 54 — 
Paid losses(49)(43)(25)
End of period reserves$193 $242 $232 
Schedule of Reconciliation Of Change In Net Ultimate Loss And Loss Adjustment Expense To Prior Year Development
The following table presents net prior year development before the adverse development cover reinsurance agreements (“ADC”) cessions for the year ended December 31, 2025:
(Dollars in millions)
Prior Year Development Net of External Reinsurance Before ADC Cessions (1)
Reinsurance - Casualty Business$456 
Reinsurance - Property Business(428)
Insurance - Casualty Business474 
Insurance - Property Business(113)
Subtotal, adjusted pre-tax basis$389 
(1) Excluding the impact of:
- Our Other segment which has $146 million of prior year development.
- $122 million of excess compensation for the uncertainty of future claims development of which $105 million is from our Insurance segment and $17 million from our Other segment.