Reserve for Loss and Loss Expense | Reserve for Loss and Loss Expense (a) The table below provides a roll forward of reserves for loss and loss expense for beginning and ending reserve balances: ($ in thousands) 2022 2021 2020 Gross reserves for loss and loss expense, at beginning of year $ 4,580,903 4,260,355 4,067,163 Less: reinsurance recoverable on unpaid loss and loss expense, at beginning of year 1 578,641 554,269 547,066 Net reserves for loss and loss expense, at beginning of year 4,002,262 3,706,086 3,520,097 Incurred loss and loss expense for claims occurring in the: Current year 2,190,668 1,896,837 1,708,755 Prior years (78,890) (82,853) (72,932) Total incurred loss and loss expense 2,111,778 1,813,984 1,635,823 Paid loss and loss expense for claims occurring in the: Current year 768,583 676,331 642,586 Prior years 958,149 841,477 807,248 Total paid loss and loss expense 1,726,732 1,517,808 1,449,834 Net reserves for loss and loss expense, at end of year 4,387,308 4,002,262 3,706,086 Add: Reinsurance recoverable on unpaid loss and loss expense, at end of year 757,513 578,641 554,269 Gross reserves for loss and loss expense at end of year $ 5,144,821 4,580,903 4,260,355 1 2020 includes an adjustment of $2.9 million related to our adoption of ASU 2016-13, Financial Instruments - Credit Losses. Our net loss and loss expense reserves increased by $385.0 million in 2022, $296.2 million in 2021, and $183.1 million in 2020. The loss and loss expense reserves are net of anticipated recoveries for salvage and subrogation claims, which amounted to $91.3 million for 2022, $87.0 million for 2021, and $80.9 million for 2020. The increase in net loss and loss expense reserves in 2022 was primarily driven by increases in exposure due to premium growth. This increase in our net loss and loss expense reserves was partially offset by favorable prior year loss reserve development. In 2022, we experienced overall net favorable prior year loss reserve development of $78.9 million, compared to $82.9 million in 2021 and $72.9 million in 2020. The following table summarizes the prior year reserve development by line of business: (Favorable)/Unfavorable Prior Year Development ($ in millions) 2022 2021 2020 General Liability $ (5.0) (29.0) (35.0) Commercial Automobile 22.5 13.3 7.1 Workers Compensation (70.0) (58.0) (60.0) Businessowners' Policies (7.3) (0.4) 3.9 Commercial Property (1.6) (2.6) 9.2 Bonds (10.0) — — Homeowners (0.6) 1.8 7.7 Personal Automobile 0.5 (0.2) (1.8) E&S Casualty Lines (5.0) (7.0) — E&S Property Lines (2.5) (0.8) (4.0) Other 0.1 — — Total $ (78.9) (82.9) (72.9) The Insurance Subsidiaries had $78.9 million of favorable prior year reserve development during 2022, which included $86.0 million of net favorable casualty reserve development and $7.1 million of unfavorable property reserve development. The net favorable casualty reserve development was largely driven by the workers compensation line of business, which was impacted by continued favorable medical trends in accident years 2020 and prior, and favorable inception-to-date claim frequencies in accident year 2020. Partially offsetting this net favorable reserve development was $15.0 million of unfavorable casualty reserve development in the commercial auto line of business ($22.5 million net of property reserve development), primarily driven by increased loss severities in accident year 2021. The Insurance Subsidiaries had $82.9 million of favorable prior year reserve development during 2021, which included $81.0 million of net favorable casualty reserve development and $1.9 million of favorable property reserve development. The net favorable casualty reserve development was largely driven by the workers compensation and general liability lines of business. Workers compensation was impacted by continued favorable medical trends in accident years 2019 and prior, and general liability development was attributable to lower loss severities in accident years 2018 and prior. In addition, our E&S casualty lines experienced favorable reserve development of $7.0 million in 2021. Partially offsetting this net favorable reserve development was $15.0 million of unfavorable casualty reserve development in the commercial auto line of business ($13.3 million net of property reserve development), driven by unfavorable reserve development on loss severities in accident years 2016 through 2019. The Insurance Subsidiaries had $72.9 million of favorable prior year reserve development during 2020, which included $85.0 million of net favorable casualty reserve development and $12.1 million of unfavorable property reserve development. The net favorable casualty reserve development was largely driven by the workers compensation and general liability lines of business. Workers compensation was impacted by continued favorable medical trends in accident years 2018 and prior, and general liability development was attributable to lower loss severities in accident years 2017 and prior. Partially offsetting this net favorable reserve development was $10.0 million of unfavorable casualty reserve development in the commercial auto line of business ($7.1 million net of property reserve development), driven by unfavorable reserve development on loss severities in accident years 2016 through 2019, and higher than expected frequencies in accident year 2019. (b) We have exposure to abuse or molestation claims within our general liability line of business, primarily through insurance policies that we issue to schools, religious institutions, day-care facilities, and other social services. We also have exposure to abuse or molestation claims from recently enacted state laws that extend the statute of limitations or permit windows to be opened for abuse or molestation claims and lawsuits that were previously barred by statutes of limitations. The emergence of these claims is highly unpredictable and may be reported over an extended period of time. In addition to legislative changes that increase our exposure, there are significant uncertainties in estimating our exposure to abuse or molestation claims (for both case and IBNR reserves) resulting from (i) lack of relevant historical data, (ii) the delayed and inconsistent reporting patterns associated with these claims, (iii) the obligation of an insurer to defend a claim, (iv) the extent to which a party can prove the existence of coverage, and (v) uncertainty as to the number and identity of claimants. It is possible, as a result, that we may receive claims decades after the allegations occurred from coverages provided by us or our predecessor companies, that will require complex claims coverage determinations, potential litigation, and the need to collect from reinsurers under older reinsurance agreements. (c) Reserves established for liability insurance include exposure to asbestos and environmental claims. These claims have arisen primarily from insured exposures in municipal government, small non-manufacturing commercial risk, and homeowners policies. The emergence of these claims is highly unpredictable and may be reported over an extended period of time. There are significant uncertainties in estimating our exposure to asbestos and environmental claims (for both case and IBNR reserves) resulting from (i) lack of relevant historical data, (ii) the delayed and inconsistent reporting patterns associated with these claims, and (iii) uncertainty as to the number and identity of claimants and complex legal and coverage issues. Legal issues that arise in asbestos and environmental cases include federal or state venue, choice of law, causation, admissibility of evidence, allocation of damages and contribution among joint defendants, successor and predecessor liability, and whether direct action against insurers can be maintained. Coverage issues that arise in asbestos and environmental cases include the interpretation and application of policy exclusions, the determination and calculation of policy limits, the determination of the ultimate amount of a loss, the extent to which a loss is covered by a policy, if at all, the obligation of an insurer to defend a claim, and the extent to which a party can prove the existence of coverage. Courts have reached different and sometimes inconsistent conclusions on these legal and coverage issues. Traditional accident year loss development methods cannot be applied because past loss history is not necessarily indicative of future behavior. Instead, we review the experience by calendar year and rely on alternative metrics, such as paid and incurred survival ratios. As a result, reserves for asbestos and environmental require a high degree of judgment. The following table details our loss and loss expense reserves for various asbestos and environmental claims showing gross and net of reinsurance: 2022 ($ in millions) Gross Net Asbestos $ 5.9 4.7 Landfill sites 11.8 7.5 Underground storage tanks 10.1 8.1 Total $ 27.8 20.3 Historically, our asbestos and environmental claims have been significantly lower in volume than many other Standard Commercial Lines carriers since, prior to the introduction of the absolute pollution exclusion endorsement in the mid-1980’s, we primarily wrote Standard Personal Lines, and therefore, our exposure to asbestos and environmental claims has been limited. The following table provides a roll forward of asbestos and environmental incurred loss and loss expense and related reserves thereon showing gross and net of reinsurance: 2022 2021 2020 ($ in thousands) Gross Net Gross Net Gross Net Asbestos Reserves for loss and loss expense at beginning of year $ 6,115 4,884 6,254 5,023 6,288 5,057 Incurred loss and loss expense 8 8 51 51 320 320 Less: loss and loss expense paid (232) (232) (190) (190) (354) (354) Reserves for loss and loss expense at the end of year $ 5,891 4,660 6,115 4,884 6,254 5,023 Environmental Reserves for loss and loss expense at beginning of year $ 21,658 16,191 22,276 16,398 22,413 16,532 Incurred loss and loss expense 696 (213) (613) (14) (447) (474) Less: loss and loss expense paid (477) (309) (5) (193) 310 340 Reserves for loss and loss expense at the end of year $ 21,877 15,669 21,658 16,191 22,276 16,398 Total Asbestos and Environmental Claims Reserves for loss and loss expense at beginning of year $ 27,773 21,075 28,530 21,421 28,701 21,589 Incurred loss and loss expense 704 (205) (562) 37 (127) (154) Less: loss and loss expense paid (709) (541) (195) (383) (44) (14) Reserves for loss and loss expense at the end of year $ 27,768 20,329 27,773 21,075 28,530 21,421 (d) The following is information about incurred and paid claims development as of December 31, 2022, net of reinsurance, as well as the associated IBNR liabilities. During the experience period we implemented a series of underwriting and claims-related initiatives, including claims management changes. These initiatives focused on general underwriting and claims improvements occurring naturally through our portfolio and may impact some relationships in the tables below. As a result, several historical patterns have changed and may no longer be appropriate to use as the sole basis for projections. The tables below also include information regarding reported claims. Claims are counted at the occurrence, line of business, and policy level. For example, if a single occurrence (e.g. an automobile accident) leads to a claim under an automobile and an associated umbrella policy, they are each counted separately. Conversely, multiple claimants under the same occurrence/line/policy would contribute only a single count. A claim is considered reported when a reserve is established or a payment is made. Therefore, claims closed without payment are included in the count as long as there was an associated case reserve at some point in its life cycle. The cumulative number of reported claims for each accident year in the tables below are updated with information available as of December 31, 2022. Therefore, the claim counts presented for the more recent accident years may not be representative of the ultimate claim counts, as they are for the more mature accident years presented. All Lines (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 1,044,142 1,062,045 1,047,230 1,021,007 1,002,316 987,763 984,858 973,739 957,958 951,813 33,631 91,959 2014 1,107,513 1,133,798 1,146,990 1,124,014 1,104,218 1,100,208 1,089,529 1,094,367 1,090,345 42,087 95,835 2015 1,114,081 1,130,513 1,144,830 1,138,313 1,119,441 1,108,860 1,103,592 1,103,543 45,698 95,173 2016 1,188,608 1,203,634 1,227,142 1,199,734 1,180,829 1,171,273 1,167,539 67,934 95,944 2017 1,270,110 1,313,372 1,313,585 1,288,526 1,268,941 1,273,039 84,415 99,877 2018 1,413,800 1,461,603 1,457,415 1,441,303 1,425,540 153,214 107,095 2019 1,483,945 1,523,041 1,526,566 1,529,859 272,639 104,096 2020 1,591,972 1,587,607 1,550,195 395,519 94,752 2021 1,784,661 1,781,054 636,984 97,914 2022 2,073,343 1,089,571 94,382 Total 13,946,270 All Lines (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 335,956 518,872 644,475 748,758 833,823 872,331 891,841 904,825 911,657 916,769 2014 405,898 614,075 736,154 855,959 936,425 981,868 1,002,157 1,020,961 1,032,400 2015 376,641 581,203 725,385 845,868 929,222 967,857 1,000,509 1,018,023 2016 387,272 617,958 764,331 892,390 983,852 1,025,264 1,061,952 2017 433,440 678,453 829,134 954,792 1,050,258 1,116,336 2018 511,271 779,466 942,893 1,083,556 1,187,744 2019 510,091 781,462 949,996 1,109,628 2020 572,302 831,976 988,463 2021 609,889 934,965 2022 699,789 Total 10,066,069 All outstanding liabilities before 2013, net of reinsurance 379,073 Liabilities for loss and loss expenses, net of reinsurance 4,259,274 General Liability (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 250,609 251,421 239,776 225,709 210,785 203,831 202,697 195,697 192,782 189,594 12,561 10,462 2014 244,312 249,946 257,132 239,333 234,082 237,125 229,679 230,247 228,933 18,901 10,704 2015 254,720 245,710 246,990 233,249 219,204 214,176 211,768 210,137 19,932 10,565 2016 277,214 272,048 277,986 263,245 252,733 246,643 243,669 30,556 10,825 2017 293,747 293,128 301,384 289,883 278,607 283,379 46,761 11,324 2018 317,934 336,326 345,224 332,013 324,567 92,627 11,802 2019 347,150 356,363 358,301 366,184 154,311 11,575 2020 361,554 360,302 352,834 201,089 9,645 2021 422,748 414,279 287,278 10,136 2022 482,590 409,505 8,988 Total 3,096,166 General Liability (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 12,789 35,113 72,127 104,587 139,114 153,628 163,764 169,847 172,983 174,987 2014 14,901 46,825 79,972 121,969 154,957 179,192 187,352 198,772 204,212 2015 14,665 39,978 78,668 116,804 144,216 157,071 173,697 179,117 2016 15,684 46,549 89,431 133,757 164,136 181,770 199,032 2017 17,366 49,470 92,355 131,980 167,002 201,948 2018 19,531 60,784 108,421 155,538 197,286 2019 18,097 58,284 100,206 160,680 2020 21,858 58,699 100,356 2021 28,069 71,664 2022 31,502 Total 1,520,784 All outstanding liabilities before 2013, net of reinsurance 113,263 Liabilities for loss and loss expenses, net of reinsurance 1,688,645 Workers Compensation (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 199,794 194,318 187,658 173,160 166,662 162,787 159,767 157,645 153,436 149,975 16,818 11,385 2014 199,346 187,065 182,579 172,515 164,420 160,646 159,604 161,021 158,479 17,598 10,498 2015 193,729 194,639 183,604 179,642 176,242 172,572 170,577 169,008 18,790 10,554 2016 196,774 184,946 176,248 166,009 156,540 155,210 151,961 21,205 10,586 2017 195,202 184,306 175,853 162,672 154,159 151,221 19,961 10,813 2018 193,894 193,818 181,151 173,428 167,974 25,963 11,133 2019 188,625 188,596 174,912 164,940 32,088 10,324 2020 168,643 168,594 159,229 44,323 7,534 2021 185,198 185,151 74,474 8,547 2022 207,206 116,968 8,517 Total 1,665,144 Workers Compensation (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 36,829 74,568 96,376 109,739 118,669 124,130 126,822 129,224 130,467 131,390 2014 35,924 78,944 100,876 113,626 119,392 124,077 127,858 130,726 132,809 2015 33,857 77,320 98,195 112,601 120,097 124,046 129,019 132,235 2016 34,525 78,531 98,037 109,166 115,159 119,800 122,186 2017 40,375 82,216 100,645 110,645 116,426 120,468 2018 41,122 84,780 105,903 119,904 126,206 2019 37,826 77,878 100,812 112,649 2020 29,559 68,277 87,211 2021 32,918 76,015 2022 45,814 Total 1,086,983 All outstanding liabilities before 2013, net of reinsurance 230,858 Liabilities for loss and loss expenses, net of reinsurance 809,019 Commercial Automobile (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 188,289 205,282 209,197 207,994 210,410 207,975 209,602 208,040 207,554 207,564 535 26,221 2014 200,534 212,725 216,824 219,925 218,172 217,334 216,461 214,992 214,816 516 28,263 2015 220,994 240,958 253,074 259,495 260,565 261,386 262,054 262,766 1,627 30,085 2016 255,187 274,367 285,302 285,304 290,359 291,674 294,297 2,635 32,041 2017 301,274 329,389 324,291 322,197 326,461 325,654 4,664 33,345 2018 347,908 352,487 345,547 350,310 348,202 11,375 36,002 2019 385,212 398,346 404,854 407,051 32,019 36,375 2020 381,654 381,163 375,636 70,872 30,343 2021 483,831 512,673 155,984 36,843 2022 572,421 278,004 36,909 Total 3,521,080 Commercial Automobile (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 76,469 109,893 140,015 169,850 189,626 200,750 202,622 205,064 206,162 206,641 2014 80,810 117,169 148,884 180,701 202,821 209,655 212,481 213,689 213,847 2015 91,347 132,260 175,866 211,515 238,142 249,905 255,600 257,668 2016 106,022 155,720 200,701 233,939 264,858 277,242 284,870 2017 117,287 178,823 220,422 262,349 296,600 309,810 2018 134,867 193,788 243,713 291,725 319,819 2019 149,538 221,590 283,410 331,152 2020 139,016 198,034 254,365 2021 187,200 283,411 2022 216,180 Total 2,677,763 All outstanding liabilities before 2013, net of reinsurance 4,650 Liabilities for loss and loss expenses, net of reinsurance 847,967 Businessowners' Policies (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 49,617 42,618 41,005 40,624 41,369 39,709 39,699 39,358 38,930 38,984 169 3,484 2014 55,962 60,949 62,548 59,806 58,517 58,093 57,302 57,483 57,355 96 4,067 2015 52,871 53,768 57,245 55,925 54,454 52,325 52,200 52,514 608 3,968 2016 52,335 53,792 54,993 53,835 53,367 53,147 53,201 828 3,854 2017 46,624 48,698 51,524 48,067 43,606 42,374 879 3,895 2018 55,024 57,202 62,427 60,393 56,625 3,125 4,262 2019 53,531 59,466 64,667 65,762 8,181 3,639 2020 71,836 73,680 73,077 7,630 5,421 2021 66,312 63,648 10,539 3,454 2022 86,194 33,995 3,074 Total 589,734 Businessowners' Policies (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 17,412 26,592 30,845 34,760 37,993 38,464 39,085 39,212 39,440 39,445 2014 28,914 40,584 44,911 49,460 52,940 55,458 55,708 55,729 56,861 2015 24,189 36,014 42,710 46,571 49,073 49,839 50,005 51,120 2016 24,655 36,848 39,973 45,308 48,786 50,536 52,070 2017 21,865 31,337 36,950 40,359 39,940 40,845 2018 29,995 39,791 44,316 48,144 51,239 2019 27,718 41,587 46,113 52,887 2020 43,376 57,210 60,596 2021 34,412 47,436 2022 36,421 Total 488,920 All outstanding liabilities before 2013, net of reinsurance 9,657 Liabilities for loss and loss expenses, net of reinsurance 110,471 Commercial Property (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 88,101 90,639 90,103 90,005 90,436 90,278 90,218 90,486 90,461 90,799 4 5,716 2014 141,192 136,249 136,820 138,751 138,155 136,212 136,237 136,151 136,112 5 6,517 2015 110,270 109,513 111,750 111,566 112,496 112,582 112,937 112,915 9 6,407 2016 121,927 126,185 125,937 124,487 123,567 123,005 123,126 14 6,743 2017 138,773 149,106 149,044 153,664 154,119 154,942 20 6,906 2018 183,177 190,834 192,558 194,016 196,413 47 8,293 2019 173,826 177,075 179,574 180,605 230 7,315 2020 232,060 225,278 226,107 2,023 10,147 2021 246,319 239,822 4,672 7,942 2022 297,318 56,716 7,224 Total 1,758,159 Commercial Property (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 60,244 87,874 90,446 90,350 90,840 90,696 90,646 90,917 90,891 91,206 2014 101,131 132,909 136,634 137,883 137,418 136,008 135,928 136,141 136,107 2015 79,048 106,182 109,829 110,994 110,969 112,117 112,410 112,391 2016 83,966 118,789 122,930 123,828 123,601 122,909 123,265 2017 99,047 142,338 148,589 152,018 153,750 154,689 2018 135,416 184,813 192,698 193,487 196,376 2019 130,891 172,768 177,825 179,538 2020 164,613 215,107 220,953 2021 161,757 227,259 2022 186,677 Total 1,628,461 All outstanding liabilities before 2013, net of reinsurance 579 Liabilities for loss and loss expenses, net of reinsurance 130,277 Personal Automobile (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 108,417 109,620 106,225 106,703 107,759 107,680 107,916 107,803 107,754 107,758 57 22,376 2014 102,250 109,325 106,757 107,452 106,821 107,104 107,106 107,566 107,543 47 22,509 2015 96,387 99,698 100,214 99,570 98,718 98,588 98,596 98,669 117 20,865 2016 92,727 98,032 100,202 101,140 99,544 99,858 100,395 409 19,827 2017 101,880 105,139 103,653 103,260 103,557 105,079 710 20,748 2018 111,594 113,569 112,030 112,418 113,647 2,098 22,684 2019 114,043 115,688 115,993 118,669 4,163 22,860 2020 95,625 94,532 90,179 6,584 17,533 2021 108,244 102,777 10,411 19,672 2022 121,030 26,632 20,345 Total 1,065,746 Personal Automobile (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 61,384 80,861 92,637 100,528 105,131 106,679 106,876 107,419 107,423 107,417 2014 62,519 83,739 92,589 99,173 104,055 105,709 106,478 107,108 107,325 2015 58,725 76,470 87,163 92,102 95,997 97,275 97,761 97,920 2016 57,961 76,823 86,752 94,372 98,080 98,977 99,656 2017 62,854 82,730 91,479 97,628 100,521 103,556 2018 69,721 89,628 99,982 107,026 109,644 2019 69,699 92,162 102,930 109,844 2020 53,407 68,691 76,710 2021 65,325 84,743 2022 75,994 Total 972,809 All outstanding liabilities before 2013, net of reinsurance 7,045 Liabilities for loss and loss expenses, net of reinsurance 99,982 Homeowners (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 73,670 72,528 71,494 72,145 71,714 72,148 72,318 71,948 71,955 71,960 67 7,753 2014 80,111 82,461 83,637 83,844 83,539 83,824 83,525 83,830 83,819 60 8,776 2015 76,637 76,400 76,559 74,723 74,978 74,673 74,682 74,237 20 7,753 2016 60,105 60,931 62,391 61,723 61,735 60,855 60,841 438 6,896 2017 59,167 67,978 70,365 70,064 68,938 68,902 504 7,389 2018 62,961 68,526 69,832 68,931 68,416 608 7,608 2019 64,306 72,772 73,816 73,070 1,412 7,010 2020 109,033 112,523 113,804 3,611 9,824 2021 82,425 83,295 3,657 6,884 2022 93,826 17,362 5,819 Total 792,170 Homeowners (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Year Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 50,664 65,528 67,838 69,775 71,776 72,197 72,433 72,446 72,447 72,415 2014 61,561 76,007 79,751 81,664 82,583 82,836 82,831 83,321 83,782 2015 52,589 70,078 72,202 72,927 74,079 74,052 74,096 74,108 2016 42,252 57,333 59,546 60,082 61,187 60,449 60,474 2017 45,466 63,290 67,193 67,767 68,078 68,282 2018 49,430 64,137 65,348 66,634 67,739 2019 49,680 67,631 69,911 70,880 2020 83,838 105,690 109,145 2021 59,054 77,018 2022 68,832 Total 752,675 All outstanding liabilities before 2013, net of reinsurance 6,102 Liabilities for loss and loss expenses, net of reinsurance 45,597 E&S Casualty Lines (in thousands, except for claim counts) Incurred Loss and Allocated Loss Expenses, Net of Reinsurance As of December 31, 2022 Accident Year Unaudited IBNR Cumulative Number of Reported Claims 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 55,468 $ 60,309 67,099 69,112 67,647 68,972 68,451 68,029 60,349 60,511 3,504 2,311 2014 55,316 63,505 69,929 71,719 71,206 71,153 70,846 74,270 74,538 4,918 2,141 2015 75,498 76,432 82,404 90,488 90,355 90,126 87,662 90,263 4,646 2,887 2016 94,451 96,416 104,655 105,120 104,730 102,476 101,873 12,138 2,998 2017 91,438 95,783 99,866 99,395 99,960 102,045 11,390 2,848 2018 98,324 103,004 103,184 104,983 105,756 17,093 2,816 2019 117,087 118,298 117,736 117,113 39,429 2,683 2020 103,872 103,137 95,832 49,633 1,788 2021 128,099 125,436 89,909 1,751 2022 146,999 132,276 1,285 Total 1,020,366 E&S Casualty Lines (in thousands) Cumulative Paid Loss and Allocated Loss Expenses, Net of Reinsurance Accident Unaudited 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013 $ 2,715 $ 9,470 21,980 35,200 46,108 51,142 54,974 55,988 57,152 58,584 2014 2,353 12,234 25,571 43,877 53,780 60,092 64,698 66,661 68,648 2015 3,036 13,057 29,389 50,712 64,529 71,421 75,844 81,396 2016 3,720 16,195 33,950 56,581 69,448 75,004 81,932 2017 5,057 14,672 34,179 53,238 68,266 77,090 2018 5,509 21,337 39,174 57,962 73,605 2019 4,422 17,812 35,844 57,701 2020 3,695 13,064 27,861 2021 4,326 15,835 2022 4,198 Total 546,850 All outstanding liabilities before 2013, net of reinsurance 5,991 Liabilities for loss and loss expenses, net of reinsurance 479,507 (e) The reconciliation of the net incurred and paid claims development tables to the liability for loss and loss expenses in the consolidated statement of financial position is as follows: (in thousands) December 31, 2022 Net outstanding liabilities: Standard Commercial Lines General liability $ 1,688,645 Workers compensation 809,019 Commercial automobile 847,967 Businessowners' policies 110,471 Commercial property 130,277 Other Standard Commercial Lines 17,995 Total Standard Commercial Lines net outstanding liabilities 3,604,374 Standard Personal Lines Personal automobile 99,982 Homeowners 45,597 Other Standard Personal Lines 11,739 Total Standard Personal Lines net outstanding liabilities 157,318 E&S Lines Casualty lines 479,507 Property lines 18,075 Total E&S Lines net outstanding liabilities 497,582 Total liabilities for unpaid loss and loss expenses, net of reinsurance 4,259,274 Reinsurance recoverable on unpaid claims: Standard Commercial Lines General liability 246,736 Workers compensation 199,057 Commercial automobile 14,271 Businessowners' policies 19,277 Commercial property 81,970 Other Standard Commercial Lines 4,443 Total Standard Commercial Lines reinsurance recoverable on unpaid loss 565,754 Standard Personal Lines Personal automobile 36,529 Homeowners 7,124 Other Standard Personal Lines 132,525 Total Standard Personal Lines reinsurance recoverable on unpaid loss 176,178 E&S Lines Casualty lines 11,397 Property lines 4,184 Total E&S Lines reinsurance recoverable on unpaid loss 15,581 Total reinsurance recoverable on unpaid loss 757,513 Unallocated loss expenses 128,034 Total gross liability for unpaid loss and loss expenses $ 5,144,821 (f) The table below reflects the historical average annual percentage payout of incurred claims by age. For example, the general liability line of business averages payout of 6.3% of its ultimate losses in the first year, 11.8% in the second year, and so forth. The following is supplementary information about average historical claims duration as of December 31, 2022: Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1 2 3 4 5 6 7 8 9 10 General liability 6.3% 11.8 15.5 17.4 15.1 9.9 7.2 4.1 3.0 2.1 Workers compensation 22.3 25.9 13.9 8.9 4.7 3.0 1.9 1.8 3.1 2.2 Commercial automobile 36.8 16.9 14.6 13.3 9.9 4.2 1.9 1.1 0.7 0.1 Businessowners’ policies 49.0 21.8 8.3 8.1 6.1 3.1 1.3 0.6 0.3 0.2 Commercial property 68.7 26.4 3.2 1.0 0.4 — — — — — Personal automobile 59.8 18.1 8.8 6.5 3.7 1.7 0.5 0.4 0.2 0.1 Homeowners 70.8 21.8 3.5 1.6 1.7 0.2 0.2 0.1 0.1 — E&S Lines - casualty 3.9 11.5 18.0 21.7 15.8 7.9 6.8 5.2 2.6 3.5 |