v3.26.1
Loss and Loss Adjustment Expense Reserves
 6 Months Ended
Jun. 30, 2026
Loss and Loss Adjustment Expenses Reserves [Abstract]  
Loss and Loss Adjustment Expense Reserves LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES
Activity in the loss and loss adjustment expense reserves is summarized as follows:
June 30,
(millions)20262025
Balance at January 1$43,310 $39,057 
Less reinsurance recoverables on unpaid losses3,807 4,487 
Net balance at January 139,503 34,570 
Incurred related to:
Current year29,401 27,016 
Prior years(1,002)(607)
Total incurred28,399 26,409 
Paid related to:
Current year13,928 12,842 
Prior years12,073 10,883 
Total paid26,001 23,725 
Net balance at June 30
41,901 37,254 
Plus reinsurance recoverables on unpaid losses3,666 3,900 
Balance at June 30
$45,567 $41,154 
We experienced favorable reserve development of $1,002 million and $607 million during the first six months of 2026 and 2025, respectively, which is reflected as “incurred related to prior years” in the table above.
Year-to-date June 30, 2026
•The favorable prior-year reserve development included approximately $670 million attributable to accident year 2025, $220 million to accident year 2024, and the remainder to accident years 2023 and prior.
•Our personal auto products incurred about $845 million of favorable loss and loss adjustment expense (LAE) reserve development, with the agency and direct auto businesses each contributing about half. The favorable development was primarily due to lower than anticipated bodily injury severity and, to a lesser extent, lower than anticipated payments on reopened property damage claims that were previously closed and lower than anticipated personal injury protection loss adjustment expenses.
•Our Commercial Lines business incurred about $140 million of favorable loss and LAE reserve development. The favorable development was primarily due to lower than anticipated injury severity in our transportation network company (TNC) business, partially offset by higher than anticipated injury severity and litigation defense costs in our core commercial auto products.
Year-to-date June 30, 2025
•The favorable prior-year reserve development included approximately $400 million attributable to accident year 2024, $115 million to accident year 2023, and the remainder to accident years 2022 and prior.
•Our personal auto products incurred about $520 million of favorable loss and LAE reserve development, with the agency and direct auto businesses each contributing about half. The favorable development was primarily due to lower than anticipated loss severity and frequency in Florida and, to a lesser extent, lower than anticipated litigation defense costs across most states.
•Our personal property products experienced about $50 million of favorable development, primarily attributable to favorable development on 2024 catastrophe events.
•Our Commercial Lines business experienced about $45 million of favorable development, primarily attributable to lower than anticipated severity in our TNC business.