v3.26.1
Liability for Future Policyholder Benefits
 6 Months Ended
Jun. 30, 2026
Insurance [Abstract]  
Liability for Future Policyholder Benefits
Note 5 - Property and Casualty Insurance Reserves
Property and Casualty Insurance Reserve activity for the six months ended June 30, 2026 and 2025 was:
Six Months Ended
(Dollars in Millions)Jun 30,
2026		Jun 30,
2025
Property and Casualty Insurance Reserves:
Gross of Reinsurance at Beginning of Year$2,910.8 $2,611.9 
Less: Reinsurance Recoverables at Beginning of Year25.6 24.3 
Property and Casualty Insurance Reserves, Net of Reinsurance at Beginning of Year2,885.2 2,587.6 
Incurred Losses and LAE related to:
Current Year1,491.4 1,440.4 
Prior Years15.9 14.4 
Total Incurred Losses and LAE1,507.3 1,454.8 
Paid Losses and LAE related to:
Current Year511.3 535.1 
Prior Years838.5 866.8 
Total Paid Losses and LAE1,349.8 1,401.9 
Property and Casualty Insurance Reserves, Net of Reinsurance at End of Period3,042.7 2,640.5 
Plus: Reinsurance Recoverables at End of Period22.4 24.2 
Property and Casualty Insurance Reserves, Gross of Reinsurance at End of Period$3,065.1 $2,664.7 
Property and Casualty Insurance Reserves are estimated based on historical experience patterns and current economic trends. Actual loss experience and loss trends may differ from these historical experience patterns and economic conditions. Loss experience and loss trends emerge over several years from the dates of loss inception. The Company monitors such emerging loss trends on a quarterly basis. Changes in such estimates are included in the Condensed Consolidated Statements of (Loss) Income in the period of change. Additionally, the Company reviews if any premium revisions are appropriate as a result of any incurred losses and loss adjustment expenses (“LAE”) related to prior years recorded in the current period. For the six months ended June 30, 2026 and 2025, no premium revisions were deemed necessary solely as a result of any incurred losses or LAE related to prior years recorded in the current year.
For the six months ended June 30, 2026, the net adverse prior year development of $15.9 million included $23.9 million of adverse development on prior accident years attributable to evolving loss patterns and higher defense costs associated with attorney-represented bodily injury coverages in the Commercial Automobile product line, partially offset by favorable development on other coverages and lower losses stemming from litigated matters.

For the six months ended June 30, 2025, the net adverse prior year development of $14.4 million included $24.0 million of adverse development on prior accident years attributable to evolving loss patterns and higher defense costs associated with attorney-represented bodily injury coverages and higher than expected development on litigated matters related to prior year claims in the Commercial Automobile product line. This adverse development was partially offset by $10.1 million of favorable reserve development on prior accident years primarily related to improved loss patterns on policies with personal injury protection coverage and partially offset by adverse development on litigated matters in the Specialty Personal Automobile product line.

The Company cannot predict whether loss and LAE reserves will develop favorably or unfavorably from the amounts reported in the Condensed Consolidated Financial Statements. Any such development could have a material effect on the Company’s consolidated financial results for a given period.
Note 6 - Liability for Future Policyholder Benefits
The Company’s Life Insurance Reserves are reported using the Company’s estimate of its liability for future policyholder benefits. The liability for future policyholder benefits is grouped by contract type and issue year into cohorts consistent with the grouping used in estimating the associated liability. Significant assumption inputs to the calculation of the liability for future policyholder benefits include mortality, lapses, and discount rates (both accretion and current). The liability is adjusted for differences between actual and expected experience.
The following tables summarize balances and changes in the present value of expected net premiums, present value of expected future policyholder benefits and net liability for future policyholder benefits as of and for the three and six months ended June 30, 2026 and 2025:
Three Months EndedSix Months Ended
(Dollars in Millions)Jun 30, 2026Jun 30, 2025Jun 30, 2026Jun 30, 2025
Present Value of Expected Net PremiumsBalance, Beginning of Period$681.8 $668.2 $672.6 $646.1 
Beginning Balance at Original Discount Rate$704.4 $695.0 $686.6 $681.0 
Effect of Changes in Cash Flow Assumptions— — — — 
Effect of Actual Variances from Expected Experience1.8 6.9 11.2 16.7 
Adjusted Beginning of Period Balance706.2 701.9 697.8 697.7 
Issuances27.2 20.3 53.0 40.7 
Interest Accrual7.4 7.5 14.7 14.8 
Net Premiums Collected(25.1)(24.1)(49.8)(47.6)
Ending Balance at Original Discount Rate715.7 705.6 715.7 705.6 
Effect of Changes in Discount Rate Assumptions(22.2)(22.5)(22.2)(22.5)
Balance, End of Period$693.5 $683.1 $693.5 $683.1 
Present Value of Expected Future Policyholder BenefitsBalance, Beginning of Period$3,295.2 $3,333.5 $3,348.5 $3,295.9 
Beginning Balance at Original Discount Rate$3,825.6 $3,823.5 $3,806.6 $3,812.1 
Effect of Changes in Cash Flow Assumptions— — — — 
Effect of Actual Variances from Expected Experience(0.1)6.7 8.9 16.7 
Adjusted Beginning of Period Balance3,825.5 3,830.2 3,815.5 3,828.8 
Issuances 27.1 20.7 52.9 41.1 
Interest Accrual41.8 42.0 83.5 84.0 
Benefit Payments(55.9)(58.6)(113.4)(119.6)
Ending Balance at Original Discount Rate3,838.5 3,834.3 3,838.5 3,834.3 
Effect of Changes in Discount Rate Assumptions(506.7)(490.9)(506.7)(490.9)
Balance, End of Period$3,331.8 $3,343.4 $3,331.8 $3,343.4 
Net Liability for Future Policyholder Benefits, pre-flooring$2,638.3 $2,660.3 $2,638.3 $2,660.3 
Cumulative impact of flooring the future Policyholder Benefits Reserve— — — — 
Net Liability for Future Policyholder Benefits, post-flooring2,638.3 2,660.3 2,638.3 2,660.3 
Less: Reinsurance Recoverable— — — — 
Net Liability for Future Policyholder Benefits, After Reinsurance Recoverable$2,638.3 $2,660.3 $2,638.3 $2,660.3 
Note 6 - Liability for Future Policyholder Benefits (Continued)
The weighted-average liability duration of the liability for future policyholder benefits as calculated under current rates is as follows:
Jun 30, 2026Jun 30, 2025
Weighted-Average Liability Duration of the Liability for Future Policyholder Benefits (Years)13.413.7
The reconciliation of the net liability for future policyholder benefits to Life and Health Insurance Reserves in the Condensed Consolidated Balance Sheets is as follows:
(Dollars in Millions)Jun 30, 2026Jun 30, 2025
Net Liability for Future Policyholder Benefits, post-flooring$2,638.3 $2,660.3 
Deferred Profit Liability510.3 444.5 
Other1
129.5 130.5 
Total Life and Health Insurance Reserves$3,278.1 $3,235.3 
1Other primarily consists of Accident and Health and Universal Life reserves
The amounts of expected undiscounted future benefit payments, expected undiscounted future gross premiums and expected discounted future gross premiums, are as follows:
(Dollars in Millions)Jun 30, 2026Jun 30, 2025
Expected Future Benefit Payments, undiscounted$10,067.6 $10,162.1 
Expected Future Gross Premiums, undiscounted$3,938.1 $4,015.8 
Expected Future Gross Premiums, discounted$2,641.2 $2,691.6 
The amount of revenue and interest recognized on life insurance products in the Condensed Consolidated Statements of (Loss) Income is as follows:
Three Months EndedSix Months Ended
(Dollars in Millions)Jun 30, 2026Jun 30, 2025Jun 30, 2026Jun 30, 2025
Gross Premiums or Assessments $99.4 $98.8 $200.9 $200.5 
Interest Expense $34.3 $34.4 $68.8 $69.1 
The weighted-average interest rate is as follows:
Jun 30, 2026Jun 30, 2025
Interest Accretion Rate4.50 %4.50 %
Current Discount Rate5.83 %5.74 %
Significant assumption inputs to the calculation of the liability for future policyholder benefits include mortality, lapses, and discount rates (both accretion and current). The Company did not make any changes to mortality and lapse assumptions during the six months ended June 30, 2026 and 2025. Market data that underlies current discount rates was updated as of June 30, 2026.
The balances of and changes in Deferred Profit Liability as of and for the periods indicated are as follows:
Six Months Ended
(Dollars in Millions)Jun 30, 2026Jun 30, 2025
Balance, Beginning of Year$481.7 $412.1 
Profits Deferred77.0 79.6 
Interest Accrual11.2 9.7 
Amortization(58.9)(57.6)
Effect of Actual Variances from Expected Experience and Other Changes(0.7)0.7 
Balance, End of Period$510.3 $444.5