v3.26.3
Loss and Loss Adjustment Expense Reserves
 9 Months Ended
Sep. 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:
September 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 year44,839 40,922 
Prior years(1,536)(1,068)
Total incurred43,303 39,854 
Paid related to:
Current year23,579 21,904 
Prior years16,033 14,228 
Total paid39,612 36,132 
Net balance at September 30
43,194 38,292 
Plus reinsurance recoverables on unpaid losses3,592 3,813 
Balance at September 30
$46,786 $42,105 
We experienced favorable reserve development of $1,536 million and $1,068 million during the first nine months of 2026 and 2025, respectively, which is reflected as “incurred related to prior years” in the table above.
Year-to-date September 30, 2026
•The favorable prior-year reserve development included approximately $975 million attributable to accident year 2025, $325 million to accident year 2024, and the remainder to accident years 2023 and prior.
•Our personal auto products incurred about $1,300 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 loss adjustment expenses.
•Our Commercial Lines business incurred about $210 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 September 30, 2025
•The favorable prior-year reserve development included approximately $660 million attributable to accident year 2024, $190 million to accident year 2023, and the remainder to accident years 2022 and prior.
•Our personal auto products incurred about $910 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 and lower than anticipated payments on reopened property damage claims that were previously closed.
•Our personal property products experienced about $75 million of favorable development, primarily attributable to favorable development on 2024 catastrophe events.
•Our Commercial Lines business experienced about $80 million of favorable development, primarily attributable to lower than anticipated severity in our TNC business, partially offset by higher than anticipated severity and litigation defense costs in our core commercial auto bodily injury coverages.