THG 2018 Annual Report

SCHEDULE V THE HANOVER INSURANCE GROUP, INC. VALUATION AND QUALIFYING ACCOUNTS DECEMBER 31 Additions (in millions) Description Balance at beginning of period Charged to costs and expenses Charged to other accounts (1) Deductions Balance at end of period 2018 Allowance for doubtful accounts $ 4.3 $ 9.5 $ ² $ (9.6) $ 4.2 Allowance for uncollectible reinsurance recoverables 9.7 0.6 (6.4) ² 3.9 $ 14.0 $ 10.1 $ (6.4) $ (9.6) $ 8.1 2017 Allowance for doubtful accounts $ 3.7 $ 9.4 $ ² $ (8.8) $ 4.3 Allowance for uncollectible reinsurance recoverables (2) 13.1 0.3 0.1 (3.8) 9.7 $ 16.8 $ 9.7 $ 0.1 $ (12.6) $ 14.0 2016 Allowance for doubtful accounts $ 3.2 $ 8.7 $ ² $ (8.2) $ 3.7 Allowance for uncollectible reinsurance recoverables (2)(3) 9.7 3.4 0.1 (0.1) 13.1 $ 12.9 $ 12.1 $ 0.1 $ (8.3) $ 16.8 (1) Amounts charged to other accounts include foreign exchange gains and losses. Additionally, in 2018 the Company sold its Chaucer business; and accordingly, the $6.4 million balance associated with this business was reduced as part of the sale. (2) The balance at beginning of period and the balance at end of period include $6.3 million and $6.4 million, respectively, for the year-ended 2017 and $6.2 million and $6.3 million, respectively, for the year-ended 2016 related to the former Chaucer business. (3) Activity primarily relates to the impairment in 2016 and subsequent write-off in 2017 of a receivable that is associated with a single reinsurance counterparty that was placed into conservation by the state of California in July 2016. This counterparty is not LQYROYHG LQ WKH &RPSDQ\¶V RQJRLQJ UHLQVXUDQFH SURJUDP DQG WKH HQWLUH UHFHLYDEOH UHODWHG WR WKLV FRXQWHU party resulted from a one- WLPH EORFN UHLQVXUDQFH WUDQVDFWLRQ WKDW RFFXUUHG LQ DV SDUW RI WKH &RPSDQ\¶V H[SRVXUH PDQDJHPHQW DFWLRQV 153 2018 ANNUAL REPORT | THE HANOVER INSURANCE GROUP