THG 2018 Annual Report

ultimate claims deterioration would have decreased incurred catastrophe losses by approximately $9 million, net of reinsurance. Carried Reserves and Reserve Rollforward The following table provides a reconciliation of the gross beginning and ending reserve for unpaid losses and loss adjustment expenses. YEARS ENDED DECEMBER 31 2018 2017 2016 (in millions) Gross loss and LAE reserves, beginning of year $ 5,058.5 $ 4,660.0 $ 4,201.9 Reinsurance recoverable on unpaid losses 1,455.0 1,349.2 1,295.3 Net loss and LAE reserves, beginning of year 3,603.5 3,310.8 2,906.6 Net incurred losses and LAE in respect of losses occurring in: Current year 2,733.5 2,579.8 2,307.8 Prior year non-catastrophe development 0.4 1.2 235.6 Prior year catastrophe development (9.3) (1.4) 2.6 Total incurred losses and LAE 2,724.6 2,579.6 2,546.0 Net payments of losses and LAE in respect of losses occurring in: Current year 1,232.3 1,203.8 1,063.0 Prior years 1,264.3 1,083.1 1,078.8 Total payments 2,496.6 2,286.9 2,141.8 Net reserve for losses and LAE, end of year 3,831.5 3,603.5 3,310.8 Reinsurance recoverable on unpaid losses 1,472.6 1,455.0 1,349.2 Gross reserve for losses and LAE, end of year $ 5,304.1 $ 5,058.5 $ 4,660.0 The following table summarizes the gross reserve for losses and LAE by line of business. DECEMBER 31 2018 2017 2016 (in millions) Commercial multiple peril $ 1,098.7 $ 1,012.5 $ 899.7 Workers' compensation 649.3 628.3 580.2 Commercial automobile 399.6 380.2 374.2 Other commercial lines: AIX program business 492.0 475.4 453.2 General liability 285.0 269.8 261.9 Umbrella 139.7 135.9 112.6 Surety 99.0 87.8 72.4 Other lines 395.3 410.6 311.5 Total other commercial lines 1,411.0 1,379.5 1,211.6 Total Commercial Lines 3,558.6 3,400.5 3,065.7 Personal automobile 1,532.8 1,471.7 1,430.2 Homeowners and other personal 174.8 147.6 123.8 Total Personal Lines 1,707.6 1,619.3 1,554.0 Total Other Segment 37.9 38.7 40.3 Total loss and LAE reserves $ 5,304.1 $ 5,058.5 $ 4,660.0 ³2WKHU FRPPHUFLDO OLQHV ± 2WKHU OLQHV´ LQ WKH WDEOH DERYH LV SULPDULO\ FRPSULVHG RI PDQDJHPHQW DQG SURIHVVLRQDO OLDELOLW\ PDULQH miscellaneous comm HUFLDO SURSHUW\ KHDOWKFDUH DQG ILGHOLW\ OLQHV /RVV DQG /$( UHVHUYHV LQ RXU ³7RWDO 2WKHU 6HJPHQW´ UHODWH WR RXU run-off voluntary assumed reinsurance pools business. 52 THE HANOVER INSURANCE GROUP | 2018 ANNUAL REPORT