Unpaid Losses And Loss Adjustment Expenses

9 Months Ended

Sep. 30, 2025

Liability for Unpaid Claims and Claims Adjustment Expense, Incurred Claims [Abstract]

Unpaid Losses And Loss Adjustment Expenses

Unpaid Losses and Loss Adjustment Expenses

The following table presents a reconciliation of consolidated beginning and ending reserves for losses and loss adjustment expenses.


	Nine Months Ended September 30,
(dollars in thousands)	2025		2024
Gross reserves for losses and loss adjustment expenses, beginning of year	$	26,633,094	$	23,483,321
Reinsurance recoverables on unpaid losses, beginning of year	11,120,367		8,820,567
Net reserves for losses and loss adjustment expenses, beginning of year	15,512,727		14,662,754
Effect of foreign currency rate changes on beginning of year balance	160,363		45,503
Adjusted net reserves for losses and loss adjustment expenses, beginning of year	15,673,090		14,708,257
Incurred losses and loss adjustment expenses:
Current accident year	4,156,998		4,155,146
Prior accident years	(360,473)		(344,212)
Total incurred losses and loss adjustment expenses	3,796,525		3,810,934
Payments:
Current accident year	444,603		444,221
Prior accident years	2,640,264		2,415,104
Total payments	3,084,867		2,859,325
Effect of foreign currency rate changes on current year activity	900		1,861
Change in net reserves for losses and loss adjustment expenses of Markel CATCo Re	(2,005)		(78,091)
Commutation of ceded reinsurance contracts	312,244		—


Net reserves for losses and loss adjustment expenses, end of period	16,695,887		15,583,636
Reinsurance recoverables on unpaid losses, end of period	12,442,082		10,293,842
Gross reserves for losses and loss adjustment expenses, end of period	$	29,137,969	$	25,877,478

For the nine months ended September 30, 2025, current accident year losses and loss adjustment expenses included $56.6 million of net losses and loss adjustment expenses attributed to the series of wildfires that occurred in southern California in January 2025 (California Wildfires). The net losses and loss adjustment expenses attributed to the California Wildfires as of September 30, 2025 represent the Company's best estimate based upon information currently available. This loss estimate was based on claims received, policy level reviews, and an analysis of ceded reinsurance contracts. The Company's estimate is based on various assumptions about coverage and liability and is therefore subject to change. While the Company believes its net reserves for the California Wildfires as of September 30, 2025 are adequate, it continues to closely monitor reported claims and may adjust the estimate of ultimate net losses as new information becomes available.

For the nine months ended September 30, 2025, losses and loss adjustment expenses included $360.5 million of favorable development on prior years loss reserves, which included $314.8 million of net favorable development on the Company's marine and energy, property, programs, general liability, and workers' compensation product lines within its Markel Insurance segment. Favorable development on the Markel Insurance segment's prior years loss reserves was net of $142.3 million of adverse development on run-off risk-managed directors and officers product lines.

In July 2025, the Company commuted a portfolio of ceded reinsurance contracts with certain Nephila Reinsurers (see note 9) consisting of property catastrophe and brokerage property exposures for policy years 2023 and prior. Gross and ceded reserves for losses and loss adjustment expenses on the commuted contracts totaled $312.2 million and resulted in cash payments of $292.6 million.

For the nine months ended September 30, 2024, current accident year losses and loss adjustment expenses included $62.0 million of net losses and loss adjustment expenses attributed to Hurricane Helene.

For the nine months ended September 30, 2024, losses and loss adjustment expenses included $344.2 million of favorable development on prior years loss reserves, which included $289.9 million of net favorable development on the Company's international professional liability product lines, as well as its general liability, property, and credit and surety product lines within its Markel Insurance segment.

MARKEL GROUP INC. 10-Q