Company: L
Filing Date: 2025-02-11
Form Type: 10-K
Source: 0000060086-25-000036
Chunk: 84

Company: LOEWS CORP
Filing Date: 2025-02-11
Form: 10-K
Item: Item 3
Chunk 84
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250 million. Net reserves for workers’ compensation were approximately $3.5 billion as of December 31, 2024.

For general liability, the most significant factor affecting reserve estimates is claim severity. Claim severity is driven by changes in the cost of repairing or replacing property, the cost of medical care, the cost of wage replacement, judicial decisions, legislation and other factors. If the estimated claim severity for general liability increases by 6%, CNA estimates that its net reserves would increase by approximately $300 million. If the estimated claim severity for general liability decreases by 3%, CNA estimates that its net reserves would decrease by approximately $150 million. Net reserves for general liability were approximately $4.9 billion as of December 31, 2024.

Commercial auto liability is also considered long-tail; however, both the frequency of claims and severity of loss assumptions for the latest few accident years are significantly influenced by social inflation, economic inflation, driving habits and attorney involvement. If these trends accelerate beyond expectations, there may be significant deviation in CNA’s net reserves.  If the estimated auto liability claim severity were to increase 5% and frequency were to increase 1% on the three most recent accident years, CNA estimates that its net reserves would increase by approximately $90 million.  CNA’s net reserves for commercial auto were approximately $1.2 billion as of December 31, 2024. 

Given the factors described above, it is not possible to quantify precisely the ultimate exposure represented by claims and related litigation. As a result, CNA regularly reviews the adequacy of its reserves and reassesses its reserve estimates as historical loss experience develops, additional claims are reported and settled and additional information becomes available in subsequent periods. In reviewing CNA’s reserve estimates, CNA makes adjustments in the period that the need for such adjustments is determined. These reviews have resulted in CNA’s identification of information and trends that have caused CNA to change its reserves in prior periods and could lead to CNA’s identification of a need for additional material increases or decreases in claim and claim adjustment expense reserves, which could materially affect our results of operations and equity and CNA’s business and insurer financial strength and corporate debt ratings positively or negatively. See Note 8 of the Notes to the Consolidated Financial Statements included under Item 8 for additional information about reserve development.

72

The following table summarizes gross and net carried reserves for CNA’s Property & Casualty Operations:

December 3120242023(In millions)     G