Average renewal rates outside the United States were up slightly in our commercial insurance segment in both 2014 and 2013 compared with expiring rates. In our professional liability business, such rates were flat in 2014 and up slightly in 2013 compared with expiring rates. The amounts of coverage purchased or the insured exposures were down slightly in 2014 and down modestly in 2013 in both our commercial insurance segment and professional liability business compared with the respective prior year. We continued to retain a high percentage of our existing commercial and professional liability business in both years. Retention levels in 2014 compared with 2013 increased modestly in our commercial insurance segment and were similar in our professional liability business. Retention levels in 2013 compared with 2012 were similar in our commercial insurance segment, but increased modestly in our professional liability business. The level of new business in 2014 compared to 2013 was up in both
our commercial insurance segment and professional liability business, but more so in our commercial insurance segment. The level of new business in 2013 compared with 2012 was up slightly in our commercial insurance segment, but down in our professional liability business.
For hurricane and severe thunderstorm events along the southern U.S. coastline, the $150 million catastrophe bond arrangement provides additional coverage of approximately 50% of homeowners-related hurricane and severe thunderstorm losses (net of recoveries from other available reinsurance) between $855 million and $1.15 billion.
Our major, traditional property reinsurance treaties expire on April 1, 2015. We expect that the property reinsurance treaty market will remain competitive with respect to price as well as terms and conditions. The final structure of our reinsurance program and amount of coverage purchased, including the mixture of traditional catastrophe reinsurance and collateralized reinsurance coverage funded through the issuance of collateralized risk linked securities, is still being determined and will affect our total reinsurance costs in 2015.
Casualty results were profitable in each of the past three years, but less so in 2013. The 4.8 percentage point decrease in the combined ratio in 2014 compared with 2013 was due primarily to better results in the primary liability component of this business. The 5.2 percentage point increase in the combined ratio in 2013 compared with 2012 was mainly due to less profitable results in the excess liability component and to a greater adverse impact from asbestos and toxic waste claims. Results for the automobile component of our casualty business were modestly unprofitable in 2014 compared with modestly profitable results in 2013 and near breakeven results in 2012. Results for the primary liability component of our casualty business were slightly profitable in 2014 compared with unprofitable results in 2013 and 2012, which were adversely affected by a higher number of large reported losses, many of which related to prior accident years. Results for the excess liability component were highly profitable in each of the past three years. Excess liability results in all three years, but more so in 2012, benefited from substantial favorable prior year loss development mainly driven by lower than expected claim severity. Results for our casualty business were adversely affected in each of the past three years by incurred losses related to asbestos and toxic waste claims. Our analysis of these exposures resulted in increases in the estimate of our ultimate liabilities. Such losses represented 6.0 percentage points of the combined ratio for our casualty business in 2014, 5.1 percentage points in 2013 and 3.4 percentage points in 2012.
As part of our loss reserving analysis, we take into consideration the various factors that contribute to the uncertainty in the loss reserving process. Those factors that could materially affect our loss reserve estimates include loss development patterns and loss cost trends, rate and exposure level changes, the effects of changes in coverage and policy limits, business mix shifts, the effects of regulatory and legislative developments, the effects of changes in judicial interpretations, the effects of emerging claims and coverage issues and the effects of changes in claim handling practices. In making estimates of reserves, however, we do not necessarily make an explicit assumption for each of these factors. Moreover, all estimation methods do not utilize the same assumptions and typically no single
At December 31, 2014, $321 million of the net loss reserves related to asbestos claims were IBNR reserves.
driven by accident years 2010 and prior. This emergence was recognized as one among many factors in the determination of carried loss reserves for these classes at December 31, 2014. Among other important factors were the uncertainty from the crisis in the financial markets and its aftermath, the effects of the ensuing economic downturn, other recent litigation dynamics, and the positive pricing trends experienced in the past three years.
We experienced favorable development of about $265 million in the aggregate, including $30 million related to catastrophes, in the personal and commercial property classes, mostly related to the 2012 and 2011 accident years. The severity and frequency of late developing property claims that emerged during 2013 were lower than expected, including those related to catastrophes, and the development of existing case reserves was more favorable than expected.
We experienced overall favorable development of about $260 million in the professional liability classes other than fidelity. This favorable development was driven by the directors and officers liability and fiduciary liability classes, partially offset by adverse development in the errors and omissions liability and employment practices liability classes. Overall, the reported loss activity was less than expected, with aggregate favorable emergence from accident years 2010 and prior.
During each of the past three years, the fair value of some of our investments were at a level below our cost. Some of these investments were deemed to be other than temporarily impaired. In 2012, about 65% of the $40 million of other-than-temporary impairment losses recognized for equity securities related to issuers in the financial services industry.
2.25%. Subject to certain conditions, Chubb has the right to defer the payment of interest on the capital securities for a period not exceeding ten consecutive years. During any such period, interest will continue to accrue and Chubb generally may not declare or pay any dividends on or purchase any shares of its capital stock.
Management regularly monitors the Corporation’s capital resources. In connection with our long term capital strategy, from time to time Chubb may contribute capital to its property and casualty subsidiaries. In addition, in order to satisfy capital needs as a result of any rating agency capital adequacy or other future rating issues, or in the event we were to need additional capital to make strategic investments in light of market opportunities, we may take a variety of actions, which could include the issuance of additional debt and/or equity securities. We believe that our strong financial position and current debt level provide us with the flexibility and capacity to obtain funds externally through debt or equity financings on both a short term and long term basis.
Pursuant to these authorizations, Chubb repurchased shares of its common stock in open market transactions as follows: in 2012, repurchased 13,094,640 shares at a cost of $935 million; in 2013, repurchased 14,887,701 shares at a cost of $1,300 million; and in 2014, repurchased 16,893,455 shares at a cost of $1,555 million.
The Corporation’s liquidity requirements in the past have generally been met by funds from operations and we expect that funds from operations will continue to be sufficient to meet such requirements in the future. Liquidity requirements could also be met by funds received upon the maturity or sale of marketable securities in our investment portfolio. The Corporation also has the ability to borrow under its $500 million credit facility and we believe we could issue debt or equity securities.