The following table details our Property segment incurred claims and claim expenses, net of reinsurance, as of December 31, 2020.
Our initial and subsequent estimates of incurred claims and claim expenses, net of reinsurance, are impacted by available information derived from claims information from certain customers and brokers, industry assessments of losses, proprietary models, and the terms and conditions of our contracts. As described above, given the complexity in reserving for claims and claims expenses associated with property losses, and catastrophe excess of loss reinsurance contracts in particular, which make up a significant proportion of our Property segment, we have experienced development, both favorable and unfavorable, in any given accident year. For example, net claims and claim expenses associated with the 2017 accident year have experienced favorable development. This is largely driven by reductions in estimated net ultimate claims and claim expenses associated with Hurricanes Harvey, Irma and Maria, the Mexico City
historical industry default statistics developed by major rating agencies and are then adjusted by us based on industry knowledge and our judgment and estimates. We then evaluate the overall adequacy of the provision for current expected credit losses based on other qualitative and judgmental factors. At December 31, 2020, our reinsurance recoverable balance was $2.9 billion (2019 - $2.8 billion). Of this amount, 45.2% is fully collateralized by our reinsurers, 53.4% is recoverable from reinsurers rated A- or higher by major rating agencies and 1.4% is recoverable from reinsurers rated lower than A- by major rating agencies (2019 - 57.5%, 41.0% and 1.5%, respectively). The reinsurers with the three largest balances accounted for 15.3%, 10.8% and 6.7%, respectively, of our reinsurance recoverable balance at December 31, 2020 (2019 - 12.7%, 7.2% and 7.0%, respectively). The provision for current expected credit losses recorded against reinsurance recoverable was $6.3 million at December 31, 2020 (2019 - $7.3 million). The three largest company-specific components of the provision for current expected credit losses represented 13.2%, 13.0% and 6.7%, respectively, of our total provision for current expected credit losses at December 31, 2020 (2019 - 18.1%, 7.9% and 7.2%, respectively).
At December 31, 2020, we classified $81.2 million and $7.6 million of our assets and liabilities, respectively, at fair value on a recurring basis using Level 3 inputs. This represented 0.3% and 0.0% of our total assets and liabilities, respectively. Level 3 fair value measurements are based on valuation techniques that use at least one significant input that is unobservable. These measurements are made under circumstances in which there is little, if any, market activity for the asset or liability. We use valuation models or other pricing techniques that require a variety of inputs including contractual terms, market prices and rates, yield curves, credit curves, measures of volatility, prepayment rates and correlations of such inputs, some of which may be unobservable, to value these Level 3 assets and liabilities.
Income taxes have been provided in accordance with the provisions of FASB ASC Topic Income Taxes. Deferred tax assets and liabilities result from temporary differences between the amounts recorded in our consolidated financial statements and the tax basis of our assets and liabilities. Such temporary differences are primarily due to net operating loss carryforwards and GAAP versus tax basis accounting differences relating to unearned premiums, reserves for claims and claim expenses, deferred finance charges, deferred underwriting results, accrued expenses, investments, deferred acquisition expenses, intangible assets, amortization and depreciation and VOBA. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period in which the change in tax rates is enacted. A valuation allowance against net deferred tax assets is recorded if it is more likely than not that all, or some portion, of the benefits related to deferred tax assets will not be realized.
In 2019, our Property segment gross premiums written increased by $670.1 million, or 38.1%, to $2.4 billion, compared to $1.8 billion in 2018.