Directors’ and officers’ claims

Commercial auto liability

General liability

Personal auto liability

Other Operations’ non-asbestos and non-environmental reserves

Other reserve re-estimates, net [1]

Released reserves for professional liability claims by $53, primarily related to accident years 2003 to 2008. Beginning in 2008, the Company observed that claim severity for both D&O and E&O claims for the 2003 to 2006 accident years was developing favorably to previous expectations and the Company released reserves for these accident years in 2008. During 2009, the Company’s updated analysis showed that claim severity for D&O losses in the 2003 to 2008 accident years continued to develop favorably to previous expectations, resulting in a reduction of reserves.

Released reserves for commercial auto liability claims by $39 including $23 in Small Commercial, primarily related to accident years 2003 to 2008. In the fourth quarter of 2009, the Company recognized that the full value of large auto liability claims was being recognized as case reserves at an earlier age. The increased adequacy of case reserves caused the Company to decrease its estimate of reserves for IBNR loss and loss adjustment expenses.

Released reserves for general liability claims by $27, primarily related to accident years 2004 to 2007. Beginning in the third quarter of 2007, the Company observed that reported losses for high hazard and umbrella general liability claims, primarily related to the 2001 to 2006 accident years, were emerging favorably and this caused management to reduce its estimate of the cost of future reported claims for these accident years, resulting in a reserve release in each quarter since the third quarter of 2007. During 2009, management determined that the lower level of loss emergence was also evident in accident year 2007 and had continued for accident years 2003 to 2006 and, as a result, the Company reduced the reserves. In addition, during the third quarter of 2009, the Company recognized that the cost of late emerging exposures were likely to be higher than previously expected. Also in the third quarter, the Company recognized additional ceded losses on accident years 1999 and prior. These third quarter events were largely offsetting.

Released reserves for Personal Lines auto liability claims by $24. Beginning in the first quarter of 2008, management observed an improvement in emerged claim severity for the 2005 through 2007 accident years attributed, in part, to changes made in claim handling procedures in 2007. During 2009, the Company recognized that favorable development in reported severity was a sustained trend for those accident years and, accordingly, management reduced its reserve estimate. In the third quarter of 2009, management also recognized sustained favorable development trends in AARP for accident year 2008 and released reserves for that

In the fourth quarter of 2009, the Company completed its evaluation of certain of its non-asbestos and non-environmental reserves, including its assumed reinsurance liabilities. Based on this evaluation, the Company strengthened reserves by $35, including $25 related to projected unallocated loss adjustment expenses.

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