Question-and-Answer Session
Operator
Thank you. (Operator Instructions) We'll go first to Matthew Heimermann, J.P. Morgan.
Matthew Heimermann - J.P. Morgan Securities Inc.
Hi. Good morning, everyone.
Michael D. Price - President, CEO
Good morning, Matt.
Matthew Heimermann - J.P. Morgan Securities Inc.
A couple quick questions. Maybe, Neal, could you just talk about, particularly in the Casualty segment, what drove some of the development? Is that just a function of the year end process or were there - anything unusual come out of that?
Neal J. Schmidt - Chief Actuary
Well, there's a couple of items, Matt. One is that during the quarter we had two contracts that were commuted and we had been carrying those at loss ratios higher than what the ultimate commutation amount was, so that was a significant item.
Secondly, in our U.K. motor business our year end review we lowered the tail factors we had been using, and at the same time the ceding companies lowered the [inaudible] so we had a double effect of a [inaudible] coupled with a lower inception-to-date loss in that, and that was a significant item.
And the third item, which was smaller, is in the surety area. Just as our general process, the inception-to-date losses on the 2005 year got to a point of credibility where we felt the favorable experience warranted a lower loss [inaudible]. [break in audio] three major items in the quarter.
Matthew Heimermann - J.P. Morgan Securities Inc.
Okay, that's helpful. Thank you.
Michael, could you just maybe touch on - your 1/1 renewal experience, I mean, seems to - well, I guess if we look at 1/1 renewals across a whole cross-section of the industry, there's obviously, you know, there's some companies who are renewal portfolios haven't changed at all. There's others where they've changed more dramatically.
I guess could you compare and contrast what's happening in the market that might help explain why there's a deviation, or is are we just at an inflection point where perception of risk is starting to dramatically change.
Michael D. Price - President, CEO
I think, Matt, that we are a point in the market cycle where there's a divergence of opinion among market participants as to just how profitable the Casualty business may be right now. Clearly, we can think of examples of companies who were very aggressive in fighting for share on [inaudible] at January 1 and thereby managed to hold their premium writings level. Whereas there are others who, like us, sought to restructure their involvement, reduce their participation or just retire from programs. And as you pointed out, we're somewhere in the middle of that pack.
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