RenaissanceRe Reports Fourth Quarter 2021 Net Income Available to Common Shareholders of $210.9 Million; Operating Income Available to Common Shareholders of $213.7 Million.

RenaissanceRe Reports Annual Net Loss Attributable to Common Shareholders of $73.4 Million; Operating Income Available to Common Shareholders of $81.6 Million.

  • Grew gross premiums written by $2.0 billion, or 34.9%, and net premiums written by $1.8 billion, or 45.0%, in 2021.
  • Casualty and Specialty segment combined ratio of 92.5% in the fourth quarter of 2021 and 97.0% in 2021.
  • Repurchased $326.9 million of common shares in the fourth quarter; aggregate of $1.0 billion of common shares repurchased in 2021; and an additional $56.7 million of common shares repurchased from January 1, 2022 through January 21, 2022.
  • Raised $1.1 billion of additional capital in the Capital Partners business in 2021, including $258.0 million from RenaissanceRe, with a further $662.7 million raised effective January 1, 2022, including $209.7 million from RenaissanceRe.
  • 2021 Weather-Related Large Losses contributed a $962.1 million net negative impact on net loss attributable to common shareholders in 2021, including $53.4 million in the fourth quarter of 2021.

RenaissanceRe Holdings Ltd. (NYSE: RNR) (“RenaissanceRe” or the “Company”) today announced its financial results for the fourth quarter and full year 2021.

Fourth Quarter 2021

Net Income Available to Common Shareholders per Diluted Common Share: $4.65

Operating Income Available to Common Shareholders per Diluted Common Share*: $4.71

Underwriting Income

Fee Income

Net Investment Income

$276.7M

$30.0M

$80.5M

Change in Book Value per Common Share: 2.5%

Change in Tangible Book Value per Common Share Plus Change in Accum. Dividends*: 2.8%

*

Operating Return on Average Common Equity, Operating Income (Loss) Available (Attributable) to Common Shareholders, Operating Income (Loss) Available (Attributable) to Common Shareholders per Diluted Common Share and Change in Tangible Book Value per Common Share Plus Change in Accumulated Dividends are non-GAAP financial measures; see “Comments on Regulation G” for a reconciliation of non-GAAP financial measures.

Kevin J. O’Donnell, President and Chief Executive Officer, said, “The fourth quarter was a solid finish to a difficult year. We reported a return on average common equity of over 14% for the quarter driven by record profitability in our Casualty and Specialty segment and strong results in our Property segment. For the full year, we earned a modest operating profit despite catastrophe losses of nearly $1 billion. At the same time, we exercised leadership in the market, growing net premiums written by 45% while simultaneously returning over $1 billion in capital to shareholders.

 

At the January 2022 renewal, our Capital Partners team once again led the industry, raising $500 million in DaVinci to grow in an improving environment and further optimize our Property segment. In addition, we continued to expand our Casualty and Specialty business in an attractive market, and as a result have built a stronger, more diversified and efficient underwriting portfolio that I am confident will produce superior returns for our shareholders in 2022.”

Consolidated Financial Results - Fourth Quarter

 

Consolidated Highlights

 

 

 

 

 

Three months ended

December 31

 

(in thousands, except per share amounts and percentages)

2021

 

2020

 

Gross premiums written

$

1,313,018

 

 

$

935,514

 

 

Underwriting income (loss)

 

276,661

 

 

 

(151,655

)

 

Combined ratio

 

79.4

%

 

 

114.7

%

 

 

 

 

 

 

Net Income (Loss)

 

 

 

 

Available (Attributable) to common shareholders

 

210,917

 

 

 

189,812

 

 

Available (Attributable) to common shareholders per diluted common share

$

4.65

 

 

$

3.74

 

 

Operating Income (Loss) (1)

 

 

 

 

Available (Attributable) to common shareholders

 

213,692

 

 

 

(77,122

)

 

Available (Attributable) to common shareholders per diluted common share

$

4.71

 

 

$

(1.59

)

 

Book value per common share

$

132.17

 

 

$

138.46

 

 

Change in book value per share

 

2.5

%

 

 

2.5

%

 

Tangible book value per common share plus accumulated dividends (1)

$

149.79

 

 

$

155.17

 

 

Change in tangible book value per common share plus change in accumulated dividends (1)

 

2.8

%

 

 

3.0

%

 

 

 

 

 

 

Return on average common equity - annualized

 

14.2

%

 

 

10.9

%

 

Operating return on average common equity - annualized (1)

 

14.4

%

 

 

(4.4

) %

(1) See “Comments on Regulation G” for a reconciliation of non-GAAP financial measures.

Three Drivers of Profit: Underwriting, Fee and Investment Income - Fourth Quarter

Underwriting Results - Property Segment: Combined ratio of 64.4%; 10.8 percentage points from weather-related large losses.

Property Segment

 

 

 

 

 

 

Three months ended

December 31

 

Q/Q Change

(in thousands, except percentages)

2021

 

2020

 

Gross premiums written

$

    384,657

 

 

$

    308,315

 

 

24.8%

Underwriting income (loss)

 

      223,098

 

 

 

    (130,268

)

 

 

 

 

 

 

 

 

Underwriting Ratios

 

 

 

 

 

Net claims and claim expense ratio - current accident year

 

43.8

%

 

 

130.5

%

 

(86.7) pts

Net claims and claim expense ratio - prior accident years

 

(4.9

) %

 

 

(24.8

) %

 

19.9 pts

Net claims and claim expense ratio - calendar year

 

38.9

%

 

 

105.7

%

 

(66.8) pts

Underwriting expense ratio

 

25.5

%

 

 

19.9

%

 

5.6 pts

Combined ratio

 

64.4

%

 

 

125.6

%

 

(61.2) pts

  • Gross premiums written increased 24.8%, driven by:

- Growth in the other property class of business of $127.7 million, or 51.2%, principally as a result of rate improvements driving growth in new and existing business, notably within catastrophe exposed U.S. property excess and surplus lines; partially offset by a

- Decrease in property catastrophe class of business of $51.3 million, or 86.8%, primarily due to a decrease in reinstatement premiums.

  • Ceded premiums written were $9.5 million, a decrease of $19.0 million, or 66.6%. This decrease was primarily driven by the non-renewal of certain deals ceded to Upsilon RFO Re Ltd. (“Upsilon RFO”).
  • The net claims and claim expense ratio - current accident year decreased 86.7 percentage points, primarily as a result of COVID-19 losses in the fourth quarter of 2020, combined with a lower amount of weather-related losses in the fourth quarter of 2021.
  • The net claims and claim expense ratio - prior accident year reflected net favorable development primarily from weather-related large losses in the 2017 to 2019 accident years.
  • Underwriting expense ratio increased 5.6 percentage points, driven by lower profit commissions and a lower impact to the ratio from reinstatement premiums, as well as changes in the mix of business due to continued growth in the other property class of business.
  • Underwriting income of $223.1 million and a combined ratio of 64.4% included weather-related large losses which had a $68.4 million net negative impact on the Property segment underwriting result and added 10.8 percentage points to the combined ratio in the fourth quarter of 2021.

Underwriting Results - Casualty and Specialty Segment: Grew gross premiums written by 48.0% and reported a combined ratio of 92.5%

 

Casualty and Specialty Segment

 

 

 

 

 

 

 

Three months ended

December 31

 

Q/Q

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Gross premiums written

$

928,361

 

 

$

627,199

 

 

48.0

%

 

Underwriting income (loss)

 

53,563

 

 

 

(21,387

)

 

 

 

 

 

 

 

 

 

 

Underwriting Ratios

 

 

 

 

 

 

Net claims and claim expense ratio - current accident year

 

63.9

%

 

 

70.5

%

 

(6.6) pts

 

Net claims and claim expense ratio - prior accident years

 

(1.3

) %

 

 

(0.5

) %

 

(0.8) pts

 

Net claims and claim expense ratio - calendar year

 

62.6

%

 

 

70.0

%

 

(7.4) pts

 

Underwriting expense ratio

 

29.9

%

 

 

34.1

%

 

(4.2) pts

 

Combined ratio

 

92.5

%

 

 

104.1

%

 

(11.6) pts

  • Gross premiums written increased 48.0%, primarily driven by growth in professional liability, general casualty and other specialty lines of business. This growth was principally driven by increases in new and existing business written in the current and prior periods, combined with rate improvements.
  • Net claims and claim expense ratio declined 7.4 percentage points principally as a result of lower current accident year losses, which in turn were primarily driven by lower attritional losses and lower losses related to the COVID-19 pandemic.
  • The underwriting expense ratio decreased 4.2 percentage points driven by a 2.9 percentage point improvement in the net acquisition expense ratio, principally due to changes in the mix of business and estimated profit commissions, combined with a decrease in the operating expense ratio driven by improved operating leverage.

Fee Income: $30.0 million of fee income; impacted by the 2021 Weather-Related Large Losses

 

Fee Income

 

 

 

 

 

 

 

Three months ended

December 31

 

Q/Q

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Total management fee income

$

24,723

 

$

26,778

 

$

(2,055

)

 

Total performance fee income (loss) (1)

 

5,299

 

 

9,128

 

 

(3,829

)

 

Total fee income

$

30,022

 

$

35,906

 

$

(5,884

)

(1) Performance fees are based on the performance of the individual vehicles or products, and may be negative in a particular period if, for example, large losses occur, which can potentially result in no performance fees or the reversal of previously accrued performance fees.

  • Total fee income decreased $5.9 million due to lower management and performance fee income primarily driven by the impact of the 2021 Weather-Related Large Losses on the results of the Company’s joint ventures and managed funds. In addition, management fees were also impacted by a deferral of management fees in DaVinci in the fourth quarter of 2021.

Investment Results: Performance primarily driven by net realized and unrealized losses in the fixed maturity investments portfolio

 

Investment Results

 

 

 

 

 

 

 

Three months ended

December 31

 

Q/Q

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Net investment income

$

80,483

 

 

$

81,717

 

 

$

(1,234

)

 

Net realized and unrealized gains (losses) on investments

 

(21,518

)

 

 

258,745

 

 

 

(280,263

)

 

Total investment result

 

58,965

 

 

 

340,462

 

 

 

(281,497

)

 

Total investment return - annualized

 

1.1

%

 

 

6.6

%

 

(5.5) pts

  • Total investment result decreased $281.5 million, primarily due to the difference in net realized and unrealized gains (losses) on investments, principally within the fixed maturity and equity investments portfolios.

– In the fourth quarter of 2021, net realized and unrealized losses on fixed maturity investments of $116.7 million were primarily driven by increasing yields on U.S. treasuries; partially offset by net realized and unrealized gains of $73.6 million on equity investments in line with wider equity markets.

– In the fourth quarter of 2020, net realized and unrealized gains on equity investments of $154.3 million were primarily driven by the significant price appreciation in equity markets generally, and in particular in the Company’s strategic investment in Trupanion, Inc. Net realized and unrealized gains on fixed maturity investments of $90.1 million during the quarter were largely driven by tightening credit spreads on certain fixed maturity investments.

  • Managed fixed maturity and short-term investment weighted average yield to maturity was 1.2% and average duration was 3.0 years on total consolidated fixed maturity and short-term investments at fair value of $18.8 billion at December 31, 2021.

Other Items of Note - Fourth Quarter

  • Net income attributable to redeemable noncontrolling interests was $68.5 million compared to net loss attributable to redeemable noncontrolling interests of $5.5 million in the fourth quarter of 2020, primarily due to:

– DaVinciRe Holdings Ltd. (“DaVinci”), which had underwriting income in the fourth quarter of 2021 as compared to underwriting losses in the fourth quarter of 2020, and was partially offset by;

– RenaissanceRe Medici Fund Ltd. (“Medici”), which had net loss in the fourth quarter of 2021 as compared to net income in the fourth quarter of 2020. The Medici net loss for the quarter includes net foreign exchange losses that were attributable to third party investors, resulting in net income being retained by the Company.

  • Income tax expense of $18.6 million compared to an income tax benefit of $9.9 million in the fourth quarter of 2020. The increase in income tax expense was primarily driven by underwriting income in the Company’s taxable jurisdictions, partially offset by net unrealized investment losses in the Company’s U.S. based operations.
  • Net foreign exchange losses of $16.7 million compared to a $23.3 million net foreign exchange gain in the fourth quarter of 2020. The net foreign exchange loss was primarily driven by losses attributable to third-party investors in Medici which are allocated through noncontrolling interests and miscellaneous foreign exchange losses generated by underwriting activities.

Consolidated Financial Results - Full Year

 

Consolidated Highlights

 

 

 

 

 

Twelve months ended

December 31

 

(in thousands, except per share amounts and percentages)

2021

 

2020

 

Gross premiums written

$

7,833,798

 

 

$

5,806,165

 

 

Underwriting income (loss)

 

(108,948

)

 

 

(76,511

)

 

Combined ratio

 

102.1

%

 

 

101.9

%

 

 

 

 

 

 

Net Income (Loss)

 

 

 

 

Available (Attributable) to common shareholders

$

(73,421

)

 

$

731,482

 

 

Available (Attributable) to common shareholders per diluted common share

$

(1.57

)

 

$

15.31

 

 

Operating Income (Loss) (1)

 

 

 

 

Available (Attributable) to common shareholders

$

81,599

 

 

$

14,640

 

 

Available (Attributable) to common shareholders per diluted common share

$

1.72

 

 

$

0.12

 

 

Book value per common share

$

132.17

 

 

$

138.46

 

 

Change in book value per share

 

(4.5

) %

 

 

14.9

%

 

Tangible book value per common share plus accumulated dividends (1)

$

149.79

 

 

$

155.17

 

 

Change in tangible book value per common share plus change in accumulated dividends (1)

 

(4.0

) %

 

 

17.9

%

 

 

 

 

 

 

Return on average common equity

 

(1.1

) %

 

 

11.7

%

 

Operating return on average common equity (1)

 

1.3

%

 

 

0.2

%

(1) See “Comments on Regulation G” for a reconciliation of non-GAAP financial measures.

Net negative impact of the 2021 Weather-Related Large Losses

Net negative impact on underwriting result includes the sum of (1) net claims and claim expenses incurred, (2) assumed and ceded reinstatement premiums earned and (3) earned and lost profit commissions. Net negative impact on net income (loss) available (attributable) to RenaissanceRe common shareholders is the sum of (1) net negative impact on underwriting result and (2) redeemable noncontrolling interest.

Net negative impact on the consolidated financial statements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2021

Winter Storm

Uri

 

European

Floods

 

Hurricane

Ida

 

Other 2021

Catastrophe

Events (1)

 

Aggregate

Losses (2)

 

Total 2021

Weather-

Related Large

Losses (3)

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net claims and claims expenses incurred

$

(358,937

)

 

$

(360,644

)

 

$

(741,285

)

 

$

(85,941

)

 

$

(161,093

)

 

$

(1,707,900

)

 

 

Assumed reinstatement premiums earned

 

86,626

 

 

 

90,346

 

 

 

156,061

 

 

 

9,939

 

 

 

6,140

 

 

$

349,112

 

 

 

Ceded reinstatement premiums earned

 

(11,045

)

 

 

(16,372

)

 

 

(27,467

)

 

 

 

 

 

 

 

$

(54,884

)

 

 

Earned (lost) profit commissions

 

773

 

 

 

8,084

 

 

 

 

 

 

1,645

 

 

 

 

 

 

10,502

 

 

 

Net negative impact on underwriting result

 

(282,583

)

 

 

(278,586

)

 

 

(612,691

)

 

 

(74,357

)

 

 

(154,953

)

 

 

(1,403,170

)

 

 

Redeemable noncontrolling interest

 

101,966

 

 

 

84,082

 

 

 

200,806

 

 

 

17,082

 

 

 

37,175

 

 

 

441,111

 

 

 

Net negative impact on net income (loss) available (attributable) to RenaissanceRe common shareholders

$

(180,617

)

 

$

(194,504

)

 

$

(411,885

)

 

$

(57,275

)

 

$

(117,778

)

 

$

(962,059

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net negative impact on the segment underwriting results and consolidated combined ratio

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2021

Winter Storm

Uri

 

European

Floods

 

Hurricane

Ida

 

Other 2021

Catastrophe

Events (1)

 

Aggregate

Losses (2)

 

Total 2021

Weather-

Related Large

Losses (3)

 

 

(in thousands, except percentages)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net negative impact on Property segment underwriting result

$

(275,566

)

 

$

(276,317

)

 

$

(596,271

)

 

$

(74,357

)

 

$

(154,953

)

 

$

(1,377,464

)

 

 

Net negative impact on Casualty and Specialty segment underwriting result

 

(7,017

)

 

 

(2,269

)

 

 

(16,420

)

 

 

 

 

 

 

 

 

(25,706

)

 

 

Net negative impact on underwriting result

$

(282,583

)

 

$

(278,586

)

 

$

(612,691

)

 

$

(74,357

)

 

$

(154,953

)

 

$

(1,403,170

)

 

 

Percentage point impact on consolidated combined ratio

 

5.5

 

 

 

5.4

 

 

 

12.0

 

 

 

1.4

 

 

 

3.0

 

 

 

28.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

“Other 2021 Catastrophe Events” includes the hail storm in Europe in late June 2021, the wildfires in California during the third quarter of 2021, the tornadoes in the Central and Midwest U.S. in December 2021, and the Midwest Derecho in December 2021.

(2)

“Aggregate Losses” includes loss estimates associated with certain aggregate loss contracts triggered during 2021 as a result of weather-related catastrophe events.

(3)

“2021 Weather-Related Large Losses” includes Winter Storm Uri, the European Floods, Hurricane Ida, Other 2021 Catastrophe Events and Aggregate Losses.

Estimates of net negative impact are based on a review of potential exposures, preliminary discussions with certain counterparties and actuarial modeling techniques. Actual net negative impact, both individually and in the aggregate, may vary from these estimates, perhaps materially. Changes in these estimates will be recorded in the period in which they occur.

Meaningful uncertainty remains regarding the estimates and the nature and extent of losses from catastrophe events, driven by the magnitude and recent nature of each event, the geographic areas impacted by the events, relatively limited claims data received to date, the contingent nature of business interruption and other exposures, potential uncertainties relating to reinsurance recoveries, and other factors inherent in loss estimation, among other things.

Three Drivers of Profit: Underwriting, Fee, and Investment Income - Full Year

Underwriting Results - Property Segment: Grew gross premiums written by 32.0%; 2021 Weather-Related Large Losses contributed 58.6 percentage points to the combined ratio

 

Property Segment

 

 

 

 

 

 

 

Twelve months ended

December 31

 

Y/Y

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Gross premiums written

$

3,958,724

 

 

$

2,999,142

 

 

32.0

%

 

Underwriting income (loss)

 

(185,504

)

 

 

11,021

 

 

 

 

 

 

 

 

 

 

 

Underwriting Ratios

 

 

 

 

 

 

Net claims and claim expense ratio - current accident year

 

91.9

%

 

 

82.3

%

 

9.6 pts

 

Net claims and claim expense ratio - prior accident years

 

(9.0

) %

 

 

(8.1

) %

 

(0.9) pts

 

Net claims and claim expense ratio - calendar year

 

82.9

%

 

 

74.2

%

 

8.7 pts

 

Underwriting expense ratio

 

24.2

%

 

 

25.2

%

 

(1.0) pts

 

Combined ratio

 

107.1

%

 

 

99.4

%

 

7.7 pts

  • Gross premiums written increased 32.0%, driven by:

    – Growth in the other property class of business of $610.6 million, or 54.9%, principally as a result of rate improvements driving growth in new and existing business, notably within catastrophe exposed U.S. property excess and surplus lines.

    – Growth in the property catastrophe class of business of $349.0 million, or 18.5%, principally as a result of an increase in reinstatement premiums, rate improvements, and increased shares on existing deals, as well as participation in new deals and opportunities.
    • $339.7 million of reinstatement premiums associated with the 2021 Weather-Related Large Losses, compared to reinstatement premiums of $77.0 million associated with 2020 weather-related large losses and $25.9 million associated with COVID-19 losses in 2020.
  • Ceded premiums written were $1.1 billion, an increase of $128.8 million, or 13.4%. This increase was primarily driven by higher gross premiums written in 2021, which were ceded to Upsilon RFO, and ceded reinstatement premiums earned of $54.7 million from the 2021 Weather-Related Large Losses.
  • The net claims and claim expense ratio for prior accident years reflected net favorable development of 15.3% for property catastrophe and 2.4% for other property in the year, primarily related to weather-related large losses in the 2017 to 2019 accident years.
  • Underwriting loss of $185.5 million and a combined ratio of 107.1%, primarily driven by the 2021 Weather-Related Large Losses, which had a $1.4 billion net negative impact on the Property segment underwriting result and added 58.6 percentage points to the combined ratio.

Casualty and Specialty Segment: Grew gross written premium by 38% and reported a combined ratio of 97.0%

 

Casualty and Specialty Segment

 

 

 

 

 

 

 

Twelve months ended

December 31

 

Y/Y

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Gross premiums written

$

3,875,074

 

 

$

2,807,023

 

 

38.0

%

 

Underwriting income (loss)

 

76,556

 

 

 

(87,532

)

 

 

 

 

 

 

 

 

 

 

Underwriting Ratios

 

 

 

 

 

 

Net claims and claim expense ratio - current accident year

 

66.9

%

 

 

75.2

%

 

(8.3) pts

 

Net claims and claim expense ratio - prior accident years

 

(0.7

) %

 

 

(1.4

) %

 

0.7 pts

 

Net claims and claim expense ratio - calendar year

 

66.2

%

 

 

73.8

%

 

(7.6) pts

 

Underwriting expense ratio

 

30.8

%

 

 

30.5

%

 

0.3 pts

 

Combined ratio

 

97.0

%

 

 

104.3

%

 

(7.3) pts

  • Gross premiums written increased 38.0%, primarily due to growth from new and existing business opportunities written in the current and prior periods across various classes of business within the segment, combined with rate improvements.
  • Net claims and claim expense ratio decreased 7.6 percentage points, driven by lower current accident year losses. As compared to 2021, 2020 was impacted by net losses related to the COVID-19 pandemic.
  • The underwriting expense ratio increased 0.3 percentage points due to:

– An increase of 1.1 percentage points in the net acquisition expense ratio principally due the effects of purchase accounting amortization in 2020 related to the acquisition of TMR which decreased the acquisition ratio in the prior year period; largely offset by

– Lower operating expense ratio driven by improved operating leverage.

Fee Income: $128.5 million of fee income; impacted by 2021 Weather-Related Large Losses

 

Fee Income

 

 

 

 

 

 

 

Twelve months ended

December 31

 

Y/Y

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Total management fee income

$

109,071

 

$

111,476

 

$

(2,405

)

 

Total performance fee income (loss) (1)

 

19,432

 

 

33,686

 

 

(14,254

)

 

Total fee income

$

128,503

 

$

145,162

 

$

(16,659

)

(1)

Performance fees are based on the performance of the individual vehicles or products, and may be negative in a particular period if, for example, large losses occur, which can potentially result in no performance fees or the reversal of previously accrued performance fees.

  • Total fee income decreased $16.7 million due to lower performance and management fee income in 2021.

– Lower management fee income in 2021 was primarily due to a deferral of management fees in DaVinci as a result of the 2021 Weather-Related Large Losses.

– Lower performance fee income in 2021 was primarily due to the impact of the 2021 Weather-Related Large Losses on the results of the Company’s joint ventures and managed funds, partially offset by higher favorable development on prior year losses in DaVinci.

Investment Results: Performance primarily driven by net realized and unrealized losses in the fixed maturity investments portfolio

 

Investment Results

 

 

 

 

 

 

 

Twelve months ended

December 31

 

Y/Y

Change

 

(in thousands, except percentages)

2021

 

2020

 

 

Net investment income

$

319,479

 

 

$

354,038

 

 

$

(34,559

)

 

Net realized and unrealized gains (losses) on investments

 

(218,134

)

 

 

820,636

 

 

 

(1,038,770

)

 

Total investment result

 

101,345

 

 

 

1,174,674

 

 

 

(1,073,329

)

 

Total investment return

 

0.5

%

 

 

5.9

%

 

(5.4) pts

  • Total investment result decreased $1.1 billion primarily due to the difference in net realized and unrealized gains (losses) on investments, principally within the fixed maturity and equity investments portfolios.

– Net realized and unrealized losses in 2021 of $322.0 million on fixed maturity investments were primarily driven by increasing yields on U.S. treasuries; partially offset by net realized and unrealized gains of $49.6 million on equity investments.

– In 2020, the total investment result was favorably impacted by the recovery in the financial markets following the disruption associated with the COVID-19 pandemic, resulting in net realized and unrealized gains of $592.4 million on fixed maturity investments and $235.6 million on equity investments.

  • Managed fixed maturity and short-term investment weighted average yield to maturity was 1.2% and average duration was 3.0 years on total consolidated fixed maturity and short-term investments at fair value of $18.8 billion at December 31, 2021.

Other Items of Note - Full Year and Subsequent Events

  • Corporate expenses were $41.2 million, a decrease of $55.8 million, primarily driven by higher non-recurring expenses in 2020 resulting from the loss on sale of RenaissanceRe UK, executive compensation charges, and certain integration and compensation related costs associated with the acquisition of TMR.
  • Net loss attributable to redeemable noncontrolling interests was $63.3 million, compared to net income attributable to redeemable noncontrolling interest of $230.7 million in 2020, reflecting the impact of higher underwriting losses in DaVinci, lower underwriting income in Vermeer, and a decrease in Medici net income, primarily due to foreign exchange losses that are attributable to third party investors.
  • Income tax benefit of $10.7 million, principally driven by unrealized investment portfolio losses in the Company’s taxable jurisdictions.
  • Net foreign exchange losses of $41.0 million compared to a $27.8 million net foreign exchange gain in 2020. The net foreign exchange loss was primarily driven by losses attributable to third party investors in Medici, which are allocated through noncontrolling interest, and miscellaneous foreign exchange losses generated by underwriting activities.
  • Raised gross proceeds of $500.0 million in July 2021 through the issuance of 20,000,000 Depositary Shares, each of which represents a 1/1,000th interest in a share of the Company’s 4.20% Series G Preference Shares, $1.00 par value and $25,000 liquidation preference per share (equivalent to $25.00 per Depositary Share). Redeemed all 11,000,000 outstanding 5.375% Series E Preference Shares on August 11, 2021 for $275.0 million plus accrued and unpaid dividends thereon.
  • Raised capital of $662.7 million, effective January 1, 2022, through Upsilon RFO, DaVinci and Medici, including $209.7 million from the Company. Following these transactions, the Company’s ownership in Upsilon RFO, DaVinci and Medici was 13.6%, 30.9% and 13.7%, respectively.

Conference Call Details and Additional Information

Non-GAAP Financial Measures and Additional Financial Information

This Press Release includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the U.S. (“GAAP”) including “operating Income (loss) available (attributable) to RenaissanceRe common shareholders,” “operating Income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted,” “operating return on average common equity - annualized,” “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” A reconciliation of such measures to the most comparable GAAP figures in accordance with Regulation G is presented in the attached supplemental financial data.

Please refer to the “Investors - Financial Reports - Financial Supplements” section of the Company’s website at www.renre.com for a copy of the Financial Supplement which includes additional information on the Company’s financial performance.

Conference Call Information

RenaissanceRe will host a conference call on Wednesday, January 26, 2022 at 10:00 a.m. ET to discuss this release. Live broadcast of the conference call will be available through the “Investors - Webcasts & Presentations” section of the Company’s website at www.renre.com.

About RenaissanceRe

RenaissanceRe is a global provider of reinsurance and insurance that specializes in matching well-structured risks with efficient sources of capital. The Company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, RenaissanceRe has offices in Bermuda, Australia, Ireland, Singapore, Switzerland, the United Kingdom and the United States.

Cautionary Statement Regarding Forward-Looking Statements

Any forward-looking statements made in this Press Release reflect RenaissanceRe’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are subject to numerous factors that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements, including the following: the Company’s exposure to natural and non-natural catastrophic events and circumstances and the variance it may cause in the Company’s financial results; the effect of climate change on the Company’s business, including the trend towards increasingly frequent and severe climate events; the effectiveness of the Company’s claims and claim expense reserving process; the effect of emerging claims and coverage issues; the highly competitive nature of the Company’s industry, resulting in consolidation of competitors, customers and (re)insurance brokers, and the Company’s reliance on a small and decreasing number of brokers; the historically cyclical nature of the (re)insurance industries; collection on claimed retrocessional coverage, and new retrocessional reinsurance being available on acceptable terms; the ability of the Company’s ceding companies and delegated authority counterparties to accurately assess the risks they underwrite; the Company’s ability to maintain its financial strength ratings; the impact of large non-recurring contracts and reinstatement premiums on the Company’s financial results; the Company’s ability to attract and retain key executives and employees; the effect of cybersecurity risks, including technology breaches or failure; the performance of the Company’s investment portfolio and financial market volatility; the effects of inflation; the Company’s ability to successfully implement its business strategies and initiatives, and the success of any of the Company’s strategic investments or acquisitions, including its ability to manage its operations as its product and geographical diversity increases; the Company’s exposure to credit loss from counterparties; the Company’s need to make many estimates and judgments in the preparation of its financial statements; the Company’s ability to effectively manage capital on behalf of investors in joint ventures or other entities it manages; changes to the accounting rules and regulatory systems applicable to the Company’s business, including changes in Bermuda laws or regulations or as a result of increased global regulation of the insurance and reinsurance industries; other political, regulatory or industry initiatives adversely impacting the Company; the Company’s ability to comply with covenants in its debt agreements; a contention by the U.S. Internal Revenue Service that any of the Company’s Bermuda subsidiaries are subject to taxation in the U.S.; the effects of U.S. tax reform legislation, Organisation for Economic Co-operation and Development or European Union measures and possible future tax reform legislation and regulations, including changes to the tax treatment of the Company’s shareholders or investors in its joint ventures or other entities it manages; the Company’s ability to determine any impairments taken on its investments; the uncertainty of the continuing and future impact of the COVID-19 pandemic, including measures taken in response thereto and the effect of legislative, regulatory and judicial influences on the Company’s potential reinsurance, insurance and investment exposures, or other effects that it may have; foreign currency exchange rate fluctuations; the Company’s ability to raise capital if necessary; the Company’s ability to comply with applicable sanctions and foreign corrupt practices laws; the Company’s dependence on the ability of its operating subsidiaries to declare and pay dividends; aspects of the Company’s corporate structure that may discourage third-party takeovers and other transactions; difficulties investors may have in serving process or enforcing judgments against the Company in the U.S.; and other factors affecting future results disclosed in RenaissanceRe’s filings with the SEC, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Prospectus Supplement dated July 7, 2021.

RenaissanceRe Holdings Ltd.

Summary Consolidated Statements of Operations

(in thousands of United States Dollars, except per share amounts and percentages)

(Unaudited)

 

Three months ended

 

Twelve months ended

 

December 31,

2021

 

December 31,

2020

 

December 31,

2021

 

December 31,

2020

Revenues

 

 

 

 

 

 

 

Gross premiums written

$

1,313,018

 

 

$

935,514

 

 

$

7,833,798

 

 

$

5,806,165

 

Net premiums written

$

1,116,560

 

 

$

746,311

 

 

$

5,939,375

 

 

$

4,096,333

 

Decrease (increase) in unearned premiums

 

224,730

 

 

 

282,774

 

 

 

(745,194

)

 

 

(143,871

)

Net premiums earned

 

1,341,290

 

 

 

1,029,085

 

 

 

5,194,181

 

 

 

3,952,462

 

Net investment income

 

80,483

 

 

 

81,717

 

 

 

319,479

 

 

 

354,038

 

Net foreign exchange gains (losses)

 

(16,697

)

 

 

23,270

 

 

 

(41,006

)

 

 

27,773

 

Equity in earnings (losses) of other ventures

 

3,830

 

 

 

(1,868

)

 

 

12,309

 

 

 

17,194

 

Other income (loss)

 

6,431

 

 

 

4,374

 

 

 

10,880

 

 

 

213

 

Net realized and unrealized gains (losses) on investments

 

(21,518

)

 

 

258,745

 

 

 

(218,134

)

 

 

820,636

 

Total revenues

 

1,393,819

 

 

 

1,395,323

 

 

 

5,277,709

 

 

 

5,172,316

 

Expenses

 

 

 

 

 

 

 

Net claims and claim expenses incurred

 

690,970

 

 

 

901,353

 

 

 

3,876,087

 

 

 

2,924,609

 

Acquisition expenses

 

333,986

 

 

 

238,283

 

 

 

1,214,858

 

 

 

897,677

 

Operational expenses

 

39,673

 

 

 

41,104

 

 

 

212,184

 

 

 

206,687

 

Corporate expenses

 

10,426

 

 

 

21,031

 

 

 

41,152

 

 

 

96,970

 

Interest expense

 

11,872

 

 

 

11,841

 

 

 

47,536

 

 

 

50,453

 

Total expenses

 

1,086,927

 

 

 

1,213,612

 

 

 

5,391,817

 

 

 

4,176,396

 

Income (loss) before taxes

 

306,892

 

 

 

181,711

 

 

 

(114,108

)

 

 

995,920

 

Income tax benefit (expense)

 

(18,616

)

 

 

9,923

 

 

 

10,668

 

 

 

(2,862

)

Net income (loss)

 

288,276

 

 

 

191,634

 

 

 

(103,440

)

 

 

993,058

 

Net (income) loss attributable to redeemable noncontrolling interests

 

(68,516

)

 

 

5,467

 

 

 

63,285

 

 

 

(230,653

)

Net income (loss) attributable to RenaissanceRe

 

219,760

 

 

 

197,101

 

 

 

(40,155

)

 

 

762,405

 

Dividends on preference shares

 

(8,843

)

 

 

(7,289

)

 

 

(33,266

)

 

 

(30,923

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

$

210,917

 

 

$

189,812

 

 

$

(73,421

)

 

$

731,482

 

 

 

 

 

 

 

 

 

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share – basic

$

4.65

 

 

$

3.75

 

 

$

(1.57

)

 

$

15.34

 

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share – diluted

$

4.65

 

 

$

3.74

 

 

$

(1.57

)

 

$

15.31

 

Operating (loss) income (attributable) available to RenaissanceRe common shareholders per common share - diluted (1)

$

4.71

 

 

$

(1.59

)

 

$

1.72

 

 

$

0.12

 

 

 

 

 

 

 

 

 

Average shares outstanding - basic

 

44,722

 

 

 

50,022

 

 

 

47,171

 

 

 

47,103

 

Average shares outstanding - diluted

 

44,748

 

 

 

50,111

 

 

 

47,171

 

 

 

47,178

 

 

 

 

 

 

 

 

 

Net claims and claim expense ratio

 

51.5

%

 

 

87.6

%

 

 

74.6

%

 

 

74.0

%

Underwriting expense ratio

 

27.9

%

 

 

27.1

%

 

 

27.5

%

 

 

27.9

%

Combined ratio

 

79.4

%

 

 

114.7

%

 

 

102.1

%

 

 

101.9

%

 

 

 

 

 

 

 

 

Return on average common equity - annualized

 

14.2

%

 

 

10.9

%

 

 

(1.1

) %

 

 

11.7

%

Operating return on average common equity - annualized (1)

 

14.4

%

 

 

(4.4

) %

 

 

1.3

%

 

 

0.2

%

(1)

See Comments on Regulation G for a reconciliation of non-GAAP financial measures.

RenaissanceRe Holdings Ltd.

Summary Consolidated Balance Sheets

(in thousands of United States Dollars, except per share amounts)

 

 

 

 

 

December 31,

2021

 

December 31,

2020

Assets

(Unaudited)

 

(Audited)

Fixed maturity investments trading, at fair value

$

13,507,131

 

 

$

13,506,503

 

Short term investments, at fair value

 

5,298,385

 

 

 

4,993,735

 

Equity investments trading, at fair value

 

546,016

 

 

 

702,617

 

Other investments, at fair value

 

1,993,059

 

 

 

1,256,948

 

Investments in other ventures, under equity method

 

98,068

 

 

 

98,373

 

Total investments

 

21,442,659

 

 

 

20,558,176

 

Cash and cash equivalents

 

1,859,019

 

 

 

1,736,813

 

Premiums receivable

 

3,781,542

 

 

 

2,894,631

 

Prepaid reinsurance premiums

 

854,722

 

 

 

823,582

 

Reinsurance recoverable

 

4,268,669

 

 

 

2,926,010

 

Accrued investment income

 

55,740

 

 

 

66,743

 

Deferred acquisition costs and value of business acquired

 

849,160

 

 

 

633,521

 

Receivable for investments sold

 

380,442

 

 

 

568,293

 

Other assets

 

224,053

 

 

 

363,170

 

Goodwill and other intangible assets

 

243,496

 

 

 

249,641

 

Total assets

$

33,959,502

 

 

$

30,820,580

 

Liabilities, Noncontrolling Interests and Shareholders’ Equity

 

 

 

Liabilities

 

 

 

Reserve for claims and claim expenses

$

13,294,630

 

 

$

10,381,138

 

Unearned premiums

 

3,531,213

 

 

 

2,763,599

 

Debt

 

1,168,353

 

 

 

1,136,265

 

Reinsurance balances payable

 

3,860,963

 

 

 

3,488,352

 

Payable for investments purchased

 

1,170,568

 

 

 

1,132,538

 

Other liabilities

 

755,441

 

 

 

970,121

 

Total liabilities

 

23,781,168

 

 

 

19,872,013

 

Redeemable noncontrolling interests

 

3,554,053

 

 

 

3,388,319

 

Shareholders’ Equity

 

 

 

Preference shares

 

750,000

 

 

 

525,000

 

Common shares

 

44,445

 

 

 

50,811

 

Additional paid-in capital

 

608,121

 

 

 

1,623,206

 

Accumulated other comprehensive loss

 

(10,909

)

 

 

(12,642

)

Retained earnings

 

5,232,624

 

 

 

5,373,873

 

Total shareholders’ equity attributable to RenaissanceRe

 

6,624,281

 

 

 

7,560,248

 

Total liabilities, noncontrolling interests and shareholders’ equity

$

33,959,502

 

 

$

30,820,580

 

 

 

 

 

Book value per common share

$

132.17

 

 

$

138.46

 

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Segment Information

(in thousands of United States Dollars, except percentages)

(Unaudited)

 

Three months ended December 31, 2021

 

Property

 

Casualty and

Specialty

 

Other

 

Total

Gross premiums written

$

384,657

 

 

$

928,361

 

 

$

 

 

$

1,313,018

 

Net premiums written

$

375,112

 

 

$

741,448

 

 

$

 

 

$

1,116,560

 

Net premiums earned

$

626,359

 

 

$

714,931

 

 

$

 

 

$

1,341,290

 

Net claims and claim expenses incurred

 

243,356

 

 

 

447,614

 

 

 

 

 

 

690,970

 

Acquisition expenses

 

131,007

 

 

 

202,979

 

 

 

 

 

 

333,986

 

Operational expenses

 

28,898

 

 

 

10,775

 

 

 

 

 

 

39,673

 

Underwriting income (loss)

$

223,098

 

 

$

53,563

 

 

$

 

 

 

276,661

 

Net investment income

 

 

 

 

 

80,483

 

 

 

80,483

 

Net foreign exchange gain (loss)

 

 

 

 

 

(16,697

)

 

 

(16,697

)

Equity in earnings of other ventures

 

 

 

 

 

3,830

 

 

 

3,830

 

Other income (loss)

 

 

 

 

 

6,431

 

 

 

6,431

 

Net realized and unrealized gain (loss) on investments

 

 

 

 

 

(21,518

)

 

 

(21,518

)

Corporate expenses

 

 

 

 

 

(10,426

)

 

 

(10,426

)

Interest expense

 

 

 

 

 

(11,872

)

 

 

(11,872

)

Income (loss) before taxes and redeemable noncontrolling interests

 

 

 

 

 

 

 

306,892

 

Income tax benefit (expense)

 

 

 

 

 

(18,616

)

 

 

(18,616

)

Net (income) loss attributable to redeemable noncontrolling interests

 

 

 

 

 

(68,516

)

 

 

(68,516

)

Dividends on preference shares

 

 

 

 

 

(8,843

)

 

 

(8,843

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

 

 

 

 

 

 

$

210,917

 

 

 

 

 

 

 

 

 

Net claims and claim expenses incurred – current accident year

$

274,649

 

 

$

457,080

 

 

$

 

 

$

731,729

 

Net claims and claim expenses incurred – prior accident years

 

(31,293

)

 

 

(9,466

)

 

 

 

 

 

(40,759

)

Net claims and claim expenses incurred – total

$

243,356

 

 

$

447,614

 

 

$

 

 

$

690,970

 

 

 

 

 

 

 

 

 

Net claims and claim expense ratio – current accident year

 

43.8

%

 

 

63.9

%

 

 

 

 

54.6

%

Net claims and claim expense ratio – prior accident years

 

(4.9

) %

 

 

(1.3

) %

 

 

 

 

(3.1

) %

Net claims and claim expense ratio – calendar year

 

38.9

%

 

 

62.6

%

 

 

 

 

51.5

%

Underwriting expense ratio

 

25.5

%

 

 

29.9

%

 

 

 

 

27.9

%

Combined ratio

 

64.4

%

 

 

92.5

%

 

 

 

 

79.4

%

 

 

 

 

 

 

 

 

 

Three months ended December 31, 2020

 

Property

 

Casualty and

Specialty

 

Other

 

Total

Gross premiums written

$

308,315

 

 

$

627,199

 

 

$

 

 

$

935,514

 

Net premiums written

$

279,773

 

 

$

466,538

 

 

$

 

 

$

746,311

 

Net premiums earned

$

507,141

 

 

$

521,944

 

 

$

 

 

$

1,029,085

 

Net claims and claim expenses incurred

 

536,218

 

 

 

365,135

 

 

 

 

 

 

901,353

 

Acquisition expenses

 

75,032

 

 

 

163,251

 

 

 

 

 

 

238,283

 

Operational expenses

 

26,159

 

 

 

14,945

 

 

 

 

 

 

41,104

 

Underwriting income (loss)

$

(130,268

)

 

$

(21,387

)

 

$

 

 

 

(151,655

)

Net investment income

 

 

 

 

 

81,717

 

 

 

81,717

 

Net foreign exchange gain (loss)

 

 

 

 

 

23,270

 

 

 

23,270

 

Equity in earnings of other ventures

 

 

 

 

 

(1,868

)

 

 

(1,868

)

Other income (loss)

 

 

 

 

 

4,374

 

 

 

4,374

 

Net realized and unrealized gain (loss) on investments

 

 

 

 

 

258,745

 

 

 

258,745

 

Corporate expenses

 

 

 

 

 

(21,031

)

 

 

(21,031

)

Interest expense

 

 

 

 

 

(11,841

)

 

 

(11,841

)

Income (loss) before taxes and redeemable noncontrolling interests

 

 

 

 

 

 

 

181,711

 

Income tax benefit (expense)

 

 

 

 

 

9,923

 

 

 

9,923

 

Net (income) loss attributable to redeemable noncontrolling interests

 

 

 

 

 

5,467

 

 

 

5,467

 

Dividends on preference shares

 

 

 

 

 

(7,289

)

 

 

(7,289

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

 

 

 

 

 

 

$

189,812

 

 

 

 

 

 

 

 

 

Net claims and claim expenses incurred – current accident year

$

661,711

 

 

$

368,071

 

 

$

 

 

$

1,029,782

 

Net claims and claim expenses incurred – prior accident years

 

(125,493

)

 

 

(2,936

)

 

 

 

 

 

(128,429

)

Net claims and claim expenses incurred – total

$

536,218

 

 

$

365,135

 

 

$

 

 

$

901,353

 

 

 

 

 

 

 

 

 

Net claims and claim expense ratio – current accident year

 

130.5

%

 

 

70.5

%

 

 

 

 

100.1

%

Net claims and claim expense ratio – prior accident years

 

(24.8

) %

 

 

(0.5

) %

 

 

 

 

(12.5

) %

Net claims and claim expense ratio – calendar year

 

105.7

%

 

 

70.0

%

 

 

 

 

87.6

%

Underwriting expense ratio

 

19.9

%

 

 

34.1

%

 

 

 

 

27.1

%

Combined ratio

 

125.6

%

 

 

104.1

%

 

 

 

 

114.7

%

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Segment Information

(in thousands of United States Dollars, except percentages)

(Unaudited)

 

Year ended December 31, 2021

 

Property

 

Casualty and

Specialty

 

Other

 

Total

Gross premiums written

$

3,958,724

 

 

$

3,875,074

 

 

$

 

 

$

7,833,798

 

Net premiums written

$

2,868,002

 

 

$

3,071,373

 

 

$

 

 

$

5,939,375

 

Net premiums earned

$

2,608,298

 

 

$

2,585,883

 

 

$

 

 

$

5,194,181

 

Net claims and claim expenses incurred

 

2,163,016

 

 

 

1,713,071

 

 

 

 

 

 

3,876,087

 

Acquisition expenses

 

487,178

 

 

 

727,680

 

 

 

 

 

 

1,214,858

 

Operational expenses

 

143,608

 

 

 

68,576

 

 

 

 

 

 

212,184

 

Underwriting income (loss)

$

(185,504

)

 

$

76,556

 

 

$

 

 

 

(108,948

)

Net investment income

 

 

 

 

 

319,479

 

 

 

319,479

 

Net foreign exchange gain (loss)

 

 

 

 

 

(41,006

)

 

 

(41,006

)

Equity in earnings of other ventures

 

 

 

 

 

12,309

 

 

 

12,309

 

Other income (loss)

 

 

 

 

 

10,880

 

 

 

10,880

 

Net realized and unrealized gain (loss) on investments

 

 

 

 

 

(218,134

)

 

 

(218,134

)

Corporate expenses

 

 

 

 

 

(41,152

)

 

 

(41,152

)

Interest expense

 

 

 

 

 

(47,536

)

 

 

(47,536

)

Income (loss) before taxes and redeemable noncontrolling interests

 

 

 

 

 

 

 

(114,108

)

Income tax benefit (expense)

 

 

 

 

 

10,668

 

 

 

10,668

 

Net (income) loss attributable to redeemable noncontrolling interests

 

 

 

 

 

63,285

 

 

 

63,285

 

Dividends on preference shares

 

 

 

 

 

(33,266

)

 

 

(33,266

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

 

 

 

 

 

 

$

(73,421

)

 

 

 

 

 

 

 

 

Net claims and claim expenses incurred – current accident year

$

2,396,389

 

 

$

1,729,168

 

 

$

 

 

$

4,125,557

 

Net claims and claim expenses incurred – prior accident years

 

(233,373

)

 

 

(16,097

)

 

 

 

 

 

(249,470

)

Net claims and claim expenses incurred – total

$

2,163,016

 

 

$

1,713,071

 

 

$

 

 

$

3,876,087

 

 

 

 

 

 

 

 

 

Net claims and claim expense ratio – current accident year

 

91.9

%

 

 

66.9

%

 

 

 

 

79.4

%

Net claims and claim expense ratio – prior accident years

 

(9.0

) %

 

 

(0.7

) %

 

 

 

 

(4.8

) %

Net claims and claim expense ratio – calendar year

 

82.9

%

 

 

66.2

%

 

 

 

 

74.6

%

Underwriting expense ratio

 

24.2

%

 

 

30.8

%

 

 

 

 

27.5

%

Combined ratio

 

107.1

%

 

 

97.0

%

 

 

 

 

102.1

%

 

 

 

 

 

 

 

 

 

Year ended December 31, 2020

 

Property

 

Casualty and

Specialty

 

Other

 

Total

Gross premiums written

$

2,999,142

 

 

$

2,807,023

 

 

$

 

 

$

5,806,165

 

Net premiums written

$

2,037,200

 

 

$

2,059,133

 

 

$

 

 

$

4,096,333

 

Net premiums earned

$

1,936,215

 

 

$

2,016,247

 

 

$

 

 

$

3,952,462

 

Net claims and claim expenses incurred

 

1,435,947

 

 

 

1,488,662

 

 

 

 

 

 

2,924,609

 

Acquisition expenses

 

353,700

 

 

 

543,977

 

 

 

 

 

 

897,677

 

Operational expenses

 

135,547

 

 

 

71,140

 

 

 

 

 

 

206,687

 

Underwriting income (loss)

$

11,021

 

 

$

(87,532

)

 

$

 

 

 

(76,511

)

Net investment income

 

 

 

 

 

354,038

 

 

 

354,038

 

Net foreign exchange gain (loss)

 

 

 

 

 

27,773

 

 

 

27,773

 

Equity in earnings of other ventures

 

 

 

 

 

17,194

 

 

 

17,194

 

Other income (loss)

 

 

 

 

 

213

 

 

 

213

 

Net realized and unrealized gain (loss) on investments

 

 

 

 

 

820,636

 

 

 

820,636

 

Corporate expenses

 

 

 

 

 

(96,970

)

 

 

(96,970

)

Interest expense

 

 

 

 

 

(50,453

)

 

 

(50,453

)

Income (loss) before taxes and redeemable noncontrolling interests

 

 

 

 

 

 

 

995,920

 

Income tax benefit (expense)

 

 

 

 

 

(2,862

)

 

 

(2,862

)

Net (income) loss attributable to redeemable noncontrolling interests

 

 

 

 

 

(230,653

)

 

 

(230,653

)

Dividends on preference shares

 

 

 

 

 

(30,923

)

 

 

(30,923

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

 

 

 

 

 

 

$

731,482

 

 

 

 

 

 

 

 

 

Net claims and claim expenses incurred – current accident year

$

1,592,996

 

 

$

1,515,425

 

 

$

 

 

$

3,108,421

 

Net claims and claim expenses incurred – prior accident years

 

(157,049

)

 

 

(26,763

)

 

 

 

 

 

(183,812

)

Net claims and claim expenses incurred – total

$

1,435,947

 

 

$

1,488,662

 

 

$

 

 

$

2,924,609

 

 

 

 

 

 

 

 

 

Net claims and claim expense ratio – current accident year

 

82.3

%

 

 

75.2

%

 

 

 

 

78.6

%

Net claims and claim expense ratio – prior accident years

 

(8.1

) %

 

 

(1.4

) %

 

 

 

 

(4.6

) %

Net claims and claim expense ratio – calendar year

 

74.2

%

 

 

73.8

%

 

 

 

 

74.0

%

Underwriting expense ratio

 

25.2

%

 

 

30.5

%

 

 

 

 

27.9

%

Combined ratio

 

99.4

%

 

 

104.3

%

 

 

 

 

101.9

%

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Gross Premiums Written

(in thousands of United States Dollars)

(Unaudited)

 

 

 

 

 

Three months ended

 

Twelve months ended

 

December 31,

2021

 

December 31,

2020

 

December 31,

2021

 

December 31,

2020

Property Segment

 

 

 

 

 

 

 

Catastrophe

$

7,795

 

$

59,120

 

$

2,235,736

 

$

1,886,785

Other property

 

376,862

 

 

249,195

 

 

1,722,988

 

 

1,112,357

Property segment gross premiums written

$

384,657

 

$

308,315

 

$

3,958,724

 

$

2,999,142

 

 

 

 

 

 

 

 

Casualty and Specialty Segment

 

 

 

 

 

 

 

General casualty (1)

$

281,926

 

$

190,996

 

$

1,258,536

 

$

904,594

Professional liability (2)

 

333,257

 

 

207,437

 

 

1,283,864

 

 

836,120

Financial lines (3)

 

139,799

 

 

122,023

 

 

498,946

 

 

514,192

Other (4)

 

173,379

 

 

106,743

 

 

833,728

 

 

552,117

Casualty and Specialty segment gross premiums written

$

928,361

 

$

627,199

 

$

3,875,074

 

$

2,807,023

(1)

Includes automobile liability, casualty clash, employer’s liability, umbrella or excess casualty, workers’ compensation and general liability.

(2)

Includes directors and officers, medical malpractice, and professional indemnity.

(3)

Includes financial guaranty, mortgage guaranty, political risk, surety and trade credit.

(4)

Includes accident and health, agriculture, aviation, cyber, energy, marine, satellite and terrorism. Lines of business such as regional multi-line and whole account may have characteristics of various other classes of business, and are allocated accordingly.

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Total Investment Result

(in thousands of United States Dollars, except percentages)

(Unaudited)

 

 

 

 

 

 

 

 

 

Three months ended

 

Twelve months ended

 

December 31,

2021

 

December 31,

2020

 

December 31,

2021

 

December 31,

2020

Fixed maturity investments trading

$

55,643

 

 

$

66,912

 

 

$

234,911

 

 

$

278,215

 

Short term investments

 

464

 

 

 

1,047

 

 

 

2,333

 

 

 

20,799

 

Equity investments trading

 

4,077

 

 

 

1,628

 

 

 

9,017

 

 

 

6,404

 

Other investments

 

 

 

 

 

 

 

Catastrophe bonds

 

16,527

 

 

 

13,500

 

 

 

64,860

 

 

 

54,784

 

Other

 

8,100

 

 

 

4,083

 

 

 

28,811

 

 

 

9,417

 

Cash and cash equivalents

 

74

 

 

 

192

 

 

 

297

 

 

 

2,974

 

 

 

84,885

 

 

 

87,362

 

 

 

340,229

 

 

 

372,593

 

Investment expenses

 

(4,402

)

 

 

(5,645

)

 

 

(20,750

)

 

 

(18,555

)

Net investment income

 

80,483

 

 

 

81,717

 

 

 

319,479

 

 

 

354,038

 

 

 

 

 

 

 

 

 

Net realized and unrealized gains (losses) on:

 

 

 

 

 

 

 

Fixed maturity investments trading, net of investments-related derivatives (1)

 

(116,689

)

 

 

90,132

 

 

 

(322,025

)

 

 

592,412

 

Equity investments trading, net of investments-related derivatives (1)

 

73,645

 

 

 

154,306

 

 

 

49,609

 

 

 

235,552

 

Other investments

 

 

 

 

 

 

 

Catastrophe bonds

 

(9,958

)

 

 

(9,742

)

 

 

(35,033

)

 

 

(7,031

)

Other

 

31,484

 

 

 

24,049

 

 

 

89,315

 

 

 

(297

)

Net realized and unrealized gains (losses) on investments

 

(21,518

)

 

 

258,745

 

 

 

(218,134

)

 

 

820,636

 

Total investment result

$

58,965

 

 

$

340,462

 

 

$

101,345

 

 

$

1,174,674

 

 

 

 

 

 

 

 

 

Total investment return - annualized

 

1.1

%

 

 

6.6

%

 

 

0.5

%

 

 

5.9

%

(1)

Net realized and unrealized gains (losses) on fixed maturity investments trading includes the impacts of interest rate futures, interest rate swaps, credit default swaps and total return swaps. Net realized and unrealized gains (losses) on equity investments trading includes the impact of equity futures.

Comments on Regulation G

In addition to the GAAP financial measures set forth in this Press Release, the Company has included certain non-GAAP financial measures within the meaning of Regulation G. The Company has provided these financial measures in previous investor communications and the Company’s management believes that these measures are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for comparison with other companies within the industry. These measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors are cautioned not to place undue reliance on these non-GAAP measures in assessing the Company’s overall financial performance.

Operating Income (Loss) Available (Attributable) to RenaissanceRe Common Shareholders and Operating Return on Average Common Equity - Annualized

The Company uses “operating Income (loss) available (attributable) to RenaissanceRe common shareholders” as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “Operating Income (loss) available (attributable) to RenaissanceRe common shareholders” as used herein differs from “net income (loss) attributable to RenaissanceRe common shareholders,” which the Company believes is the most directly comparable GAAP measure, by the exclusion of net realized and unrealized gains and losses on investments, excluding other investments - catastrophe bonds, net foreign exchange gains and losses, corporate expenses associated with the acquisition of TMR and the subsequent sale of RenaissanceRe (UK) Limited (“RenaissanceRe UK”), the income tax expense or benefit associated with these adjustments and the portion of these adjustments attributable to the Company’s redeemable noncontrolling interests. The Company’s management believes that “operating Income (loss) available (attributable) to RenaissanceRe common shareholders” is useful to investors because it more accurately measures and predicts the Company’s results of operations by removing the variability arising from: fluctuations in the fair value of the Company’s fixed maturity investment portfolio, equity investments trading, other investments (excluding catastrophe bonds) and investments-related derivatives; fluctuations in foreign exchange rates; corporate expenses associated with the acquisition of TMR and the subsequent sale of RenaissanceRe UK; the associated income tax expense or benefit of these adjustments; and the portion of these adjustments attributable to the Company’s redeemable noncontrolling interests. The Company also uses “operating Income (loss) available (attributable) to RenaissanceRe common shareholders” to calculate “operating Income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted” and “operating return on average common equity - annualized.” The following table is a reconciliation of: (1) net income (loss) attributable to RenaissanceRe common shareholders to “operating Income (loss) available (attributable) to RenaissanceRe common shareholders”; (2) net income (loss) attributable to RenaissanceRe common shareholders per common share - diluted to “operating Income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted”; and (3) return on average common equity - annualized to “operating return on average common equity - annualized.” Comparative information for all prior periods has been updated to conform to the current methodology and presentation.

 

Three months ended

 

Twelve months ended

(in thousands of United States Dollars, except per share amounts and percentages)

December 31,

2021

 

December 31,

2020

 

December 31,

2021

 

December 31,

2020

Net income (loss) available (attributable) to RenaissanceRe common shareholders

$

210,917

 

 

$

189,812

 

 

$

(73,421

)

 

$

731,482

 

Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds

 

11,560

 

 

 

(268,487

)

 

 

183,101

 

 

 

(827,667

)

Adjustment for net foreign exchange losses (gains)

 

16,697

 

 

 

(23,270

)

 

 

41,006

 

 

 

(27,773

)

Adjustment for corporate expenses associated with the acquisition of TMR and the subsequent sale of RenaissanceRe UK

 

 

 

 

7,346

 

 

 

135

 

 

 

47,964

 

Adjustment for income tax expense (benefit) (1)

 

(3,628

)

 

 

7,723

 

 

 

(11,521

)

 

 

29,863

 

Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2)

 

(21,854

)

 

 

9,754

 

 

 

(57,701

)

 

 

60,771

 

Operating income (loss) available (attributable) to RenaissanceRe common shareholders

$

213,692

 

 

$

(77,122

)

 

$

81,599

 

 

$

14,640

 

 

 

 

 

 

 

 

 

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted

$

4.65

 

 

$

3.74

 

 

$

(1.57

)

 

$

15.31

 

Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds

 

0.26

 

 

 

(5.36

)

 

 

3.88

 

 

 

(17.54

)

Adjustment for net foreign exchange losses (gains)

 

0.37

 

 

 

(0.46

)

 

 

0.87

 

 

 

(0.59

)

Adjustment for corporate expenses associated with the acquisition of TMR and the subsequent sale of RenaissanceRe UK

 

 

 

 

0.15

 

 

 

 

 

 

1.02

 

Adjustment for income tax expense (benefit) (1)

 

(0.08

)

 

 

0.15

 

 

 

(0.24

)

 

 

0.63

 

Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2)

 

(0.49

)

 

 

0.19

 

 

 

(1.22

)

 

 

1.29

 

Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted

$

4.71

 

 

$

(1.59

)

 

$

1.72

 

 

$

0.12

 

 

 

 

 

 

 

 

 

Return on average common equity - annualized

 

14.2

%

 

 

10.9

%

 

 

(1.1

) %

 

 

11.7

%

Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds

 

0.8

%

 

 

(15.4

) %

 

 

2.9

%

 

 

(13.4

) %

Adjustment for net foreign exchange losses (gains)

 

1.1

%

 

 

(1.3

) %

 

 

0.6

%

 

 

(0.4

) %

Adjustment for corporate expenses associated with the acquisition of TMR and the subsequent sale of RenaissanceRe UK

 

%

 

 

0.4

%

 

 

%

 

 

0.8

%

Adjustment for income tax expense (benefit) (1)

 

(0.2

) %

 

 

0.4

%

 

 

(0.2

) %

 

 

0.5

%

Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2)

 

(1.5

) %

 

 

0.6

%

 

 

(0.9

) %

 

 

1.0

%

Operating return on average common equity - annualized

 

14.4

%

 

 

(4.4

) %

 

 

1.3

%

 

 

0.2

%

(1)

Adjustment for income tax expense (benefit) represents the income tax (expense) benefit associated with the adjustments to net income available to RenaissanceRe common shareholders. The income tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors.

(2)

Represents the portion of these adjustments that are attributable to the Company's redeemable noncontrolling interests, including the income tax impact of those adjustments.

Tangible Book Value Per Common Share and Tangible Book Value Per Common Share Plus Accumulated Dividends

The Company has included in this Press Release “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” “Tangible book value per common share” is defined as book value per common share excluding goodwill and intangible assets per share. “Tangible book value per common share plus accumulated dividends” is defined as book value per common share excluding goodwill and intangible assets per share, plus accumulated dividends. The Company’s management believes “tangible book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because they provide a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets. The following table is a reconciliation of book value per common share to “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.”

 

December 31,

2021

 

September 30,

2021

 

June 30,

2021

 

March 31,

2021

 

December 31,

2020

Book value per common share

$

132.17

 

 

$

128.91

 

 

$

139.35

 

 

$

131.15

 

 

$

138.46

 

Adjustment for goodwill and other intangibles (1)

 

(5.90

)

 

 

(5.67

)

 

 

(5.60

)

 

 

(5.42

)

 

 

(5.37

)

Tangible book value per common share

 

126.27

 

 

 

123.24

 

 

 

133.75

 

 

 

125.73

 

 

 

133.09

 

Adjustment for accumulated dividends

 

23.52

 

 

 

23.16

 

 

 

22.80

 

 

 

22.44

 

 

 

22.08

 

Tangible book value per common share plus accumulated dividends

$

149.79

 

 

$

146.40

 

 

$

156.55

 

 

$

148.17

 

 

$

155.17

 

 

 

 

 

 

 

 

 

 

 

Quarterly change in book value per common share

 

2.5

%

 

 

(7.5

) %

 

 

6.3

%

 

 

(5.3

) %

 

 

2.5

%

Quarterly change in tangible book value per common share plus change in accumulated dividends

 

2.8

%

 

 

(7.6

) %

 

 

6.7

%

 

 

(5.3

) %

 

 

3.0

%

Year to date change in book value per common share

 

(4.5

) %

 

 

(6.9

) %

 

 

0.6

%

 

 

(5.3

) %

 

 

14.9

%

Year to date change in tangible book value per common share plus change in accumulated dividends

 

(4.0

) %

 

 

(6.6

) %

 

 

1.0

%

 

 

(5.3

) %

 

 

17.9

%

(1)

At December 31, 2021, September 30, 2021, June 30, 2021, March 31, 2021, and December 31, 2020, goodwill and other intangibles included $18.6 million, $19.0 million, $22.4 million, $22.7 million, and $23.0 million, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method.

 

Contacts

INVESTOR CONTACT:

RenaissanceRe Holdings Ltd.

Keith McCue

Senior Vice President, Finance & Investor Relations

(441) 239-4830

MEDIA CONTACT:

RenaissanceRe Holdings Ltd.

Keil Gunther

Senior Vice President, Head of Global Marketing & Client Communication

(441) 239-4932

or

Kekst CNC

Dawn Dover

(212) 521-4800

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