RenaissanceRe Announces Estimated Net Negative Impact from Third Quarter 2018 Catastrophe Events; Expects to Report Modest Pr...
October 17 2018 - 4:15PM
Business Wire
RenaissanceRe Holdings Ltd. (NYSE: RNR) (the “Company” or
“RenaissanceRe”) today announced it currently estimates that losses
from third quarter 2018 catastrophe events will have an estimated
net negative impact of approximately $155 million on its third
quarter 2018 results of operations. The estimated losses for these
events are primarily driven by Typhoon Jebi and Hurricane Florence,
which will have an estimated net negative impact of approximately
$70 million and $55 million, respectively. Losses from the other
third quarter 2018 catastrophe events, including Typhoons Mangkhut
and Trami, and the California wildfires, will have an estimated net
negative impact of approximately $30 million. The Company expects
to report modest net income available to common shareholders for
the third quarter of 2018.
Kevin J. O’Donnell, CEO of RenaissanceRe, commented: "It was an
active quarter for catastrophic events around the world, most
notably in Japan and the United States, and we extend our
sympathies to all those affected. Consistent with our 25-year track
record as a global reinsurer, we stand ready to support all of our
cedents by rapidly paying their claims and continuing to deliver on
our promise to provide superior customer relationships."
Net negative impact includes the sum of estimates of net claims
and claim expenses incurred, earned reinstatement premiums assumed
and ceded, lost profit commissions and redeemable noncontrolling
interest. The Company’s estimates of net negative impact are based
on a review of its potential exposures, preliminary discussions
with certain counterparties and catastrophe modeling
techniques.
Meaningful uncertainty regarding the estimates and the nature
and extent of the losses from the catastrophe events in the third
quarter of 2018 remains, driven by the magnitude and recent
occurrence of each event, 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. Accordingly, the Company’s actual net negative impact
from the catastrophe events in the third quarter of 2018 may vary
from these preliminary estimates, perhaps materially. Updated
estimates related to these events will be reflected in
RenaissanceRe’s third quarter 2018 results, when reported, and
changes in these estimates will be recorded in the period in which
they occur.
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, the
Company has offices in Bermuda, 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 frequency and severity of catastrophic and other
events that the Company covers; the effectiveness of the Company’s
claims and claim expense reserving process; the Company’s ability
to maintain its financial strength ratings; the effect of climate
change on the Company’s business; collection on claimed
retrocessional coverage, and new retrocessional reinsurance being
available on acceptable terms and providing the coverage that we
intended to obtain; the effects of U.S. tax reform legislation and
possible future tax reform legislation and regulations, including
changes to the tax treatment of the Company’s shareholders or
investors in the Company’s joint ventures or other entities the
Company manages; the effect of emerging claims and coverage issues;
continued soft reinsurance underwriting market conditions; the
Company’s reliance on a small and decreasing number of reinsurance
brokers and other distribution services for the preponderance of
its revenue; the Company’s exposure to credit loss from
counterparties in the normal course of business; the effect of
continued challenging economic conditions throughout the world; a
contention by the Internal Revenue Service that Renaissance
Reinsurance Ltd., or any of the Company’s other Bermuda
subsidiaries, is subject to taxation in the U.S.; the success of
any of the Company’s strategic investments or acquisitions,
including the Company’s ability to manage its operations as its
product and geographical diversity increases; the Company’s ability
to retain key senior officers and to attract or retain the
executives and employees necessary to manage its business; the
performance of the Company’s investment portfolio; losses that the
Company could face from terrorism, political unrest or war; the
effect of cybersecurity risks, including technology breaches or
failure on the Company’s business; the Company’s ability to
successfully implement its business strategies and initiatives; the
Company’s ability to determine the impairments taken on
investments; the effect of inflation; the ability of the Company’s
ceding companies and delegated authority counterparties to
accurately assess the risks they underwrite; the effect of
operational risks, including system or human failures; the
Company’s ability to effectively manage capital on behalf of
investors in joint ventures or other entities it manages; foreign
currency exchange rate fluctuations; the Company’s ability to raise
capital if necessary; the Company’s ability to comply with
covenants in its debt agreements; changes to the regulatory systems
under which the Company operates, including as a result of
increased global regulation of the insurance and reinsurance
industry; changes in Bermuda laws and regulations and the political
environment in Bermuda; 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 or other transactions; the cyclical nature of the
reinsurance and insurance industries; adverse legislative
developments that reduce the size of the private markets the
Company serves or impede their future growth; consolidation of
competitors, customers and insurance and reinsurance brokers; the
effect on the Company’s business of the highly competitive nature
of its industry, including the effect of new entrants to, competing
products for and consolidation in the (re)insurance industry; other
political, regulatory or industry initiatives adversely impacting
the Company; increasing barriers to free trade and the free flow of
capital; international restrictions on the writing of reinsurance
by foreign companies and government intervention in the natural
catastrophe market; the effect of Organisation for Economic
Co-operation and Development or European Union (“EU”) measures to
increase the Company’s taxes and reporting requirements; the effect
of the vote by the U.K. to leave the EU; changes in regulatory
regimes and accounting rules that may impact financial results
irrespective of business operations; the Company’s need to make
many estimates and judgments in the preparation of its financial
statements; and other factors affecting future results disclosed in
RenaissanceRe’s filings with the Securities and Exchange
Commission, including its Annual Reports on Form 10-K and Quarterly
Reports on Form 10-Q.
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version on businesswire.com: https://www.businesswire.com/news/home/20181017005875/en/
Investors:RenaissanceRe Holdings Ltd.Keith McCue,
441-239-4830Senior Vice President, Finance & Investor
RelationsorMedia:RenaissanceRe Holdings Ltd.Keil Gunther,
441-239-4932Vice President, Marketing & CommunicationsorKekst
and CompanyPeter Hill or Dawn Dover212-521-4800
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