RenRe posts $92m annual loss
RenaissanceRe Holdings Ltd posted a net loss of $92.2 million for 2011 on heavy catastrophe claims.
For the fourth quarter, the Bermuda reinsurer recorded net income of of $81.8 million and its operating earnings of $1.11 per share handily beat the $1.04 expectation of analysts polled by Bloomberg.
The net loss for the year compared to net income of $702.6 million in 2010.
RenRe CEO Neill Currie said the company had seen higher pricing at January renewals last month.
“I am pleased to report growth in tangible book value per share plus dividends of over three percent in the fourth quarter, despite losses from the floods in Thailand,” Mr Currie said.
The Thai floods generated $59.5 million of underwriting losses, which had a net impact of $45.5 million on the company.
Underwriting income for the fourth quarter was $127.1 million, while the combined ratio - the proportion of premium dollars spent on claims and expenses - was 36.2 percent compared to 19.8 percent in the same period of 2010.
For the year, RenRe’s underwriting loss was $177.2 million and the combined ratio 118.6 percent, compared to 45.1 percent in 2010. Results were impacted by $725.2 million in underwriting losses from large loss events, including the 2011 New Zealand and Tohoku earthquakes, the large US tornadoes, the Australian floods, losses arising from aggregate contracts, hurricane Irene and the Thailand floods, which added 85.4 percentage points to the combined ratio.
“For the full year, we experienced a modest 1.8 percent decrease in tangible book value per share plus dividends in one of the most costly years in history for insured catastrophes,” Mr Currie said.
“During the year, we supported our clients by paying valid claims with industry-leading speed and providing much needed capacity. We entered the January 1 renewal season with a strong balance sheet, industry-leading ratings and an experienced and disciplined underwriting team.
“We were able to assemble a high quality portfolio of risks at January 1 and one that reflects firmer pricing for property catastrophe reinsurance. We believe we are well positioned to grow in 2012.”
RenRe wrote more business in 2011, with gross premiums written rising $269.7 million, or 23.1 percent, to $1.43 billion. The company said this was partly due in part to $160.3 million of reinstatement premiums written, principally within the catastrophe unit, compared to $28 million in 2010.
RenRe also noted improving market conditions in its catastrophe unit during the June and July 2011 renewals, and an increase in premiums within the company’s Lloyd’s segment.
During the year, book value per share decreased $3.31, or 5.3 percent, to $59.27, compared to a 21.1 percent increase in 2010.