Bermuda-based RenaissanceRe Holdings Ltd. reported net income available to common shareholders of $122.6 million or $2.23 per diluted common share in the fourth quarter of 2010, compared to $211.8 million or $3.38 per diluted common share, in the fourth quarter of 2009.
Operating income available to its common shareholders was $189.1 million for the fourth quarter of 2010, or $3.47 per diluted common share, compared to $177.7 million, or $2.82 per diluted common share, in the fourth quarter of 2009.
The Company reported an annualized return on average common equity of 14.6 percent and an annualized operating return on average common equity of 22.5 percent in the fourth quarter of 2010, compared to 27.1 percent and 22.7 percent, respectively, in the fourth quarter of 2009.
For the full year, RenRe reported net income available to its common shareholders of $702.6 million, compared to $838.9 million for 2009, a 16 percent decline. The earnings bulletin noted that RenRe posted “a 21.7 percent return on average common equity and a 16.5 percent operating return on average common equity, compared to 30.2 percent and 27.6 percent, respectively, for 2009.
“Book value per common share increased $2.01, or 3.3 percent, in the fourth quarter of 2010 to $62.58, compared to a 5.0 percent increase in the fourth quarter of 2009. For the year, book value per common share increased $10.90, or 21.1 percent, compared to a 33.4 percent increase in 2009.
CEO Neill A. Currie commented: “I am pleased to report strong earnings for the full year, despite softening market conditions in many lines and a number of significant catastrophic events that took place around the world. We reported $702.6 million of net income for the year, an operating ROE of 16.5 percent and over 21 percent growth in book value per common share. Robust underwriting profits, solid investment results and disciplined execution by our team contributed to these results.”
“During the year, we completed a strategic review of our U.S.-based insurance operations which ultimately culminated in our announced sale of these operations. The sale is expected to close in early 2011. This decision reflects our commitment to being nimble and sharpens our focus on being a leading underwriter of low frequency, high-severity risks.”
RenRe’s earnings bulletin also stated that gross premiums written for 2010 were $1.1653 billion, a decrease of $63.6 million, or 5.2 percent, from 2009.” The decrease in gross premiums written was driven by decreases in the Company’s Reinsurance and Insurance segments of $87.2 million and $28.2 million, respectively, and partially offset by $66.2 million of gross premiums written in the Company’s Lloyd’s segment.
“The Company generated $474.6 million of underwriting income and had a combined ratio of 45.1 percent in 2010, compared to $695.2 million of underwriting income and a 21.2 percent combined ratio in 2009. The $220.6 million decrease in underwriting income and 23.9 percentage point increase in the combined ratio was driven by the comparably high level of insured catastrophes during 2010, compared to 2009, specifically the comparative impact of the 2010 earthquakes which resulted in $252.1 million of net underwriting losses, and increased the Company’s combined ratio by 32.0 percentage points in 2010.
“The net negative impact from the 2010 earthquakes was $211.7 million and includes the sum of estimates of net claims and claim expenses incurred, earned reinstatement premiums assumed and ceded, lost profit commissions, redeemable non-controlling interest, and for the New Zealand earthquake, equity in net claims and claim expenses of Top Layer Re.”
Source: RenaissanceRe
Topics Profit Loss Underwriting
Was this article valuable?
Here are more articles you may enjoy.
Investment Funds File New Suits Over Lighthouse Insurance Collapse in 2022 
Uncertainty Keeps Prices Up; No Prior-Year Loss Development: Travelers 
AIG General Insurance Chairman McElroy to Retire May 1 
Former Congressman Charged After Collision with State Trooper in Florida 
