Fitch Affirms RenaissanceRe’s Ratings

July 15, 2005

Fitch Ratings has affirmed the ‘A-‘ long-term and senior debt ratings and ‘BBB+’ preferred stock rating on RenaissanceRe Holdings Ltd. (RenRe).

Additionally, Fitch has affirmed the ‘BBB+’ rating on Renaissance Re Capital Trust’s capital securities and has assigned an ‘A+’ insurer financial strength rating to RenRe’s lead operating subsidiary, Renaissance Reinsurance Ltd. (RenRe Ltd.). The Rating Outlook is Stable.

Fitch’s rating actions reflect RenRe’s sound underwriting skills, strong competitive position in the property/CAT reinsurance market, favorable long-term earnings trends, and solid capitalization. Partially offsetting these positive factors is the affect on earnings and capital of the underwriting volatility inherent in the company core property/catastrophe reinsurance product.

Additionally, Fitch notes that RenRe restated its financial statements when it filed its 2004 10K and subsequently has received three subpoenas requesting information related to finite reinsurance and related products.

Although numerous companies have received subpoenas that Fitch believes are likely similar to those received by RenRe, and Fitch believes that RenRe is cooperating with the subpoenas, it also believes that the company faces heightened exposure to these issues because of its restatement.

Because natural catastrophes can have a significant affect on RenRe’s underwriting results, Fitch evaluates the company’s underwriting profitability over extended time periods. RenRe’s average combined ratio for the five-year period through 2004 was 70.9%, which compares favorable to peers’ combined ratio for the same period. Additionally, Fitch considers the volatility of RenRe’s underwriting results to be moderately less than that of peer companies that focus on property/catastrophe reinsurance.

RenRe’s first-quarter 2005 and second-half 2004 underwriting profitability was significantly below the company’s historic results. European windstorm losses in first-quarter 2005 and Florida hurricane losses in third-quarter 2004, disrupted RenRe’s extended streak of strong operating profitability.

Fitch considers RenRe’s third-quarter 2004 hurricane losses large in comparison to its peers, reflecting a relatively aggressive market share the company had gained in Florida in recent years. However, Fitch continues to believe that the company’s catastrophe modeling and risk-management skills are sound.

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