Bermuda-based RenaissanceRe Holdings Ltd., a leading nat cat property reinsurer, joined the comeback kids of 2009 with a robust performance in the third quarter. The Company reported net income available to common shareholders of $258.6 million or $4.12 per diluted common share in the third quarter of 2009, compared to a net loss attributable to common shareholders of $231.0 million or $3.79 per diluted common share for the third quarter of 2008.
It also reported operating income, which excludes capital gains/losses, available to common shareholders of $242.2 million for the third quarter of 2009, compared to an operating loss attributable to common shareholders of $143.4 million in the third quarter of 2008.
The Company said its annualized return on average common equity was 35.5 percent and it had an annualized operating return on average common equity of 33.3 percent in the third quarter of 2009, compared to negative 36.1 percent and negative 22.4 percent, respectively, in the third quarter of 2008.
Book value per common share was $49.21 at September 30, 2009, an increase of $5.04, or 11.4 percent, in the third quarter of 2009, compared to a 10.1 percent decrease in the third quarter of 2008. For the nine months ended September 30, 2009, the Company’s book value per common share has increased $10.47, or 27.0 percent.
CEO Neill A. Currie expressed his satisfaction at the “strong quarter,” noting that RenRe had “generated solid underwriting profits and strong investment returns in the quarter, reflecting the quality of the portfolio of risks we have underwritten, a lack of insured catastrophes and improved investment markets.”
RenRe’s bulletin also noted: “Gross premiums written for the third quarter of 2009 decreased $37.4 million to $202.4 million, compared to $239.8 million in the third quarter of 2008, principally due to $49.0 million in reinstatement premiums written in the Company’s Reinsurance segment in the third quarter of 2008, as a result of hurricanes Gustav and Ike, that did not recur in the third quarter of 2009.
“The Company generated $167.7 million of underwriting income and a combined ratio of 43.3 percent in the third quarter of 2009, compared to an underwriting loss of $240.5 million and a combined ratio of 163.4 percent in the third quarter of 2008.
“The $408.3 million increase in underwriting income and 120.1 percentage point decrease in the combined ratio was driven by the comparably low level of insured catastrophes during the third quarter of 2009, compared to the third quarter of 2008, specifically the comparative impact of hurricanes Gustav and Ike which resulted in an underwriting loss of $419.6 million and increased the Company’s combined ratio by 116.8 percentage points during the third quarter of 2008.
“The Company experienced $70.4 million of favorable development on prior year reserves in the third quarter of 2009, compared to $36.0 million of favorable development in the third quarter of 2008.” The increase was mainly “a result of reductions in estimated ultimate losses on certain specific events within the catastrophe unit, and lower than expected claims emergence within the Company’s specialty unit.”
The complete report and details on accessing the replay to the earnings conference call, held on Wednesday, October 28, may be obtained on the Company’s web site at: www.renre.com
Source: RenaissanceRe Holdings
Topics Profit Loss Underwriting
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