PEMBROKE, Bermuda--(BUSINESS WIRE)--Apr. 12, 2017--
RenaissanceRe Holdings Ltd. (the “Company”) (NYSE:RNR) today announced
the estimated impact of the U.K. Ministry of Justice’s recent
announcement of a decrease in the discount rate used to calculate lump
sum awards in U.K. bodily injury cases, known as the Ogden rate.
Effective March 20, 2017, the Ogden rate changed from plus 2.5% to minus
0.75%, a decrease of 325 basis points.
Based upon information currently available, the Company estimates that
the pre-tax impact of the rate change on its carried reserves is
approximately $30 million, to be recognized in the first quarter of
2017. The majority of the reserve increase relates to a limited number
of U.K. medical malpractice contracts within the Company’s Casualty and
Specialty segment.
Due to the complexity of factors contributing to the change in reserve
estimates, the ultimate impact to the Company’s reserves as a result of
the change in the Ogden rate may vary from these estimates.
RenaissanceRe Holdings Ltd. is a global provider of reinsurance and
insurance. The Company’s business consists of two reportable segments:
(1) Property, which is comprised of catastrophe and other property
reinsurance and insurance written on behalf of our operating
subsidiaries and certain joint ventures managed by our ventures unit,
and (2) Casualty and Specialty, which is comprised of casualty and
specialty reinsurance and insurance written on behalf of our operating
subsidiaries and certain specialty joint ventures managed by our
ventures unit.
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; the
effect of U.S. business tax reform proposals; adverse tax developments,
including potential changes to the taxation of inter-company or related
party transactions, or changes to the tax treatment of shareholders or
investors in RenaissanceRe or 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
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 retain key
senior officers and to attract or retain the executives and employees
necessary to manage its business; the Company’s ability to determine the
impairments taken on investments; the availability of retrocessional
reinsurance on acceptable terms; 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; 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; 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; other
political, regulatory or industry initiatives adversely impacting the
Company; risks related to Solvency II; 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; consolidation of competitors, customers and
insurance and reinsurance brokers; 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 Organization 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/or accounting rules that impact financial results irrespective of
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 SEC,
including its Annual Reports on Form 10-K and Quarterly Reports on Form
10-Q.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170412005782/en/
Source: RenaissanceRe Holdings Ltd.
Investors:
RenaissanceRe Holdings Ltd.
Aditya Dutt,
441-239-4778
Senior Vice President, Treasurer
or
Media:
RenaissanceRe
Holdings Ltd.
Elizabeth Tillman, 212-238-9224
Director –
Communications
or
Kekst and Company
Peter Hill or Dawn
Dover, 212-521-4800