UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 28, 2020
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of Principal Executive Office) (Zip Code)
(441 ) 295-4513
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report).
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of each exchange on which registered | ||||||
Item 2.02 Results of Operations and Financial Condition.
On July 28, 2020, RenaissanceRe Holdings Ltd. (the “Company”) issued a press release announcing its financial results for the three months ended July 28, 2020 and the availability of its corresponding financial supplement. Copies of the press release and the financial supplement are attached as Exhibit 99.1 and 99.2, respectively, to this Form 8-K. This Form 8-K and Exhibits 99.1 and 99.2 hereto are each being furnished to the Securities and Exchange Commission (the “SEC”) pursuant to Item 2.02 of Form 8-K and are therefore not to be considered “filed” with the SEC.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit # Description
101 Pursuant to Rule 406 of Regulation S-T, the cover page information is formatted in Inline XBRL.
104 Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101).
* Exhibits 99.1 and 99.2 are being furnished to the SEC pursuant to Item 2.02 and are not being filed with the SEC. Therefore, these exhibits are not incorporated by reference in any of the registrant’s other SEC filings.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| RENAISSANCERE HOLDINGS LTD. | ||||||||||||||
| Date: | By: | /s/ Robert Qutub | ||||||||||||
| July 28, 2020 | Robert Qutub | |||||||||||||
| Executive Vice President and Chief Financial Officer | ||||||||||||||
RenaissanceRe Reports Second Quarter 2020 Net Income Available to Common Shareholders of
$575.8 Million, or $12.63 Per Diluted Common Share; Operating Income Available to Common Shareholders of $190.1 Million, or $4.06 Per Diluted Common Share
Pembroke, Bermuda, July 28, 2020 -- RenaissanceRe Holdings Ltd. (NYSE: RNR) (the “Company” or “RenaissanceRe”) today reported net income available to RenaissanceRe common shareholders of $575.8 million, or $12.63 per diluted common share, in the second quarter of 2020, compared to net income available to RenaissanceRe common shareholders of $367.9 million, or $8.35 per diluted common share, in the second quarter of 2019. Operating income available to RenaissanceRe common shareholders was $190.1 million, or $4.06 per diluted common share, in the second quarter of 2020, compared to $198.8 million, or $4.47 per diluted common share, in the second quarter of 2019. The Company reported an annualized return on average common equity of 38.5% and an annualized operating return on average common equity of 12.7% in the second quarter of 2020, compared to 28.9% and 15.6%, respectively, in the second quarter of 2019. Book value per common share increased $17.12, or 14.6%, to $134.27 in the second quarter of 2020, compared to a 7.3% increase in the second quarter of 2019. Tangible book value per common share plus accumulated dividends increased $18.37, or 16.6%, to $150.09 in the second quarter of 2020, compared to an 8.2% increase in the second quarter of 2019.
Kevin J. O’Donnell, President and Chief Executive Officer of RenaissanceRe, commented: “I am proud of our team’s performance in the second quarter, where we delivered strong financial results and accomplished several strategic goals. We demonstrated market leadership in both our Property and Casualty and Specialty segments, constructing a larger and more efficient portfolio through disciplined and focused underwriting. While COVID-19 continues to present unprecedented economic and societal challenges, we feel confident with our portfolio and raised over $1 billion of new common equity in anticipation of future opportunities that we believe will deliver long-term value for our shareholders.”
Second Quarter of 2020 Summary
•Gross premiums written increased by $225.0 million, or 15.2%, to $1.7 billion, in the second quarter of 2020 compared to the second quarter of 2019, driven by an increase of $203.3 million in the Property segment and an increase of $21.6 million in the Casualty and Specialty segment.
•Underwriting income of $217.1 million and a combined ratio of 78.5% in the second quarter of 2020, compared to underwriting income of $170.8 million and a combined ratio of 81.3% in the second quarter of 2019. The Property segment generated underwriting income of $200.6 million and had a combined ratio of 59.1% in the second quarter of 2020. The Casualty and Specialty segment generated underwriting income of $16.5 million and had a combined ratio of 96.8% in the second quarter of 2020.
•Total investment result was a gain of $537.7 million in the second quarter of 2020, generating an annualized total investment return of 11.8%, compared to a gain of $309.8 million and an annualized total investment return of 8.0% in the second quarter of 2019.
•On June 5, 2020, the Company issued 6,325,000 of its common shares in an underwritten public offering at a public offering price of $166.00 per share. Concurrently with the public offering, the Company raised $75.0 million through the issuance of 451,807 of its common shares at a price of $166.00 per share to State Farm Mutual Automobile Insurance Company, one of the Company’s existing stockholders, in a private placement. The total net proceeds from the offerings were $1.1 billion. The Company intends to use the net proceeds from these offerings for general corporate purposes, which may include expanding existing business lines, entering new business lines, forming new joint ventures, or acquiring books of business from other companies.
•Over $250.0 million of gross capital raised in the second quarter of 2020 through the Company’s managed joint ventures and third-party capital vehicles, including Upsilon RFO Re Ltd., Vermeer Reinsurance Ltd. (“Vermeer”) and RenaissanceRe Medici Fund Ltd (“Medici”).
1
Underwriting Results by Segment
Property Segment
Gross premiums written in the Property segment were $1.0 billion in the second quarter of 2020, an increase of $203.3 million, or 24.2%, compared to $839.2 million in the second quarter of 2019.
Gross premiums written in the catastrophe class of business were $711.8 million in the second quarter of 2020, an increase of $109.1 million, or 18.1%, compared to the second quarter of 2019. This increase was primarily driven by expanded participation on existing transactions, certain new transactions and rate improvements.
Gross premiums written in the other property class of business were $330.8 million in the second quarter of 2020, an increase of $94.2 million, or 39.8%, compared to the second quarter of 2019. This increase was primarily driven by growth from existing relationships and new opportunities across a number of the Company’s underwriting platforms.
Ceded premiums written in the Property segment were $338.4 million in the second quarter of 2020, an increase of $43.3 million, or 14.7%, compared to the second quarter of 2019. The increase in ceded premiums written was principally due to certain of the gross premiums written in the catastrophe class of business noted above being ceded to third-party investors in the Company’s managed vehicles, primarily RenaissanceRe Upsilon Fund Ltd.
The Property segment generated underwriting income of $200.6 million in the second quarter of 2020, compared to $151.7 million in the second quarter of 2019. In the second quarter of 2020, the Property segment generated a net claims and claim expense ratio of 33.4%, an underwriting expense ratio of 25.7% and a combined ratio of 59.1%, compared to 34.6%, 29.7% and 64.3%, respectively, in the second quarter of 2019. The underwriting result and combined ratio in the second quarter of 2020 improved principally due to a decrease in the underwriting expense ratio of 4.0 percentage points compared to the second quarter of 2019, driven by lower acquisition and operating expense ratios. The decrease in operating expenses was due in part to reduced travel, marketing and office operational expenses as a result of the COVID-19 pandemic. The decrease in the net claims and claim expense ratio was primarily driven by net favorable development on prior accident years net claims and claim expenses of $6.6 million, or 1.3 percentage points, during the second quarter of 2020, resulting from reductions in the estimated ultimate losses associated with a number of small catastrophe events in prior periods. This was partially offset by higher current accident year net claims and claim expenses due to a higher level of attritional losses associated with a larger proportion of the other property class of business being earned in the period compared to the second quarter of 2019. In addition, the underwriting result was impacted by losses related to a number of small weather-related catastrophe events that occurred during the second quarter of 2020.
Casualty and Specialty Segment
Gross premiums written in the Casualty and Specialty segment were $659.3 million in the second quarter of 2020, an increase of $21.6 million, or 3.4%, as compared to the second quarter of 2019. This increase was primarily due to growth from new and existing business opportunities written in the current and prior periods across various classes of business within the segment, substantially offset by non-renewal of a portion of the business acquired in connection with the acquisition of TMR (as defined herein).
The Casualty and Specialty segment generated underwriting income of $16.5 million in the second quarter of 2020, compared to $19.0 million in the second quarter of 2019. In the second quarter of 2020, the Casualty and Specialty segment generated a net claims and claim expense ratio of 66.7%, an underwriting expense ratio of 30.1% and a combined ratio of 96.8%, compared to 63.0%, 33.1% and 96.1%, respectively, in the second quarter of 2019. The increase in the net claims and claim expense ratio of 3.7 percentage points, was principally the result of higher current accident year attritional losses in the second quarter of 2020 compared to the second quarter of 2019 from specialty lines of business. The underwriting expense ratio in the Casualty and Specialty segment decreased 3.0 percentage points, to 30.1%, in the second quarter of 2020 compared to the second quarter of 2019, driven by lower acquisition and operating expense ratios. Operating expenses were impacted by reduced travel, marketing and office operational expenses as a result of the COVID-19 pandemic.
2
COVID-19
The Company continues to evaluate industry trends and its own potential exposure associated with the ongoing COVID-19 pandemic, and expects historically significant industry losses to emerge over time as the full impact of the pandemic and its effects on the global economy are realized. Among other things, the Company continues to actively monitor information received from or reported by clients, brokers, industry actuaries, regulators, courts, and others, and to assess that information in the context of its own portfolio. Our loss estimates represent our best estimate based on currently available information, and actual losses may vary materially from these estimates.
Other Items
•The Company’s total investment result, which includes the sum of net investment income and net realized and unrealized gains on investments, was a gain of $537.7 million in the second quarter of 2020, compared to a gain of $309.8 million in the second quarter of 2019, an increase of $227.9 million. The primary driver of the total investment result in the second quarter of 2020 was net realized and unrealized gains on investments of $448.4 million principally within the fixed maturity and equity investments trading portfolios.
•Net income attributable to redeemable noncontrolling interests in the second quarter of 2020 was $118.7 million, compared to $71.8 million in the second quarter of 2019. The increase was primarily driven by growth and improved performance of DaVinciRe Holdings Ltd., Medici and Vermeer.
•In the second quarter of 2020, total fee income increased by $5.3 million, to $45.5 million, compared to $40.2 million in the second quarter of 2019, primarily driven by an increase in the dollar value of capital being managed, combined with the improved underlying performance of our joint ventures and managed capital vehicles.
•In the second quarter of 2020, corporate expenses decreased by $11.9 million, to $11.9 million, compared to $23.8 million in the second quarter of 2019, primarily driven by $14.5 million of expenses incurred in connection with the acquisition of Tokio Millennium Re AG (now known as RenaissanceRe Europe AG), Tokio Millennium Re (UK) Limited (now known as RenaissanceRe (UK) Limited) and their subsidiaries (collectively, "TMR") during the second quarter of 2019 compared to $2.1 million in the second quarter of 2020.
•Income tax expense was $29.9 million in the second quarter of 2020, compared to $9.5 million in the second quarter of 2019, principally driven by investment gains in our U.S.-based operations.
This Press Release includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the U.S. (“GAAP”) including “operating income available to RenaissanceRe common shareholders,” “operating income available to RenaissanceRe common shareholders per common share - diluted,” “operating return on average common equity - annualized,” “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” A reconciliation of such measures to the most comparable GAAP figures in accordance with Regulation G is presented in the attached supplemental financial data.
Please refer to the “Investors - Financial Reports - Financial Supplements” section of the Company’s website at www.renre.com for a copy of the Financial Supplement which includes additional information on the Company’s financial performance.
RenaissanceRe will host a conference call on Wednesday, July 29, 2020 at 11:00 a.m. ET to discuss this release. Live broadcast of the conference call will be available through the “Investors - Webcasts & Presentations” section of the Company’s website at www.renre.com.
About RenaissanceRe
RenaissanceRe is a global provider of reinsurance and insurance that specializes in matching well-structured risks with efficient sources of capital. The Company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, the Company has offices in Bermuda, Australia, Ireland, Singapore, Switzerland, the United Kingdom and the United States.
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
3
results to differ materially from those set forth in or implied by such forward-looking statements, including the following: the uncertainty of the continuing impact of the COVID-19 pandemic and measures taken in response thereto; the effect of legislative, regulatory, judicial or social influences related to the COVID-19 pandemic on the Company’s financial performance, including the emergence of unexpected or un-modeled insurance or reinsurance losses, and the Company’s ability to conduct its business; the impact and potential future impacts of the COVID-19 pandemic on the value of the Company’s investments and its access to capital in the future or the pricing or terms of available financing; the effect that measures taken to mitigate the COVID-19 pandemic have on the Company’s operations and those of its counterparties; the frequency and severity of catastrophic and other events the Company covers; the effectiveness of the Company’s claims and claim expense reserving process; the effect of climate change on the Company’s business, including the trend towards increasingly frequent and severe climate events; the Company’s ability to maintain its financial strength ratings; the effect of emerging claims and coverage issues; collection on claimed retrocessional coverage, and new retrocessional reinsurance being available on acceptable terms and providing the coverage that the Company intended to obtain; 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; the performance of the Company’s investment portfolio; a contention by the U.S. 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 effects of U.S. tax reform legislation and possible future tax reform legislation and regulations, including changes to the tax treatment of the Company’s shareholders or investors in its joint ventures or other entities it manages; the effect of cybersecurity risks, including technology breaches or failure, on the Company’s business; the success of any of the Company’s strategic investments or acquisitions, including its ability to manage its operations as its product and geographical diversity increases; the Company’s ability to retain its key senior officers and to attract or retain the executives and employees necessary to manage its business; 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; soft reinsurance underwriting market conditions; changes in the method for determining the London Inter-bank Offered Rate (“LIBOR”) and the potential replacement of LIBOR; losses the Company could face from terrorism, political unrest or war; the Company’s ability to successfully implement its business strategies and initiatives; the Company’s ability to determine any impairments taken on its investments; the effects 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 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 industries; 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; aspects of the Company’s corporate structure that may discourage third-party takeovers and other transactions; difficulties investors may have in servicing process or enforcing judgments against the Company in the U.S.; 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; consolidation of competitors, customers and insurance and reinsurance brokers; 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; other political, regulatory or industry initiatives adversely impacting the Company; the Company’s ability to comply with applicable sanctions and foreign corrupt practices laws; 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 Organisation for Economic Co-operation and Development or European Union (“EU”) measures to increase the Company’s taxes and reporting requirements; changes in regulatory regimes and accounting rules that may impact financial results irrespective of business operations; the Company’s need to make many estimates and judgments in the preparation of its financial statements; the effect of the exit by the United Kingdom from the EU; and other factors affecting future results disclosed in RenaissanceRe’s filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and prospectus supplement filed on June 4, 2020.
4
| INVESTOR CONTACT: | MEDIA CONTACT: | ||||
| Keith McCue | Keil Gunther | ||||
| Senior Vice President, Finance & Investor Relations | Vice President, Head of Global Marketing & Client | ||||
| RenaissanceRe Holdings Ltd. | Communication | ||||
| (441) 239-4830 | RenaissanceRe Holdings Ltd. | ||||
| (441) 239-4932 | |||||
| or | |||||
| Kekst CNC | |||||
| Dawn Dover | |||||
| (212) 521-4800 | |||||
5
| RenaissanceRe Holdings Ltd. | |||||||||||||||||||||||
| Summary Consolidated Statements of Operations | |||||||||||||||||||||||
| (in thousands of United States Dollars, except per share amounts and percentages) | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||
| June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
Gross premiums written | $ | 1,701,872 | $ | 1,476,908 | $ | 3,727,593 | $ | 3,041,203 | |||||||||||||||
Net premiums written | $ | 1,180,803 | $ | 1,022,965 | $ | 2,450,611 | $ | 1,951,996 | |||||||||||||||
Increase in unearned premiums | (170,707) | (111,463) | (527,417) | (490,466) | |||||||||||||||||||
Net premiums earned | 1,010,096 | 911,502 | 1,923,194 | 1,461,530 | |||||||||||||||||||
Net investment income | 89,305 | 118,588 | 188,778 | 200,682 | |||||||||||||||||||
Net foreign exchange (losses) gains | (7,195) | 9,309 | (12,923) | 6,463 | |||||||||||||||||||
Equity in earnings of other ventures | 9,041 | 6,812 | 13,605 | 11,473 | |||||||||||||||||||
Other (loss) income | (1,201) | 922 | (5,637) | 4,093 | |||||||||||||||||||
Net realized and unrealized gains on investments | 448,390 | 191,247 | 337,683 | 361,260 | |||||||||||||||||||
Total revenues | 1,548,436 | 1,238,380 | 2,444,700 | 2,045,501 | |||||||||||||||||||
| Expenses | |||||||||||||||||||||||
Net claims and claim expenses incurred | 510,272 | 453,373 | 1,081,226 | 680,408 | |||||||||||||||||||
Acquisition expenses | 233,610 | 227,482 | 444,214 | 351,433 | |||||||||||||||||||
Operational expenses | 49,077 | 59,814 | 116,538 | 104,747 | |||||||||||||||||||
Corporate expenses | 11,898 | 23,847 | 27,889 | 62,636 | |||||||||||||||||||
Interest expense | 11,842 | 15,534 | 26,769 | 27,288 | |||||||||||||||||||
Total expenses | 816,699 | 780,050 | 1,696,636 | 1,226,512 | |||||||||||||||||||
Income before taxes | 731,737 | 458,330 | 748,064 | 818,989 | |||||||||||||||||||
| Income tax expense | (29,875) | (9,475) | (21,029) | (17,006) | |||||||||||||||||||
| Net income | 701,862 | 448,855 | 727,035 | 801,983 | |||||||||||||||||||
Net income attributable to noncontrolling interests | (118,728) | (71,812) | (216,819) | (142,034) | |||||||||||||||||||
Net income attributable to RenaissanceRe | 583,134 | 377,043 | 510,216 | 659,949 | |||||||||||||||||||
Dividends on preference shares | (7,289) | (9,189) | (16,345) | (18,378) | |||||||||||||||||||
Net income available to RenaissanceRe common shareholders | $ | 575,845 | $ | 367,854 | $ | 493,871 | $ | 641,571 | |||||||||||||||
Net income available to RenaissanceRe common shareholders per common share – basic | $ | 12.64 | $ | 8.36 | $ | 11.04 | $ | 14.82 | |||||||||||||||
Net income available to RenaissanceRe common shareholders per common share – diluted | $ | 12.63 | $ | 8.35 | $ | 11.02 | $ | 14.81 | |||||||||||||||
Operating income available to RenaissanceRe common shareholders per common share - diluted | $ | 4.06 | $ | 4.47 | $ | 4.91 | $ | 8.05 | |||||||||||||||
Average shares outstanding - basic | 44,939 | 43,483 | 44,190 | 42,774 | |||||||||||||||||||
Average shares outstanding - diluted | 45,003 | 43,521 | 44,253 | 42,806 | |||||||||||||||||||
Net claims and claim expense ratio | 50.5 | % | 49.7 | % | 56.2 | % | 46.6 | % | |||||||||||||||
Underwriting expense ratio | 28.0 | % | 31.6 | % | 29.2 | % | 31.2 | % | |||||||||||||||
Combined ratio | 78.5 | % | 81.3 | % | 85.4 | % | 77.8 | % | |||||||||||||||
Return on average common equity - annualized | 38.5 | % | 28.9 | % | 17.1 | % | 26.4 | % | |||||||||||||||
Operating return on average common equity - annualized (1) | 12.7 | % | 15.6 | % | 7.8 | % | 14.4 | % | |||||||||||||||
(1) See Comments on Regulation G for a reconciliation of non-GAAP financial measures.
6
| RenaissanceRe Holdings Ltd. | |||||||||||
| Summary Consolidated Balance Sheets | |||||||||||
| (in thousands of United States Dollars, except per share amounts) | |||||||||||
| June 30, 2020 | December 31, 2019 | ||||||||||
| Assets | (Unaudited) | (Audited) | |||||||||
| Fixed maturity investments trading, at fair value | $ | 12,495,135 | $ | 11,171,655 | |||||||
| Short term investments, at fair value | 5,570,804 | 4,566,277 | |||||||||
| Equity investments trading, at fair value | 470,087 | 436,931 | |||||||||
| Other investments, at fair value | 1,093,338 | 1,087,377 | |||||||||
| Investments in other ventures, under equity method | 94,285 | 106,549 | |||||||||
| Total investments | 19,723,649 | 17,368,789 | |||||||||
| Cash and cash equivalents | 1,185,844 | 1,379,068 | |||||||||
| Premiums receivable | 3,519,965 | 2,599,896 | |||||||||
| Prepaid reinsurance premiums | 1,266,203 | 767,781 | |||||||||
| Reinsurance recoverable | 2,774,358 | 2,791,297 | |||||||||
| Accrued investment income | 70,004 | 72,461 | |||||||||
| Deferred acquisition costs and value of business acquired | 734,286 | 663,991 | |||||||||
| Receivable for investments sold | 648,458 | 78,369 | |||||||||
| Other assets | 298,396 | 346,216 | |||||||||
| Goodwill and other intangibles | 258,591 | 262,226 | |||||||||
| Total assets | $ | 30,479,754 | $ | 26,330,094 | |||||||
| Liabilities, Noncontrolling Interests and Shareholders’ Equity | |||||||||||
| Liabilities | |||||||||||
| Reserve for claims and claim expenses | $ | 9,365,469 | $ | 9,384,349 | |||||||
| Unearned premiums | 3,549,641 | 2,530,975 | |||||||||
| Debt | 1,135,216 | 1,384,105 | |||||||||
| Reinsurance balances payable | 4,094,027 | 2,830,691 | |||||||||
| Payable for investments purchased | 1,259,116 | 225,275 | |||||||||
| Other liabilities | 342,014 | 932,024 | |||||||||
| Total liabilities | 19,745,483 | 17,287,419 | |||||||||
| Redeemable noncontrolling interest | 3,387,099 | 3,071,308 | |||||||||
| Shareholders’ Equity | |||||||||||
| Preference shares | 525,000 | 650,000 | |||||||||
| Common shares | 50,811 | 44,148 | |||||||||
| Additional paid-in capital | 1,602,738 | 568,277 | |||||||||
| Accumulated other comprehensive loss | (3,066) | (1,939) | |||||||||
| Retained earnings | 5,171,689 | 4,710,881 | |||||||||
| Total shareholders’ equity attributable to RenaissanceRe | 7,347,172 | 5,971,367 | |||||||||
| Total liabilities, noncontrolling interests and shareholders’ equity | $ | 30,479,754 | $ | 26,330,094 | |||||||
| Book value per common share | $ | 134.27 | $ | 120.53 | |||||||
7
| RenaissanceRe Holdings Ltd. | |||||||||||||||||||||||
| Supplemental Financial Data - Segment Information | |||||||||||||||||||||||
| (in thousands of United States Dollars, except percentages) | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three months ended June 30, 2020 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 1,042,536 | $ | 659,336 | $ | — | $ | 1,701,872 | |||||||||||||||
| Net premiums written | $ | 704,138 | $ | 476,665 | $ | — | $ | 1,180,803 | |||||||||||||||
| Net premiums earned | $ | 491,116 | $ | 518,980 | $ | — | $ | 1,010,096 | |||||||||||||||
| Net claims and claim expenses incurred | 164,050 | 346,266 | (44) | 510,272 | |||||||||||||||||||
| Acquisition expenses | 94,772 | 138,837 | 1 | 233,610 | |||||||||||||||||||
| Operational expenses | 31,656 | 17,422 | (1) | 49,077 | |||||||||||||||||||
| Underwriting income | $ | 200,638 | $ | 16,455 | $ | 44 | 217,137 | ||||||||||||||||
| Net investment income | 89,305 | 89,305 | |||||||||||||||||||||
| Net foreign exchange losses | (7,195) | (7,195) | |||||||||||||||||||||
| Equity in earnings of other ventures | 9,041 | 9,041 | |||||||||||||||||||||
| Other loss | (1,201) | (1,201) | |||||||||||||||||||||
| Net realized and unrealized gains on investments | 448,390 | 448,390 | |||||||||||||||||||||
| Corporate expenses | (11,898) | (11,898) | |||||||||||||||||||||
| Interest expense | (11,842) | (11,842) | |||||||||||||||||||||
| Income before taxes and redeemable noncontrolling interests | 731,737 | ||||||||||||||||||||||
| Income tax expense | (29,875) | (29,875) | |||||||||||||||||||||
| Net income attributable to redeemable noncontrolling interests | (118,728) | (118,728) | |||||||||||||||||||||
| Dividends on preference shares | (7,289) | (7,289) | |||||||||||||||||||||
| Net income available to RenaissanceRe common shareholders | $ | 575,845 | |||||||||||||||||||||
| Net claims and claim expenses incurred – current accident year | $ | 170,614 | $ | 355,064 | $ | — | $ | 525,678 | |||||||||||||||
| Net claims and claim expenses incurred – prior accident years | (6,564) | (8,798) | (44) | (15,406) | |||||||||||||||||||
| Net claims and claim expenses incurred – total | $ | 164,050 | $ | 346,266 | $ | (44) | $ | 510,272 | |||||||||||||||
| Net claims and claim expense ratio – current accident year | 34.7 | % | 68.4 | % | 52.0 | % | |||||||||||||||||
| Net claims and claim expense ratio – prior accident years | (1.3) | % | (1.7) | % | (1.5) | % | |||||||||||||||||
| Net claims and claim expense ratio – calendar year | 33.4 | % | 66.7 | % | 50.5 | % | |||||||||||||||||
| Underwriting expense ratio | 25.7 | % | 30.1 | % | 28.0 | % | |||||||||||||||||
| Combined ratio | 59.1 | % | 96.8 | % | 78.5 | % | |||||||||||||||||
| Three months ended June 30, 2019 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 839,200 | $ | 637,708 | $ | — | $ | 1,476,908 | |||||||||||||||
| Net premiums written | $ | 544,115 | $ | 478,850 | $ | — | $ | 1,022,965 | |||||||||||||||
| Net premiums earned | $ | 425,013 | $ | 486,489 | $ | — | $ | 911,502 | |||||||||||||||
| Net claims and claim expenses incurred | 146,874 | 306,501 | (2) | 453,373 | |||||||||||||||||||
| Acquisition expenses | 89,711 | 137,963 | (192) | 227,482 | |||||||||||||||||||
| Operational expenses | 36,764 | 23,016 | 34 | 59,814 | |||||||||||||||||||
| Underwriting income | $ | 151,664 | $ | 19,009 | $ | 160 | 170,833 | ||||||||||||||||
| Net investment income | 118,588 | 118,588 | |||||||||||||||||||||
| Net foreign exchange gains | 9,309 | 9,309 | |||||||||||||||||||||
| Equity in earnings of other ventures | 6,812 | 6,812 | |||||||||||||||||||||
| Other income | 922 | 922 | |||||||||||||||||||||
| Net realized and unrealized gains on investments | 191,247 | 191,247 | |||||||||||||||||||||
| Corporate expenses | (23,847) | (23,847) | |||||||||||||||||||||
| Interest expense | (15,534) | (15,534) | |||||||||||||||||||||
| Income before taxes and redeemable noncontrolling interests | 458,330 | ||||||||||||||||||||||
| Income tax expense | (9,475) | (9,475) | |||||||||||||||||||||
| Net income attributable to redeemable noncontrolling interests | (71,812) | (71,812) | |||||||||||||||||||||
| Dividends on preference shares | (9,189) | (9,189) | |||||||||||||||||||||
| Net income available to RenaissanceRe common shareholders | $ | 367,854 | |||||||||||||||||||||
| Net claims and claim expenses incurred – current accident year | $ | 136,111 | $ | 317,029 | $ | — | $ | 453,140 | |||||||||||||||
| Net claims and claim expenses incurred – prior accident years | 10,763 | (10,528) | (2) | 233 | |||||||||||||||||||
| Net claims and claim expenses incurred – total | $ | 146,874 | $ | 306,501 | $ | (2) | $ | 453,373 | |||||||||||||||
| Net claims and claim expense ratio – current accident year | 32.0 | % | 65.2 | % | 49.7 | % | |||||||||||||||||
| Net claims and claim expense ratio – prior accident years | 2.6 | % | (2.2) | % | — | % | |||||||||||||||||
| Net claims and claim expense ratio – calendar year | 34.6 | % | 63.0 | % | 49.7 | % | |||||||||||||||||
| Underwriting expense ratio | 29.7 | % | 33.1 | % | 31.6 | % | |||||||||||||||||
| Combined ratio | 64.3 | % | 96.1 | % | 81.3 | % | |||||||||||||||||
8
| RenaissanceRe Holdings Ltd. | |||||||||||||||||||||||
| Supplemental Financial Data - Segment Information | |||||||||||||||||||||||
| (in thousands of United States Dollars, except percentages) | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Six months ended June 30, 2020 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 2,263,062 | $ | 1,464,531 | $ | — | $ | 3,727,593 | |||||||||||||||
| Net premiums written | $ | 1,378,719 | $ | 1,071,892 | $ | — | $ | 2,450,611 | |||||||||||||||
| Net premiums earned | $ | 912,451 | $ | 1,010,743 | $ | — | $ | 1,923,194 | |||||||||||||||
| Net claims and claim expenses incurred | 308,902 | 772,475 | (151) | 1,081,226 | |||||||||||||||||||
| Acquisition expenses | 180,123 | 264,090 | 1 | 444,214 | |||||||||||||||||||
| Operational expenses | 75,663 | 40,876 | (1) | 116,538 | |||||||||||||||||||
| Underwriting income (loss) | $ | 347,763 | $ | (66,698) | $ | 151 | 281,216 | ||||||||||||||||
| Net investment income | 188,778 | 188,778 | |||||||||||||||||||||
| Net foreign exchange losses | (12,923) | (12,923) | |||||||||||||||||||||
| Equity in earnings of other ventures | 13,605 | 13,605 | |||||||||||||||||||||
| Other loss | (5,637) | (5,637) | |||||||||||||||||||||
| Net realized and unrealized gains on investments | 337,683 | 337,683 | |||||||||||||||||||||
| Corporate expenses | (27,889) | (27,889) | |||||||||||||||||||||
| Interest expense | (26,769) | (26,769) | |||||||||||||||||||||
| Income before taxes and redeemable noncontrolling interests | 748,064 | ||||||||||||||||||||||
| Income tax expense | (21,029) | (21,029) | |||||||||||||||||||||
| Net income attributable to redeemable noncontrolling interests | (216,819) | (216,819) | |||||||||||||||||||||
| Dividends on preference shares | (16,345) | (16,345) | |||||||||||||||||||||
| Net income attributable to RenaissanceRe common shareholders | $ | 493,871 | |||||||||||||||||||||
| Net claims and claim expenses incurred – current accident year | $ | 301,458 | $ | 781,274 | $ | — | $ | 1,082,732 | |||||||||||||||
| Net claims and claim expenses incurred – prior accident years | 7,444 | (8,799) | (151) | (1,506) | |||||||||||||||||||
| Net claims and claim expenses incurred – total | $ | 308,902 | $ | 772,475 | $ | (151) | $ | 1,081,226 | |||||||||||||||
| Net claims and claim expense ratio – current accident year | 33.0 | % | 77.3 | % | 56.3 | % | |||||||||||||||||
| Net claims and claim expense ratio – prior accident years | 0.9 | % | (0.9) | % | (0.1) | % | |||||||||||||||||
| Net claims and claim expense ratio – calendar year | 33.9 | % | 76.4 | % | 56.2 | % | |||||||||||||||||
| Underwriting expense ratio | 28.0 | % | 30.2 | % | 29.2 | % | |||||||||||||||||
| Combined ratio | 61.9 | % | 106.6 | % | 85.4 | % | |||||||||||||||||
| Six months ended June 30, 2019 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 1,871,584 | $ | 1,169,619 | $ | — | $ | 3,041,203 | |||||||||||||||
| Net premiums written | $ | 1,108,345 | $ | 843,651 | $ | — | $ | 1,951,996 | |||||||||||||||
| Net premiums earned | $ | 715,758 | $ | 745,772 | $ | — | $ | 1,461,530 | |||||||||||||||
| Net claims and claim expenses incurred | 202,957 | 477,434 | 17 | 680,408 | |||||||||||||||||||
| Acquisition expenses | 143,450 | 208,175 | (192) | 351,433 | |||||||||||||||||||
| Operational expenses | 65,308 | 39,405 | 34 | 104,747 | |||||||||||||||||||
| Underwriting income | $ | 304,043 | $ | 20,758 | $ | 141 | 324,942 | ||||||||||||||||
| Net investment income | 200,682 | 200,682 | |||||||||||||||||||||
| Net foreign exchange gains | 6,463 | 6,463 | |||||||||||||||||||||
| Equity in earnings of other ventures | 11,473 | 11,473 | |||||||||||||||||||||
| Other income | 4,093 | 4,093 | |||||||||||||||||||||
| Net realized and unrealized gains on investments | 361,260 | 361,260 | |||||||||||||||||||||
| Corporate expenses | (62,636) | (62,636) | |||||||||||||||||||||
| Interest expense | (27,288) | (27,288) | |||||||||||||||||||||
| Income before taxes and redeemable noncontrolling interests | 818,989 | ||||||||||||||||||||||
| Income tax expense | (17,006) | (17,006) | |||||||||||||||||||||
| Net income attributable to redeemable noncontrolling interests | (142,034) | (142,034) | |||||||||||||||||||||
| Dividends on preference shares | (18,378) | (18,378) | |||||||||||||||||||||
| Net income available to RenaissanceRe common shareholders | $ | 641,571 | |||||||||||||||||||||
| Net claims and claim expenses incurred – current accident year | $ | 190,317 | $ | 494,164 | $ | — | $ | 684,481 | |||||||||||||||
| Net claims and claim expenses incurred – prior accident years | 12,640 | (16,730) | 17 | (4,073) | |||||||||||||||||||
| Net claims and claim expenses incurred – total | $ | 202,957 | $ | 477,434 | $ | 17 | $ | 680,408 | |||||||||||||||
| Net claims and claim expense ratio – current accident year | 26.6 | % | 66.3 | % | 46.8 | % | |||||||||||||||||
| Net claims and claim expense ratio – prior accident years | 1.8 | % | (2.3) | % | (0.2) | % | |||||||||||||||||
| Net claims and claim expense ratio – calendar year | 28.4 | % | 64.0 | % | 46.6 | % | |||||||||||||||||
| Underwriting expense ratio | 29.1 | % | 33.2 | % | 31.2 | % | |||||||||||||||||
| Combined ratio | 57.5 | % | 97.2 | % | 77.8 | % | |||||||||||||||||
9
| RenaissanceRe Holdings Ltd. | |||||||||||||||||||||||
| Supplemental Financial Data - Gross Premiums Written | |||||||||||||||||||||||
| (in thousands of United States Dollars) | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||
| June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
| Property Segment | |||||||||||||||||||||||
| Catastrophe | $ | 711,786 | $ | 602,656 | $ | 1,647,976 | $ | 1,447,869 | |||||||||||||||
| Other property | 330,750 | 236,544 | 615,086 | 423,715 | |||||||||||||||||||
Property segment gross premiums written | $ | 1,042,536 | $ | 839,200 | $ | 2,263,062 | $ | 1,871,584 | |||||||||||||||
| Casualty and Specialty Segment | |||||||||||||||||||||||
| General casualty (1) | $ | 206,666 | $ | 258,357 | $ | 453,333 | $ | 411,691 | |||||||||||||||
| Professional liability (2) | 222,737 | 167,206 | 453,224 | 316,583 | |||||||||||||||||||
| Financial lines (3) | 101,635 | 91,202 | 248,714 | 218,558 | |||||||||||||||||||
| Other (4) | 128,298 | 120,943 | 309,260 | 222,787 | |||||||||||||||||||
Casualty and Specialty segment gross premiums written | $ | 659,336 | $ | 637,708 | $ | 1,464,531 | $ | 1,169,619 | |||||||||||||||
| (1) | Includes automobile liability, casualty clash, employer’s liability, umbrella or excess casualty, workers’ compensation and general liability. | ||||
| (2) | Includes directors and officers, medical malpractice, and professional indemnity. | ||||
| (3) | Includes financial guaranty, mortgage guaranty, political risk, surety and trade credit. | ||||
| (4) | Includes accident and health, agriculture, aviation, cyber, energy, marine, satellite and terrorism. Lines of business such as regional multi-line and whole account may have characteristics of various other classes of business, and are allocated accordingly. | ||||
10
| RenaissanceRe Holdings Ltd. | |||||||||||||||||||||||
| Supplemental Financial Data - Total Investment Result | |||||||||||||||||||||||
| (in thousands of United States Dollars, except percentages) | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||
| June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | ||||||||||||||||||||
| Fixed maturity investments trading | $ | 69,943 | $ | 88,106 | $ | 143,281 | $ | 149,589 | |||||||||||||||
| Short term investments | 6,049 | 17,807 | 18,141 | 29,651 | |||||||||||||||||||
| Equity investments trading | 1,666 | 916 | 3,217 | 1,943 | |||||||||||||||||||
| Other investments | |||||||||||||||||||||||
| Catastrophe bonds | 13,519 | 11,781 | 27,658 | 20,472 | |||||||||||||||||||
| Other | 1,107 | 1,914 | 2,736 | 3,554 | |||||||||||||||||||
| Cash and cash equivalents | 837 | 2,306 | 2,341 | 3,823 | |||||||||||||||||||
| 93,121 | 122,830 | 197,374 | 209,032 | ||||||||||||||||||||
| Investment expenses | (3,816) | (4,242) | (8,596) | (8,350) | |||||||||||||||||||
| Net investment income | 89,305 | 118,588 | 188,778 | 200,682 | |||||||||||||||||||
| Net realized and unrealized gains (losses) on: | |||||||||||||||||||||||
| Fixed maturity investments trading (1) | 322,711 | 171,920 | 423,932 | 288,621 | |||||||||||||||||||
| Equity investments trading (1) | 113,506 | 22,083 | (38,376) | 76,027 | |||||||||||||||||||
| Other investments | |||||||||||||||||||||||
| Catastrophe bonds | 4,452 | (11,902) | (9,900) | (14,112) | |||||||||||||||||||
| Other | 7,721 | 9,146 | (37,973) | 10,724 | |||||||||||||||||||
| Net realized and unrealized gains on investments | 448,390 | 191,247 | 337,683 | 361,260 | |||||||||||||||||||
| Total investment result | $ | 537,695 | $ | 309,835 | $ | 526,461 | $ | 561,942 | |||||||||||||||
| Total investment return - annualized | 11.8 | % | 8.0 | % | 5.8 | % | 7.3 | % | |||||||||||||||
(1) Net realized and unrealized gains (losses) on fixed maturity investments trading includes the impacts of interest rate futures, interest rate swaps, credit default swaps and total return swaps. Net realized gains (losses) on equity investments trading includes the impact of equity futures.
11
Comments on Regulation G
In addition to the GAAP financial measures set forth in this Press Release, the Company has included certain non-GAAP financial measures within the meaning of Regulation G. The Company has provided these financial measures in previous investor communications and the Company’s management believes that these measures are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for comparison with other companies within the industry. These measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors are cautioned not to place undue reliance on these non-GAAP measures in assessing the Company’s overall financial performance.
Operating Income Available to RenaissanceRe Common Shareholders and Operating Return on Average Common Equity - Annualized
The Company uses “operating income available to RenaissanceRe common shareholders” as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “Operating income available to RenaissanceRe common shareholders” as used herein differs from “net income available to RenaissanceRe common shareholders,” which the Company believes is the most directly comparable GAAP measure, by the exclusion of net realized and unrealized gains and losses on investments, excluding other investments - catastrophe bonds, net foreign exchange gains and losses, transaction and integration expenses associated with the acquisition of TMR, the income tax expense or benefit associated with these adjustments and the portion of these adjustments attributable to the Company's redeemable noncontrolling interests." The Company’s management believes that “operating income available to RenaissanceRe common shareholders” is useful to investors because it more accurately measures and predicts the Company’s results of operations by removing the variability arising from: fluctuations in the fair value of the Company’s fixed maturity investment portfolio, equity investments trading, other investments (excluding catastrophe bonds) and investments-related derivatives; fluctuations in foreign exchange rates; certain transaction and integration expenses associated with the acquisition of TMR; the associated income tax expense or benefit of these adjustments; and the portion of these adjustments attributable to the Company's redeemable noncontrolling interests. The Company also uses “operating income available to RenaissanceRe common shareholders” to calculate “operating income available to RenaissanceRe common shareholders per common share - diluted” and “operating return on average common equity - annualized.” The following table is a reconciliation of: (1) net income available to RenaissanceRe common shareholders to “operating income available to RenaissanceRe common shareholders”; (2) net income available to RenaissanceRe common shareholders per common share - diluted to “operating income available to RenaissanceRe common shareholders per common share - diluted”; and (3) return on average common equity - annualized to “operating return on average common equity - annualized.” Comparative information for all prior periods has been updated to conform to the current methodology and presentation.
12
| Three months ended | Six months ended | ||||||||||||||||||||||
| (in thousands of United States Dollars, except per share amounts and percentages) | June 30, 2020 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||
Net income available to RenaissanceRe common shareholders | $ | 575,845 | $ | 367,854 | $ | 493,871 | $ | 641,571 | |||||||||||||||
Adjustment for net realized and unrealized gains on investments, excluding other investments - catastrophe bonds | (443,938) | (203,149) | (347,583) | (375,372) | |||||||||||||||||||
Adjustment for net foreign exchange losses (gains) | 7,195 | (9,309) | 12,923 | (6,463) | |||||||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 2,279 | 14,483 | 6,702 | 40,003 | |||||||||||||||||||
Adjustment for income tax expense (1) | 21,223 | 10,442 | 17,082 | 18,776 | |||||||||||||||||||
Adjustment for net income attributable to redeemable noncontrolling interests (2) | 27,472 | 18,518 | 40,491 | 33,932 | |||||||||||||||||||
Operating income available to RenaissanceRe common shareholders | $ | 190,076 | $ | 198,839 | $ | 223,486 | $ | 352,447 | |||||||||||||||
Net income available to RenaissanceRe common shareholders per common share - diluted | $ | 12.63 | $ | 8.35 | $ | 11.02 | $ | 14.81 | |||||||||||||||
Adjustment for net realized and unrealized gains on investments, excluding other investments - catastrophe bonds | (9.86) | (4.67) | (7.85) | (8.77) | |||||||||||||||||||
Adjustment for net foreign exchange losses (gains) | 0.16 | (0.21) | 0.29 | (0.15) | |||||||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 0.05 | 0.33 | 0.15 | 0.93 | |||||||||||||||||||
Adjustment for income tax expense (1) | 0.47 | 0.24 | 0.39 | 0.44 | |||||||||||||||||||
Adjustment for net income attributable to redeemable noncontrolling interests (2) | 0.61 | 0.43 | 0.91 | 0.79 | |||||||||||||||||||
Operating income available to RenaissanceRe common shareholders per common share - diluted | $ | 4.06 | $ | 4.47 | $ | 4.91 | $ | 8.05 | |||||||||||||||
| Return on average common equity - annualized | 38.5 | % | 28.9 | % | 17.1 | % | 26.4 | % | |||||||||||||||
Adjustment for net realized and unrealized gains on investments, excluding other investments - catastrophe bonds | (29.7) | % | (16.0) | % | (11.9) | % | (15.5) | % | |||||||||||||||
Adjustment for net foreign exchange losses (gains) | 0.5 | % | (0.7) | % | 0.4 | % | (0.3) | % | |||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 0.2 | % | 1.1 | % | 0.2 | % | 1.6 | % | |||||||||||||||
Adjustment for income tax expense (1) | 1.4 | % | 0.8 | % | 0.6 | % | 0.8 | % | |||||||||||||||
Adjustment for net income attributable to redeemable noncontrolling interests (2) | 1.8 | % | 1.5 | % | 1.4 | % | 1.4 | % | |||||||||||||||
Operating return on average common equity - annualized | 12.7 | % | 15.6 | % | 7.8 | % | 14.4 | % | |||||||||||||||
(1) Adjustment for income tax expense represents the income tax expense associated with the adjustments to net income available to RenaissanceRe common shareholders. The income tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors.
(2) Represents the portion of these adjustments that are attributable to the Company's redeemable noncontrolling interests, including the income tax impact of those adjustments.
13
Tangible Book Value Per Common Share and Tangible Book Value Per Common Share Plus Accumulated Dividends
The Company has included in this Press Release “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” “Tangible book value per common share” is defined as book value per common share excluding goodwill and intangible assets per share. “Tangible book value per common share plus accumulated dividends” is defined as book value per common share excluding goodwill and intangible assets per share, plus accumulated dividends. The Company’s management believes “tangible book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because they provide a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets. The following table is a reconciliation of book value per common share to “tangible book value per common share” and “tangible book value per common share plus accumulated dividends”.
| At | |||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
Book value per common share | $ | 134.27 | $ | 117.15 | $ | 120.53 | $ | 120.07 | $ | 119.17 | |||||||||||||||||||
Adjustment for goodwill and other intangibles (1) | (5.56) | (6.46) | (6.50) | (6.55) | (6.60) | ||||||||||||||||||||||||
Tangible book value per common share | 128.71 | 110.69 | 114.03 | 113.52 | 112.57 | ||||||||||||||||||||||||
Adjustment for accumulated dividends | 21.38 | 21.03 | 20.68 | 20.34 | 20.00 | ||||||||||||||||||||||||
Tangible book value per common share plus accumulated dividends | $ | 150.09 | $ | 131.72 | $ | 134.71 | $ | 133.86 | $ | 132.57 | |||||||||||||||||||
Quarterly change in book value per common share | 14.6 | % | (2.8) | % | 0.4 | % | 0.8 | % | 7.3 | % | |||||||||||||||||||
Quarterly change in tangible book value per common share plus change in accumulated dividends | 16.6 | % | (2.6) | % | 0.7 | % | 1.1 | % | 8.2 | % | |||||||||||||||||||
| Year to date change in book value per common share | 11.4 | % | (2.8) | % | 15.7 | % | 15.3 | % | 14.4 | % | |||||||||||||||||||
Year to date change in tangible book value per common share plus change in accumulated dividends | 13.5 | % | (2.6) | % | 17.9 | % | 17.1 | % | 15.7 | % | |||||||||||||||||||
(1) At June 30, 2020, March 31, 2020, December 31, 2019, September 30, 2019 and June 30, 2019, goodwill and other intangibles included $23.5 million, $24.2 million, $24.9 million, $25.6 million, $26.3 million and $27.0 million, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method.
14
| RenaissanceRe Holdings Ltd. | ||
| Contents | ||
| Page | |||||||||||
| Basis of Presentation | |||||||||||
| Financial Highlights | |||||||||||
| Summary Consolidated Financial Statements | |||||||||||
| a. | Consolidated Statements of Operations | ||||||||||
| b. | Consolidated Balance Sheets | ||||||||||
| Underwriting and Reserves | |||||||||||
| a. | Consolidated Segment Underwriting Results | ||||||||||
| b. | Segment Underwriting Results | ||||||||||
| c. | Property Segment - Catastrophe and Other Property Underwriting Results | ||||||||||
| d. | Gross Premiums Written | ||||||||||
| e. | Reserves for Claims and Claim Expenses | ||||||||||
| f. | Paid to Incurred Analysis | ||||||||||
| Managed Joint Ventures and Fee Income | |||||||||||
| a. | Fee Income | ||||||||||
| b. | Noncontrolling Interests | ||||||||||
| c. | DaVinciRe Holdings Ltd. and Subsidiary Consolidated Statements of Operations | ||||||||||
| Investments | |||||||||||
| a. | Total Investment Result | ||||||||||
| b. | Investment Portfolio - Composition | ||||||||||
| c. | Investment Portfolio - Fixed Maturity Investments | ||||||||||
| d. | Investment Portfolio - Weighted Average Yield to Maturity and Credit Rating | ||||||||||
| e. | Retained Investment Information | ||||||||||
| Other Items | |||||||||||
| a. | Earnings per Share | ||||||||||
| Comments on Regulation G | |||||||||||
| RenaissanceRe Holdings Ltd. | ||
| Basis of Presentation | ||
RenaissanceRe Holdings Ltd. (the "Company" or "RenaissanceRe") is a global provider of reinsurance and insurance. The Company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, the Company has offices in Bermuda, Australia, Ireland, Singapore, Switzerland, the United Kingdom and the United States.
On March 22, 2019, the Company's wholly owned subsidiary RenaissanceRe Specialty Holdings (UK) Limited completed its previously announced purchase of all the share capital of RenaissanceRe Europe AG (formerly known as Tokio Millennium Re AG), RenaissanceRe (UK) Limited (formerly known as Tokio Millennium Re (UK) Limited) and their subsidiaries (collectively, “TMR”). The three months ended June 30, 2019, was the first full period that reflected the results of TMR on the Company’s results of operations. This Financial Supplement should be read in that context.
This financial supplement includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the U.S ("GAAP") including “operating income available to RenaissanceRe common shareholders,” “operating income available to RenaissanceRe common shareholders per common share - diluted,” “operating return on average common equity - annualized,” “tangible book value per common share,” “tangible book value per common share plus accumulated dividends," "retained investment result" and "retained fixed maturity and short term investments, at fair value." A reconciliation of such measures to the most comparable GAAP figures in accordance with Regulation G is presented in the attached supplemental financial data. See pages 20 through 24 for "Comments on Regulation G."
Cautionary Statement under “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995; Statements made in this financial supplement contain information about the Company's future business prospects. These statements may be considered “forward-looking.” These statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements. For further information regarding cautionary statements and factors affecting future results, please refer to RenaissanceRe Holdings Ltd.'s filings with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 10-K, its Quarterly Reports on Form 10-Q and prospectus supplement dated June 4, 2020.
All information contained herein is unaudited. Unless otherwise noted, amounts are in thousands of United States Dollars, except for share and per share amounts and ratio information. Certain prior period comparatives have been reclassified to conform to the current presentation. This supplement is being provided for informational purposes only. It should be read in conjunction with documents filed by RenaissanceRe with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 10-K and its Quarterly Reports on Form 10-Q. Please refer to the Company's website at www.renre.com for further information about RenaissanceRe.
i | ||||||||
| Financial Highlights | |||||||||||||||||||||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
| Highlights | |||||||||||||||||||||||||||||||||||||||||
| Gross premiums written | $ | 1,701,872 | $ | 2,025,721 | $ | 905,479 | $ | 861,068 | $ | 1,476,908 | $ | 3,727,593 | $ | 3,041,203 | |||||||||||||||||||||||||||
| Underwriting income (loss) | $ | 217,137 | $ | 64,079 | $ | (65,157) | $ | (3,368) | $ | 170,833 | $ | 281,216 | $ | 324,942 | |||||||||||||||||||||||||||
| Net investment income | $ | 89,305 | $ | 99,473 | $ | 112,138 | $ | 111,387 | $ | 118,588 | $ | 188,778 | $ | 200,682 | |||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 448,390 | (110,707) | 18,454 | 34,395 | 191,247 | 337,683 | 361,260 | ||||||||||||||||||||||||||||||||||
Total investment result | $ | 537,695 | $ | (11,234) | $ | 130,592 | $ | 145,782 | $ | 309,835 | $ | 526,461 | $ | 561,942 | |||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 575,845 | $ | (81,974) | $ | 33,773 | $ | 36,698 | $ | 367,854 | $ | 493,871 | $ | 641,571 | |||||||||||||||||||||||||||
Operating income available to RenaissanceRe common shareholders (1) | $ | 190,076 | $ | 33,410 | $ | 12,623 | $ | 32,681 | $ | 198,839 | $ | 223,486 | $ | 352,447 | |||||||||||||||||||||||||||
| Per share data | |||||||||||||||||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - basic | $ | 12.64 | $ | (1.89) | $ | 0.77 | $ | 0.83 | $ | 8.36 | $ | 11.04 | $ | 14.82 | |||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted | $ | 12.63 | $ | (1.89) | $ | 0.77 | $ | 0.83 | $ | 8.35 | $ | 11.02 | $ | 14.81 | |||||||||||||||||||||||||||
Operating income available to RenaissanceRe common shareholders per common share - diluted (1) | $ | 4.06 | $ | 0.76 | $ | 0.28 | $ | 0.73 | $ | 4.47 | $ | 4.91 | $ | 8.05 | |||||||||||||||||||||||||||
| Book value per common share | $ | 134.27 | $ | 117.15 | $ | 120.53 | $ | 120.07 | $ | 119.17 | $ | 134.27 | $ | 119.17 | |||||||||||||||||||||||||||
| Tangible book value per common share (1) | $ | 128.71 | $ | 110.69 | $ | 114.03 | $ | 113.52 | $ | 112.57 | $ | 128.71 | $ | 112.57 | |||||||||||||||||||||||||||
Tangible book value per common share plus accumulated dividends (1) | $ | 150.09 | $ | 131.72 | $ | 134.71 | $ | 133.86 | $ | 132.57 | $ | 150.09 | $ | 132.57 | |||||||||||||||||||||||||||
Change in tangible book value per common share plus change in accumulated dividends (1) | 16.6 | % | (2.6) | % | 0.7 | % | 1.1 | % | 8.2 | % | 13.5 | % | 15.7 | % | |||||||||||||||||||||||||||
| Financial ratios | |||||||||||||||||||||||||||||||||||||||||
| Combined ratio | 78.5 | % | 93.0 | % | 106.7 | % | 100.4 | % | 81.3 | % | 85.4 | % | 77.8 | % | |||||||||||||||||||||||||||
| Return on average common equity - annualized | 38.5 | % | (6.3) | % | 2.5 | % | 2.8 | % | 28.9 | % | 17.1 | % | 26.4 | % | |||||||||||||||||||||||||||
| Operating return on average common equity - annualized (1) | 12.7 | % | 2.6 | % | 0.9 | % | 2.5 | % | 15.6 | % | 7.8 | % | 14.4 | % | |||||||||||||||||||||||||||
| Total investment return - annualized | 11.8 | % | (0.1) | % | 3.1 | % | 3.6 | % | 8.0 | % | 5.8 | % | 7.3 | % | |||||||||||||||||||||||||||
(1) See "Comments on Regulation G" for a reconciliation of non-GAAP financial measures.
1 | | |||||||
| Summary Consolidated Financial Statements | |||||||||||||||||||||||||||||||||||||||||
| Consolidated Statements of Operations | |||||||||||||||||||||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||
| Gross premiums written | $ | 1,701,872 | $ | 2,025,721 | $ | 905,479 | $ | 861,068 | $ | 1,476,908 | $ | 3,727,593 | $ | 3,041,203 | |||||||||||||||||||||||||||
| Net premiums written | $ | 1,180,803 | $ | 1,269,808 | $ | 725,367 | $ | 704,130 | $ | 1,022,965 | $ | 2,450,611 | $ | 1,951,996 | |||||||||||||||||||||||||||
| (Increase) decrease in unearned premiums | (170,707) | (356,710) | 244,758 | 202,618 | (111,463) | (527,417) | (490,466) | ||||||||||||||||||||||||||||||||||
| Net premiums earned | 1,010,096 | 913,098 | 970,125 | 906,748 | 911,502 | 1,923,194 | 1,461,530 | ||||||||||||||||||||||||||||||||||
| Net investment income | 89,305 | 99,473 | 112,138 | 111,387 | 118,588 | 188,778 | 200,682 | ||||||||||||||||||||||||||||||||||
| Net foreign exchange (losses) gains | (7,195) | (5,728) | (1,126) | (8,275) | 9,309 | (12,923) | 6,463 | ||||||||||||||||||||||||||||||||||
| Equity in earnings of other ventures | 9,041 | 4,564 | 5,874 | 5,877 | 6,812 | 13,605 | 11,473 | ||||||||||||||||||||||||||||||||||
| Other (loss) income | (1,201) | (4,436) | (160) | 1,016 | 922 | (5,637) | 4,093 | ||||||||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 448,390 | (110,707) | 18,454 | 34,395 | 191,247 | 337,683 | 361,260 | ||||||||||||||||||||||||||||||||||
| Total revenues | 1,548,436 | 896,264 | 1,105,305 | 1,051,148 | 1,238,380 | 2,444,700 | 2,045,501 | ||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||
| Net claims and claim expenses incurred | 510,272 | 570,954 | 762,093 | 654,520 | 453,373 | 1,081,226 | 680,408 | ||||||||||||||||||||||||||||||||||
| Acquisition expenses | 233,610 | 210,604 | 208,618 | 202,181 | 227,482 | 444,214 | 351,433 | ||||||||||||||||||||||||||||||||||
| Operational expenses | 49,077 | 67,461 | 64,571 | 53,415 | 59,814 | 116,538 | 104,747 | ||||||||||||||||||||||||||||||||||
| Corporate expenses | 11,898 | 15,991 | 17,642 | 13,844 | 23,847 | 27,889 | 62,636 | ||||||||||||||||||||||||||||||||||
| Interest expense | 11,842 | 14,927 | 15,496 | 15,580 | 15,534 | 26,769 | 27,288 | ||||||||||||||||||||||||||||||||||
| Total expenses | 816,699 | 879,937 | 1,068,420 | 939,540 | 780,050 | 1,696,636 | 1,226,512 | ||||||||||||||||||||||||||||||||||
| Income before taxes | 731,737 | 16,327 | 36,885 | 111,608 | 458,330 | 748,064 | 818,989 | ||||||||||||||||||||||||||||||||||
| Income tax (expense) benefit | (29,875) | 8,846 | 3,455 | (3,664) | (9,475) | (21,029) | (17,006) | ||||||||||||||||||||||||||||||||||
| Net income | 701,862 | 25,173 | 40,340 | 107,944 | 448,855 | 727,035 | 801,983 | ||||||||||||||||||||||||||||||||||
Net (income) loss attributable to redeemable noncontrolling interests | (118,728) | (98,091) | 2,622 | (62,057) | (71,812) | (216,819) | (142,034) | ||||||||||||||||||||||||||||||||||
| Net income (loss) attributable to RenaissanceRe | 583,134 | (72,918) | 42,962 | 45,887 | 377,043 | 510,216 | 659,949 | ||||||||||||||||||||||||||||||||||
| Dividends on preference shares | (7,289) | (9,056) | (9,189) | (9,189) | (9,189) | (16,345) | (18,378) | ||||||||||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 575,845 | $ | (81,974) | $ | 33,773 | $ | 36,698 | $ | 367,854 | $ | 493,871 | $ | 641,571 | |||||||||||||||||||||||||||
2 | | |||||||
| Summary Consolidated Financial Statements | |||||||||||||||||||||||||||||
| Consolidated Balance Sheets | |||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||
| Fixed maturity investments trading, at fair value | $ | 12,495,135 | $ | 11,045,801 | $ | 11,171,655 | $ | 11,386,228 | $ | 10,479,666 | |||||||||||||||||||
| Short term investments, at fair value | 5,570,804 | 5,263,242 | 4,566,277 | 4,116,156 | 4,579,171 | ||||||||||||||||||||||||
| Equity investments trading, at fair value | 470,087 | 360,444 | 436,931 | 379,422 | 273,646 | ||||||||||||||||||||||||
| Other investments, at fair value | 1,093,338 | 1,058,714 | 1,087,377 | 962,109 | 955,437 | ||||||||||||||||||||||||
| Investments in other ventures, under equity method | 94,285 | 90,396 | 106,549 | 103,978 | 100,396 | ||||||||||||||||||||||||
| Total investments | 19,723,649 | 17,818,597 | 17,368,789 | 16,947,893 | 16,388,316 | ||||||||||||||||||||||||
| Cash and cash equivalents | 1,185,844 | 896,216 | 1,379,068 | 871,251 | 670,626 | ||||||||||||||||||||||||
| Premiums receivable | 3,519,965 | 3,105,441 | 2,599,896 | 2,799,954 | 3,140,688 | ||||||||||||||||||||||||
| Prepaid reinsurance premiums | 1,266,203 | 1,151,926 | 767,781 | 972,047 | 1,158,534 | ||||||||||||||||||||||||
| Reinsurance recoverable | 2,774,358 | 2,765,583 | 2,791,297 | 2,438,299 | 2,865,150 | ||||||||||||||||||||||||
| Accrued investment income | 70,004 | 73,496 | 72,461 | 73,509 | 76,949 | ||||||||||||||||||||||||
| Deferred acquisition costs and value of business acquired | 734,286 | 739,875 | 663,991 | 708,258 | 780,756 | ||||||||||||||||||||||||
| Receivable for investments sold | 648,458 | 341,786 | 78,369 | 225,147 | 395,787 | ||||||||||||||||||||||||
| Other assets | 298,396 | 312,523 | 346,216 | 344,593 | 344,938 | ||||||||||||||||||||||||
| Goodwill and other intangibles | 258,591 | 260,076 | 262,226 | 263,259 | 265,217 | ||||||||||||||||||||||||
| Total assets | $ | 30,479,754 | $ | 27,465,519 | $ | 26,330,094 | $ | 25,644,210 | $ | 26,086,961 | |||||||||||||||||||
| Liabilities, Noncontrolling Interests and Shareholders' Equity | |||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||
| Reserve for claims and claim expenses | $ | 9,365,469 | $ | 9,406,707 | $ | 9,384,349 | $ | 8,602,437 | $ | 8,484,848 | |||||||||||||||||||
| Unearned premiums | 3,549,641 | 3,245,914 | 2,530,975 | 2,967,535 | 3,362,520 | ||||||||||||||||||||||||
| Debt | 1,135,216 | 1,134,695 | 1,384,105 | 1,383,498 | 1,382,890 | ||||||||||||||||||||||||
| Reinsurance balances payable | 4,094,027 | 3,775,375 | 2,830,691 | 2,910,601 | 3,280,048 | ||||||||||||||||||||||||
| Payable for investments purchased | 1,259,116 | 636,136 | 225,275 | 654,685 | 554,696 | ||||||||||||||||||||||||
| Other liabilities | 342,014 | 351,320 | 932,024 | 395,186 | 396,651 | ||||||||||||||||||||||||
| Total liabilities | 19,745,483 | 18,550,147 | 17,287,419 | 16,913,942 | 17,461,653 | ||||||||||||||||||||||||
| Redeemable noncontrolling interest | 3,387,099 | 3,231,846 | 3,071,308 | 2,779,033 | 2,712,466 | ||||||||||||||||||||||||
| Shareholders' Equity | |||||||||||||||||||||||||||||
| Preference shares | 525,000 | 525,000 | 650,000 | 650,000 | 650,000 | ||||||||||||||||||||||||
| Common shares | 50,811 | 44,034 | 44,148 | 44,152 | 44,162 | ||||||||||||||||||||||||
| Additional paid-in capital | 1,602,738 | 502,608 | 568,277 | 560,166 | 552,210 | ||||||||||||||||||||||||
| Accumulated other comprehensive (loss) income | (3,066) | (1,664) | (1,939) | 4,988 | (3,869) | ||||||||||||||||||||||||
| Retained earnings | 5,171,689 | 4,613,548 | 4,710,881 | 4,691,929 | 4,670,339 | ||||||||||||||||||||||||
| Total shareholders' equity attributable to RenaissanceRe | 7,347,172 | 5,683,526 | 5,971,367 | 5,951,235 | 5,912,842 | ||||||||||||||||||||||||
| Total liabilities, noncontrolling interests and shareholders' equity | $ | 30,479,754 | $ | 27,465,519 | $ | 26,330,094 | $ | 25,644,210 | $ | 26,086,961 | |||||||||||||||||||
| Book value per common share | $ | 134.27 | $ | 117.15 | $ | 120.53 | $ | 120.07 | $ | 119.17 | |||||||||||||||||||
3 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||
| Consolidated Segment Underwriting Results | |||||||||||||||||||||||
| Three months ended June 30, 2020 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 1,042,536 | $ | 659,336 | $ | — | $ | 1,701,872 | |||||||||||||||
| Net premiums written | $ | 704,138 | $ | 476,665 | $ | — | $ | 1,180,803 | |||||||||||||||
| Net premiums earned | $ | 491,116 | $ | 518,980 | $ | — | $ | 1,010,096 | |||||||||||||||
| Net claims and claim expenses incurred | 164,050 | 346,266 | (44) | 510,272 | |||||||||||||||||||
| Acquisition expenses | 94,772 | 138,837 | 1 | 233,610 | |||||||||||||||||||
| Operational expenses | 31,656 | 17,422 | (1) | 49,077 | |||||||||||||||||||
| Underwriting income | $ | 200,638 | $ | 16,455 | $ | 44 | $ | 217,137 | |||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 170,614 | $ | 355,064 | $ | — | $ | 525,678 | |||||||||||||||
| Net claims and claim expenses incurred - prior accident years | (6,564) | (8,798) | (44) | (15,406) | |||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 164,050 | $ | 346,266 | $ | (44) | $ | 510,272 | |||||||||||||||
| Net claims and claim expense ratio - current accident year | 34.7 | % | 68.4 | % | 52.0 | % | |||||||||||||||||
| Net claims and claim expense ratio - prior accident years | (1.3) | % | (1.7) | % | (1.5) | % | |||||||||||||||||
| Net claims and claim expense ratio - calendar year | 33.4 | % | 66.7 | % | 50.5 | % | |||||||||||||||||
| Underwriting expense ratio | 25.7 | % | 30.1 | % | 28.0 | % | |||||||||||||||||
| Combined ratio | 59.1 | % | 96.8 | % | 78.5 | % | |||||||||||||||||
| Three months ended June 30, 2019 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 839,200 | $ | 637,708 | $ | — | $ | 1,476,908 | |||||||||||||||
| Net premiums written | $ | 544,115 | $ | 478,850 | $ | — | $ | 1,022,965 | |||||||||||||||
| Net premiums earned | $ | 425,013 | $ | 486,489 | $ | — | $ | 911,502 | |||||||||||||||
| Net claims and claim expenses incurred | 146,874 | 306,501 | (2) | 453,373 | |||||||||||||||||||
| Acquisition expenses | 89,711 | 137,963 | (192) | 227,482 | |||||||||||||||||||
| Operational expenses | 36,764 | 23,016 | 34 | 59,814 | |||||||||||||||||||
| Underwriting income | $ | 151,664 | $ | 19,009 | $ | 160 | $ | 170,833 | |||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 136,111 | $ | 317,029 | $ | — | $ | 453,140 | |||||||||||||||
| Net claims and claim expenses incurred - prior accident years | 10,763 | (10,528) | (2) | 233 | |||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 146,874 | $ | 306,501 | $ | (2) | $ | 453,373 | |||||||||||||||
| Net claims and claim expense ratio - current accident year | 32.0 | % | 65.2 | % | 49.7 | % | |||||||||||||||||
| Net claims and claim expense ratio - prior accident years | 2.6 | % | (2.2) | % | — | % | |||||||||||||||||
| Net claims and claim expense ratio - calendar year | 34.6 | % | 63.0 | % | 49.7 | % | |||||||||||||||||
| Underwriting expense ratio | 29.7 | % | 33.1 | % | 31.6 | % | |||||||||||||||||
| Combined ratio | 64.3 | % | 96.1 | % | 81.3 | % | |||||||||||||||||
4 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||
| Consolidated Segment Underwriting Results | |||||||||||||||||||||||
| Six months ended June 30, 2020 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 2,263,062 | $ | 1,464,531 | $ | — | $ | 3,727,593 | |||||||||||||||
| Net premiums written | $ | 1,378,719 | $ | 1,071,892 | $ | — | $ | 2,450,611 | |||||||||||||||
| Net premiums earned | $ | 912,451 | $ | 1,010,743 | $ | — | $ | 1,923,194 | |||||||||||||||
| Net claims and claim expenses incurred | 308,902 | 772,475 | (151) | 1,081,226 | |||||||||||||||||||
| Acquisition expenses | 180,123 | 264,090 | 1 | 444,214 | |||||||||||||||||||
| Operational expenses | 75,663 | 40,876 | (1) | 116,538 | |||||||||||||||||||
| Underwriting income (loss) | $ | 347,763 | $ | (66,698) | $ | 151 | $ | 281,216 | |||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 301,458 | $ | 781,274 | $ | — | $ | 1,082,732 | |||||||||||||||
| Net claims and claim expenses incurred - prior accident years | 7,444 | (8,799) | (151) | (1,506) | |||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 308,902 | $ | 772,475 | $ | (151) | $ | 1,081,226 | |||||||||||||||
| Net claims and claim expense ratio - current accident year | 33.0 | % | 77.3 | % | 56.3 | % | |||||||||||||||||
| Net claims and claim expense ratio - prior accident years | 0.9 | % | (0.9) | % | (0.1) | % | |||||||||||||||||
| Net claims and claim expense ratio - calendar year | 33.9 | % | 76.4 | % | 56.2 | % | |||||||||||||||||
| Underwriting expense ratio | 28.0 | % | 30.2 | % | 29.2 | % | |||||||||||||||||
| Combined ratio | 61.9 | % | 106.6 | % | 85.4 | % | |||||||||||||||||
| Six months ended June 30, 2019 | |||||||||||||||||||||||
| Property | Casualty and Specialty | Other | Total | ||||||||||||||||||||
| Gross premiums written | $ | 1,871,584 | $ | 1,169,619 | $ | — | $ | 3,041,203 | |||||||||||||||
| Net premiums written | $ | 1,108,345 | $ | 843,651 | $ | — | $ | 1,951,996 | |||||||||||||||
| Net premiums earned | $ | 715,758 | $ | 745,772 | $ | — | $ | 1,461,530 | |||||||||||||||
| Net claims and claim expenses incurred | 202,957 | 477,434 | 17 | 680,408 | |||||||||||||||||||
| Acquisition expenses | 143,450 | 208,175 | (192) | 351,433 | |||||||||||||||||||
| Operational expenses | 65,308 | 39,405 | 34 | 104,747 | |||||||||||||||||||
| Underwriting income | $ | 304,043 | $ | 20,758 | $ | 141 | $ | 324,942 | |||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 190,317 | $ | 494,164 | $ | — | $ | 684,481 | |||||||||||||||
| Net claims and claim expenses incurred - prior accident years | 12,640 | (16,730) | 17 | (4,073) | |||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 202,957 | $ | 477,434 | $ | 17 | $ | 680,408 | |||||||||||||||
| Net claims and claim expense ratio - current accident year | 26.6 | % | 66.3 | % | 46.8 | % | |||||||||||||||||
| Net claims and claim expense ratio - prior accident years | 1.8 | % | (2.3) | % | (0.2) | % | |||||||||||||||||
| Net claims and claim expense ratio - calendar year | 28.4 | % | 64.0 | % | 46.6 | % | |||||||||||||||||
| Underwriting expense ratio | 29.1 | % | 33.2 | % | 31.2 | % | |||||||||||||||||
| Combined ratio | 57.5 | % | 97.2 | % | 77.8 | % | |||||||||||||||||
5 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||||||||
| Segment Underwriting Results | |||||||||||||||||||||||||||||
| Three months ended | |||||||||||||||||||||||||||||
| Property Segment | June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | ||||||||||||||||||||||||
| Gross premiums written | $ | 1,042,536 | $ | 1,220,526 | $ | 245,001 | $ | 314,400 | $ | 839,200 | |||||||||||||||||||
| Net premiums written | $ | 704,138 | $ | 674,581 | $ | 242,932 | $ | 302,982 | $ | 544,115 | |||||||||||||||||||
| Net premiums earned | $ | 491,116 | $ | 421,335 | $ | 467,404 | $ | 444,332 | $ | 425,013 | |||||||||||||||||||
| Net claims and claim expenses incurred | 164,050 | 144,852 | 424,207 | 338,260 | 146,874 | ||||||||||||||||||||||||
| Acquisition expenses | 94,772 | 85,351 | 90,790 | 79,521 | 89,711 | ||||||||||||||||||||||||
| Operational expenses | 31,656 | 44,007 | 39,469 | 34,238 | 36,764 | ||||||||||||||||||||||||
| Underwriting income (loss) | $ | 200,638 | $ | 147,125 | $ | (87,062) | $ | (7,687) | $ | 151,664 | |||||||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 170,614 | $ | 130,844 | $ | 432,160 | $ | 345,880 | $ | 136,111 | |||||||||||||||||||
| Net claims and claim expenses incurred - prior accident years | (6,564) | 14,008 | (7,953) | (7,620) | 10,763 | ||||||||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 164,050 | $ | 144,852 | $ | 424,207 | $ | 338,260 | $ | 146,874 | |||||||||||||||||||
| Net claims and claim expense ratio - current accident year | 34.7 | % | 31.1 | % | 92.5 | % | 77.8 | % | 32.0 | % | |||||||||||||||||||
| Net claims and claim expense ratio - prior accident years | (1.3) | % | 3.3 | % | (1.7) | % | (1.7) | % | 2.6 | % | |||||||||||||||||||
| Net claims and claim expense ratio - calendar year | 33.4 | % | 34.4 | % | 90.8 | % | 76.1 | % | 34.6 | % | |||||||||||||||||||
| Underwriting expense ratio | 25.7 | % | 30.7 | % | 27.8 | % | 25.6 | % | 29.7 | % | |||||||||||||||||||
| Combined ratio | 59.1 | % | 65.1 | % | 118.6 | % | 101.7 | % | 64.3 | % | |||||||||||||||||||
| Three months ended | |||||||||||||||||||||||||||||
| Casualty and Specialty Segment | June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | ||||||||||||||||||||||||
| Gross premiums written | $ | 659,336 | $ | 805,195 | $ | 660,478 | $ | 546,668 | $ | 637,708 | |||||||||||||||||||
| Net premiums written | $ | 476,665 | $ | 595,227 | $ | 482,435 | $ | 401,148 | $ | 478,850 | |||||||||||||||||||
| Net premiums earned | $ | 518,980 | $ | 491,763 | $ | 502,721 | $ | 462,416 | $ | 486,489 | |||||||||||||||||||
| Net claims and claim expenses incurred | 346,266 | 426,209 | 338,104 | 316,099 | 306,501 | ||||||||||||||||||||||||
| Acquisition expenses | 138,837 | 125,253 | 117,849 | 122,654 | 137,963 | ||||||||||||||||||||||||
| Operational expenses | 17,422 | 23,454 | 25,943 | 19,198 | 23,016 | ||||||||||||||||||||||||
| Underwriting income (loss) | $ | 16,455 | $ | (83,153) | $ | 20,825 | $ | 4,465 | $ | 19,009 | |||||||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 355,064 | $ | 426,210 | $ | 342,268 | $ | 319,087 | $ | 317,029 | |||||||||||||||||||
| Net claims and claim expenses incurred - prior accident years | (8,798) | (1) | (4,164) | (2,988) | (10,528) | ||||||||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 346,266 | $ | 426,209 | $ | 338,104 | $ | 316,099 | $ | 306,501 | |||||||||||||||||||
| Net claims and claim expense ratio - current accident year | 68.4 | % | 86.7 | % | 68.1 | % | 69.0 | % | 65.2 | % | |||||||||||||||||||
| Net claims and claim expense ratio - prior accident years | (1.7) | % | — | % | (0.8) | % | (0.6) | % | (2.2) | % | |||||||||||||||||||
| Net claims and claim expense ratio - calendar year | 66.7 | % | 86.7 | % | 67.3 | % | 68.4 | % | 63.0 | % | |||||||||||||||||||
| Underwriting expense ratio | 30.1 | % | 30.2 | % | 28.6 | % | 30.6 | % | 33.1 | % | |||||||||||||||||||
| Combined ratio | 96.8 | % | 116.9 | % | 95.9 | % | 99.0 | % | 96.1 | % | |||||||||||||||||||
6 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||||||||||||||
| Property Segment - Catastrophe and Other Property Underwriting Results | |||||||||||||||||||||||||||||||||||
| Three months ended June 30, 2020 | Three months ended June 30, 2019 | ||||||||||||||||||||||||||||||||||
| Catastrophe | Other Property | Total | Catastrophe | Other Property | Total | ||||||||||||||||||||||||||||||
| Gross premiums written | $ | 711,786 | $ | 330,750 | $ | 1,042,536 | $ | 602,656 | $ | 236,544 | $ | 839,200 | |||||||||||||||||||||||
| Net premiums written | $ | 391,350 | $ | 312,788 | $ | 704,138 | $ | 319,128 | $ | 224,987 | $ | 544,115 | |||||||||||||||||||||||
| Net premiums earned | $ | 245,518 | $ | 245,598 | $ | 491,116 | $ | 222,527 | $ | 202,486 | $ | 425,013 | |||||||||||||||||||||||
| Net claims and claim expenses incurred | 22,511 | 141,539 | 164,050 | 37,757 | 109,117 | 146,874 | |||||||||||||||||||||||||||||
| Acquisition expenses | 31,727 | 63,045 | 94,772 | 35,079 | 54,632 | 89,711 | |||||||||||||||||||||||||||||
| Operational expenses | 25,653 | 6,003 | 31,656 | 28,837 | 7,927 | 36,764 | |||||||||||||||||||||||||||||
| Underwriting income | $ | 165,627 | $ | 35,011 | $ | 200,638 | $ | 120,854 | $ | 30,810 | $ | 151,664 | |||||||||||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 37,528 | $ | 133,086 | $ | 170,614 | $ | 38,175 | $ | 97,936 | $ | 136,111 | |||||||||||||||||||||||
| Net claims and claim expenses incurred - prior accident years | (15,017) | 8,453 | (6,564) | (418) | 11,181 | 10,763 | |||||||||||||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 22,511 | $ | 141,539 | $ | 164,050 | $ | 37,757 | $ | 109,117 | $ | 146,874 | |||||||||||||||||||||||
| Net claims and claim expense ratio - current accident year | 15.3 | % | 54.2 | % | 34.7 | % | 17.2 | % | 48.4 | % | 32.0 | % | |||||||||||||||||||||||
| Net claims and claim expense ratio - prior accident years | (6.1) | % | 3.4 | % | (1.3) | % | (0.2) | % | 5.5 | % | 2.6 | % | |||||||||||||||||||||||
| Net claims and claim expense ratio - calendar year | 9.2 | % | 57.6 | % | 33.4 | % | 17.0 | % | 53.9 | % | 34.6 | % | |||||||||||||||||||||||
| Underwriting expense ratio | 23.3 | % | 28.1 | % | 25.7 | % | 28.7 | % | 30.9 | % | 29.7 | % | |||||||||||||||||||||||
| Combined ratio | 32.5 | % | 85.7 | % | 59.1 | % | 45.7 | % | 84.8 | % | 64.3 | % | |||||||||||||||||||||||
| Six months ended June 30, 2020 | Six months ended June 30, 2019 | ||||||||||||||||||||||||||||||||||
| Catastrophe | Other Property | Total | Catastrophe | Other Property | Total | ||||||||||||||||||||||||||||||
| Gross premiums written | $ | 1,647,976 | $ | 615,086 | $ | 2,263,062 | $ | 1,447,869 | $ | 423,715 | $ | 1,871,584 | |||||||||||||||||||||||
| Net premiums written | $ | 868,807 | $ | 509,912 | $ | 1,378,719 | $ | 763,144 | $ | 345,201 | $ | 1,108,345 | |||||||||||||||||||||||
| Net premiums earned | $ | 466,173 | $ | 446,278 | $ | 912,451 | $ | 402,764 | $ | 312,994 | $ | 715,758 | |||||||||||||||||||||||
| Net claims and claim expenses incurred | 20,417 | 288,485 | 308,902 | 23,763 | 179,194 | 202,957 | |||||||||||||||||||||||||||||
| Acquisition expenses | 60,434 | 119,689 | 180,123 | 59,406 | 84,044 | 143,450 | |||||||||||||||||||||||||||||
| Operational expenses | 61,198 | 14,465 | 75,663 | 52,449 | 12,859 | 65,308 | |||||||||||||||||||||||||||||
| Underwriting income | $ | 324,124 | $ | 23,639 | $ | 347,763 | $ | 267,146 | $ | 36,897 | $ | 304,043 | |||||||||||||||||||||||
| Net claims and claim expenses incurred - current accident year | $ | 60,910 | $ | 240,548 | $ | 301,458 | $ | 41,665 | $ | 148,652 | $ | 190,317 | |||||||||||||||||||||||
| Net claims and claim expenses incurred - prior accident years | (40,493) | 47,937 | 7,444 | (17,902) | 30,542 | 12,640 | |||||||||||||||||||||||||||||
| Net claims and claim expenses incurred - total | $ | 20,417 | $ | 288,485 | $ | 308,902 | $ | 23,763 | $ | 179,194 | $ | 202,957 | |||||||||||||||||||||||
| Net claims and claim expense ratio - current accident year | 13.1 | % | 53.9 | % | 33.0 | % | 10.3 | % | 47.5 | % | 26.6 | % | |||||||||||||||||||||||
| Net claims and claim expense ratio - prior accident years | (8.7) | % | 10.7 | % | 0.9 | % | (4.4) | % | 9.8 | % | 1.8 | % | |||||||||||||||||||||||
| Net claims and claim expense ratio - calendar year | 4.4 | % | 64.6 | % | 33.9 | % | 5.9 | % | 57.3 | % | 28.4 | % | |||||||||||||||||||||||
| Underwriting expense ratio | 26.1 | % | 30.1 | % | 28.0 | % | 27.8 | % | 30.9 | % | 29.1 | % | |||||||||||||||||||||||
| Combined ratio | 30.5 | % | 94.7 | % | 61.9 | % | 33.7 | % | 88.2 | % | 57.5 | % | |||||||||||||||||||||||
7 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||||||||||||||||||||
| Gross Premiums Written | |||||||||||||||||||||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
| Property Segment | |||||||||||||||||||||||||||||||||||||||||
| Catastrophe | $ | 711,786 | $ | 936,190 | $ | 44,824 | $ | 102,779 | $ | 602,656 | $ | 1,647,976 | $ | 1,447,869 | |||||||||||||||||||||||||||
| Other property | 330,750 | 284,336 | 200,177 | 211,621 | 236,544 | 615,086 | 423,715 | ||||||||||||||||||||||||||||||||||
Property segment gross premiums written | $ | 1,042,536 | $ | 1,220,526 | $ | 245,001 | $ | 314,400 | $ | 839,200 | $ | 2,263,062 | $ | 1,871,584 | |||||||||||||||||||||||||||
| Casualty and Specialty Segment | |||||||||||||||||||||||||||||||||||||||||
| General casualty (1) | $ | 206,666 | $ | 246,667 | $ | 197,338 | $ | 191,447 | $ | 258,357 | 453,333 | 411,691 | |||||||||||||||||||||||||||||
| Professional liability (2) | 222,737 | 230,487 | 189,838 | 151,754 | 167,206 | 453,224 | 316,583 | ||||||||||||||||||||||||||||||||||
| Financial lines (3) | 101,635 | 147,079 | 126,983 | 111,459 | 91,202 | 248,714 | 218,558 | ||||||||||||||||||||||||||||||||||
| Other (4) | 128,298 | 180,962 | 146,319 | 92,008 | 120,943 | 309,260 | 222,787 | ||||||||||||||||||||||||||||||||||
Casualty and Specialty segment gross premiums written | $ | 659,336 | $ | 805,195 | $ | 660,478 | $ | 546,668 | $ | 637,708 | $ | 1,464,531 | $ | 1,169,619 | |||||||||||||||||||||||||||
| (1) | Includes automobile liability, casualty clash, employer’s liability, umbrella or excess casualty, workers’ compensation and general liability. | ||||
| (2) | Includes directors and officers, medical malpractice, and professional indemnity. | ||||
| (3) | Includes financial guaranty, mortgage guaranty, political risk, surety and trade credit. | ||||
| (4) | Includes accident and health, agriculture, aviation, cyber, energy, marine, satellite and terrorism. Lines of business such as regional multi-line and whole account may have characteristics of various other classes of business, and are allocated accordingly. | ||||
8 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||
| Reserves for Claims and Claim Expenses | |||||||||||||||||||||||
| Case Reserves | Additional Case Reserves | IBNR | Total | ||||||||||||||||||||
| June 30, 2020 | |||||||||||||||||||||||
| Property | $ | 1,095,511 | $ | 1,650,244 | $ | 842,395 | $ | 3,588,150 | |||||||||||||||
| Casualty and Specialty | 1,682,299 | 127,588 | 3,967,100 | 5,776,987 | |||||||||||||||||||
| Other | 332 | — | — | 332 | |||||||||||||||||||
| Total | $ | 2,778,142 | $ | 1,777,832 | $ | 4,809,495 | $ | 9,365,469 | |||||||||||||||
| March 31, 2020 | |||||||||||||||||||||||
| Property | $ | 1,095,840 | $ | 1,707,754 | $ | 958,827 | $ | 3,762,421 | |||||||||||||||
| Casualty and Specialty | 1,644,402 | 105,505 | 3,894,049 | 5,643,956 | |||||||||||||||||||
| Other | 330 | — | — | 330 | |||||||||||||||||||
| Total | $ | 2,740,572 | $ | 1,813,259 | $ | 4,852,876 | $ | 9,406,707 | |||||||||||||||
| December 31, 2019 | |||||||||||||||||||||||
| Property | $ | 1,253,406 | $ | 1,631,223 | $ | 1,189,221 | $ | 4,073,850 | |||||||||||||||
| Casualty and Specialty | 1,596,426 | 129,720 | 3,583,913 | 5,310,059 | |||||||||||||||||||
| Other | 440 | — | — | 440 | |||||||||||||||||||
| Total | $ | 2,850,272 | $ | 1,760,943 | $ | 4,773,134 | $ | 9,384,349 | |||||||||||||||
| September 30, 2019 | |||||||||||||||||||||||
| Property | $ | 1,170,009 | $ | 1,493,600 | $ | 916,314 | $ | 3,579,923 | |||||||||||||||
| Casualty and Specialty | 1,475,505 | 151,555 | 3,389,344 | 5,016,404 | |||||||||||||||||||
| Other | 2,944 | — | 3,166 | 6,110 | |||||||||||||||||||
| Total | $ | 2,648,458 | $ | 1,645,155 | $ | 4,308,824 | $ | 8,602,437 | |||||||||||||||
| June 30, 2019 | |||||||||||||||||||||||
| Property | $ | 1,191,810 | $ | 1,635,595 | $ | 791,628 | $ | 3,619,033 | |||||||||||||||
| Casualty and Specialty | 1,450,805 | 128,701 | 3,280,133 | 4,859,639 | |||||||||||||||||||
| Other | 3,010 | — | 3,166 | 6,176 | |||||||||||||||||||
| Total | $ | 2,645,625 | $ | 1,764,296 | $ | 4,074,927 | $ | 8,484,848 | |||||||||||||||
9 | | |||||||
| Underwriting and Reserves | |||||||||||||||||||||||||||||||||||
| Paid to Incurred Analysis | |||||||||||||||||||||||||||||||||||
| Three months ended June 30, 2020 | Three months ended June 30, 2019 | ||||||||||||||||||||||||||||||||||
| Gross | Recoveries | Net | Gross | Recoveries | Net | ||||||||||||||||||||||||||||||
| Reserve for claims and claim expenses, beginning of period | $ | 9,406,707 | $ | 2,765,583 | $ | 6,641,124 | $ | 8,391,484 | $ | 2,908,343 | $ | 5,483,141 | |||||||||||||||||||||||
| Incurred claims and claim expenses | |||||||||||||||||||||||||||||||||||
| Current year | 650,900 | 125,222 | 525,678 | 525,838 | 72,698 | 453,140 | |||||||||||||||||||||||||||||
| Prior years | (3,674) | 11,732 | (15,406) | 226,218 | 225,985 | 233 | |||||||||||||||||||||||||||||
| Total incurred claims and claim expenses | 647,226 | 136,954 | 510,272 | 752,056 | 298,683 | 453,373 | |||||||||||||||||||||||||||||
| Paid claims and claim expenses | |||||||||||||||||||||||||||||||||||
| Current year | 32,182 | 1,758 | 30,424 | 46,602 | 2,419 | 44,183 | |||||||||||||||||||||||||||||
| Prior years | 701,647 | 130,017 | 571,630 | 608,902 | 338,461 | 270,441 | |||||||||||||||||||||||||||||
| Total paid claims and claim expenses | 733,829 | 131,775 | 602,054 | 655,504 | 340,880 | 314,624 | |||||||||||||||||||||||||||||
| Foreign exchange (1) | 45,365 | 3,596 | 41,769 | (3,188) | (996) | (2,192) | |||||||||||||||||||||||||||||
| Reserve for claims and claim expenses, end of period | $ | 9,365,469 | $ | 2,774,358 | $ | 6,591,111 | $ | 8,484,848 | $ | 2,865,150 | $ | 5,619,698 | |||||||||||||||||||||||
| Six months ended June 30, 2020 | Six months ended June 30, 2019 | ||||||||||||||||||||||||||||||||||
| Gross | Recoveries | Net | Gross | Recoveries | Net | ||||||||||||||||||||||||||||||
| Reserve for claims and claim expenses, beginning of period | $ | 9,384,349 | $ | 2,791,297 | $ | 6,593,052 | $ | 6,076,271 | $ | 2,372,221 | $ | 3,704,050 | |||||||||||||||||||||||
| Incurred claims and claim expenses | |||||||||||||||||||||||||||||||||||
| Current year | 1,440,910 | 358,178 | 1,082,732 | 826,399 | 141,918 | 684,481 | |||||||||||||||||||||||||||||
| Prior years | (45,969) | (44,463) | (1,506) | 263,776 | 267,849 | (4,073) | |||||||||||||||||||||||||||||
| Total incurred claims and claim expenses | 1,394,941 | 313,715 | 1,081,226 | 1,090,175 | 409,767 | 680,408 | |||||||||||||||||||||||||||||
| Paid claims and claim expenses | |||||||||||||||||||||||||||||||||||
| Current year | 66,492 | 4,867 | 61,625 | 55,941 | 3,609 | 52,332 | |||||||||||||||||||||||||||||
| Prior years | 1,337,025 | 329,109 | 1,007,916 | 1,012,242 | 441,681 | 570,561 | |||||||||||||||||||||||||||||
| Total paid claims and claim expenses | 1,403,517 | 333,976 | 1,069,541 | 1,068,183 | 445,290 | 622,893 | |||||||||||||||||||||||||||||
| Foreign exchange (1) | (10,304) | 3,322 | (13,626) | (1,625) | (983) | (642) | |||||||||||||||||||||||||||||
| Amounts acquired (2) | — | — | — | 2,388,210 | 529,435 | 1,858,775 | |||||||||||||||||||||||||||||
| Reserve for claims and claim expenses, end of period | $ | 9,365,469 | $ | 2,774,358 | $ | 6,591,111 | $ | 8,484,848 | $ | 2,865,150 | $ | 5,619,698 | |||||||||||||||||||||||
(1) Reflects the impact of the foreign exchange revaluation of net reserves denominated in non-U.S. dollars as at the balance sheet date.
(2) Represents the fair value of TMR's reserves for claims and claim expenses, net of reinsurance recoverables, acquired at March 22, 2019.
10 | | |||||||
| Managed Joint Ventures and Fee Income | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fee Income | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The table below reflects the total fee income earned through third-party capital management as well as various joint ventures and certain structured retrocession agreements to which the Company is a party. Joint ventures include DaVinciRe Holdings Ltd. ("DaVinciRe"), Top Layer Reinsurance Ltd., Vermeer Reinsurance Ltd. ("Vermeer") and certain entities investing in Langhorne Holdings LLC. Managed funds include RenaissanceRe Upsilon Fund Ltd. ("Upsilon Fund") and RenaissanceRe Medici Fund Ltd. ("Medici"). Structured reinsurance products and other include certain other vehicles and reinsurance contracts which transfer risk to capital.
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
Management fee income | |||||||||||||||||||||||||||||||||||||||||
Joint ventures | $ | 12,190 | $ | 11,781 | $ | 11,858 | $ | 11,434 | $ | 9,519 | $ | 23,971 | $ | 19,254 | |||||||||||||||||||||||||||
Structured reinsurance products and other | 8,739 | 6,418 | 3,814 | 4,558 | 9,976 | 17,336 | 18,221 | ||||||||||||||||||||||||||||||||||
Managed funds | 6,508 | 8,597 | 8,252 | 8,765 | 6,467 | 12,926 | 10,264 | ||||||||||||||||||||||||||||||||||
Total management fee income | 27,437 | 26,796 | 23,924 | 24,757 | 25,962 | 54,233 | 47,739 | ||||||||||||||||||||||||||||||||||
Performance fee income (loss) | |||||||||||||||||||||||||||||||||||||||||
Joint ventures | 6,165 | 7,828 | (3,374) | 5,278 | 5,218 | 13,993 | 7,756 | ||||||||||||||||||||||||||||||||||
Structured reinsurance products and other | 7,994 | 8,375 | (5,314) | 275 | 8,541 | 16,369 | 12,732 | ||||||||||||||||||||||||||||||||||
Managed funds | 3,914 | 2,363 | (2,036) | 1,688 | 470 | 6,277 | 768 | ||||||||||||||||||||||||||||||||||
Total performance fee income (loss) (1) | 18,073 | 18,566 | (10,724) | 7,241 | 14,229 | 36,639 | 21,256 | ||||||||||||||||||||||||||||||||||
Total fee income | $ | 45,510 | $ | 45,362 | $ | 13,200 | $ | 31,998 | $ | 40,191 | $ | 90,872 | $ | 68,995 | |||||||||||||||||||||||||||
(1) Performance fees are based on the performance of the individual vehicles or products, and may be negative in a particular period if, for example, large losses occur, which can potentially result in no performance fees or the reversal of previously accrued performance fees.
11 | | |||||||
| Managed Joint Ventures and Fee Income | |||||||||||||||||||||||||||||||||||||||||
| Noncontrolling Interests | |||||||||||||||||||||||||||||||||||||||||
The Company consolidates the results of certain of its joint ventures and managed capital vehicles, namely, DaVinciRe, Medici and Vermeer (collectively, the "Consolidated Managed Joint Ventures"), on its consolidated balance sheets and statements of operations. Redeemable noncontrolling interests on the Company's consolidated balance sheets represents the portion of the net assets of the Consolidated Managed Joint Ventures attributable to third-party investors in these Consolidated Managed Joint Ventures. Net (income) loss attributable to redeemable noncontrolling interests on the Company's consolidated statements of operations represents the portion of the (income) loss associated with the Consolidated Managed Joint Ventures included on the Company's consolidated statements of operations that is attributable to third-party investors in these Consolidated Managed Joint Ventures.
A summary of the redeemable noncontrolling interests on the Company's consolidated statements of operations is set forth below:
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
Redeemable noncontrolling interest - DaVinciRe | $ | (88,374) | $ | (84,906) | $ | 25,862 | $ | (30,558) | $ | (59,855) | $ | (173,280) | $ | (122,388) | |||||||||||||||||||||||||||
Redeemable noncontrolling interest - Medici | (13,151) | 4,678 | (6,363) | (15,211) | (1,704) | (8,473) | (4,185) | ||||||||||||||||||||||||||||||||||
Redeemable noncontrolling interest - Vermeer | (17,203) | (17,863) | (16,877) | (16,288) | (10,253) | (35,066) | (15,461) | ||||||||||||||||||||||||||||||||||
Net (income) loss attributable to redeemable noncontrolling interests (1) | $ | (118,728) | $ | (98,091) | $ | 2,622 | $ | (62,057) | $ | (71,812) | $ | (216,819) | $ | (142,034) | |||||||||||||||||||||||||||
(1) A negative number in the table above represents the allocation of net income earned by the Consolidated Managed Joint Ventures to third-party investors, with a corresponding decrease (increase) to the Company's net income (loss) attributable to RenaissanceRe. Conversely, a positive number in the table above represents the allocation of net losses incurred by the Consolidated Managed Joint Ventures to third-party investors, with a corresponding increase (decrease) to the Company's net (loss) income attributable to RenaissanceRe.
A summary of the Company’s redeemable noncontrolling interests on its consolidated balance sheets is set forth below:
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
| Redeemable noncontrolling interest - DaVinciRe | $ | 1,621,300 | $ | 1,533,085 | $ | 1,435,581 | $ | 1,462,677 | $ | 1,431,101 | |||||||||||||||||||
| Redeemable noncontrolling interest - Medici | 682,118 | 677,283 | 632,112 | 534,618 | 515,915 | ||||||||||||||||||||||||
| Redeemable noncontrolling interest - Vermeer | 1,083,681 | 1,021,478 | 1,003,615 | 781,738 | 765,450 | ||||||||||||||||||||||||
| Redeemable noncontrolling interests | $ | 3,387,099 | $ | 3,231,846 | $ | 3,071,308 | $ | 2,779,033 | $ | 2,712,466 | |||||||||||||||||||
A summary of the redeemable noncontrolling economic ownership of third parties in the Consolidated Managed Joint Ventures is set forth below:
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
| DaVinciRe | 78.6 | % | 78.6 | % | 78.1 | % | 78.1 | % | 78.1 | % | |||||||||||||||||||
| Medici | 88.6 | % | 88.8 | % | 87.9 | % | 86.3 | % | 86.1 | % | |||||||||||||||||||
| Vermeer | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||||||
12 | | |||||||
| Managed Joint Ventures and Fee Income | |||||||||||||||||||||||||||||||||||||||||
| DaVinciRe Holdings Ltd. and Subsidiary Consolidated Statements of Operations | |||||||||||||||||||||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||
| Gross premiums written | $ | 222,306 | $ | 255,640 | $ | 15,566 | $ | 32,986 | $ | 206,052 | $ | 477,946 | $ | 392,166 | |||||||||||||||||||||||||||
| Net premiums written | $ | 177,116 | $ | 241,641 | $ | 15,210 | $ | 30,605 | $ | 165,394 | $ | 418,757 | $ | 333,313 | |||||||||||||||||||||||||||
| (Increase) decrease in unearned premiums | (58,172) | (135,933) | 90,674 | 63,671 | (78,769) | (194,105) | (168,363) | ||||||||||||||||||||||||||||||||||
| Net premiums earned | 118,944 | 105,708 | 105,884 | 94,276 | 86,625 | 224,652 | 164,950 | ||||||||||||||||||||||||||||||||||
| Net investment income | 11,557 | 15,087 | 13,506 | 13,813 | 13,597 | 26,644 | 26,420 | ||||||||||||||||||||||||||||||||||
| Net foreign exchange gains (losses) | 8 | (1,180) | (399) | (174) | (936) | (1,172) | (1,192) | ||||||||||||||||||||||||||||||||||
| Other income | — | — | — | — | 139 | — | 344 | ||||||||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 34,674 | 18,529 | (1,307) | 6,493 | 20,914 | 53,203 | 43,349 | ||||||||||||||||||||||||||||||||||
| Total revenues | 165,183 | 138,144 | 117,684 | 114,408 | 120,339 | 303,327 | 233,871 | ||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||
| Net claims and claim expenses incurred | 9,829 | (13,726) | 135,397 | 45,325 | 10,986 | (3,897) | 14,649 | ||||||||||||||||||||||||||||||||||
| Acquisition expenses | 29,208 | 30,112 | 1,313 | 15,762 | 21,211 | 59,320 | 38,177 | ||||||||||||||||||||||||||||||||||
| Operational and corporate expenses | 11,862 | 11,889 | 12,238 | 12,139 | 9,777 | 23,751 | 20,427 | ||||||||||||||||||||||||||||||||||
| Interest expense | 1,859 | 1,858 | 1,859 | 1,859 | 1,858 | 3,717 | 3,716 | ||||||||||||||||||||||||||||||||||
| Total expenses | 52,758 | 30,133 | 150,807 | 75,085 | 43,832 | 82,891 | 76,969 | ||||||||||||||||||||||||||||||||||
| Income (loss) before taxes | 112,425 | 108,011 | (33,123) | 39,323 | 76,507 | 220,436 | 156,902 | ||||||||||||||||||||||||||||||||||
| Income tax (expense) benefit | (2) | 2 | (6) | (177) | 243 | — | 101 | ||||||||||||||||||||||||||||||||||
Net income (loss) available (attributable) to DaVinciRe common shareholders | $ | 112,423 | $ | 108,013 | $ | (33,129) | $ | 39,146 | $ | 76,750 | $ | 220,436 | $ | 157,003 | |||||||||||||||||||||||||||
Net claims and claim expenses incurred - current accident year | $ | 14,728 | $ | 4,967 | $ | 113,743 | $ | 80,022 | $ | 5,623 | $ | 19,695 | $ | 15,923 | |||||||||||||||||||||||||||
Net claims and claim expenses incurred - prior accident years | (4,899) | (18,693) | 21,654 | (34,697) | 5,363 | (23,592) | (1,274) | ||||||||||||||||||||||||||||||||||
Net claims and claim expenses incurred - total | $ | 9,829 | $ | (13,726) | $ | 135,397 | $ | 45,325 | $ | 10,986 | $ | (3,897) | $ | 14,649 | |||||||||||||||||||||||||||
Net claims and claim expense ratio - current accident year | 12.4 | % | 4.7 | % | 107.4 | % | 84.9 | % | 6.5 | % | 8.8 | % | 9.7 | % | |||||||||||||||||||||||||||
Net claims and claim expense ratio - prior accident years | (4.1) | % | (17.7) | % | 20.5 | % | (36.8) | % | 6.2 | % | (10.5) | % | (0.8) | % | |||||||||||||||||||||||||||
Net claims and claim expense ratio - calendar year | 8.3 | % | (13.0) | % | 127.9 | % | 48.1 | % | 12.7 | % | (1.7) | % | 8.9 | % | |||||||||||||||||||||||||||
Underwriting expense ratio | 34.5 | % | 39.7 | % | 12.8 | % | 29.6 | % | 35.8 | % | 36.9 | % | 35.5 | % | |||||||||||||||||||||||||||
Combined ratio | 42.8 | % | 26.7 | % | 140.7 | % | 77.7 | % | 48.5 | % | 35.2 | % | 44.4 | % | |||||||||||||||||||||||||||
13 | | |||||||
| Investments | |||||||||||||||||||||||||||||||||||||||||
| Total Investment Result | |||||||||||||||||||||||||||||||||||||||||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
Fixed maturity investments trading | $ | 69,943 | $ | 73,338 | $ | 85,937 | $ | 82,977 | $ | 88,106 | $ | 143,281 | $ | 149,589 | |||||||||||||||||||||||||||
Short term investments | 6,049 | 12,092 | 11,552 | 15,061 | 17,807 | 18,141 | 29,651 | ||||||||||||||||||||||||||||||||||
Equity investments trading | 1,666 | 1,551 | 1,539 | 1,326 | 916 | 3,217 | 1,943 | ||||||||||||||||||||||||||||||||||
Other investments | |||||||||||||||||||||||||||||||||||||||||
| Catastrophe bonds | 13,519 | 14,139 | 12,870 | 12,812 | 11,781 | 27,658 | 20,472 | ||||||||||||||||||||||||||||||||||
| Other | 1,107 | 1,629 | 2,221 | 2,672 | 1,914 | 2,736 | 3,554 | ||||||||||||||||||||||||||||||||||
Cash and cash equivalents | 837 | 1,504 | 1,875 | 1,978 | 2,306 | 2,341 | 3,823 | ||||||||||||||||||||||||||||||||||
| 93,121 | 104,253 | 115,994 | 116,826 | 122,830 | 197,374 | 209,032 | |||||||||||||||||||||||||||||||||||
Investment expenses | (3,816) | (4,780) | (3,856) | (5,439) | (4,242) | (8,596) | (8,350) | ||||||||||||||||||||||||||||||||||
Net investment income | 89,305 | 99,473 | 112,138 | 111,387 | 118,588 | 188,778 | 200,682 | ||||||||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on: | |||||||||||||||||||||||||||||||||||||||||
| Fixed maturity investments trading (1) | 322,711 | 101,221 | (48,146) | 57,502 | 171,920 | 423,932 | 288,621 | ||||||||||||||||||||||||||||||||||
| Equity investments trading (1) | 113,506 | (151,882) | 66,043 | (25,564) | 22,083 | (38,376) | 76,027 | ||||||||||||||||||||||||||||||||||
| Other investments | |||||||||||||||||||||||||||||||||||||||||
Catastrophe bonds | 4,452 | (14,352) | (4,522) | 9,242 | (11,902) | (9,900) | (14,112) | ||||||||||||||||||||||||||||||||||
Other | 7,721 | (45,694) | 5,079 | (6,785) | 9,146 | (37,973) | 10,724 | ||||||||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 448,390 | (110,707) | 18,454 | 34,395 | 191,247 | 337,683 | 361,260 | ||||||||||||||||||||||||||||||||||
Total investment result | $ | 537,695 | $ | (11,234) | $ | 130,592 | $ | 145,782 | $ | 309,835 | $ | 526,461 | $ | 561,942 | |||||||||||||||||||||||||||
Total investment return - annualized | 11.8 | % | (0.1) | % | 3.1 | % | 3.6 | % | 8.0 | % | 5.8 | % | 7.3 | % | |||||||||||||||||||||||||||
(1) Net realized and unrealized gains (losses) on fixed maturity investments trading includes the impacts of interest rate futures, interest rate swaps, credit default swaps and total return swaps. Net realized gains (losses) on equity investments trading includes the impact of equity futures.
14 | | |||||||
| Investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Investment Portfolio - Composition | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Type of Investment | June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| U.S. treasuries | $ | 4,258,675 | 21.6 | % | $ | 3,915,130 | 22.0 | % | $ | 4,467,345 | 25.7 | % | $ | 4,314,006 | 25.4 | % | $ | 3,961,306 | 24.2 | % | |||||||||||||||||||||||||||||||||||||||
| Agencies | 505,038 | 2.6 | % | 537,490 | 3.1 | % | 343,031 | 1.9 | % | 507,903 | 3.0 | % | 334,923 | 2.0 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Municipal | — | — | % | — | — | % | — | — | % | 1,629 | — | % | 2,859 | — | % | ||||||||||||||||||||||||||||||||||||||||||||
| Non-U.S. government | 584,206 | 3.0 | % | 635,282 | 3.6 | % | 497,392 | 2.9 | % | 379,154 | 2.2 | % | 370,505 | 2.3 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Non-U.S. government-backed corporate | 314,833 | 1.6 | % | 283,577 | 1.6 | % | 321,356 | 1.9 | % | 263,170 | 1.6 | % | 207,668 | 1.3 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Corporate | 4,428,553 | 22.5 | % | 3,259,780 | 18.3 | % | 3,075,660 | 17.7 | % | 3,453,222 | 20.4 | % | 3,268,511 | 19.9 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Agency mortgage-backed | 985,851 | 5.0 | % | 1,056,272 | 5.9 | % | 1,148,499 | 6.6 | % | 1,248,722 | 7.4 | % | 1,167,735 | 7.1 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Non-agency mortgage-backed | 276,300 | 1.4 | % | 275,026 | 1.6 | % | 294,604 | 1.7 | % | 261,850 | 1.5 | % | 266,963 | 1.6 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Commercial mortgage-backed | 591,238 | 3.0 | % | 540,502 | 3.0 | % | 468,698 | 2.7 | % | 406,268 | 2.4 | % | 374,584 | 2.3 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Asset-backed | 550,441 | 2.8 | % | 542,742 | 3.1 | % | 555,070 | 3.2 | % | 550,304 | 3.3 | % | 524,612 | 3.2 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Total fixed maturity investments, at fair value | 12,495,135 | 63.5 | % | 11,045,801 | 62.2 | % | 11,171,655 | 64.3 | % | 11,386,228 | 67.2 | % | 10,479,666 | 63.9 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Short term investments, at fair value | 5,570,804 | 28.2 | % | 5,263,242 | 29.4 | % | 4,566,277 | 26.3 | % | 4,116,156 | 24.3 | % | 4,579,171 | 28.0 | % | ||||||||||||||||||||||||||||||||||||||||||||
Total consolidated fixed maturity and short term investments, at fair value | 18,065,939 | 91.7 | % | 16,309,043 | 91.6 | % | 15,737,932 | 90.6 | % | 15,502,384 | 91.5 | % | 15,058,837 | 91.9 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Equity investments trading, at fair value | 470,087 | 2.4 | % | 360,444 | 2.0 | % | 436,931 | 2.5 | % | 379,422 | 2.2 | % | 273,646 | 1.7 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Other investments, at fair value | 1,093,338 | 5.5 | % | 1,058,714 | 5.9 | % | 1,087,377 | 6.3 | % | 962,109 | 5.7 | % | 955,437 | 5.8 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Total managed investment portfolio | 19,629,364 | 99.6 | % | 17,728,201 | 99.5 | % | 17,262,240 | 99.4 | % | 16,843,915 | 99.4 | % | 16,287,920 | 99.4 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Investments in other ventures, under equity method | 94,285 | 0.4 | % | 90,396 | 0.5 | % | 106,549 | 0.6 | % | 103,978 | 0.6 | % | 100,396 | 0.6 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Total investments | $ | 19,723,649 | 100.0 | % | $ | 17,818,597 | 100.0 | % | $ | 17,368,789 | 100.0 | % | $ | 16,947,893 | 100.0 | % | $ | 16,388,316 | 100.0 | % | |||||||||||||||||||||||||||||||||||||||
15 | | |||||||
| Investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Investment Portfolio - Fixed Maturity Investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Credit Quality of Fixed Maturity Investments | June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| AAA | $ | 1,392,417 | 11.1 | % | $ | 1,590,824 | 14.4 | % | $ | 1,338,265 | 12.0 | % | $ | 1,215,518 | 10.7 | % | $ | 1,121,450 | 10.7 | % | |||||||||||||||||||||||||||||||||||||||
| AA | 6,670,927 | 53.4 | % | 6,212,689 | 56.3 | % | 6,677,219 | 59.8 | % | 6,699,860 | 58.8 | % | 6,073,777 | 58.0 | % | ||||||||||||||||||||||||||||||||||||||||||||
| A | 1,864,066 | 14.9 | % | 1,491,504 | 13.5 | % | 1,453,212 | 13.0 | % | 1,671,934 | 14.7 | % | 1,548,705 | 14.8 | % | ||||||||||||||||||||||||||||||||||||||||||||
| BBB | 1,433,297 | 11.5 | % | 915,375 | 8.3 | % | 874,730 | 7.8 | % | 967,928 | 8.5 | % | 898,740 | 8.6 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Non-investment grade and not rated | 1,134,428 | 9.1 | % | 835,409 | 7.5 | % | 828,229 | 7.4 | % | 830,988 | 7.3 | % | 836,994 | 7.9 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Total fixed maturity investments, at fair value | $ | 12,495,135 | 100.0 | % | $ | 11,045,801 | 100.0 | % | $ | 11,171,655 | 100.0 | % | $ | 11,386,228 | 100.0 | % | $ | 10,479,666 | 100.0 | % | |||||||||||||||||||||||||||||||||||||||
| Maturity Profile of Fixed Maturity Investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Due in less than one year | $ | 638,686 | 5.1 | % | $ | 723,397 | 6.5 | % | $ | 544,636 | 4.9 | % | $ | 603,806 | 5.3 | % | $ | 616,578 | 5.9 | % | |||||||||||||||||||||||||||||||||||||||
| Due after one through five years | 5,513,103 | 44.1 | % | 5,039,456 | 45.7 | % | 5,522,769 | 49.4 | % | 5,893,946 | 51.8 | % | 5,176,183 | 49.4 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Due after five through ten years | 3,312,749 | 26.6 | % | 2,612,031 | 23.7 | % | 2,420,602 | 21.7 | % | 2,232,264 | 19.6 | % | 1,896,176 | 18.1 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Due after ten years | 626,768 | 5.0 | % | 256,375 | 2.3 | % | 216,777 | 1.9 | % | 189,068 | 1.7 | % | 456,835 | 4.3 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Mortgage-backed securities | 1,853,388 | 14.8 | % | 1,871,800 | 16.9 | % | 1,911,801 | 17.1 | % | 1,916,840 | 16.8 | % | 1,809,282 | 17.3 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Asset-backed securities | 550,441 | 4.4 | % | 542,742 | 4.9 | % | 555,070 | 5.0 | % | 550,304 | 4.8 | % | 524,612 | 5.0 | % | ||||||||||||||||||||||||||||||||||||||||||||
| Total fixed maturity investments, at fair value | $ | 12,495,135 | 100.0 | % | $ | 11,045,801 | 100.0 | % | $ | 11,171,655 | 100.0 | % | $ | 11,386,228 | 100.0 | % | $ | 10,479,666 | 100.0 | % | |||||||||||||||||||||||||||||||||||||||
16 | | |||||||
| Investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Investment Portfolio - Weighted Average Yield to Maturity and Credit Rating | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Credit Rating (1) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | Amortized Cost | Fair Value | Weighted Average Yield to Maturity | AAA | AA | A | BBB | Non- Investment Grade | Not Rated | ||||||||||||||||||||||||||||||||||||||||||||
| Short term investments | $ | 5,570,804 | $ | 5,570,804 | 0.2 | % | $ | 5,334,436 | $ | 209,481 | $ | 16,320 | $ | 4,667 | $ | 4,316 | $ | 1,584 | |||||||||||||||||||||||||||||||||||
| 100.0 | % | 95.7 | % | 3.8 | % | 0.3 | % | 0.1 | % | 0.1 | % | — | % | ||||||||||||||||||||||||||||||||||||||||
| Fixed maturity investments | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| U.S. treasuries | 4,110,762 | 4,258,675 | 0.3 | % | — | 4,258,675 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Agencies | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fannie Mae and Freddie Mac | 273,868 | 275,704 | 0.4 | % | — | 275,704 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Other agencies | 222,277 | 229,334 | 1.1 | % | — | 229,334 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Total agencies | 496,145 | 505,038 | 0.7 | % | — | 505,038 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Non-U.S. government | 567,678 | 584,206 | 0.7 | % | 249,086 | 293,392 | 31,627 | 8,717 | 1,384 | — | |||||||||||||||||||||||||||||||||||||||||||
| Non-U.S. government-backed corporate | 308,472 | 314,833 | 0.8 | % | 143,123 | 144,003 | 19,703 | 8,004 | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Corporate | 4,325,187 | 4,428,553 | 2.7 | % | 60,638 | 278,095 | 1,801,423 | 1,355,738 | 909,359 | 23,300 | |||||||||||||||||||||||||||||||||||||||||||
| Mortgage-backed | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Residential mortgage-backed | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Agency securities | 966,047 | 985,851 | 1.0 | % | — | 985,851 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Non-agency securities - Alt A | 224,314 | 220,643 | 3.7 | % | 42,415 | 5,793 | 653 | 7,493 | 132,065 | 32,224 | |||||||||||||||||||||||||||||||||||||||||||
| Non-agency securities - Prime | 56,033 | 55,657 | 3.1 | % | 20,237 | 2,689 | 1,452 | 1,252 | 17,445 | 12,582 | |||||||||||||||||||||||||||||||||||||||||||
| Total residential mortgage-backed | 1,246,394 | 1,262,151 | 1.6 | % | 62,652 | 994,333 | 2,105 | 8,745 | 149,510 | 44,806 | |||||||||||||||||||||||||||||||||||||||||||
| Commercial mortgage-backed | 573,690 | 591,238 | 2.0 | % | 464,238 | 101,389 | 5,508 | 16,706 | 1,397 | 2,000 | |||||||||||||||||||||||||||||||||||||||||||
| Total mortgage-backed | 1,820,084 | 1,853,389 | 1.7 | % | 526,890 | 1,095,722 | 7,613 | 25,451 | 150,907 | 46,806 | |||||||||||||||||||||||||||||||||||||||||||
| Asset-backed | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Collateralized loan obligations | 520,935 | 510,408 | 2.6 | % | 378,492 | 93,497 | 1,367 | 34,380 | 2,672 | — | |||||||||||||||||||||||||||||||||||||||||||
| Other | 39,244 | 40,033 | 1.4 | % | 34,188 | 2,505 | 2,333 | 1,007 | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Total asset-backed | 560,179 | 550,441 | 2.5 | % | 412,680 | 96,002 | 3,700 | 35,387 | 2,672 | — | |||||||||||||||||||||||||||||||||||||||||||
| Total securitized assets | 2,380,263 | 2,403,830 | 1.9 | % | 939,570 | 1,191,724 | 11,313 | 60,838 | 153,579 | 46,806 | |||||||||||||||||||||||||||||||||||||||||||
| Total fixed maturity investments | 12,188,507 | 12,495,135 | 1.5 | % | 1,392,417 | 6,670,927 | 1,864,066 | 1,433,297 | 1,064,322 | 70,106 | |||||||||||||||||||||||||||||||||||||||||||
| 100.0 | % | 11.1 | % | 53.4 | % | 14.9 | % | 11.5 | % | 8.5 | % | 0.6 | % | ||||||||||||||||||||||||||||||||||||||||
Total consolidated fixed maturity and short term investments, at fair value | $ | 17,759,311 | $ | 18,065,939 | 1.1 | % | $ | 6,726,853 | $ | 6,880,408 | $ | 1,880,386 | $ | 1,437,964 | $ | 1,068,638 | $ | 71,690 | |||||||||||||||||||||||||||||||||||
| 100.0 | % | 37.2 | % | 38.1 | % | 10.4 | % | 8.0 | % | 5.9 | % | 0.4 | % | ||||||||||||||||||||||||||||||||||||||||
(1) The credit ratings included in this table are those assigned by Standard & Poor’s Corporation ("S&P"). When ratings provided by S&P were not available, ratings from other nationally recognized rating agencies were used. The Company has grouped short term investments with an A-1+ and A-1 short term issue credit rating as AAA, short term investments with an A-2 short term issue credit rating as AA and short term investments with an A-3 short term issue credit rating as A.
17 | | |||||||
| Investments | ||
| Retained Investment Information | ||
“Retained total investment result" is defined as consolidated total investment result less the portion attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures.
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
| Total investment result | |||||||||||||||||||||||||||||||||||||||||
| Net investment income | $ | 89,305 | $ | 99,473 | $ | 112,138 | $ | 111,387 | $ | 118,588 | $ | 188,778 | $ | 200,682 | |||||||||||||||||||||||||||
| Net realized and unrealized (losses) gains on investments | 448,390 | (110,707) | 18,454 | 34,395 | 191,247 | 337,683 | 361,260 | ||||||||||||||||||||||||||||||||||
| Total investment result | $ | 537,695 | $ | (11,234) | $ | 130,592 | $ | 145,782 | $ | 309,835 | $ | 526,461 | $ | 561,942 | |||||||||||||||||||||||||||
| Retained total investment result (1) | |||||||||||||||||||||||||||||||||||||||||
| Retained net investment income | $ | 67,189 | $ | 72,603 | $ | 87,739 | $ | 86,408 | $ | 95,400 | $ | 139,792 | $ | 156,842 | |||||||||||||||||||||||||||
| Retained net realized and unrealized (losses) gains on investments | 418,046 | (113,261) | 21,751 | 21,764 | 183,357 | 304,785 | 337,685 | ||||||||||||||||||||||||||||||||||
| Retained total investment result | $ | 485,235 | $ | (40,658) | $ | 109,490 | $ | 108,172 | $ | 278,757 | $ | 444,577 | $ | 494,527 | |||||||||||||||||||||||||||
(1) Includes total investment return, less the portion attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures. See "Comments on Regulation G" for a reconciliation of non-GAAP financial measures.
“Retained fixed maturity and short term investments, at fair value" is defined as total consolidated fixed maturity and short term investments, at fair value, less the portion of fixed maturity and short term investments, at fair value attributable to redeemable noncontrolling interests, certain third party vehicles and joint ventures.
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
| Managed fixed maturity and short term investments portfolio (1) | |||||||||||||||||||||||||||||
| Total consolidated fixed maturity and short term investments, at fair value | $ | 18,065,939 | $ | 16,309,043 | $ | 15,737,932 | $ | 15,502,384 | $ | 15,058,837 | |||||||||||||||||||
| Weighted average yield to maturity of fixed maturity and short term investments | 1.1 | % | 1.5 | % | 2.1 | % | 2.2 | % | 2.4 | % | |||||||||||||||||||
| Average duration of fixed maturities and short term investments, in years | 2.9 | 2.8 | 2.9 | 2.8 | 2.7 | ||||||||||||||||||||||||
| Retained fixed maturity and short term investments portfolio (2) | |||||||||||||||||||||||||||||
| Retained fixed maturity and short term investments, at fair value | $ | 12,703,423 | $ | 11,124,214 | $ | 11,154,174 | $ | 11,075,699 | $ | 10,787,618 | |||||||||||||||||||
Weighted average yield to maturity of retained fixed maturity and short term investments | 1.4 | % | 1.9 | % | 2.2 | % | 2.3 | % | 2.5 | % | |||||||||||||||||||
| Average duration of retained fixed maturities and short term investments, in years | 3.7 | 3.5 | 3.6 | 3.5 | 3.1 | ||||||||||||||||||||||||
(1) Includes total consolidated fixed maturity and short term investments, at fair value, as presented on the Company's consolidated balance sheets.
(2) Includes total consolidated fixed maturity and short term investments, at fair value, less the portion of fixed maturity and short term investments, at fair value attributable to redeemable noncontrolling interests, certain third party vehicles and joint ventures. See "Comments on Regulation G" for a reconciliation of non-GAAP financial measures.
18 | | |||||||
| Other Items | |||||||||||||||||||||||||||||
| Earnings per Share | |||||||||||||||||||||||||||||
| Three months ended | |||||||||||||||||||||||||||||
| (common shares in thousands) | June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | ||||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 575,845 | $ | (81,974) | $ | 33,773 | $ | 36,698 | $ | 367,854 | |||||||||||||||||||
| Amount allocated to participating common shareholders (1) | (7,593) | (146) | (409) | (446) | (4,393) | ||||||||||||||||||||||||
| $ | 568,252 | $ | (82,120) | $ | 33,364 | $ | 36,252 | $ | 363,461 | ||||||||||||||||||||
| Denominator: | |||||||||||||||||||||||||||||
| Denominator for basic income (loss) per RenaissanceRe common share - | |||||||||||||||||||||||||||||
| Weighted average common shares | 44,939 | 43,441 | 43,467 | 43,462 | 43,483 | ||||||||||||||||||||||||
Per common share equivalents of employee stock options and non-vested shares | 64 | — | 85 | 75 | 38 | ||||||||||||||||||||||||
| Denominator for diluted (loss) income per RenaissanceRe common share - | |||||||||||||||||||||||||||||
| Adjusted weighted average common shares and assumed conversions | 45,003 | 43,441 | 43,552 | 43,537 | 43,521 | ||||||||||||||||||||||||
| Basic income (loss) per RenaissanceRe common share | $ | 12.64 | $ | (1.89) | $ | 0.77 | $ | 0.83 | $ | 8.36 | |||||||||||||||||||
| Diluted income (loss) per RenaissanceRe common share | $ | 12.63 | $ | (1.89) | $ | 0.77 | $ | 0.83 | $ | 8.35 | |||||||||||||||||||
| Six months ended | |||||||||||||||||||||||||||||
| (common shares in thousands) | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||||||||
Net income available to RenaissanceRe common shareholders | $ | 493,871 | $ | 641,571 | |||||||||||||||||||||||||
| Amount allocated to participating common shareholders (1) | (6,153) | (7,483) | |||||||||||||||||||||||||||
| $ | 487,718 | $ | 634,088 | ||||||||||||||||||||||||||
| Denominator: | |||||||||||||||||||||||||||||
| Denominator for basic income per RenaissanceRe common share - | |||||||||||||||||||||||||||||
| Weighted average common shares | 44,190 | 42,774 | |||||||||||||||||||||||||||
Per common share equivalents of employee stock options and non-vested shares | 63 | 32 | |||||||||||||||||||||||||||
| Denominator for diluted income per RenaissanceRe common share - | |||||||||||||||||||||||||||||
| Adjusted weighted average common shares and assumed conversions | 44,253 | 42,806 | |||||||||||||||||||||||||||
| Basic income per RenaissanceRe common share | $ | 11.04 | $ | 14.82 | |||||||||||||||||||||||||
| Diluted income per RenaissanceRe common share | $ | 11.02 | $ | 14.81 | |||||||||||||||||||||||||
(1) Represents earnings and dividends attributable to holders of unvested shares issued pursuant to the Company's stock compensation plans.
19 | | |||||||
| Comments on Regulation G | ||
In addition to the GAAP financial measures set forth in this Financial Supplement, the Company has included certain non-GAAP financial measures within the meaning of Regulation G. The Company has consistently provided these financial measures in previous investor communications and the Company's management believes that these measures are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for comparison with other companies within the industry. These measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors are cautioned not to place undue reliance on these non-GAAP measures in assessing the Company's overall financial performance.
Operating Income Available to RenaissanceRe Common Shareholders and Operating Return on Average Common Equity - Annualized
The Company uses “operating income available to RenaissanceRe common shareholders” as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “Operating income available to RenaissanceRe common shareholders” as used herein differs from “net income (loss) available (attributable) to RenaissanceRe common shareholders,” which the Company believes is the most directly comparable GAAP measure, by the exclusion of net realized and unrealized gains and losses on investments, excluding other investments - catastrophe bonds, net foreign exchange gains and losses, transaction and integration expenses associated with the acquisition of TMR, the income tax expense or benefit associated with these adjustments and the portion of these adjustments attributable to the Company's redeemable noncontrolling interests." The Company's management believes that “operating income available to RenaissanceRe common shareholders” is useful to investors because it more accurately measures and predicts the Company's results of operations by removing the variability arising from: fluctuations in the fair value of the Company's fixed maturity investment portfolio, equity investments trading, other investments (excluding catastrophe bonds) and investments-related derivatives; fluctuations in foreign exchange rates; certain transaction and integration expenses associated with the acquisition of TMR; the associated income tax expense or benefit of these adjustments; and the portion of these adjustments attributable to the Company's redeemable noncontrolling interests. The Company also uses “operating income available to RenaissanceRe common shareholders” to calculate “operating income available to RenaissanceRe common shareholders per common share - diluted” and “operating return on average common equity - annualized.” The following table is a reconciliation of: (1) net income (loss) available (attributable) to RenaissanceRe common shareholders to "operating income available to RenaissanceRe common shareholders"; (2) net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted to "operating income available to RenaissanceRe common shareholders per common share - diluted"; and (3) return on average common equity - annualized to "operating return on average common equity - annualized". Comparative information for all prior periods has been updated to conform to the current methodology and presentation.
20 | | |||||||
| Comments on Regulation G | ||
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders | $ | 575,845 | $ | (81,974) | $ | 33,773 | $ | 36,698 | $ | 367,854 | $ | 493,871 | $ | 641,571 | |||||||||||||||||||||||||||
Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds | (443,938) | 96,355 | (22,976) | (25,153) | (203,149) | (347,583) | (375,372) | ||||||||||||||||||||||||||||||||||
Adjustment for net foreign exchange losses (gains) | 7,195 | 5,728 | 1,126 | 8,275 | (9,309) | 12,923 | (6,463) | ||||||||||||||||||||||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 2,279 | 4,423 | 5,700 | 4,022 | 14,483 | 6,702 | 40,003 | ||||||||||||||||||||||||||||||||||
Adjustment for income tax (benefit) expense (1) | 21,223 | (4,141) | (3,707) | 5,298 | 10,442 | 17,082 | 18,776 | ||||||||||||||||||||||||||||||||||
Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) | 27,472 | 13,019 | (1,293) | 3,541 | 18,518 | 40,491 | 33,932 | ||||||||||||||||||||||||||||||||||
Operating income available to RenaissanceRe common shareholders | $ | 190,076 | $ | 33,410 | $ | 12,623 | $ | 32,681 | $ | 198,839 | $ | 223,486 | $ | 352,447 | |||||||||||||||||||||||||||
Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted | $ | 12.63 | $ | (1.89) | $ | 0.77 | $ | 0.83 | $ | 8.35 | $ | 11.02 | $ | 14.81 | |||||||||||||||||||||||||||
Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds | (9.86) | 2.22 | (0.53) | (0.58) | (4.67) | (7.85) | (8.77) | ||||||||||||||||||||||||||||||||||
Adjustment for net foreign exchange losses (gains) | 0.16 | 0.13 | 0.03 | 0.19 | (0.21) | 0.29 | (0.15) | ||||||||||||||||||||||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 0.05 | 0.10 | 0.13 | 0.09 | 0.33 | 0.15 | 0.93 | ||||||||||||||||||||||||||||||||||
Adjustment for income tax (benefit) expense (1) | 0.47 | (0.10) | (0.09) | 0.12 | 0.24 | 0.39 | 0.44 | ||||||||||||||||||||||||||||||||||
Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) | 0.61 | 0.30 | (0.03) | 0.08 | 0.43 | 0.91 | 0.79 | ||||||||||||||||||||||||||||||||||
Operating income available to RenaissanceRe common shareholders per common share - diluted | $ | 4.06 | $ | 0.76 | $ | 0.28 | $ | 0.73 | $ | 4.47 | $ | 4.91 | $ | 8.05 | |||||||||||||||||||||||||||
Return on average common equity - annualized | 38.5 | % | (6.3) | % | 2.5 | % | 2.8 | % | 28.9 | % | 17.1 | % | 26.4 | % | |||||||||||||||||||||||||||
Adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds | (29.7) | % | 7.5 | % | (1.7) | % | (1.9) | % | (16.0) | % | (11.9) | % | (15.5) | % | |||||||||||||||||||||||||||
Adjustment for net foreign exchange losses (gains) | 0.5 | % | 0.4 | % | 0.1 | % | 0.6 | % | (0.7) | % | 0.4 | % | (0.3) | % | |||||||||||||||||||||||||||
Adjustment for transaction and integration expenses associated with the acquisition of TMR | 0.2 | % | 0.3 | % | 0.4 | % | 0.3 | % | 1.1 | % | 0.2 | % | 1.6 | % | |||||||||||||||||||||||||||
Adjustment for income tax (benefit) expense (1) | 1.4 | % | (0.3) | % | (0.3) | % | 0.4 | % | 0.8 | % | 0.6 | % | 0.8 | % | |||||||||||||||||||||||||||
Adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) | 1.8 | % | 1.0 | % | (0.1) | % | 0.3 | % | 1.5 | % | 1.4 | % | 1.4 | % | |||||||||||||||||||||||||||
Operating return on average common equity - annualized | 12.7 | % | 2.6 | % | 0.9 | % | 2.5 | % | 15.6 | % | 7.8 | % | 14.4 | % | |||||||||||||||||||||||||||
(1) Adjustment for income tax expense (benefit) represents the income tax (expense) benefit associated with the adjustments to net income (loss) available (attributable) to RenaissanceRe common shareholders. The income tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors.
(2) Represents the portion of these adjustments that are attributable to the Company's redeemable noncontrolling interests, including the income tax impact of those adjustments.
21 | | |||||||
| Comments on Regulation G | ||
Tangible Book Value Per Common Share and Tangible Book Value Per Common Share Plus Accumulated Dividends
The Company has included in this Financial Supplement “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” “Tangible book value per common share” is defined as book value per common share excluding goodwill and intangible assets per share. “Tangible book value per common share plus accumulated dividends” is defined as book value per common share excluding goodwill and intangible assets per share, plus accumulated dividends. The Company's management believes “tangible book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because they provide a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets. The following table is a reconciliation of book value per common share to "tangible book value per common share'" and "tangible book value per common share plus accumulated dividends."
| At | |||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
Book value per common share | $ | 134.27 | $ | 117.15 | $ | 120.53 | $ | 120.07 | $ | 119.17 | |||||||||||||||||||
Adjustment for goodwill and other intangibles (1) | (5.56) | (6.46) | (6.50) | (6.55) | (6.60) | ||||||||||||||||||||||||
Tangible book value per common share | 128.71 | 110.69 | 114.03 | 113.52 | 112.57 | ||||||||||||||||||||||||
Adjustment for accumulated dividends | 21.38 | 21.03 | 20.68 | 20.34 | 20.00 | ||||||||||||||||||||||||
Tangible book value per common share plus accumulated dividends | $ | 150.09 | $ | 131.72 | $ | 134.71 | $ | 133.86 | $ | 132.57 | |||||||||||||||||||
Quarterly change in book value per common share | 14.6 | % | (2.8) | % | 0.4 | % | 0.8 | % | 7.3 | % | |||||||||||||||||||
Quarterly change in tangible book value per common share plus change in accumulated dividends | 16.6 | % | (2.6) | % | 0.7 | % | 1.1 | % | 8.2 | % | |||||||||||||||||||
| Year to date change in book value per common share | 11.4 | % | (2.8) | % | 15.7 | % | 15.3 | % | 14.4 | % | |||||||||||||||||||
Year to date change in tangible book value per common share plus change in accumulated dividends | 13.5 | % | (2.6) | % | 17.9 | % | 17.1 | % | 15.7 | % | |||||||||||||||||||
(1) At June 30, 2020, March 31, 2020, December 31, 2019, September 30, 2019 and June 30, 2019, goodwill and other intangibles included $23.5 million, $24.2 million, $24.9 million, $25.6 million, and $26.3 million, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method.
22 | | |||||||
| Comments on Regulation G | ||
Retained Total Investment Result
The Company has included in this Financial Supplement “retained total investment result.” “Retained total investment result" is defined as consolidated total investment result less the portion attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures. “Retained total investment result” differs from consolidated total investment result, which the Company believes is the most directly comparable GAAP measure, due to the exclusion of the investment result attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures. The Company's management believes “retained total investment result” is useful to investors and other interested parties because it provides a measure of the portion of the Company's investment result, that impacts the investment result included in net income (loss) available (attributable) to RenaissanceRe common shareholders. The following table is a reconciliation of consolidated total investment result to “retained total investment result.”
| Three months ended | Six months ended | ||||||||||||||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | June 30, 2020 | June 30, 2019 | |||||||||||||||||||||||||||||||||||
Net investment income | $ | 89,305 | $ | 99,473 | 112,138 | $ | 111,387 | $ | 118,588 | $ | 188,778 | $ | 200,682 | ||||||||||||||||||||||||||||
Adjustment for net investment income attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures | (22,116) | (26,870) | $ | (24,399) | (24,979) | (23,188) | (48,986) | (43,840) | |||||||||||||||||||||||||||||||||
Retained net investment income | 67,189 | 72,603 | 87,739 | 86,408 | 95,400 | 139,792 | 156,842 | ||||||||||||||||||||||||||||||||||
Net realized and unrealized gains (losses) on investments | 448,390 | (110,707) | 18,454 | 34,395 | 191,247 | 337,683 | 361,260 | ||||||||||||||||||||||||||||||||||
Adjustment for net realized and unrealized losses (gains) on investments attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures | (30,344) | (2,554) | 3,297 | (12,631) | (7,890) | (32,898) | (23,575) | ||||||||||||||||||||||||||||||||||
Retained net realized and unrealized gains (losses) on investments | 418,046 | (113,261) | 21,751 | 21,764 | 183,357 | 304,785 | 337,685 | ||||||||||||||||||||||||||||||||||
Total investment result | 537,695 | (11,234) | 130,592 | 145,782 | 309,835 | 526,461 | 561,942 | ||||||||||||||||||||||||||||||||||
Adjustment for investment result attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures | (52,460) | (29,424) | (21,102) | (37,610) | (31,078) | (81,884) | (67,415) | ||||||||||||||||||||||||||||||||||
Retained total investment result | $ | 485,235 | $ | (40,658) | $ | 109,490 | $ | 108,172 | $ | 278,757 | $ | 444,577 | $ | 494,527 | |||||||||||||||||||||||||||
23 | | |||||||
| Comments on Regulation G | ||
Retained Fixed Maturity and Short Term Investments, at Fair Value
The Company has included in this Financial Supplement “retained fixed maturity and short term investments, at fair value.” “Retained fixed maturity and short term investments, at fair value" is defined as total consolidated fixed maturity and short term investments, at fair value, less the portion of fixed maturity and short term investments, at fair value attributable to redeemable noncontrolling interests, certain third party vehicles and joint ventures. “Retained fixed maturity and short term investments, at fair value” differs from total consolidated fixed maturity and short term investments, at fair value, which the Company believes is the most directly comparable GAAP measure, due to the exclusion of fixed maturity and short term investments, at fair value, attributable to redeemable noncontrolling interests, certain third party vehicles and joint ventures. The Company's management believes “retained fixed maturity and short term investments, at fair value” is useful to investors and other interested parties because it provides a measure of the portion of the Company's fixed maturity and short term investments, at fair value, that impacts the investment result included in net income (loss) available (attributable) to RenaissanceRe common shareholders. The following table is a reconciliation of total consolidated fixed maturity and short term investments, at fair value, to “retained fixed maturity and short term investments, at fair value.”
| At | |||||||||||||||||||||||||||||
| June 30, 2020 | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | |||||||||||||||||||||||||
| Fixed maturity investments, at fair value | $ | 12,495,135 | $ | 11,045,801 | $ | 11,171,655 | $ | 11,386,228 | $ | 10,479,666 | |||||||||||||||||||
| Short term investments, at fair value | 5,570,804 | 5,263,242 | 4,566,277 | 4,116,156 | 4,579,171 | ||||||||||||||||||||||||
Total consolidated fixed maturity and short term investments, at fair value | $ | 18,065,939 | $ | 16,309,043 | $ | 15,737,932 | $ | 15,502,384 | $ | 15,058,837 | |||||||||||||||||||
Adjustment for fixed maturity and short term investments attributable to redeemable noncontrolling interests, certain third-party vehicles and joint ventures | (5,362,516) | (5,184,829) | (4,583,758) | (4,426,685) | (4,271,219) | ||||||||||||||||||||||||
Retained fixed maturity and short term investments, at fair value | $ | 12,703,423 | $ | 11,124,214 | $ | 11,154,174 | $ | 11,075,699 | $ | 10,787,618 | |||||||||||||||||||
24 | | |||||||