[General Information](index=1&type=section&id=General%20Information) RenaissanceRe Holdings Ltd. filed a Quarterly Report on Form 10-Q for the period ended June 30, 2023, as a large accelerated filer with 51.2 million common shares outstanding - RenaissanceRe Holdings Ltd. filed a Quarterly Report on Form 10-Q for the period ended June 30, 2023[2](index=2&type=chunk) - The registrant is a large accelerated filer[6](index=6&type=chunk) - As of July 24, 2023, **51,181,534 Common Shares**, par value U.S. $1.00 per share, were outstanding[6](index=6&type=chunk) [GLOSSARY OF DEFINED TERMS](index=3&type=section&id=GLOSSARY%20OF%20DEFINED%20TERMS) This section defines key financial and regulatory terms relevant to the report, including 'AIG', 'ASC', 'Exchange Act', and 'Validus Acquisition' - The glossary defines key terms such as '**AIG**' (American International Group, Inc.), 'ASC' (Accounting Standards Codification), 'Exchange Act' (Securities Exchange Act of 1934), and '**Validus Acquisition**' (the acquisition of Validus Holdings, Validus Specialty, and their subsidiaries)[11](index=11&type=chunk)[12](index=12&type=chunk) [NOTE ON FORWARD-LOOKING STATEMENTS](index=5&type=section&id=NOTE%20ON%20FORWARD-LOOKING%20STATEMENTS) Forward-looking statements are based on estimates and assumptions, subject to significant uncertainties and risks, particularly those related to the Validus Acquisition - Forward-looking statements are based on estimates and assumptions subject to significant business, economic, and competitive uncertainties and contingencies[14](index=14&type=chunk) - Numerous factors could cause actual results to differ materially, including risks related to the **Validus Acquisition** (e.g., completion delays, regulatory conditions, integration difficulties, increased debt, and dilutive impact on shareholders)[15](index=15&type=chunk) [PART I. FINANCIAL INFORMATION](index=7&type=section&id=PART%20I) This part presents the company's unaudited consolidated financial statements and management's discussion and analysis for the period ended June 30, 2023 - The financial statements are unaudited and prepared in accordance with GAAP for interim financial information[38](index=38&type=chunk) - Due to business seasonality, interim results are not necessarily indicative of full fiscal year or subsequent quarter results[39](index=39&type=chunk) [ITEM 1. FINANCIAL STATEMENTS](index=7&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited consolidated financial statements of RenaissanceRe Holdings Ltd. and its subsidiaries for the three and six months ended June 30, 2023 and 2022, along with the consolidated balance sheets as of June 30, 2023 and December 31, 2022, and accompanying notes [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) The Consolidated Balance Sheets show an increase in total assets and shareholders' equity from December 31, 2022, to June 30, 2023, primarily driven by growth in investments and additional paid-in capital Consolidated Balance Sheet Highlights (in thousands USD) | Metric | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | Change (billions USD) | |:---|:---|:---|:---| | Total assets | $41.40 | $36.55 | $4.85 | | Total liabilities | $28.32 | $26.69 | $1.63 | | Total shareholders' equity attributable to RenaissanceRe | $7.40 | $5.33 | $2.08 | - Fixed maturity investments trading increased by **$1.5 billion**, and short-term investments increased by **$1.7 billion** from December 31, 2022, to June 30, 2023[21](index=21&type=chunk) - Additional paid-in capital significantly increased from **$475.6 million** to **$1.8 billion**, reflecting new share issuances[21](index=21&type=chunk) [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported a significant turnaround from a net loss in Q2 2022 to a net income in Q2 2023, driven by increased net premiums earned, substantially higher net investment income, and a reduction in net realized and unrealized investment losses Consolidated Statements of Operations Highlights (in thousands USD, except per share) | Metric | 3 Months Ended June 30, 2023 (billions USD) | 3 Months Ended June 30, 2022 (billions USD) | Change (millions USD) | |:---|:---|:---|:---| | Gross premiums written | $2.65 | $2.46 | $187.0 | | Net premiums earned | $1.79 | $1.46 | $328.9 | | Net investment income | $0.29 | $0.11 | $185.5 | | Net realized and unrealized gains (losses) on investments | ($0.22) | ($0.65) | $431.3 | | Net income (loss) attributable to RenaissanceRe | $0.20 | ($0.32) | $515.9 | | Diluted EPS | $4.09 | $(7.53) | $11.62 | | Metric | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (billions USD) | Change (billions USD) | |:---|:---|:---|:---| | Gross premiums written | $5.44 | $5.41 | $0.03 | | Net premiums earned | $3.47 | $2.94 | $0.52 | | Net investment income | $0.55 | $0.19 | $0.36 | | Net realized and unrealized gains (losses) on investments | $0.06 | ($1.33) | $1.38 | | Net income (loss) attributable to RenaissanceRe | $0.77 | ($0.70) | $1.47 | | Diluted EPS | $16.71 | $(16.64) | $33.35 | - Net income attributable to redeemable noncontrolling interests significantly increased to **$174.9 million** in **Q2 2023** (from **$49.3 million** in **Q2 2022**) and to **$442.3 million** in **H1 2023** (from **$37.4 million** in **H1 2022**)[22](index=22&type=chunk) [Consolidated Statements of Comprehensive Income (Loss)](index=10&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) The company reported a comprehensive income of $200.7 million for the three months ended June 30, 2023, a significant improvement from a comprehensive loss of $318.4 million in the prior year, primarily due to the turnaround in net income Consolidated Statements of Comprehensive Income (Loss) Highlights (in thousands USD) | Metric | 3 Months Ended June 30, 2023 (thousands USD) | 3 Months Ended June 30, 2022 (thousands USD) | Change (thousands USD) | |:---|:---|:---|:---| | Net income (loss) | $374,776 | $(266,738) | $641,514 | | Comprehensive income (loss) attributable to RenaissanceRe | $200,657 | $(318,403) | $519,060 | | Metric | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (thousands USD) | Change (billions USD) | |:---|:---|:---|:---| | Net income (loss) | $1.22 | $(664,219) | $1.88 | | Comprehensive income (loss) attributable to RenaissanceRe | $0.77 | $(705,897) | $1.48 | - Changes in net unrealized gains (losses) on investments, net of tax, contributed positively to comprehensive income in both periods of 2023, reversing losses from 2022[25](index=25&type=chunk) [Consolidated Statements of Changes in Shareholders' Equity](index=11&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) Shareholders' equity attributable to RenaissanceRe increased significantly, driven by a $1.34 billion issuance of common shares and net income, partially offset by dividends paid Changes in Shareholders' Equity (in thousands USD) | Metric | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (billions USD) | |:---|:---|:---| | Beginning balance (Total shareholders' equity) | $5.33 | $5.74 | | Issuance of shares (Common shares) | $0.01 | $0 | | Issuance of shares (Additional paid-in capital) | $1.34 | $0 | | Net income (loss) attributable to RenaissanceRe | $0.77 | ($0.70) | | Dividends on common shares | ($0.04) | ($0.03) | | Dividends on preference shares | ($0.02) | ($0.02) | | Ending balance (Total shareholders' equity) | $7.40 | $5.74 | - The company issued **7,245,000 common shares**, generating **$1.34 billion** in additional paid-in capital, primarily to fund the **Validus Acquisition**[29](index=29&type=chunk)[192](index=192&type=chunk) - No common shares were repurchased during the six months ended June 30, 2023, compared to **875,000 shares** repurchased in the same period of 2022[29](index=29&type=chunk)[193](index=193&type=chunk) [Consolidated Statements of Cash Flows](index=13&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash and cash equivalents decreased by $250.4 million in the first half of 2023, with significant cash provided by financing activities (share and debt issuance) and operating activities, largely offset by cash used in investing activities (net purchases of investments) Consolidated Statements of Cash Flows Highlights (in thousands USD) | Metric | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (billions USD) | |:---|:---|:---| | Net cash provided by (used in) operating activities | $0.63 | $0.27 | | Net cash provided by (used in) investing activities | ($3.18) | ($0.96) | | Net cash provided by (used in) financing activities | $2.30 | $0.21 | | Net increase (decrease) in cash and cash equivalents | ($0.25) | ($0.46) | | Cash and cash equivalents, end of period | $0.94 | $1.40 | - Financing activities provided **$2.3 billion** in cash, primarily from common share issuance (**$1.35 billion**) and debt issuance (**$741.6 million**)[32](index=32&type=chunk)[384](index=384&type=chunk) - Investing activities used **$3.2 billion**, mainly for net purchases of fixed maturity investments trading (**$1.6 billion**) and short-term investments (**$1.7 billion**)[32](index=32&type=chunk)[381](index=381&type=chunk) [Note 1. Organization](index=14&type=section&id=Note%201.%20Organization) RenaissanceRe Holdings Ltd. is a Bermuda-domiciled company providing property, casualty, and specialty reinsurance and insurance solutions globally through its subsidiaries, joint ventures, and managed funds - RenaissanceRe Holdings Ltd. (the parent company) and its subsidiaries provide property, casualty, and specialty reinsurance and certain insurance solutions[33](index=33&type=chunk) - Key subsidiaries include Renaissance Reinsurance Ltd. (Bermuda), Renaissance Reinsurance U.S. Inc. (Maryland), RenaissanceRe Syndicate 1458 (Lloyd's), and RenaissanceRe Europe AG (Switzerland)[34](index=34&type=chunk) - Managed joint ventures include DaVinci Reinsurance Ltd., Vermeer Reinsurance Ltd., Fontana Holdings L.P., and Top Layer Reinsurance Ltd[34](index=34&type=chunk) [Note 2. Significant Accounting Policies](index=16&type=section&id=Note%202.%20Significant%20Accounting%20Policies) The consolidated financial statements are prepared in accordance with GAAP for interim financial information, with no material changes to the significant accounting policies described in the prior Form 10-K. Management relies on estimates and assumptions, particularly for claims reserves and fair value measurements - No material changes to the Company's significant accounting policies as described in its Form 10-K for the year ended December 31, 2022[37](index=37&type=chunk) - Financial statements are prepared under GAAP for interim information, requiring management to make estimates and assumptions, including for claims and claim expense reserves, reinsurance recoverable, and fair value[38](index=38&type=chunk)[40](index=40&type=chunk) [Note 3. Investments](index=16&type=section&id=Note%203.%20Investments) The company's investment portfolio primarily consists of fixed maturity investments and short-term investments, with significant increases in U.S. treasuries and short-term holdings. Net investment income saw a substantial increase, while net realized and unrealized gains/losses on investments improved significantly from a loss position in 2022 Fair Value of Fixed Maturity Investments Trading (in thousands USD) | Category | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | U.S. treasuries | $8.59 | $7.18 | | Corporate | $4.37 | $4.39 | | Total fixed maturity investments trading | $15.89 | $14.35 | Net Investment Income (in thousands USD) | Category | 3 Months Ended June 30, 2023 (thousands USD) | 3 Months Ended June 30, 2022 (thousands USD) | 6 Months Ended June 30, 2023 (thousands USD) | 6 Months Ended June 30, 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Fixed maturity investments trading | $169,739 | $76,547 | $325,239 | $138,964 | | Short term investments | $50,231 | $4,397 | $83,181 | $5,533 | | Catastrophe bonds | $49,522 | $20,235 | $88,353 | $37,595 | | Net investment income | $292,662 | $107,211 | $547,040 | $190,902 | Net Realized and Unrealized Gains (Losses) on Investments (in thousands USD) | Category | 3 Months Ended June 30, 2023 (thousands USD) | 3 Months Ended June 30, 2022 (thousands USD) | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (billions USD) | |:---|:---|:---|:---|:---| | Fixed maturity investments trading | $(214,005) | $(436,974) | ($0.01) | ($1.02) | | Equity investments | $1,872 | $(91,512) | $32,285 | $(140,201) | | Catastrophe bonds | $38,186 | $(24,660) | $62,312 | $(32,921) | | Total | $(222,781) | $(654,107) | $0.06 | ($1.33) | [Note 4. Fair Value Measurements](index=19&type=section&id=Note%204.%20Fair%20Value%20Measurements) The company measures assets and liabilities at fair value using a three-level hierarchy, with a significant portion of fixed maturity investments classified as Level 1 (U.S. treasuries) and Level 2 (corporate, agencies, mortgage-backed). Level 3 assets, including direct private equity and term loans, are valued using unobservable inputs - Fair value hierarchy prioritizes inputs: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than quoted prices), and Level 3 (significant unobservable inputs)[54](index=54&type=chunk)[56](index=56&type=chunk) Fair Value Measurements by Level (in thousands USD) - June 30, 2023 | Category | Total (billions USD) | Level 1 (billions USD) | Level 2 (billions USD) | Level 3 (thousands USD) | |:---|:---|:---|:---|:---| | Fixed maturity investments trading | $15.89 | $8.59 | $7.30 | $0 | | Short term investments | $6.37 | $0.09 | $6.28 | $0 | | Equity investments trading | $0.09 | $0.09 | $0 | $0 | | Other investments (excl. Fund investments) | $1.85 | $0 | $1.68 | $171,155 | | Total assets measured at fair value | $25.46 | $8.78 | $15.27 | $170,680 | - Level 3 assets include direct private equity investments (**$71.2 million**) and term loans (**$100.0 million**), valued using internal models with unobservable inputs like discount rates and credit spread adjustments[58](index=58&type=chunk)[91](index=91&type=chunk)[93](index=93&type=chunk) [Note 5. Reinsurance](index=30&type=section&id=Note%205.%20Reinsurance) The company purchases reinsurance to manage risk, remaining liable if reinsurers default. Net premiums written increased, while ceded premiums decreased. The provision for current expected credit losses on premiums receivable and reinsurance recoverable saw a slight decrease Effect of Reinsurance on Premiums and Claims (in thousands USD) | Metric | 3 Months Ended June 30, 2023 (billions USD) | 3 Months Ended June 30, 2022 (billions USD) | 6 Months Ended June 30, 2023 (billions USD) | 6 Months Ended June 30, 2022 (billions USD) | |:---|:---|:---|:---|:---| | Gross premiums written | $2.65 | $2.46 | $5.44 | $5.41 | | Ceded premiums written | ($0.46) | ($0.60) | ($0.98) | ($1.38) | | Net premiums written | $2.20 | $1.86 | $4.46 | $4.03 | | Net claims and claim expenses incurred | $0.93 | $0.71 | $1.73 | $1.55 | - Premiums receivable increased to **$6.5 billion** at June 30, 2023 (from **$5.1 billion** at December 31, 2022), with a provision for current expected credit losses of **$3.2 million**[110](index=110&type=chunk) - Reinsurance recoverable remained stable at **$4.7 billion**, with **46.6%** fully collateralized and **52.7%** from reinsurers rated A- or higher; the provision for current expected credit losses was **$11.5 million**[111](index=111&type=chunk) [Note 6. Reserve for Claims and Claim Expenses](index=32&type=section&id=Note%206.%20Reserve%20for%20Claims%20and%20Claim%20Expenses) The total reserve for claims and claim expenses increased to $16.1 billion at June 30, 2023, with favorable prior year development of $136.9 million for the six months ended June 30, 2023, primarily in the Property segment Reserve for Claims and Claim Expenses by Segment (in thousands USD) | Segment | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | Property | $6.93 | $7.54 | | Casualty and Specialty | $9.20 | $8.36 | | Total | $16.14 | $15.89 | - Net favorable development of prior accident years net claims and claim expenses was **$136.9 million** for the six months ended June 30, 2023, primarily driven by better than expected loss emergence in the Property segment (**$113.3 million** favorable development)[116](index=116&type=chunk)[118](index=118&type=chunk) - The Casualty and Specialty segment also experienced **$23.5 million** in net favorable development, mainly due to reported losses being lower than expected in other specialty and credit lines of business[122](index=122&type=chunk) [Note 7. Debt and Credit Facilities](index=36&type=section&id=Note%207.%20Debt%20and%20Credit%20Facilities) The company's total debt increased to $1.88 billion at June 30, 2023, primarily due to the issuance of $750.0 million in 5.750% Senior Notes due 2033, intended to fund a portion of the Validus Acquisition. The company remains in compliance with its debt covenants Debt Obligations (in thousands USD) | Debt Type | June 30, 2023 (thousands USD) | December 31, 2022 (thousands USD) | |:---|:---|:---| | 5.750% Senior Notes due 2033 | $740,620 | $0 | | 3.600% Senior Notes due 2029 | $394,676 | $394,221 | | 3.450% Senior Notes due 2027 | $298,022 | $297,775 | | 3.700% Senior Notes due 2025 | $299,351 | $299,168 | | 4.750% Senior Notes due 2025 (DaVinci) | $149,432 | $149,278 | | Total debt | $1,882,101 | $1,170,442 | - The **$750.0 million** **5.750% Senior Notes due 2033** were issued on June 5, 2023, with net proceeds of approximately **$741.0 million**, primarily for the **Validus Acquisition**[127](index=127&type=chunk) - Outstanding amounts drawn under significant credit facilities totaled **$1.17 billion** at June 30, 2023, including secured and unsecured bilateral letter of credit facilities and a Funds at Lloyd's facility[129](index=129&type=chunk)[370](index=370&type=chunk) [Note 8. Noncontrolling Interests](index=37&type=section&id=Note%208.%20Noncontrolling%20Interests) Redeemable noncontrolling interests increased to $5.68 billion at June 30, 2023, with net income attributable to these interests rising significantly due to improved performance across DaVinci, Medici, Vermeer, and Fontana Redeemable Noncontrolling Interests (in thousands USD) | Entity | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | DaVinci | $2.27 | $1.74 | | Medici | $1.54 | $1.04 | | Vermeer | $1.59 | $1.49 | | Fontana | $0.28 | $0.27 | | Total | $5.68 | $4.54 | Net Income (Loss) Attributable to Redeemable Noncontrolling Interests (in thousands USD) | Entity | 3 Months Ended June 30, 2023 (thousands USD) | 3 Months Ended June 30, 2022 (thousands USD) | 6 Months Ended June 30, 2023 (thousands USD) | 6 Months Ended June 30, 2022 (thousands USD) | |:---|:---|:---|:---|:---| | DaVinci | $59,527 | $58,822 | $225,609 | $33,499 | | Medici | $62,190 | $(26,887) | $107,259 | $(32,174) | | Vermeer | $52,163 | $22,937 | $99,568 | $41,635 | | Fontana | $1,027 | $(5,541) | $9,855 | $(5,541) | | Total | $174,907 | $49,331 | $442,291 | $37,419 | - DaVinci completed a **$250.0 million** equity capital raise in **H1 2023**, with **$102.2 million** from third-party investors and **$147.8 million** from RenaissanceRe[136](index=136&type=chunk) [Note 9. Variable Interest Entities](index=41&type=section&id=Note%209.%20Variable%20Interest%20Entities) The company consolidates Upsilon RFO, Vermeer, and Fontana as VIEs where it is the primary beneficiary, while not consolidating Upsilon Diversified, NOC1, Mona Lisa Re, and Fibonacci Re. Capital changes occurred in Upsilon RFO and NOC1 during the period - Upsilon RFO is consolidated as a VIE, with total assets and liabilities of **$3.0 billion** at June 30, 2023[157](index=157&type=chunk) - Upsilon RFO returned **$489.6 million** of capital to investors in **H1 2023** and issued **$39.8 million** in new preference shares[156](index=156&type=chunk) - NOC1, a new segregated account of Upsilon Fund, issued **$151.5 million** of non-voting preference shares to investors in **H1 2023** and is not consolidated[163](index=163&type=chunk) [Note 10. Shareholders' Equity](index=46&type=section&id=Note%2010.%20Shareholders'%20Equity) The company declared quarterly common share dividends of $0.38 per share and preference share dividends. A significant common share offering on May 26, 2023, raised $1.35 billion in net proceeds, primarily to fund the Validus Acquisition. No common shares were repurchased in H1 2023 - Quarterly common share dividends of **$0.38 per share** were declared and paid[188](index=188&type=chunk) - On May 26, 2023, the company completed an offering of **7,245,000 common shares**, raising approximately **$1.35 billion** in net proceeds to fund a portion of the **Validus Acquisition**[192](index=192&type=chunk) - No common shares were repurchased during the six months ended June 30, 2023; **$500.0 million** remains available under the share repurchase program[193](index=193&type=chunk) [Note 11. Earnings per Share](index=47&type=section&id=Note%2011.%20Earnings%20per%20Share) Basic and diluted earnings per common share significantly improved for both the three and six months ended June 30, 2023, compared to losses in the prior year, reflecting the company's return to profitability Earnings per Common Share (USD) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | |:---|:---|:---|:---|:---| | Basic EPS | $4.10 | $(7.53) | $16.75 | $(16.64) | | Diluted EPS | $4.09 | $(7.53) | $16.71 | $(16.64) | - The denominator for diluted EPS for periods with net loss is the same as basic EPS, as common share equivalents are anti-dilutive[195](index=195&type=chunk) [Note 12. Segment Reporting](index=48&type=section&id=Note%2012.%20Segment%20Reporting) The Property segment and Casualty and Specialty segment both reported increased underwriting income and improved combined ratios for the six months ended June 30, 2023, compared to the prior year, despite the impact of large loss events Underwriting Results by Segment (in thousands USD, except percentages) | Metric | Property (H1 2023) (billions USD) | Property (H1 2022) (billions USD) | C&S (H1 2023) (billions USD) | C&S (H1 2022) (billions USD) | |:---|:---|:---|:---|:---| | Gross premiums written | $2.71 | $2.56 | $2.74 | $2.85 | | Net premiums earned | $1.45 | $1.24 | $2.02 | $1.70 | | Underwriting income (loss) | $0.58 | $0.45 | $0.14 | $0.07 | | Combined ratio | 59.9% | 63.8% | 93.0% | 96.0% | - The Property segment's combined ratio improved by **3.9 percentage points** to **59.9%** in **H1 2023**, despite a **11.3 percentage point** impact from **2023 Large Loss Events**[198](index=198&type=chunk)[332](index=332&type=chunk) - The Casualty and Specialty segment's combined ratio improved by **3.0 percentage points** to **93.0%** in **H1 2023**, driven by lower current accident year attritional losses and favorable prior year development[201](index=201&type=chunk)[341](index=341&type=chunk) [Note 13. Derivative Instruments](index=52&type=section&id=Note%2013.%20Derivative%20Instruments) The company uses various derivative instruments, including interest rate futures, foreign currency forward contracts, and credit default swaps, to manage market risks. Derivative assets totaled $25.3 million and liabilities $15.0 million at June 30, 2023 Derivative Assets and Liabilities (in thousands USD) - June 30, 2023 | Category | Gross Assets (thousands USD) | Gross Liabilities (thousands USD) | |:---|:---|:---| | Interest rate futures | $370 | $2,113 | | Foreign currency forward contracts (underwriting/non-investment) | $24,119 | $4,027 | | Foreign currency forward contracts (investment) | $78 | $2,998 | | Credit default swaps | $121 | $5,851 | | Total derivative assets (net) | $25,307 | - | | Total derivative liabilities (net) | - | $14,989 | - The company had **$2.6 billion** notional long and **$0.7 billion** notional short positions in interest rate futures at June 30, 2023[214](index=214&type=chunk) - Net realized and unrealized losses on derivatives not designated as hedges were **$71.3 million** in **Q2 2023** and **$58.0 million** in **H1 2023**[211](index=211&type=chunk) [Note 14. Commitments, Contingencies and Other Items](index=58&type=section&id=Note%2014.%20Commitments%2C%20Contingencies%20and%20Other%20Items) There are no material changes to the commitments, contingencies, and other items previously disclosed in the Form 10-K. The company is subject to routine legal proceedings, which are considered in its loss reserves, and believes no individual litigation will have a material adverse effect - No material changes from the commitments, contingencies and other items previously disclosed in the Company's Form 10-K for the year ended December 31, 2022[224](index=224&type=chunk) - The company is subject to lawsuits and regulatory actions in the normal course of business, which are considered in its loss and loss expense reserves[225](index=225&type=chunk) [Note 15. Acquisition of Validus](index=57&type=section&id=Note%2015.%20Acquisition%20of%20Validus) RenaissanceRe entered into a Stock Purchase Agreement to acquire Validus Holdings, Validus Specialty, and renewal rights of Talbot Underwriting Ltd. for approximately $2.985 billion, consisting of cash and common shares. The acquisition is expected to close in Q4 2023, subject to regulatory approvals - RenaissanceRe agreed to acquire Validus Holdings, Validus Specialty, and renewal rights of Talbot Underwriting Ltd. from **AIG**[227](index=227&type=chunk) - Aggregate consideration is approximately **$2.985 billion**, comprising **$2.735 billion** in cash and **$250.0 million** in common shares[228](index=228&type=chunk) - The **Validus Acquisition** is expected to close in **Q4 2023**, contingent on regulatory approvals and other closing conditions[227](index=227&type=chunk)[231](index=231&type=chunk) [Note 16. Subsequent Event](index=59&type=section&id=Note%2016.%20Subsequent%20Event) Effective July 1, 2023, RenaissanceRe purchased an additional $45.8 million of shares in DaVinci from a third-party investor, increasing its noncontrolling economic ownership to 27.8% - Effective July 1, 2023, RenaissanceRe purchased **$45.8 million** of shares in DaVinci from a third-party investor[232](index=232&type=chunk) - This transaction increased the company's noncontrolling economic ownership in DaVinci to **27.8%**[232](index=232&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=60&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's comprehensive analysis of RenaissanceRe's financial condition, liquidity, and results of operations for the three and six months ended June 30, 2023, compared to the prior year, emphasizing key performance drivers and strategic initiatives - The discussion covers results of operations for **Q2** and **H1 2023** vs. 2022, as well as liquidity and capital resources at June 30, 2023[234](index=234&type=chunk) - The company's financial success is primarily measured by long-term growth in tangible book value per common share plus accumulated dividends[243](index=243&type=chunk) [OVERVIEW](index=62&type=section&id=OVERVIEW) RenaissanceRe is a global reinsurance and insurance provider focused on matching risks with capital, aiming for superior returns through risk selection, customer relationships, and capital management. Its profit drivers include underwriting, fee, and investment income, with a strategic focus reinforced by the Validus Acquisition - RenaissanceRe is a global provider of reinsurance and insurance, specializing in matching well-structured risks with efficient sources of capital[238](index=238&type=chunk) - The company's strategy focuses on three competitive advantages: superior risk selection, superior customer relationships, and superior capital management[241](index=241&type=chunk) - Three principal drivers of profit are underwriting income, fee income (from Capital Partners), and investment income, with fee and investment income viewed as relatively stable and capital efficient[242](index=242&type=chunk) [SUMMARY OF CRITICAL ACCOUNTING ESTIMATES](index=64&type=section&id=SUMMARY%20OF%20CRITICAL%20ACCOUNTING%20ESTIMATES) This section refers to the critical accounting estimates detailed in the company's Form 10-K for the year ended December 31, 2022, and confirms that there have been no material changes to these estimates - Critical accounting estimates include Claims and Claim Expense Reserves, Premiums and Related Expenses, Reinsurance Recoverables, Fair Value Measurements and Impairments, and Income Taxes[255](index=255&type=chunk) - There have been no material changes to the critical accounting estimates as disclosed in the Form 10-K for the year ended December 31, 2022[255](index=255&type=chunk) [SUMMARY RESULTS OF OPERATIONS](index=65&type=section&id=SUMMARY%20RESULTS%20OF%20OPERATIONS) RenaissanceRe achieved a net income of $191.0 million in Q2 2023 and $755.1 million in H1 2023, a significant improvement from prior year losses. This was driven by strong underwriting results, improved investment performance, and increased net income attributable to redeemable noncontrolling interests Summary Results of Operations Highlights (in thousands USD, except per share) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Net income (loss) available to RenaissanceRe common shareholders | $191,025 | $(324,913) | $755,087 | $(719,326) | | Diluted EPS | $4.09 | $(7.53) | $16.71 | $(16.64) | | Combined ratio | 80.3% | 78.3% | 79.2% | 82.4% | | Total investment result | $69,881 | $(546,896) | $603,710 | $(1,136,222) | | Net income attributable to redeemable noncontrolling interests | $174,907 | $49,331 | $442,291 | $37,419 | - Book value per common share increased by **12.0%** in **Q2 2023** and **24.9%** in **H1 2023** (after considering accumulated dividends)[258](index=258&type=chunk)[312](index=312&type=chunk) - The **2023 Large Loss Events** had a net negative impact of **$68.5 million** on underwriting results in **Q2 2023** and **$147.6 million** in **H1 2023**, adding **4.2 and 4.5 percentage points** to the consolidated combined ratio, respectively[265](index=265&type=chunk)[317](index=317&type=chunk) [Underwriting Results by Segment](index=67&type=section&id=Underwriting%20Results%20by%20Segment) Both Property and Casualty & Specialty segments demonstrated strong underwriting performance in H1 2023. The Property segment's combined ratio improved to 59.9%, while the Casualty & Specialty segment's combined ratio improved to 93.0%, driven by favorable loss emergence and lower attritional losses Segment Underwriting Income and Combined Ratios (in thousands USD, except percentages) | Segment | Underwriting Income (Q2 2023) (thousands USD) | Combined Ratio (Q2 2023) | Underwriting Income (H1 2023) (thousands USD) | Combined Ratio (H1 2023) | |:---|:---|:---|:---|:---| | Property | $281,010 | 63.0% | $579,689 | 59.9% | | Casualty and Specialty | $70,005 | 93.2% | $140,945 | 93.0% | - The Property segment's current accident year net claims and claim expense ratio increased by **8.1 percentage points** in **Q2 2023** due to **2023 Large Loss Events**, but the underwriting expense ratio decreased by **4.2 percentage points** due to greater operating leverage[277](index=277&type=chunk)[278](index=278&type=chunk) - The Casualty and Specialty segment's combined ratio improved by **0.6 percentage points** in **Q2 2023** and **3.0 percentage points** in **H1 2023**, primarily from lower current accident year attritional losses and favorable prior year development[287](index=287&type=chunk)[341](index=341&type=chunk) [Property Segment](index=67&type=section&id=Property%20Segment) The Property segment's gross premiums written increased by 15.1% in Q2 2023, driven by rate improvements in catastrophe business, despite non-renewals. The combined ratio increased to 63.0% in Q2 2023 due to the impact of 2023 Large Loss Events, but the underwriting expense ratio improved due to greater operating leverage Property Segment Underwriting Results (in thousands USD, except percentages) | Metric | Q2 2023 (billions USD) | Q2 2022 (billions USD) | H1 2023 (billions USD) | H1 2022 (billions USD) | |:---|:---|:---|:---|:---| | Gross premiums written | $1.40 | $1.22 | $2.71 | $2.56 | | Net premiums written | $1.14 | $0.89 | $2.16 | $1.78 | | Underwriting income (loss) | $0.28 | $0.26 | $0.58 | $0.45 | | Combined ratio | 63.0% | 57.6% | 59.9% | 63.8% | - Gross premiums written in catastrophe business increased by **24.7%** in **Q2 2023**, driven by rate improvements, partially offset by non-renewals on Upsilon RFO[269](index=269&type=chunk) - The **2023 Large Loss Events** had a net negative impact of **$68.5 million** on the Property segment underwriting result in **Q2 2023**, adding **10.8 percentage points** to its combined ratio[276](index=276&type=chunk) [Casualty and Specialty Segment](index=70&type=section&id=Casualty%20and%20Specialty%20Segment) The Casualty and Specialty segment's gross premiums written were comparable in Q2 2023 to the prior year, with growth in other specialty offsetting decreases in professional liability. The combined ratio improved to 93.2% in Q2 2023, driven by lower current accident year attritional losses Casualty and Specialty Segment Underwriting Results (in thousands USD, except percentages) | Metric | Q2 2023 (billions USD) | Q2 2022 (billions USD) | H1 2023 (billions USD) | H1 2022 (billions USD) | |:---|:---|:---|:---|:---| | Gross premiums written | $1.25 | $1.25 | $2.74 | $2.85 | | Net premiums written | $1.05 | $0.98 | $2.30 | $2.25 | | Underwriting income (loss) | $0.07 | $0.05 | $0.14 | $0.07 | | Combined ratio | 93.2% | 93.8% | 93.0% | 96.0% | - Gross premiums written in the other specialty class of business increased, largely offsetting a decrease in professional liability[281](index=281&type=chunk) - The combined ratio improved by **0.6 percentage points** in **Q2 2023** and **3.0 percentage points** in **H1 2023**, primarily due to lower current accident year attritional losses and favorable prior year development[287](index=287&type=chunk)[341](index=341&type=chunk) [Fee Income](index=72&type=section&id=Fee%20Income) Total fee income from third-party capital management activities increased by $22.4 million in Q2 2023 and $38.8 million in H1 2023, driven by higher management and performance fees from increased capital managed and favorable underwriting results Total Fee Income (in thousands USD) | Category | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Total management fee income | $43,439 | $30,707 | $84,344 | $57,929 | | Total performance fee income | $13,242 | $3,548 | $17,109 | $4,675 | | Total fee income | $56,681 | $34,255 | $101,453 | $62,604 | - Management fee income increased due to increased capital managed at DaVinci, Vermeer, Medici, and Fontana, and the recording of previously deferred management fees in DaVinci[291](index=291&type=chunk)[343](index=343&type=chunk) - Performance fee income increased due to favorable current underwriting year results[292](index=292&type=chunk)[343](index=343&type=chunk) [Net Investment Income](index=73&type=section&id=Net%20Investment%20Income) Net investment income significantly increased by $185.5 million in Q2 2023 and $356.1 million in H1 2023, primarily due to higher interest rates and increased yields from the fixed maturity and short-term investment portfolios Net Investment Income (in thousands USD) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Net investment income | $292,662 | $107,211 | $547,040 | $190,902 | - The increase was driven by higher interest rates and higher yielding assets in fixed maturity and short-term portfolios due to reinvestment throughout 2022 and 2023, as well as increased catastrophe bond yields[297](index=297&type=chunk)[349](index=349&type=chunk) [Net Realized and Unrealized Gains (Losses) on Investments](index=74&type=section&id=Net%20Realized%20and%20Unrealized%20Gains%20(Losses)%20on%20Investments) Net realized and unrealized gains/losses on investments improved significantly, moving from substantial losses in 2022 to a smaller loss in Q2 2023 and a gain in H1 2023. This improvement was mainly due to lower interest rate increases compared to the prior year and positive movements in equity and catastrophe bond markets Net Realized and Unrealized Gains (Losses) on Investments (in thousands USD) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (billions USD) | |:---|:---|:---|:---|:---| | Net realized and unrealized gains (losses) on investments | $(222,781) | $(654,107) | $56,670 | $(1.33) | - The improvement was primarily driven by interest rate increases being generally lower in 2023 compared to 2022, reducing losses on fixed maturity investments[300](index=300&type=chunk)[352](index=352&type=chunk) - Net realized and unrealized gains on equity investments and catastrophe bonds also contributed positively, reversing losses from the prior year[300](index=300&type=chunk)[352](index=352&type=chunk) [Net Foreign Exchange Gains (Losses)](index=75&type=section&id=Net%20Foreign%20Exchange%20Gains%20(Losses)) Net foreign exchange losses decreased significantly in Q2 and H1 2023 compared to the prior year, primarily due to reduced losses attributable to third-party investors in Medici and lower foreign exchange exposures related to underwriting activities Net Foreign Exchange Gains (Losses) (in thousands USD) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Net foreign exchange gains (losses) | $(13,488) | $(50,821) | $(27,991) | $(66,307) | - Losses were primarily driven by amounts attributable to third-party investors in Medici and foreign exchange exposures from underwriting activities[301](index=301&type=chunk)[353](index=353&type=chunk) [Equity in Earnings (Losses) of Other Ventures](index=75&type=section&id=Equity%20in%20Earnings%20(Losses)%20of%20Other%20Ventures) Equity in earnings from other ventures increased to $7.7 million in Q2 2023 and $17.2 million in H1 2023, primarily due to increased profitability of investments in the Tower Hill Companies and Top Layer Re Equity in Earnings (Losses) of Other Ventures (in thousands USD) | Entity | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Tower Hill Companies | $5,379 | $1,620 | $11,646 | $(7,083) | | Top Layer | $3,197 | $1,484 | $6,561 | $2,569 | | Total | $7,700 | $7,383 | $17,230 | $993 | - The increase was principally driven by increased profitability of equity investments in the Tower Hill Companies and Top Layer Re[305](index=305&type=chunk)[354](index=354&type=chunk) [Corporate Expenses](index=75&type=section&id=Corporate%20Expenses) Corporate expenses increased by $11.0 million in Q2 2023 and $11.4 million in H1 2023, primarily due to expenses associated with the Validus Acquisition Corporate Expenses (in thousands USD) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Corporate expenses | $23,371 | $12,352 | $36,214 | $24,854 | - The increase was primarily driven by expenses associated with the **Validus Acquisition**, with additional significant costs expected[306](index=306&type=chunk)[307](index=307&type=chunk)[355](index=355&type=chunk) [Income Tax Benefit (Expense)](index=76&type=section&id=Income%20Tax%20Benefit%20(Expense)) The company recognized an income tax expense of $5.9 million in Q2 2023 and $34.8 million in H1 2023, a shift from a benefit in the prior year, primarily due to operating income in taxable jurisdictions Income Tax Benefit (Expense) (in thousands USD) | Metric | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | Income tax benefit (expense) | $(5,942) | $30,534 | $(34,844) | $67,241 | - The income tax expense in 2023 was primarily driven by operating income in taxable jurisdictions, contrasting with a benefit in 2022 due to investment losses and lower operating income[308](index=308&type=chunk)[356](index=356&type=chunk) [Net Income (Loss) Attributable to Redeemable Noncontrolling Interests](index=76&type=section&id=Net%20Income%20(Loss)%20Attributable%20to%20Redeemable%20Noncontrolling%20Interests) Net income attributable to redeemable noncontrolling interests increased substantially to $174.9 million in Q2 2023 and $442.3 million in H1 2023, reflecting improved underwriting and investment results across DaVinci, Medici, Vermeer, and Fontana Net Income (Loss) Attributable to Redeemable Noncontrolling Interests (in thousands USD) | Entity | Q2 2023 (thousands USD) | Q2 2022 (thousands USD) | H1 2023 (thousands USD) | H1 2022 (thousands USD) | |:---|:---|:---|:---|:---| | DaVinci | $59,527 | $58,822 | $225,609 | $33,499 | | Medici | $62,190 | $(26,887) | $107,259 | $(32,174) | | Vermeer | $52,163 | $22,937 | $99,568 | $41,635 | | Fontana | $1,027 | $(5,541) | $9,855 | $(5,541) | | Total | $174,907 | $49,331 | $442,291 | $37,419 | - DaVinci's increase was due to improved underwriting and higher net investment income. Medici's turnaround was driven by realized/unrealized gains on catastrophe bonds and increased net investment income[310](index=310&type=chunk)[358](index=358&type=chunk) - Vermeer and Fontana also contributed to the increase with higher net income from improved underwriting and investment results, and Fontana's full six months of results in 2023[310](index=310&type=chunk)[358](index=358&type=chunk) [FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES](index=89&type=section&id=FINANCIAL%20CONDITION%2C%20LIQUIDITY%20AND%20CAPITAL%20RESOURCES) RenaissanceRe, as a holding company, relies on subsidiary dividends and investment/fee income for liquidity. It maintains strong capital adequacy, supported by credit facilities and collateral arrangements, and is preparing for the Validus Acquisition's financial impact - RenaissanceRe relies on dividends and distributions from subsidiaries, investment income, and fee income to meet its liquidity requirements[359](index=359&type=chunk) - The company monitors capital adequacy to meet rating agency and regulatory requirements, with all insurance subsidiaries exceeding minimum solvency and capital requirements[360](index=360&type=chunk)[389](index=389&type=chunk) - The **Validus Acquisition** is expected to be funded by available cash, liquidation of investments, and proceeds from recent equity and debt offerings[394](index=394&type=chunk) [Financial Condition](index=89&type=section&id=Financial%20Condition) As a Bermuda-domiciled holding company, RenaissanceRe's financial condition is closely tied to its subsidiaries' performance and their ability to pay dividends. The company ensures its insurance subsidiaries meet all solvency and liquidity requirements in their respective jurisdictions - RenaissanceRe's assets primarily consist of investments in subsidiaries, cash, and securities, relying on subsidiary dividends and distributions for liquidity[359](index=359&type=chunk) - All insurance subsidiaries and branches exceeded minimum solvency, capital, and surplus requirements at June 30, 2023[360](index=360&type=chunk) [Liquidity and Cash Flows](index=90&type=section&id=Liquidity%20and%20Cash%20Flows) The company's liquidity needs are met by operating cash flows, supplemented by credit facilities and securities offerings. Cash flows from operations increased significantly in H1 2023, while investing activities used substantial cash for net investment purchases, largely offset by financing activities from share and debt issuances - Principal uses of liquidity include common/preference share dividends, debt payments, capital investments in subsidiaries, and acquisitions like **Validus**[361](index=361&type=chunk) - Cash flows provided by operating activities were **$626.7 million** in **H1 2023**, up from **$269.2 million** in **H1 2022**[378](index=378&type=chunk) - Cash flows used in investing activities were **$3.2 billion** in **H1 2023**, primarily for net purchases of fixed maturity and short-term investments, while financing activities provided **$2.3 billion** from share and debt issuances[378](index=378&type=chunk)[381](index=381&type=chunk)[384](index=384&type=chunk) [Capital Resources](index=96&type=section&id=Capital%20Resources) Shareholders' equity attributable to RenaissanceRe increased by $2.1 billion in H1 2023, driven by a $1.35 billion common share offering and comprehensive income. Total debt increased by $711.7 million due to a new $750.0 million senior note issuance, both largely to fund the Validus Acquisition Shareholders' Equity and Total Debt (in thousands USD) | Metric | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | Total shareholders' equity attributable to RenaissanceRe | $7.40 | $5.33 | | Total debt | $1.88 | $1.17 | - Shareholders' equity increased by **$2.1 billion** due to a **$1.35 billion** common share offering and **$774.2 million** in comprehensive income[390](index=390&type=chunk) - Total debt increased by **$711.7 million**, primarily from the issuance of **$750.0 million** in **5.750% Senior Notes due 2033**, intended to fund the **Validus Acquisition**[390](index=390&type=chunk)[391](index=391&type=chunk) [Reserve for Claims and Claim Expenses](index=97&type=section&id=Reserve%20for%20Claims%20and%20Claim%20Expenses) The estimation of claims and claim expense reserves is a critical accounting judgment, and actual payments may materially differ from these estimates, potentially impacting financial condition and liquidity - The most significant accounting judgment is the estimate of claims and claim expense reserves, which are based on actuarial and statistical projections[398](index=398&type=chunk) - Actual net claims and claim expenses paid may differ materially from estimates, potentially impacting financial condition, liquidity, and capital resources[399](index=399&type=chunk) [Investments](index=99&type=section&id=Investments) The investment portfolio is structured for capital preservation and liquidity, primarily comprising highly rated fixed income securities. Other investments include catastrophe bonds and fund investments, with fund valuations subject to reporting lags Invested Assets (in thousands USD) | Category | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | Total fixed maturity investments, at fair value | $15.89 | $14.35 | | Short term investments, at fair value | $6.37 | $4.67 | | Equity investments, at fair value | $0.09 | $0.63 | | Total other investments, at fair value | $3.09 | $2.49 | | Total investments | $25.54 | $22.22 | - The portfolio emphasizes capital preservation and liquidity, with a large majority in highly rated fixed income securities[402](index=402&type=chunk) - Fund investments are subject to a reporting lag (one month for hedge funds, three months for private equity/credit funds), requiring management estimates[405](index=405&type=chunk) [Ratings](index=101&type=section&id=Ratings) RenaissanceRe and its principal operating subsidiaries maintain high financial strength ratings from major agencies (A.M. Best, S&P, Moody's, Fitch) and "Very Strong" ERM scores, which are crucial for its competitive position Financial Strength Ratings (as of July 24, 2023) | Entity | A.M. Best | S&P | Moody's | Fitch | |:---|:---|:---|:---|:---| | Renaissance Reinsurance Ltd. | **A+** | **A+** | **A1** | **A+** | | DaVinci Reinsurance Ltd. | **A** | **A+** | **A3** | — | | RenaissanceRe ERM Score | **Very Strong** | **Very Strong** | — | — | - Rating organizations continually review financial positions, and ratings may be revised or revoked; changes in methodology could also impact ratings[408](index=408&type=chunk) - No material changes to ratings as of July 24, 2023, following the **Validus Acquisition** announcement[411](index=411&type=chunk)[412](index=412&type=chunk)[413](index=413&type=chunk)[414](index=414&type=chunk) [SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION](index=102&type=section&id=SUPPLEMENTAL%20GUARANTOR%20FINANCIAL%20INFORMATION) This section provides summarized financial information for the Obligor Group (RenaissanceRe and RenaissanceRe Finance), which guarantees certain senior notes, excluding non-obligor subsidiaries - RenaissanceRe Finance's **3.700% Senior Notes due 2025** and **3.450% Senior Notes due 2027** are fully and unconditionally guaranteed by RenaissanceRe[415](index=415&type=chunk) Obligor Group Summarized Balance Sheets (in thousands USD) | Metric | June 30, 2023 (billions USD) | December 31, 2022 (billions USD) | |:---|:---|:---| | Total current assets | $2.06 | $0.59 | | Total noncurrent assets | $1.79 | $1.17 | | Total current liabilities | $0.06 | $0.11 | | Total noncurrent liabilities | $2.04 | $1.29 | Obligor Group Summarized Statement of Operations (in thousands USD) - H1 2023 | Metric | 6 Months Ended June 30, 2023 (thousands USD) | |:---|:---| | Total revenues | $65,563 | | Total expenses | $76,544 | | Net income (loss) attributable to Obligor Group | $(31,083) | [CURRENT OUTLOOK](index=104&type=section&id=CURRENT%20OUTLOOK) RenaissanceRe anticipates continued favorable market conditions, particularly in reinsurance, driven by increased rates and demand. The Validus Acquisition is expected to enhance scale and growth. The company is actively managing the impacts of global economic stresses, inflation, and rising interest rates across its three profit drivers - The company expects continued attractive opportunities in the reinsurance market due to increased rates and demand, positioning it for growth[424](index=424&type=chunk) - The **Validus Acquisition** is expected to provide additional scale, increase importance with customers and brokers, and be immediately accretive to shareholders[421](index=421&type=chunk)[422](index=422&type=chunk) - Management is actively addressing global economic inflation and rising interest rates, which are impacting claims, investment portfolios, and market dynamics[427](index=427&type=chunk)[428](index=428&type=chunk) [Validus Acquisition](index=104&type=section&id=Validus%20Acquisition) The Validus Acquisition is expected to significantly advance RenaissanceRe's strategy as a global property and casualty reinsurer, providing increased scale, access to an attractive business book, and immediate accretion to shareholders, while deepening its relationship with AIG - The **Validus Acquisition** advances RenaissanceRe's strategy as a pure-play global property and casualty reinsurer, providing additional scale and increasing importance with customers and brokers[421](index=421&type=chunk) - It will provide access to a large, attractive book of reinsurance business aligned with existing mix and is expected to be immediately accretive to shareholders[422](index=422&type=chunk) - The acquisition also deepens the relationship with **AIG**, a core trading partner[422](index=422&type=chunk) [Reinsurance Market Trends and Developments](index=104&type=section&id=Reinsurance%20Market%20Trends%20and%20Developments) The reinsurance market is experiencing a favorable shift with upward rate momentum and improved terms, particularly in property catastrophe. The company is well-positioned to capitalize on these opportunities due to its capital, scale, and risk understanding, including climate change impacts - The reinsurance market environment has shifted favorably, with increased rates across certain lines of business at recent renewals (January 1, April 1, June 1)[423](index=423&type=chunk) - The company is well-positioned due to its capital position, ability to deploy excess capital, status as a large property catastrophe writer, and increased demand for high-end property catastrophe risk[424](index=424&type=chunk) - Investments in risk sciences and understanding of climate change provide an advantage in reflecting evolving hazards in models and pricing[426](index=426&type=chunk) [General Economic Conditions](index=105&type=section&id=General%20Economic%20Conditions) Global economic stresses, including inflation and rising interest rates, are expected to continue, impacting claims and investment portfolios. However, the company believes its business model is resilient and well-positioned to benefit from increased demand for reinsurance in such an environment - Global economic inflation has increased, exacerbated by the war in Ukraine and supply chain issues, leading to higher claims and potential impacts on investment portfolios[427](index=427&type=chunk) - Rising interest rates by central banks act as a countervailing force against inflation but can magnify effects on longer-tail business lines[428](index=428&type=chunk) - The company's business model is positioned to be less sensitive to inflationary or recessionary environments, potentially increasing demand for reinsurance[429](index=429&type=chunk) [Three Drivers of Profit](index=105&type=section&id=Three%20Drivers%20of%20Profit) The company maintains disciplined underwriting in both Property and Casualty & Specialty segments, optimizing its portfolio for attractive rates. Fee income is expected to grow steadily, and investment income is gaining momentum from higher interest rates, despite a defensive portfolio stance - Underwriting income: Property segment is optimizing its portfolio, growing catastrophe business at attractive rates while shifting away from some other property business[431](index=431&type=chunk)[432](index=432&type=chunk) - Underwriting income: Casualty and Specialty segment sees opportunities across multiple lines, growing in other specialty lines while reducing in professional liability and credit[433](index=433&type=chunk)[434](index=434&type=chunk) - Fee income: Capital Partners unit continues to grow, generating steady management fees and strong capital inflows into catastrophe bond vehicles[435](index=435&type=chunk) - Investment income: Benefiting from higher interest rates and proactive portfolio rotation into higher yielding securities, while maintaining a defensive position[436](index=436&type=chunk)[437](index=437&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=107&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to interest rate, foreign currency, credit, and equity price risks. The Validus Acquisition is anticipated to increase exposure to these market risks due to an expanded investment portfolio, but management expects to manage these exposures with existing policies - Primary market risks include interest rate risk, foreign currency risk, credit risk, and equity price risk[440](index=440&type=chunk) - The **Validus Acquisition** is expected to increase exposure to each of these market risks due to an increase in the size of the investment portfolio[442](index=442&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=107&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, and reported no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2023, providing reasonable assurance of timely and accurate information disclosure[443](index=443&type=chunk) - No material changes in internal control over financial reporting were identified during the quarter ended June 30, 2023[444](index=444&type=chunk) [PART II. OTHER INFORMATION](index=108&type=section&id=PART%20II) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and exhibits [ITEM 1. LEGAL PROCEEDINGS](index=108&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) There have been no material changes to the legal proceedings previously disclosed in the company's Form 10-K for the year ended December 31, 2022 - No material changes to the legal proceedings previously disclosed in the Form 10-K for the year ended December 31, 2022[446](index=446&type=chunk) [ITEM 1A. RISK FACTORS](index=108&type=section&id=ITEM%201A.%20RISK%20FACTORS) This section updates risk factors, primarily focusing on the Validus Acquisition, including risks of non-completion, onerous regulatory conditions, integration difficulties, undiscovered liabilities, increased debt obligations, and dilutive impact on shareholders - Risks related to the **Validus Acquisition** include potential delays or failure to complete due to regulatory clearances or other conditions[449](index=449&type=chunk) - Regulatory agencies may impose onerous conditions, and difficulties in integrating the Validus Business could prevent realization of anticipated benefits[450](index=450&type=chunk)[451](index=451&type=chunk) - Increased debt obligations from the **Validus Acquisition** could make the company more vulnerable to adverse economic conditions and limit financial flexibility[459](index=459&type=chunk) - The issuance of common shares to **AIG** in connection with the **Validus Acquisition** will have a dilutive impact on existing shareholders[460](index=460&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=111&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) The company's Board of Directors renewed its $500.0 million share repurchase program in August 2022. No common shares were repurchased under this program during the second quarter or first half of 2023, leaving the full authorized amount available - The Board of Directors renewed its authorized share repurchase program for up to **$500.0 million** on August 2, 2022[462](index=462&type=chunk) - No common shares were repurchased under the publicly announced program during the six months ended June 30, 2023[463](index=463&type=chunk) - At June 30, 2023, **$500.0 million** remained available for repurchase under the program[463](index=463&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=111&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) The company reported no defaults upon senior securities during the period - No defaults upon senior securities were reported[464](index=464&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=111&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - Mine Safety Disclosures are not applicable[465](index=465&type=chunk) [ITEM 5. OTHER INFORMATION](index=111&type=section&id=ITEM%205.%20OTHER%20INFORMATION) No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during the reporting period - None of the Company's directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the period[466](index=466&type=chunk) [ITEM 6. EXHIBITS](index=112&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed as part of the Form 10-Q, including key agreements related to the Validus Acquisition, certifications, and XBRL data files - Key exhibits include the Stock Purchase Agreement (May 22, 2023) and Amendment No. 1 (June 15, 2023) related to the **Validus Acquisition**[469](index=469&type=chunk) - Certifications from the Chief Executive Officer and Chief Financial Officer (pursuant to Rule 13a-14(a) and 18 U.S.C. Section 1350) are included[469](index=469&type=chunk) - Interactive Data Files (XBRL) are embedded within the Inline XBRL document[468](index=468&type=chunk) [SIGNATURES](index=113&type=section&id=SIGNATURES) The

Financial Data and Key Metrics Changes - The company reported a total combined ratio of 80% for the quarter, with gross premiums written up 8% and net premiums written up 18% [87] - The annualized operating return on average common equity was 28.8%, despite dilution from equity issuance [100] - Retained net investment income increased by $114 million to $189 million, with a return of 4.9%, up 2.7 percentage points [9][10] Business Line Data and Key Metrics Changes - The Property segment saw net premiums written increase by 29%, with property catastrophe net premiums written up 55% [90] - The Casualty and Specialty portfolio reported a combined ratio of 93%, with net premiums written up by about 8% [5] - Fee income in the Capital Partners business reached a record $57 million, driven by strong management and performance fees [7] Market Data and Key Metrics Changes - Catastrophe activity was above average, with large loss events negatively impacting consolidated results by $45 million [2] - The company experienced a 33% current accident year loss ratio in the Property catastrophe class, up from the previous year [2] - The midyear property renewals benefited from continued upward rate momentum, with U.S. rate increases averaging 30% to 50% [16] Company Strategy and Development Direction - The acquisition of Validus Re is expected to be immediately accretive to the company's financial metrics and enhance shareholder value [101][104] - The company is focused on rate adequacy in the property catastrophe business, anticipating that higher rates will persist [18] - The strategy includes reducing exposure to less attractive deals while growing in areas with better returns [5][88] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underwriting discipline, noting minimal impacts from catastrophes in the other property segment [29] - The company is closely monitoring meteorological conditions and expects an average hurricane season, which may influence underwriting decisions [26] - Management highlighted that demand for traditional reinsurance is expected to return, particularly as primary companies adjust their budgets [20][49] Other Important Information - The company raised approximately $2.1 billion through public equity and debt issuances to finance the Validus acquisition [75] - Operating expenses increased by 11% in the quarter, reflecting investments in personnel to support growth [11] - The company expects retained net investment income to increase to about $220 million in the third quarter [10] Q&A Session Summary Question: Validus Re deal and premium growth potential - Management acknowledged the potential for more premium than the initially expected $2.7 billion due to Validus's growth [41][42] Question: Casualty and Specialty reserves and favorable trends - Management confirmed that reserves are being closely monitored, with favorable trends expected from recent years [43][44] Question: Fee income and performance fees outlook - Management indicated that performance fees are expected to be volatile but could reach about $15 million per quarter absent large losses [47] Question: Demand for reinsurance and market conditions - Management noted that primary companies need rate increases to cover volatility, which could lead to increased demand for reinsurance [48][49] Question: Rate adequacy in property catastrophe - Management stated that rates are largely adequate now, but there may still be opportunities for additional rate increases [52][53] Question: Impact of hurricane losses on the reinsurance market - Management indicated that any significant storm could unsettle the market and lead to increased rates [82]

Financial Data and Key Metrics Changes - The company reported a net income of $564 million, driven by operating income of $360 million, with an annualized operating return on average common equity of 30% [18][10] - The total combined ratio improved to 78%, a nine percentage point improvement from the previous year [47] - Retained net investment income increased to $168 million, up 17% from Q4 2022 and significantly higher than the $63 million reported in Q1 2022 [46][18] Business Line Data and Key Metrics Changes - The Property segment achieved a combined ratio of 57%, with a current accident year loss ratio of 39% [24][44] - Property catastrophe net premiums written increased by 45% without reinstatement premiums, while overall net premiums written for the Property segment were up 15% [23][20] - The Casualty and Specialty segment reported a combined ratio of 93%, with gross and net premiums written down due to a decrease in professional liability, specifically in D&O lines [45][76] Market Data and Key Metrics Changes - The reinsurance market is experiencing a supply-demand imbalance, with increasing reinsurance demand and constrained supply due to a diminished appetite for volatility [11][35] - The company noted that the macroeconomic environment should act as a strong tailwind for performance, with persistent inflation amplifying losses for insurance companies [36][35] - The company anticipates continued favorable market conditions, particularly in the Property catastrophe segment, as they enter the midyear renewal period [21][81] Company Strategy and Development Direction - The company is focusing on optimizing its portfolio by increasing exposure to Property catastrophe business while reducing exposure to less profitable lines [39][108] - The strategy includes pushing for lower ceding commissions and reducing business where expected margins do not meet hurdle rates [84][137] - The company aims to maintain a disciplined approach to underwriting, ensuring that growth is aligned with profitability [17][41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the portfolio's resilience and the ability to navigate potential recession risks, particularly in the Professional Lines segment [72][113] - The company expects continued momentum across all three drivers of profit: Underwriting, Fees, and Investments [19][47] - Management believes that the favorable market conditions will persist, allowing for strong profitability into the future [87][21] Other Important Information - The company raised an additional $146 million in its Medici capital partners business, which has now surpassed $1.5 billion in capital [27] - Operating expenses increased by about 14% in the quarter, reflecting investments in personnel to support growth [28] - The company shared $260 million of its net income with partners in joint ventures, indicating strong collaboration and performance [52] Q&A Session Summary Question: How to assess exposure during the upcoming wind season? - Management indicated that while absolute dollar exposure may increase, it will represent a smaller percentage of shareholder equity due to reduced exposure to frequent return periods [65] Question: Context of $54 million loss in relation to market share? - Management noted that the other property portfolio is largely proportional, which reduces participation in small losses, and emphasized the shift in the cat portfolio to higher retention [70] Question: Evaluation of recession risk in Professional Lines? - Management acknowledged social inflation as a real concern but stated that the portfolio is being carefully managed to mitigate risks associated with a potential recession [71][72] Question: Impact of large losses on Casualty and Specialty profitability? - Management confirmed that the current accident year loss ratio improved, attributing this to rate adjustments and a focus on maintaining required margins [109] Question: Updates on capital raising strategy? - Management indicated that they are executing well in the market and are open to raising additional company capital if necessary, but currently see no pressure to do so [101][102]

Financial Performance - Gross premiums written decreased to $2,790,261 thousand in Q1 2023 from $2,942,964 thousand in Q1 2022, a decline of approximately 5.2%[19] - Net premiums earned increased to $1,680,550 thousand in Q1 2023, up from $1,486,425 thousand in Q1 2022, representing a growth of about 13.0%[19] - Total revenues for Q1 2023 were $2,205,100 thousand, a substantial increase from $876,416 thousand in Q1 2022, reflecting a growth of around 151.5%[19] - Net income attributable to RenaissanceRe was $572,906 thousand in Q1 2023, compared to a net loss of $385,569 thousand in Q1 2022, marking a turnaround in performance[19] - For the three months ended March 31, 2023, net premiums written increased to $2.26 billion, up from $2.17 billion in the same period of 2022, representing a growth of 4.0%[104] - For the three months ended March 31, 2023, the net income attributable to RenaissanceRe common shareholders was $564.1 million, compared to a net loss of $394.4 million for the same period in 2022[180] Investment Performance - Net investment income rose significantly to $254,378 thousand in Q1 2023 compared to $83,691 thousand in Q1 2022, an increase of approximately 203.5%[19] - The net investment income for the three months ended March 31, 2023, was $254.4 million, significantly up from $83.7 million in the same period of 2022, marking an increase of approximately 203%[47] - The company reported net realized and unrealized gains on investments of $279.5 million for the three months ended March 31, 2023, compared to a loss of $673.0 million in the same period of 2022[48] - The net realized and unrealized gains (losses) on investments were $(267,289) for the three months ended March 31, 2023, compared to $632,729 in the same period of 2022, indicating a significant decline in investment performance[29] Assets and Liabilities - Total assets increased to $38,270,327 thousand as of March 31, 2023, up from $36,552,878 thousand at the end of 2022, indicating a growth of approximately 4.7%[18] - The total liabilities increased to $27,047,406 thousand as of March 31, 2023, from $26,692,215 thousand at the end of 2022, an increase of approximately 1.3%[18] - The company's total fixed maturity investments trading amounted to $14.35 billion, with U.S. treasuries valued at $7.18 billion[59] - The total fair value of fixed maturity investments trading increased to $14.7 billion from $14.4 billion as of December 31, 2022, representing a growth of approximately 2.4%[39] Shareholder Equity and Dividends - Shareholders' equity attributable to RenaissanceRe increased to $5,865,535 thousand as of March 31, 2023, compared to $5,325,274 thousand at the end of 2022, reflecting a growth of about 10.1%[18] - The company declared dividends of $0.38 per common share in Q1 2023, compared to $0.37 per common share in Q1 2022[19] - The Company declared dividends of $0.38 per common share, totaling $16.6 million in common share dividends paid during the three months ended March 31, 2023[174][177] Claims and Expenses - The net claims and claim expenses incurred were $801.2 million for Q1 2023, a decrease from $841.7 million in Q1 2022, indicating a reduction of 4.8%[110] - The total reserve for claims and claim expenses as of March 31, 2023, was $15.99 billion, compared to $13.51 billion at the end of 2022, reflecting an increase of 14.6%[110] - The net claims and claim expenses incurred for the current year was $905.9 million for Q1 2023, compared to $859.6 million for the same period in 2022, showing an increase of 5.4%[110] - The net claims and claim expense ratio for the current accident year was 57.8%, with Property at 44.7% and Casualty and Specialty at 67.2%[185] Debt and Financing - The company’s debt obligations were $1.1 billion as of March 31, 2023, with a fair value also at $1.1 billion[92] - The total debt of the company as of March 31, 2023, was $1,097.5 million, a decrease from $1,140.9 million as of December 31, 2022[121] - The company maintained compliance with its debt covenants as of March 31, 2023, with no material changes to its debt obligations[120] Noncontrolling Interests and Subsidiaries - The redeemable noncontrolling interest in DaVinci increased to $2,234.5 million as of March 31, 2023, from $1,740.3 million at the end of 2022, reflecting a strong performance in the segment[126] - The company reported a net income attributable to redeemable noncontrolling interests of $267.4 million for the three months ended March 31, 2023, compared to a loss of $(11.9) million for the same period in 2022[126] - The company purchased $27.3 million of shares in DaVinci from third-party investors, increasing its noncontrolling economic ownership to 26.3% effective April 1, 2023[210] Operational Metrics - The combined ratio for the Company was 78.0%, with a 56.6% ratio for Property and a 92.9% ratio for Casualty and Specialty[184] - The operational expenses for the Company were $77.5 million for the three months ended March 31, 2023[184] - The Company has a share repurchase program authorized for up to $500 million, with $500 million remaining available for repurchase as of March 31, 2023[178]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File No. 001-14428 RENAISSANCERE HOLDINGS LTD. (Exact Name Of Registrant As Specified In Its Charter) (State or Other Jurisdiction of Incorporation or Organizat ...

RenaissanceRe Holdings Ltd. (NYSE:RNR) Q4 2022 Earnings Conference Call February 1, 2023 11:00 AM ET Company Participants Keith McCue - Senior Vice President, Finance & Investor Relations Kevin O'Donnell - President and Chief Executive Officer Bob Qutub - Executive Vice President and Chief Financial Officer Conference Call Participants Elyse Greenspan - Wells Fargo Josh Shanker – Bank of America Ryan Tunis – Autonomous Meyer Shields – KBW Yaron Kinar - Jefferies Brian Meredith – UBS Mike Zaremski - BMO Keit ...

Financial Data and Key Metrics Changes - The company reported a retained investment loss of $340 million due to mark-to-market losses on fixed income and equity portfolios [7] - The overall net loss was reduced by $372 million, and the operating loss was reduced by $278 million [36] - Retained net investment income was $110 million in Q3, with expectations of $125 million in Q4 and further growth in 2023 [40] Business Line Data and Key Metrics Changes - The casualty and specialty segment reported a combined ratio of 95.7%, with gross premiums written up 42% and net premiums written up 40% [24][25] - Financial lines gross premium increased by $237 million, doubling compared to Q3 2021, primarily driven by the mortgage book [26] - The property segment faced significant losses, with a combined ratio of 186% due to weather-related large losses, including Hurricane Ian [29] Market Data and Key Metrics Changes - The company noted a strong capital position and liquidity, allowing it to capitalize on upcoming opportunities in the property cat market [12][13] - The current accident year loss ratio for Property was 90%, an improvement from 107% in the same period of 2021 [31] - The company raised $122 million in capital during the quarter, indicating strong investor interest despite market challenges [37] Company Strategy and Development Direction - The company plans to recalibrate its underwriting approach by requiring substantial rate increases and tightening terms and conditions [11] - The focus will be on profitability, with expectations of increased rates and improved terms in 2023, particularly in property cat and casualty lines [14][15] - The company aims to align the interests of customers and investors to ensure long-term capacity and profitability [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming years providing significant opportunities for reinsurers, driven by a hardening market [12] - The company anticipates a hard market across most specialty classes, particularly in cyber, marine, and energy [57] - Management highlighted the importance of maintaining a strong capital position to navigate the current challenging environment [41] Other Important Information - The company expects management fees to stabilize around $25 million to $30 million per quarter going forward [22][34] - The retained portion of unrealized losses in the fixed maturity portfolio is currently $768 million, representing potential accretion to par if held to maturity [40] - The company is not planning share repurchases in Q4, focusing instead on deploying capital into profitable business opportunities [44] Q&A Session Summary Question: Capital Position Post-Hurricane Ian - Management clarified that the strong capital position is due to a combination of holdings company capital and committed partner capital, despite lower common equity [68][70] Question: Rate Increases and Terms Tightening - Management indicated that substantial rate increases are required regardless of loss impact, with expectations for high-end rate changes in the upcoming renewal season [71][72] Question: Portfolio Construction and Market Timing - Management emphasized that they build a platform to execute in any environment and are focused on ensuring investors receive excess rewards for the risks taken [76][78] Question: Property Cat Market Expectations - Management noted that gross limits in the property cat market are expected to increase, with a focus on net exposure and profitability [104][106] Question: European Market Outlook - Management remains optimistic about strong rate changes in the European market, although it is not the most critical part of their portfolio [110]

Financial Performance - Gross premiums written for Q3 2022 reached $2,220,661, an increase of 25.1% compared to $1,774,180 in Q3 2021[19] - Net premiums earned for the nine months ended September 30, 2022, were $4,709,829, up 22.2% from $3,852,891 in the same period of 2021[19] - Total revenues for Q3 2022 were $1,286,504, a decrease of 16.7% from $1,544,703 in Q3 2021[19] - Net income attributable to RenaissanceRe for Q3 2022 was $(816,501), compared to $(440,377) in Q3 2021, indicating a decline in profitability[19] - The company reported a net loss per common share of $(19.27) for Q3 2022, compared to $(9.75) in Q3 2021[19] - For the three months ended September 30, 2022, RenaissanceRe reported a net loss of $1,188,930 thousand, compared to a net loss of $638,872 thousand for the same period in 2021, representing an increase in loss of approximately 86%[22] - For the nine months ended September 30, 2022, the net loss was $1,853,149 thousand, significantly higher than the net loss of $391,716 thousand for the same period in 2021, indicating an increase in loss of approximately 373%[22] - The comprehensive loss for the three months ended September 30, 2022, was $1,190,535 thousand, compared to a comprehensive loss of $637,520 thousand in the same period of 2021, reflecting an increase of approximately 87%[22] - The net income (loss) attributable to RenaissanceRe common shareholders for the nine months ended September 30, 2022, was a loss of $1,544,670, compared to a loss of $284,338 in the same period of 2021[182][185] Investment Performance - Net investment income increased to $157,793 in Q3 2022, compared to $78,267 in Q3 2021, reflecting a growth of 101.5%[19] - The company reported net realized and unrealized gains on investments of $1,806,678 thousand for the nine months ended September 30, 2022, compared to $200,092 thousand for the same period in 2021, indicating a substantial increase in investment performance[28] - The company reported net investment income of $157.79 million for the three months ended September 30, 2022, compared to $78.27 million for the same period in 2021, representing an increase of 101.5%[43] - The company’s net investment income for the nine months ended September 30, 2022, was $348.70 million, compared to $238.99 million for the same period in 2021, showing an increase of 45.9%[43] - The company experienced net unrealized losses on investments of $137.4 million for the three months ended September 30, 2022, compared to net unrealized gains of $0.9 million in the same period of 2021[92] Assets and Liabilities - Total assets increased to $35,935,835 as of September 30, 2022, from $33,959,502 at the end of 2021, representing a growth of 5.8%[18] - Total liabilities increased to $26,879,003 as of September 30, 2022, from $23,781,168 at the end of 2021, reflecting a rise of 12.5%[18] - The total shareholders' equity as of September 30, 2022, was $4,881,872 thousand, down from $6,749,514 thousand as of September 30, 2021, indicating a decrease of approximately 28%[25] - The company's debt obligations remained stable at $1.2 billion as of September 30, 2022, with a fair value of $1.1 billion, down from $1.3 billion at the end of 2021[89] - As of September 30, 2022, total debt amounted to $1,092.7 million, a decrease from $1,169.9 million as of December 31, 2021[118] Claims and Reserves - The reserve for claims and claim expenses rose to $15,662,955 as of September 30, 2022, compared to $13,294,630 at the end of 2021, marking an increase of 17.8%[18] - Total claims and claim expense reserves reached $15.66 billion as of September 30, 2022, up from $13.23 billion at the end of 2021[108] - The net incurred claims for the current year amounted to $3.61 billion for the nine months ended September 30, 2022, compared to $3.39 billion for the same period in 2021[108] - The gross claims and claim expenses incurred for the nine months ended September 30, 2022, were $4.91 billion, compared to $4.98 billion for the same period in 2021[102] - The reserve for claims and claim expenses, net of reinsurance recoverable, increased to $10.69 billion as of September 30, 2022, from $9.04 billion in 2021[108] Shareholder Activities - Dividends per common share for the nine months ended September 30, 2022, were $1.11, compared to $1.08 in the same period of 2021, showing a slight increase of 2.8%[19] - The company repurchased common shares amounting to $166,664 thousand during the nine months ended September 30, 2022, compared to $704,465 thousand in the same period of 2021, indicating a decrease in share repurchases of approximately 76%[28] - The company has a share repurchase program authorized for up to $500.0 million, which remains available for repurchase as of September 30, 2022[176] - During the nine months ended September 30, 2022, the company paid $26.5 million in preference share dividends and $48.6 million in common share dividends[175] Underwriting Performance - The combined ratio for the nine months ended September 30, 2022, was 103.6%, compared to 110.0% for the same period in 2021, indicating improved underwriting performance[182][185] - Underwriting income for the nine months ended September 30, 2022, was a loss of $166,450, compared to a loss of $385,609 in the same period of 2021, showing a reduction in losses[182][185] - The net claims and claim expense ratio for the current accident year was 76.6% for the nine months ended September 30, 2022, down from 88.1% in the same period of 2021[182][185] Derivative Instruments - As of September 30, 2022, total derivative assets not designated as hedges amounted to $49,520 million[189] - Total derivative liabilities not designated as hedges were $47,241 million as of September 30, 2022[190] - The company reported a net loss of $81,142 million from derivative instruments not designated as hedges for the three months ended September 30, 2022[194] - The total derivative instruments designated as hedges amounted to $53,921 million as of September 30, 2022[189] - The company reported derivative gains of $4.925 million for the three months ended September 30, 2022, compared to $447 thousand for the same period in 2021, and $9.219 million for the nine months ended September 30, 2022, compared to $795 thousand for the same period in 2021[210]

Financial Performance - Gross premiums written for Q2 2022 reached $2,464.6 million, an increase of 17.7% from $2,094.2 million in Q2 2021[19] - Net premiums earned for the first half of 2022 were $2,942.8 million, up 25.5% from $2,346.6 million in the same period of 2021[19] - Total revenues for Q2 2022 were $867.0 million, a decrease of 41.2% compared to $1,477.3 million in Q2 2021[19] - Net income attributable to RenaissanceRe common shareholders for Q2 2022 was a loss of $324.9 million, compared to a profit of $456.8 million in Q2 2021[19] - For the three months ended June 30, 2022, RenaissanceRe reported a net loss of $266,738 thousand compared to a net income of $577,651 thousand for the same period in 2021, representing a significant decline[22] - For the six months ended June 30, 2022, the net loss was $664,219 thousand, a decrease from a net income of $247,156 thousand in the prior year[22] - Comprehensive loss for the three months ended June 30, 2022, was $269,072 thousand, compared to a comprehensive income of $575,972 thousand in the same period of 2021[22] - For the six months ended June 30, 2022, the Company reported a net income (loss) available to common shareholders of $(719.3) million, with a basic and diluted loss per common share of $(16.64)[180] Assets and Liabilities - Total assets as of June 30, 2022, were $35,034.4 million, an increase from $33,959.5 million at the end of 2021[18] - The total liabilities increased to $24,942.9 million as of June 30, 2022, from $23,781.2 million at the end of 2021[18] - The reserve for claims and claim expenses stood at $13,442.8 million as of June 30, 2022, compared to $13,294.6 million at the end of 2021[18] - Total shareholders' equity as of June 30, 2022, was $5,738,659 thousand, down from $7,217,606 thousand as of June 30, 2021[25] - The Company’s total debt as of June 30, 2022, was $1,136,234, a decrease from $1,268,443 as of December 31, 2021[116] Investment Income - Net investment income for the first half of 2022 was $190.9 million, an increase from $160.7 million in the same period of 2021[19] - Net investment income for the three months ended June 30, 2022, was $107.2 million, an increase of 32.4% compared to $80.9 million for the same period in 2021[44] - The company reported net realized and unrealized losses on investments of $654.1 million for the three months ended June 30, 2022, compared to gains of $191.0 million in the same period of 2021[45] - The company experienced net unrealized losses on investments of $64.6 million for the three months ended June 30, 2022, compared to net unrealized gains of $41.9 million for the same period in 2021[90] Claims and Expenses - The gross claims and claim expenses incurred for the six months ended June 30, 2022, were $1.82 billion, compared to $1.92 billion for the same period in 2021[98] - The Company’s net claims and claim expenses incurred for the six months ended June 30, 2022, amounted to $1.55 billion, with a current accident year claims ratio of 54.7%[180] - The net incurred claims for the current year was $1,608,762 for the six months ended June 30, 2022, compared to $1,448,133 for the same period in 2021[105] - The net paid claims related to prior years amounted to $1,129,979 for the six months ended June 30, 2022, up from $995,826 in 2021[105] Shareholder Returns - Dividends per common share for the first half of 2022 were $0.74, compared to $0.72 in the same period of 2021[19] - Dividends paid on common shares for the six months ended June 30, 2022, totaled $32,437 thousand, compared to $34,997 thousand in the same period of 2021[28] - The Company paid $17.7 million in preference share dividends during the six months ended June 30, 2022, compared to $14.6 million in 2021, and $32.4 million in common share dividends, down from $35.0 million in 2021[172] Share Repurchase and Capital Management - The company repurchased common shares amounting to $141,356 thousand during the six months ended June 30, 2022, down from $480,660 thousand in the prior year[28] - The Company repurchased 874,912 common shares at an aggregate cost of $137.5 million, with an average price of $157.19 per common share, leaving $475.2 million available for repurchase under the share repurchase program as of June 30, 2022[173] Noncontrolling Interests - The redeemable noncontrolling interest in DaVinciRe increased to $1,762,677 as of June 30, 2022, up from $1,499,451 at the end of 2021, representing a growth of 17.6%[119] - The redeemable noncontrolling interest in Medici increased to $1,052,560 as of June 30, 2022, compared to $856,820 at the end of 2021, reflecting a growth of 22.8%[129] - The total redeemable noncontrolling interests across all entities amounted to $4,352,797 as of June 30, 2022, up from $3,554,053 at the end of 2021, representing an increase of 22.4%[119] Derivative Instruments - The company has entered into various derivative instruments to manage foreign currency exposure and enhance yield, with total derivative assets at $30,720 as of June 30, 2022[186] - The company reported a total loss of $100.754 million on derivative instruments not designated as hedges for the three months ended June 30, 2022, compared to a loss of $8.492 million for the same period in 2021[191] - The total derivative instruments not designated as hedges resulted in a loss of $171.396 million for the six months ended June 30, 2022, compared to a loss of $4.770 million for the same period in 2021[191] Legal and Regulatory Matters - The Company is subject to various lawsuits and regulatory actions in the normal course of business, which are considered in its loss and loss expense reserves[209] - The Company believes that no individual litigation or arbitration is likely to have a material adverse effect on its financial condition, business, or operations[209]

Financial Data and Key Metrics Changes - The company reported operating income of $238 million for Q2 2022, with an annualized operating return on average common equity of 18.4% [24] - Year-to-date operating ROE stands at 14.4%, with a 21% growth in net written premiums [6] - Net premiums increased by 23% in Q2 2022 compared to the previous year [5][32] Business Line Data and Key Metrics Changes - The Casualty and Specialty segment reported a combined ratio of 94%, with gross premiums written up 37% and net premiums written up 38% [25][37] - The Property segment achieved a combined ratio of 58%, with gross premiums written increasing by $35 million (3%) and net premiums written increasing by $85 million (11%) [34] - Overall gross premiums written grew by 18% and net premiums written by 23% [32] Market Data and Key Metrics Changes - Demand for reinsurance products is expected to increase due to inflation and recession concerns, with property cat demand increasing by about $5 billion against constrained supply [14] - The company noted that rates for non-loss impacted business increased by 10% to 20%, while loss-impacted programs saw increases greater than 50% [56] Company Strategy and Development Direction - The company is committed to maintaining a strong capital position to capitalize on potential underwriting opportunities, especially in the current macroeconomic environment [30][31] - The strategic focus on reinsurance is expected to enhance the company's value proposition by providing consistent exposure-driven pricing and minimizing channel conflict [17] - The company is proactively addressing inflation impacts through a robust framework in underwriting and reserving processes [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to create near and long-term value for shareholders despite global economic challenges [9] - The company anticipates that inflation-driven interest rate increases will materially improve investment returns, offsetting inflation impacts [11] - Management expects continued upward pressure on rates and increasing demand for reinsurance products across both property and casualty segments [14][15] Other Important Information - The company reported a $51 million foreign exchange loss due to significant currency fluctuations, which is not included in operating income [43] - The investment portfolio experienced $654 million in mark-to-market losses, primarily in fixed maturity investments [42] Q&A Session Summary Question: Capital management and buyback strategy - Management indicated that no additional share repurchases are planned for Q3, with a focus on capital deployment into the business instead [64] Question: Exposure to Florida and reinsurance treaties - The company maintained flat PMLs for Southeast wind risk and has provisions for cancellation in reinsurance treaties with Florida domestics [66][67] Question: Pricing environment and competitor behavior - Management noted continued discipline from competitors in pricing and terms, with no signs of softening rates despite higher interest rates benefiting investment income [69] Question: Geographic exposures and loss ratios - The primary peak risk managed is Atlantic Hurricane, with significant exposure in Southeast Hurricane [73] Question: Operational expenses and claims payment patterns - Management acknowledged a potential slowdown in claims payment patterns due to COVID-related court delays, particularly in casualty and specialty segments [98][99] Question: Buyback strategy and market opportunities - Management clarified that buybacks are tied to the best opportunities for capital deployment, with a cautious approach to share repurchases in Q3 [104][106]