Reinsurer posts Q1 combined ratio of 230%

Bermudan catastrophe reinsurer RenaissanceRe made a loss of $248m for the first quarter of 2011 after incurring net catastrophe claims of $658m.

Claims from the Australian flooding, New Zealand earthquake and Japan earthquake combined added 212.3 percentage points to RenRe’s combined ratio, bringing it to 230% for Q1 2011.

RenRe incurred net claims and claim expenses of $46.1m from the Australian flooding, $209.8m from the New Zealand earthquake and $402m from the Japan earthquake. The combined net negative impact in the underwriting result of the three events, after reinsurance, reinstatement premiums and profit commissions, was $565.2m.

The Australian flooding accounted for 9.8 combined ratio percentage points, the New Zealand quake 59.6 and the Japan earthquake 100.6.

RenRe chief executive Neill Currie tried to put a positive spin on the results. “In the aftermath of the large catastrophes that have occurred over the last year, and as our clients’ view of risk evolves, we anticipate demand for our products will increase over time,” he said in a statement. “Our experienced team has the tools and the capital necessary to respond to the needs of our clients.”

Gross premiums written increased $94.5m, or 18.3%, to $610.5 million, primarily driven by reinstatement premiums written from the large catastrophes of the first quarter of 2011 and increases across most lines of business within the Lloyd’s segment. Excluding the impact of $113.5m and $27m of reinstatement premiums written in the first quarter of 2011 and 2010, respectively, gross premiums written increased $8m, or 1.6%.

RenaissanceRe Q1 2011 highlights in $m (compared with Q1 2010)

  • Gross written premiums: 610.5 (516)
  • Net result: -248 (+165)
  • Combined ratio 230% (67.4%)
  • Annualised return on equity: -30.7% (+14.8%)