RenRe plunges to loss due to $103.8m COVID-19 charge in casualty and specialty
Bermuda-based RenaissanceRe Holdings plunged to a first quarter loss of $82 million as losses related to the COVID-19 pandemic dragged down its investment results and casualty/specialty performance.
The reinsurer reported a net loss of $82 million in Q1 2020, compared with a net income of $273.7 million in the first quarter of 2019.
Gross premiums written increased by $461.4 million to $2.0 billion in the quarter, compared to the first quarter of 2019, driven by an increase of $273.3 million in the casualty and specialty segment and an increase of $188.1 million in the property segment.
RenRe posted an underwriting income of $64.1 million and a combined ratio of 93.0 percent in the first quarter of 2020, compared with underwriting income of $154.1 million and a combined ratio of 72 percent in Q1 2019.
The casualty and specialty segment incurred an underwriting loss of $83.2 million and had a combined ratio of 116.9 percent in the first quarter of 2020, principally impacted by net claims and claim expenses associated with the COVID-19 pandemic of $103.8 million, which added 21.1 percentage points to the combined ratio.
The losses primarily represent the cost of claims incurred but not yet reported, with respect to exposures such as event contingency and event-based casualty covers. Ren Re said actual losses may vary materially from this initial estimate.
The property segment generated underwriting income of $147.1 million and had a combined ratio of 65.1 percent in the first quarter of 2020.
The total investment result was a loss of $11.2 million in the first quarter of 2020, compared with a gain of $252.1 million in the first quarter of 2019.
Kevin O’Donnell, president and chief executive officer of RenaissanceRe, said: “While our financial performance in the first quarter was negatively impacted by COVID-19, we are well capitalized with ample liquidity and our core franchise remains strong. I am confident that we are prepared to meet both the challenges as well as the opportunities of this evolving situation, and will continue delivering long-term value.”
