RenRe sees profits slip for Q1 2017
RenaissanceRe Holdings has announced the estimated impact of the UK Ministry of Justice's recent announcement of a decrease in the Ogden rate.
The Ogden Rate is the discount rate used to calculate lump sum awards in UK bodily injury cases. At the end of February the UK Ministry of Justice announced that from mid-March it was reducing the rate.
Although this had been expected, the decrease was sharper than had been predicted by the insurance market.
RenaissanceRe said that based upon information currently available, it estimates that the pre-tax impact of the rate change on its carried reserves is approximately $30 million, to be recognised in the first quarter of 2017. The majority of the reserve increase relates to a limited number of UK medical malpractice contracts within the company's casualty and specialty segment.
However, the company also pointed out that due to the complexity of factors contributing to the change in reserve estimates, the ultimate impact to the Company's reserves as a result of the change in the Ogden rate may vary from these estimates.
RenaissanceRe Holdings, Odgen rate, Bermuda