AM Best affirms FSR of RenRe Holdings and its subsidiaries

AM Best has affirmed the financial strength rating (FSR) of A+ (Superior) of Renaissance Reinsurance (RenRe) and Renaissance Reinsurance of Europe (Dublin, Ireland). The outlook for these ratings remains negative.

AM Best has also affirmed the FSR of A (Excellent) of DaVinci Reinsurance (DaVinci). The outlook for this rating remains stable.

The ratings agency said the actions reflect RenRe’s superior level of risk-adjusted capitalisation, the strength and depth of its management team and the ability of the company to deliver strong long-term profitability over the course of the insurance cycle.

“The company is widely recognized for its thoughtful leadership in enterprise risk management and as a pioneer in third-party capital management. In that regard, RenRe maintains its superior market reputation as a leader in state-of-the-art property catastrophe modelling and risk optimisation, which has attracted capital from outside investors to form several successful joint ventures, including DaVinci and Top Layer Reinsurance,” said AM Best.

RenRe’s exposure to high-severity losses associated with catastrophic events has offset these strengths, according to AM Best.

AM Best suggested that superior operating results coupled with strong risk-adjusted capitalisation over the long term could return RenRe’s negative outlooks to stable.

Outsized catastrophe or investment losses, weak or strained risk-adjusted capitalisation or continued downward pressure on property catastrophe rates could lead to a downgrade, however.