High levels of claims from two years of California wildfires contributed to a challenging 2018 for Bermuda reinsurer RenaissanceRe, although CEO Kevin O’Donnell remains positive for a successful 2019.
The reinsurer’s net profits for 2018 had dipped year-on-year, falling to $197.3 million compared with $244.8 million for 2017. It attributed this drop to the negative impact of large loss events costing some $86.4 million.
In 2018, RenaissanceRe’s combined ratio improved to 87.6 percent compared with 137.9 percent the year before. Its underwriting income was $244.9 million last year, a big improvement on the underwriting loss of $651.5 million it posted in 2017.
RenaissanceRe’s gross written premiums reached $3.3 billion for 2018, up from $2.8 billion in 2017, representing an increase of $512.9 million (18.3 percent).
“Once again in 2018, we benefited from our industry leading ability to construct efficient portfolios of risk through superior underwriting and the application of our gross-to-net strategy,” said Kevin O’Donnell, president and CEO of RenaissanceRe.
“In the quarter, we reported positive operating income, while rapidly paying claims to customers facing significant losses from Category 4 Hurricane Michael and a second consecutive year of record-breaking wildfires in California.
“For the year, we outperformed on multiple metrics, posting a strong operating ROE, delivering robust top line growth, and executing effectively on a number of key initiatives, including the formation of our latest innovative joint venture, Vermeer and our pending acquisition of Tokio Millennium Re. Looking ahead, at the recent January 1 renewal we laid the foundation for a successful 2019 and ongoing shareholder value creation.”
RenaissanceRe, Result, Kevin O'Donnell, Bermuda