Renaissancere reports q4 2022 net income available to common shareholders of $448.1 million; operating income available to common shareholders of $322.2 million.
Pembroke, bermuda--(business wire)--renaissancere holdings ltd. (nyse: rnr) (“renaissancere” or the “company”) today announced its financial results for the fourth quarter and full year 2022. fourth quarter 2022 net income available to common shareholders per diluted common share: $10.27 operating income available to common shareholders per diluted common share*: $7.33 underwriting income $316.3m fee income $30.3m net investment income $211.2m change in book value per common share: 10.7% change in tangible book value per common share plus change in accum. dividends*: 11.9% operating return on average common equity, operating income (loss) available (attributable) to common shareholders, operating income (loss) available (attributable) to common shareholders per diluted common share and change in tangible book value per common share plus change in accumulated dividends are non-gaap financial measures; see “comments on regulation g” for a reconciliation of non-gaap financial measures. kevin j. o’donnell, president and chief executive officer, said, “we finished the year with an excellent quarter, reporting an annualized operating return on average common equity of 29.6% driven by strong underwriting results, significantly increased net investment income and stable management fees. for the full year, we delivered a 6.3% operating return despite a net negative impact of $807.6 million from catastrophe losses. at the january renewal we demonstrated leadership and discipline, achieving the step change in rate and terms investors required, while providing the reinsurance capacity customers needed. we enter 2023 with expectations of continuing strong demand for our products, ample capital to meet this demand, and anticipation of one of the most successful years in our history.” consolidated financial results - fourth quarter consolidated highlights three months ended december 31, (in thousands, except per share amounts and percentages) 2022 2021 gross premiums written $ 1,585,276 $ 1,313,018 net premiums written 1,345,616 1,116,560 underwriting income (loss) 316,302 276,661 combined ratio 80.5 % 79.4 % net income (loss) available (attributable) to common shareholders 448,092 210,917 available (attributable) to common shareholders per diluted common share $ 10.27 $ 4.65 operating income (loss) (1) available (attributable) to common shareholders 322,153 213,692 available (attributable) to common shareholders per diluted common share $ 7.33 $ 4.71 book value per common share $ 104.65 $ 132.17 change in book value per share 10.7 % 2.5 % tangible book value per common share plus accumulated dividends (1) $ 123.81 $ 149.79 change in tangible book value per common share plus change in accumulated dividends (1) 11.9 % 2.8 % return on average common equity - annualized 41.2 % 14.2 % operating return on average common equity - annualized (1) 29.6 % 14.4 % see “comments on regulation g” for a reconciliation of non-gaap financial measures. three drivers of profit: underwriting, fee and investment income - fourth quarter underwriting results - property segment: combined ratio of 62.6%; 19.2 percentage points from weather-related large losses. property segment three months ended december 31, q/q change (in thousands, except percentages) 2022 2021 gross premiums written $ 372,082 $ 384,657 (3.3 ) % net premiums written 372,998 375,112 (0.6 ) % underwriting income (loss) 257,225 223,098 underwriting ratios net claims and claim expense ratio - current accident year 53.8 % 43.8 % 10.0 pts net claims and claim expense ratio - prior accident years (18.9 ) % (4.9 ) % (14.0) pts net claims and claim expense ratio - calendar year 34.9 % 38.9 % (4.0) pts underwriting expense ratio 27.7 % 25.5 % 2.2 pts combined ratio 62.6 % 64.4 % (1.8) pts gross premiums written decreased by $12.6 million, or 3.3%, driven by a reduction of $11.8 million within the catastrophe class of business primarily due to lower reinstatement premiums. net premiums written decreased by $2.1 million, or 0.6%, also reflecting lower reinstatement premiums. net claims and claim expense ratio - current accident year increased 10.0 percentage points, primarily due to the impacts of winter storm elliott and hurricane nicole, as well as losses associated with aggregate loss contracts. – weather-related large losses contributed 19.2 percentage points to the current accident year net claims and claim expense ratio in the fourth quarter of 2022, compared to a contribution of 11.0 percentage points from weather-related large losses in the fourth quarter of 2021. net claims and claim expense ratio - prior accident years reflects net favorable development, primarily from weather-related large losses in the 2019 and 2021 accident years, driven by better than expected loss emergence. underwriting expense ratio increased 2.2 percentage points, driven by a lower performance-based compensation expense in the fourth quarter of 2021, in addition to lower management fees due to reductions in upsilon and the portfolio of structured reinsurance products. underwriting income of $257.2 million and a combined ratio of 62.6%. weather-related large losses had a $131.9 million net negative impact on the property segment underwriting result and added 19.2 percentage points to the combined ratio in the fourth quarter of 2022. underwriting results - casualty and specialty segment: combined ratio of 93.7% and growth in net premiums written of 31.2%. casualty and specialty segment three months ended december 31, q/q change (in thousands, except percentages) 2022 2021 gross premiums written $ 1,213,194 $ 928,361 30.7 % net premiums written 972,618 741,448 31.2 % underwriting income (loss) 59,077 53,563 underwriting ratios net claims and claim expense ratio - current accident year 64.9 % 63.9 % 1.0 pts net claims and claim expense ratio - prior accident years (2.7 )% (1.3 )% (1.4) pts net claims and claim expense ratio - calendar year 62.2 % 62.6 % (0.4) pts underwriting expense ratio 31.5 % 29.9 % 1.6 pts combined ratio 93.7 % 92.5 % 1.2 pts gross premiums written increased 30.7% with growth across all lines of business. the increase reflects growth in new and existing business and rate improvement, mainly from business written in prior periods. net premiums written increased 31.2% consistent with the increase in gross premiums written. net claims and claim expense ratio - current accident year increased by 1.0 percentage point principally as a result of a large energy loss in the other specialty lines of business. net claims and claim expense ratio - prior accident years reflects higher favorable prior accident year loss development of 1.4 percentage points as compared to the fourth quarter of 2021, driven by favorable experience in other specialty and credit lines of business. underwriting expense ratio increased 1.6 percentage points, principally due to: – increase in the operating expense ratio of 0.9 percentage points mainly due to a lower performance-based compensation expense in the fourth quarter of 2021; and – increase in the net acquisition expense ratio of 0.7 percentage points due to changes in the mix of business and estimated profit commission expense. fee income: $30.3 million of fee income; management fees stable while performance fees impacted by 2022 weather-related large losses. fee income three months ended december 31, q/q change (in thousands, except percentages) 2022 2021 total management fee income $ 25,984 $ 24,723 $ 1,261 total performance fee income (loss) (1) 4,363 5,299 (936 ) total fee income $ 30,347 $ 30,022 $ 325 performance fees are based on the performance of the individual vehicles or products, and may be negative in a particular period if, for example, large losses occur, which can potentially result in no performance fees or the reversal of previously accrued performance fees. management fee income was relatively stable as compared to the fourth quarter of 2021, reflecting increased capital managed at davincire holdings ltd. (“davinci”), vermeer reinsurance ltd. (“vermeer”), renaissancere medici fund ltd. (“medici”), and fontana holdings l.p. and its subsidiaries (“fontana”), largely offset by reductions in the company’s structured reinsurance products and upsilon, as well as a deferral of management fees in davinci as a result of the weather-related large losses experienced in the current and prior years. performance fee income was lower in the fourth quarter of 2022 compared to the fourth quarter of 2021, and was affected by the cumulative impact of the catastrophe events in 2021 and 2022. investment results: total investment result improved $320.4 million; driven by 162.5% growth in net investment income and $168.1 million of net realized and unrealized gains in the fixed maturity investments portfolio. investment results three months ended december 31, q/q change (in thousands, except percentages) 2022 2021 net investment income $ 211,237 $ 80,483 $ 130,754 net realized and unrealized gains (losses) on investments 168,139 (21,518 ) 189,657 total investment result $ 379,376 $ 58,965 $ 320,411 total investment return - annualized 7.4 % 1.1 % 6.3 pts net investment income increased $130.8 million, primarily driven by: – rising interest rates and increased yields in the fixed maturity trading and short term investment portfolios; – higher yields on catastrophe bonds; and – higher average invested assets and yields in private credit fund investments. net realized and unrealized gains on investments increased $189.7 million principally driven by: – net realized and unrealized gains on fixed maturity investments trading of $77.1 million, which includes unrealized gains of $187.9 million resulting from the modest reduction in interest rates on medium-term u.s. treasuries, as well as a narrowing of credit spreads on the corporate and high yield fixed maturity portfolios, partially offset by realized losses of $110.8 million. this compares to net realized and unrealized losses of $101.0 million in the fourth quarter of 2021 resulting from increases in interest rates. total investments were $22.2 billion at december 31, 2022 (december 31, 2021 - $21.4 billion). weighted average yield to maturity and duration on the company’s investment portfolio (which excludes investments that have no final maturity, yield to maturity or duration) was 5.7% and 2.5 years (december 31, 2021 - 1.6% and 2.8 years, respectively). other items of note - fourth quarter net income attributable to redeemable noncontrolling interests of $236.4 million was primarily driven by: – strong underwriting results for davinci and vermeer; – strong net investment income stemming from higher interest rates and yields within the investment portfolios of the company’s joint ventures and managed funds; and – net realized and unrealized gains on investments recorded during the quarter, as described above. raised third-party capital of $123.0 million in the fourth quarter of 2022, including $120.0 million in vermeer. redemptions of third-party capital of $224.6 million from upsilon during the fourth quarter of 2022, reducing the size of upsilon as a result of the release of collateral associated with prior years’ contracts. consolidated financial results - full year consolidated highlights twelve months ended december 31, (in thousands, except per share amounts and percentages) 2022 2021 gross premiums written $ 9,213,540 $ 7,833,798 net premiums written 7,196,160 5,939,375 underwriting income (loss) 149,852 (108,948 ) combined ratio 97.7 % 102.1 % net income (loss) available (attributable) to common shareholders $ (1,096,578 ) $ (73,421 ) available (attributable) to common shareholders per diluted common share $ (25.50 ) $ (1.57 ) operating income (loss) (1) available (attributable) to common shareholders $ 315,556 $ 81,599 available (attributable) to common shareholders per diluted common share $ 7.30 $ 1.72 book value per common share $ 104.65 $ 132.17 change in book value per share (20.8 )% (4.5 )% tangible book value per common share plus accumulated dividends (1) $ 123.81 $ 149.79 change in tangible book value per common share plus change in accumulated dividends (1) (20.6 )% (4.0 )% return on average common equity (22.0 )% (1.1 )% operating return on average common equity (1) 6.3 % 1.3 % see “comments on regulation g” for a reconciliation of non-gaap financial measures. net negative impact of the 2022 weather-related large losses net negative impact on underwriting result includes the sum of (1) net claims and claim expenses incurred, (2) assumed and ceded reinstatement premiums earned and (3) earned and lost profit commissions. net negative impact on net income (loss) available (attributable) to renaissancere common shareholders is the sum of (1) net negative impact on underwriting result and (2) redeemable noncontrolling interest, both before consideration of any related income tax benefit (expense). the company’s estimates of net negative impact are based on a review of our potential exposures, preliminary discussions with certain counterparties and actuarial modeling techniques. our actual net negative impact, both individually and in the aggregate, may vary from these estimates, perhaps materially. changes in these estimates will be recorded in the period in which they occur. meaningful uncertainty remains regarding the estimates and the nature and extent of the losses from these catastrophe events, driven by the magnitude and recent nature of each event, the geographic areas impacted by the events, relatively limited claims data received to date, the contingent nature of business interruption and other exposures, potential uncertainties relating to reinsurance recoveries and other factors inherent in loss estimation, among other things. net negative impact on the consolidated financial statements year ended december 31, 2022 hurricane ian other 2022 catastrophe events (1) aggregate losses total 2022 weather- related large losses (2) (in thousands) net claims and claims expenses incurred $ (982,189 ) $ (330,973 ) $ (93,810 ) $ (1,406,972 ) assumed reinstatement premiums earned 221,801 27,138 52 248,991 ceded reinstatement premiums earned (57,913 ) (579 ) — (58,492 ) earned (lost) profit commissions (1,487 ) (1,285 ) (49 ) (2,821 ) net negative impact on underwriting result (819,788 ) (305,699 ) (93,807 ) (1,219,294 ) redeemable noncontrolling interest 286,910 87,398 37,399 411,707 net negative impact on net income (loss) available (attributable) to renaissancere common shareholders $ (532,878 ) $ (218,301 ) $ (56,408 ) $ (807,587 ) net negative impact on the segment underwriting results and consolidated combined ratio year ended december 31, 2022 hurricane ian other 2022 catastrophe events (1) aggregate losses total 2022 weather- related large losses (2) (in thousands, except percentages) net negative impact on property segment underwriting result $ (811,828 ) $ (302,080 ) $ (93,807 ) $ (1,207,715 ) net negative impact on casualty and specialty segment underwriting result (7,960 ) (3,619 ) — (11,579 ) net negative impact on underwriting result $ (819,788 ) $ (305,699 ) $ (93,807 ) $ (1,219,294 ) percentage point impact on consolidated combined ratio 13.4 4.9 1.5 20.0 “other 2022 catastrophe events” includes the floods in eastern australia in february and march of 2022, storm eunice, the severe weather in france in may and june of 2022, hurricane fiona and the typhoons in asia during the third quarter of 2022, and hurricane nicole and winter storm elliott during the fourth quarter of 2022. “2022 weather-related large losses” includes hurricane ian, other 2022 catastrophe events and loss estimates associated with certain aggregate loss contracts triggered during 2022 as a result of weather-related catastrophe events. three drivers of profit: underwriting, fee, and investment income - full year underwriting results - property segment: combined ratio of 100.6%; 46.8 percentage points from the 2022 weather-related large losses. property segment twelve months ended december 31, y/y change (in thousands, except percentages) 2022 2021 gross premiums written $ 3,734,241 $ 3,958,724 (5.7 ) % net premiums written 2,847,659 2,868,002 (0.7 ) % underwriting income (loss) (16,109 ) (185,504 ) underwriting ratios net claims and claim expense ratio - current accident year 81.2 % 91.9 % (10.7) pts net claims and claim expense ratio - prior accident years (7.4 )% (9.0 )% 1.6 pts net claims and claim expense ratio - calendar year 73.8 % 82.9 % (9.1) pts underwriting expense ratio 26.8 % 24.2 % 2.6 pts combined ratio 100.6 % 107.1 % (6.5) pts gross premiums written decreased 5.7%, driven by: – decrease in the catastrophe class of business of $159.0 million, or 7.1%, principally driven by lower reinstatement premiums in 2022 compared to 2021, as well as the reduction in the size of upsilon over the course of the year. – decrease in the other property class of business of $65.5 million, or 3.8%, principally due to the non-renewal of certain deals, partially offset by growth and rate improvement across other areas within the other property class of business. ceded premiums written were $886.6 million, a decrease of $204.1 million, or 18.7%. this decrease was primarily driven by: – the reduction in gross premiums written in upsilon, which are largely ceded to third party investors. – a reduction in retrocessional purchases as part of the company’s gross-to-net strategy, in conjunction with the growth in managed third-party capital vehicles. net claims and claim expense ratio - current accident year improved by 10.7 percentage points, primarily as a result of a lower impact from the 2022 weather-related large losses as compared to the impact of weather-related large losses in 2021. the net claims and claim expense ratio - prior accident years reflected net favorable development of 7.4%, primarily related to weather-related large losses in the 2017 to 2021 accident years. underwriting expense ratio increased 2.6 percentage points, driven by a lower performance based compensation expense in 2021, in addition to lower management fees due to reductions in upsilon and the portfolio of structured reinsurance products. underwriting loss of $16.1 million and a combined ratio of 100.6%, primarily driven by the 2022 weather-related large losses, which had a $1.2 billion net negative impact on the property segment underwriting result and added 46.8 percentage points to the combined ratio. casualty and specialty segment: net premiums written increased by 41.6%; combined ratio of 95.3% casualty and specialty segment twelve months ended december 31, y/y change (in thousands, except percentages) 2022 2021 gross premiums written $ 5,479,299 $ 3,875,074 41.4 % net premiums written 4,348,501 3,071,373 41.6 % underwriting income (loss) 165,961 76,556 underwriting ratios net claims and claim expense ratio - current accident year 65.5 % 66.9 % (1.4) pts net claims and claim expense ratio - prior accident years (1.1 )% (0.7 )% (0.4) pts net claims and claim expense ratio - calendar year 64.4 % 66.2 % (1.8) pts underwriting expense ratio 30.9 % 30.8 % 0.1 pts combined ratio 95.3 % 97.0 % (1.7) pts gross premiums written increased 41.4%, driven by: – growth in new and existing business, and rate improvements, principally in the casualty and credit lines of business. – gross premiums written in 2022 also included approximately $450 million from positive premium developments on business underwritten in 2021 and prior years, and reflects rate improvements principally in casualty lines of business. net premiums written increased 41.6%, primarily driven by growth in casualty and credit lines of business, consistent with the changes in gross premiums written. net claims and claim expense ratio - current accident year improved by 1.4 percentage points, primarily as a result of lower current accident year attritional losses compared to 2021. net claims and claim expense ratio - prior accident years improved by 0.4 percentage points, reflecting higher favorable prior accident year loss development compared to 2021. the underwriting expense ratio increased 0.1 percentage points driven by an increase of 0.5 percentage points in the net acquisition expense ratio due to higher costs. this was largely offset by a 0.4 percentage point decrease in the operating expense ratio, driven by continued improvement in operating leverage. fee income: $118.7 million of fee income; management fees stable year over year fee income twelve months ended december 31, y/y change (in thousands, except percentages) 2022 2021 total management fee income $ 108,902 $ 109,071 $ (169 ) total performance fee income (loss) (1) 9,777 19,432 (9,655 ) total fee income $ 118,679 $ 128,503 $ (9,824 ) performance fees are based on the performance of the individual vehicles or products, and may be negative in a particular period if, for example, large losses occur, which can potentially result in no performance fees or the reversal of previously accrued performance fees. total fee income decreased $9.8 million primarily due to lower performance fee income in 2022. – relatively stable management fee income in 2022. the management fees in both years were impacted by a deferral of management fees in davinci as a result of the large losses experienced in both years. – lower performance fee income in 2022 was primarily due to the impact of the 2022 weather-related large losses on the results of the company’s joint ventures and managed funds, partially offset by higher favorable development on prior year losses in davinci. investment results: net investment income increased $240.5 million; total investment result primarily driven by net realized and unrealized losses in the fixed maturity and equity investments portfolio. investment results twelve months ended december 31, y/y change (in thousands, except percentages) 2022 2021 net investment income $ 559,932 $ 319,479 $ 240,453 net realized and unrealized gains (losses) on investments (1,800,485 ) (218,134 ) (1,582,351 ) total investment result $ (1,240,553 ) $ 101,345 $ (1,341,898 ) total investment return (5.7 )% 0.5 % (6.2) pts total investment result decreased $1.3 billion primarily due to: – net realized and unrealized losses in 2022 of $1.4 billion on fixed maturity investments, primarily due to the increase in inflation in 2022, combined with increasing yields on u.s. treasuries, as well as net realized and unrealized losses on equity investments of $123.8 million, which was the result of a generally lower equity market environment through the year, and $130.3 million of net realized and unrealized losses on catastrophe bonds, primarily due to hurricane ian; – net investment income increased as a result of higher interest rates and increased yields within the company’s investment portfolio, primarily driven by an increase in yields on u.s treasuries. other items of note - full year and subsequent events net loss attributable to redeemable noncontrolling interests of $98.6 million was primarily driven by: – net realized and unrealized losses on investments in davinci, vermeer, fontana and medici, including losses on its catastrophe bonds portfolio; and – impact of the 2022 weather-related large losses on davinci, vermeer and medici; partially offset by – net investment income in vermeer. income tax benefit of $59.0 million, principally driven by unrealized investment portfolio losses in the company’s taxable jurisdictions. net foreign exchange losses of $56.9 million compared to a $41.0 million net foreign exchange loss in 2021. the net foreign exchange loss was primarily driven by losses attributable to third party investors in medici, which are allocated through noncontrolling interest, and certain foreign exchange exposures related to underwriting activities, which are not expected to recur. raised third party capital of $1.4 billion during 2022, through davinci ($462.7 million), medici ($350.1 million), fontana ($273.7 million), vermeer ($250.0 million) and upsilon ($79.0 million). redemptions of third-party capital of $687.6 million during 2022, of which $425.8 million were from upsilon, and the remaining from davinci and medici. repurchased 1.1 million common shares at an aggregate cost of $162.8 million and an average price of $155.00 per common share. raised third party capital of $402.9 million, effective january 1, 2023, including $377.2 million in davinci and the remaining in medici. following these transactions, the company’s ownership in davinci and medici was 25.4% and 12.5%, respectively. mona lisa re issued $185 million of principal-at-risk variable rate notes to investors, effective january 10, 2023. conference call details and additional information non-gaap financial measures and additional financial information this press release includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the u.s. (“gaap”) including “operating income (loss) available (attributable) to renaissancere common shareholders,” “operating income (loss) available (attributable) to renaissancere common shareholders per common share - diluted,” “operating return on average common equity - annualized,” “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” a reconciliation of such measures to the most comparable gaap figures in accordance with regulation g is presented in the attached supplemental financial data. please refer to the “investors - financial reports - financial supplements” section of the company’s website at www.renre.com for a copy of the financial supplement which includes additional information on the company’s financial performance. conference call information renaissancere will host a conference call on wednesday, february 1, 2023 at 11:00 a.m. et to discuss this release. live broadcast of the conference call will be available through the “investors - webcasts & presentations” section of the company’s website at www.renre.com. about renaissancere renaissancere is a global provider of reinsurance and insurance that specializes in matching well-structured risks with efficient sources of capital. the company provides property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. established in 1993, renaissancere has offices in bermuda, australia, ireland, singapore, switzerland, the united kingdom and the united states. cautionary statement regarding forward-looking statements any forward-looking statements made in this press release reflect renaissancere’s current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the private securities litigation reform act of 1995. these statements are subject to numerous factors that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements, including the following: the company’s exposure to natural and non-natural catastrophic events and circumstances and the variance it may cause in the company’s financial results; the effect of climate change on the company’s business, including the trend towards increasingly frequent and severe climate events; the effectiveness of the company’s claims and claim expense reserving process; the effect of emerging claims and coverage issues; the performance of the company’s investment portfolio and financial market volatility; the effects of inflation; the ability of the company’s ceding companies and delegated authority counterparties to accurately assess the risks they underwrite; the company’s ability to maintain its financial strength ratings; the highly competitive nature of the company’s industry and its reliance on a small number of brokers; collection on claimed retrocessional coverage, and new retrocessional reinsurance being available on acceptable terms or at all; the historically cyclical nature of the (re)insurance industries; the company’s ability to attract and retain key executives and employees; the company’s ability to successfully implement its business strategies and initiatives; the company’s exposure to credit loss from counterparties; the company’s need to make many estimates and judgments in the preparation of its financial statements; the company’s ability to effectively manage capital on behalf of investors in joint ventures or other entities it manages; changes to the accounting rules and regulatory systems applicable to the company’s business, including changes in bermuda and u.s. laws and regulations; other political, regulatory or industry initiatives adversely impacting the company; the company’s ability to comply with covenants in its debt agreements; the effect of adverse economic factors, including changes in prevailing interest rates and recession or the perception that recession may occur; the effect of cybersecurity risks, including technology breaches or failure; a contention by the u.s. internal revenue service that any of the company’s bermuda subsidiaries are subject to taxation in the u.s.; the effects of possible future tax reform legislation and regulations in the jurisdictions in which we operate; the company’s ability to determine any impairments taken on its investments; the company’s ability to raise capital on acceptable terms, including through debt instruments, the capital markets, and third party investments in our joint ventures and managed funds; the company’s ability to comply with applicable sanctions and foreign corrupt practices laws; the company’s dependence on the ability of its operating subsidiaries to declare and pay dividends; and other factors affecting future results disclosed in renaissancere’s filings with the sec, including its annual reports on form 10-k and quarterly reports on form 10-q. renaissancere holdings ltd. summary consolidated statements of operations (in thousands of united states dollars, except per share amounts and percentages) (unaudited) three months ended twelve months ended december 31, 2022 december 31, 2021 december 31, 2022 december 31, 2021 revenues gross premiums written $ 1,585,276 $ 1,313,018 $ 9,213,540 $ 7,833,798 net premiums written $ 1,345,616 $ 1,116,560 $ 7,196,160 $ 5,939,375 decrease (increase) in unearned premiums 278,544 224,730 (862,171 ) (745,194 ) net premiums earned 1,624,160 1,341,290 6,333,989 5,194,181 net investment income 211,237 80,483 559,932 319,479 net foreign exchange gains (losses) 10,781 (16,697 ) (56,909 ) (41,006 ) equity in earnings (losses) of other ventures 8,517 3,830 11,249 12,309 other income (loss) 7,686 6,431 12,636 10,880 net realized and unrealized gains (losses) on investments 168,139 (21,518 ) (1,800,485 ) (218,134 ) total revenues 2,030,520 1,393,819 5,060,412 5,277,709 expenses net claims and claim expenses incurred 822,937 690,970 4,338,840 3,876,087 acquisition expenses 413,217 333,986 1,568,606 1,214,858 operational expenses 71,704 39,673 276,691 212,184 corporate expenses 11,537 10,426 46,775 41,152 interest expense 12,384 11,872 48,335 47,536 total expenses 1,331,779 1,086,927 6,279,247 5,391,817 income (loss) before taxes 698,741 306,892 (1,218,835 ) (114,108 ) income tax benefit (expense) (5,408 ) (18,616 ) 59,019 10,668 net income (loss) 693,333 288,276 (1,159,816 ) (103,440 ) net (income) loss attributable to redeemable noncontrolling interests (236,397 ) (68,516 ) 98,613 63,285 net income (loss) attributable to renaissancere 456,936 219,760 (1,061,203 ) (40,155 ) dividends on preference shares (8,844 ) (8,843 ) (35,375 ) (33,266 ) net income (loss) available (attributable) to renaissancere common shareholders $ 448,092 $ 210,917 $ (1,096,578 ) $ (73,421 ) net income (loss) available (attributable) to renaissancere common shareholders per common share – basic $ 10.30 $ 4.65 $ (25.50 ) $ (1.57 ) net income (loss) available (attributable) to renaissancere common shareholders per common share – diluted $ 10.27 $ 4.65 $ (25.50 ) $ (1.57 ) operating (loss) income (attributable) available to renaissancere common shareholders per common share - diluted (1) $ 7.33 $ 4.71 $ 7.30 $ 1.72 average shares outstanding - basic 42,795 44,722 43,040 47,171 average shares outstanding - diluted 42,914 44,748 43,040 47,171 net claims and claim expense ratio 50.7 % 51.5 % 68.5 % 74.6 % underwriting expense ratio 29.8 % 27.9 % 29.2 % 27.5 % combined ratio 80.5 % 79.4 % 97.7 % 102.1 % return on average common equity - annualized 41.2 % 14.2 % (22.0 )% (1.1 )% operating return on average common equity - annualized (1) 29.6 % 14.4 % 6.3 % 1.3 % see comments on regulation g for a reconciliation of non-gaap financial measures. renaissancere holdings ltd. summary consolidated balance sheets (in thousands of united states dollars, except per share amounts) december 31, 2022 december 31, 2021 assets (unaudited) (audited) fixed maturity investments trading, at fair value $ 14,351,402 $ 13,507,131 short term investments, at fair value 4,669,272 5,298,385 equity investments, at fair value 625,058 546,016 other investments, at fair value 2,494,954 1,993,059 investments in other ventures, under equity method 79,750 98,068 total investments 22,220,436 21,442,659 cash and cash equivalents 1,194,339 1,859,019 premiums receivable 5,139,471 3,781,542 prepaid reinsurance premiums 1,021,412 854,722 reinsurance recoverable 4,710,925 4,268,669 accrued investment income 121,501 55,740 deferred acquisition costs 1,171,738 849,160 receivable for investments sold 350,526 380,442 other assets 384,702 224,053 goodwill and other intangible assets 237,828 243,496 total assets $ 36,552,878 $ 33,959,502 liabilities, noncontrolling interests and shareholders’ equity liabilities reserve for claims and claim expenses $ 15,892,573 $ 13,294,630 unearned premiums 4,559,107 3,531,213 debt 1,170,442 1,168,353 reinsurance balances payable 3,928,281 3,860,963 payable for investments purchased 493,776 1,170,568 other liabilities 648,036 755,441 total liabilities 26,692,215 23,781,168 redeemable noncontrolling interests 4,535,389 3,554,053 shareholders’ equity preference shares 750,000 750,000 common shares 43,718 44,445 additional paid-in capital 475,647 608,121 accumulated other comprehensive income (loss) (15,462 ) (10,909 ) retained earnings 4,071,371 5,232,624 total shareholders’ equity attributable to renaissancere 5,325,274 6,624,281 total liabilities, noncontrolling interests and shareholders’ equity $ 36,552,878 $ 33,959,502 book value per common share $ 104.65 $ 132.17 renaissancere holdings ltd. supplemental financial data - segment information (in thousands of united states dollars, except percentages) (unaudited) three months ended december 31, 2022 property casualty and specialty other total gross premiums written $ 372,082 $ 1,213,194 $ — $ 1,585,276 net premiums written $ 372,998 $ 972,618 $ — $ 1,345,616 net premiums earned $ 688,238 $ 935,922 $ — $ 1,624,160 net claims and claim expenses incurred 240,503 582,434 — 822,937 acquisition expenses 140,872 272,345 — 413,217 operational expenses 49,638 22,066 — 71,704 underwriting income (loss) $ 257,225 $ 59,077 $ — 316,302 net investment income 211,237 211,237 net foreign exchange gains (losses) 10,781 10,781 equity in earnings of other ventures 8,517 8,517 other income (loss) 7,686 7,686 net realized and unrealized gains (losses) on investments 168,139 168,139 corporate expenses (11,537 ) (11,537 ) interest expense (12,384 ) (12,384 ) income (loss) before taxes and redeemable noncontrolling interests 698,741 income tax benefit (expense) (5,408 ) (5,408 ) net (income) loss attributable to redeemable noncontrolling interests (236,397 ) (236,397 ) dividends on preference shares (8,844 ) (8,844 ) net income (loss) available (attributable) to renaissancere common shareholders $ 448,092 net claims and claim expenses incurred – current accident year $ 370,175 $ 607,648 $ — $ 977,823 net claims and claim expenses incurred – prior accident years (129,672 ) (25,214 ) — (154,886 ) net claims and claim expenses incurred – total $ 240,503 $ 582,434 $ — $ 822,937 net claims and claim expense ratio – current accident year 53.8 % 64.9 % 60.2 % net claims and claim expense ratio – prior accident years (18.9 )% (2.7 )% (9.5 )% net claims and claim expense ratio – calendar year 34.9 % 62.2 % 50.7 % underwriting expense ratio 27.7 % 31.5 % 29.8 % combined ratio 62.6 % 93.7 % 80.5 % three months ended december 31, 2021 property casualty and specialty other total gross premiums written $ 384,657 $ 928,361 $ — $ 1,313,018 net premiums written $ 375,112 $ 741,448 $ — $ 1,116,560 net premiums earned $ 626,359 $ 714,931 $ — $ 1,341,290 net claims and claim expenses incurred 243,356 447,614 — 690,970 acquisition expenses 131,007 202,979 — 333,986 operational expenses 28,898 10,775 — 39,673 underwriting income (loss) $ 223,098 $ 53,563 $ — 276,661 net investment income 80,483 80,483 net foreign exchange gains (losses) (16,697 ) (16,697 ) equity in earnings of other ventures 3,830 3,830 other income (loss) 6,431 6,431 net realized and unrealized gains (losses) on investments (21,518 ) (21,518 ) corporate expenses (10,426 ) (10,426 ) interest expense (11,872 ) (11,872 ) income (loss) before taxes and redeemable noncontrolling interests 306,892 income tax benefit (expense) (18,616 ) (18,616 ) net (income) loss attributable to redeemable noncontrolling interests (68,516 ) (68,516 ) dividends on preference shares (8,843 ) (8,843 ) net income (loss) available (attributable) to renaissancere common shareholders $ 210,917 net claims and claim expenses incurred – current accident year $ 274,649 $ 457,080 $ — $ 731,729 net claims and claim expenses incurred – prior accident years (31,293 ) (9,466 ) — (40,759 ) net claims and claim expenses incurred – total $ 243,356 $ 447,614 $ — $ 690,970 net claims and claim expense ratio – current accident year 43.8 % 63.9 % 54.6 % net claims and claim expense ratio – prior accident years (4.9 )% (1.3 )% (3.1 )% net claims and claim expense ratio – calendar year 38.9 % 62.6 % 51.5 % underwriting expense ratio 25.5 % 29.9 % 27.9 % combined ratio 64.4 % 92.5 % 79.4 % renaissancere holdings ltd. supplemental financial data - segment information (in thousands of united states dollars, except percentages) (unaudited) year ended december 31, 2022 property casualty and specialty other total gross premiums written $ 3,734,241 $ 5,479,299 $ — $ 9,213,540 net premiums written $ 2,847,659 $ 4,348,501 $ — $ 7,196,160 net premiums earned $ 2,770,227 $ 3,563,762 $ — $ 6,333,989 net claims and claim expenses incurred 2,044,771 2,294,069 — 4,338,840 acquisition expenses 547,210 1,021,396 — 1,568,606 operational expenses 194,355 82,336 — 276,691 underwriting income (loss) $ (16,109 ) $ 165,961 $ — 149,852 net investment income 559,932 559,932 net foreign exchange gain (loss) (56,909 ) (56,909 ) equity in earnings of other ventures 11,249 11,249 other income (loss) 12,636 12,636 net realized and unrealized gain (loss) on investments (1,800,485 ) (1,800,485 ) corporate expenses (46,775 ) (46,775 ) interest expense (48,335 ) (48,335 ) income (loss) before taxes and redeemable noncontrolling interests (1,218,835 ) income tax benefit (expense) 59,019 59,019 net (income) loss attributable to redeemable noncontrolling interests 98,613 98,613 dividends on preference shares (35,375 ) (35,375 ) net income (loss) available (attributable) to renaissancere common shareholders $ (1,096,578 ) net claims and claim expenses incurred – current accident year $ 2,250,512 $ 2,335,910 $ — $ 4,586,422 net claims and claim expenses incurred – prior accident years (205,741 ) (41,841 ) — (247,582 ) net claims and claim expenses incurred – total $ 2,044,771 $ 2,294,069 $ — $ 4,338,840 net claims and claim expense ratio – current accident year 81.2 % 65.5 % 72.4 % net claims and claim expense ratio – prior accident years (7.4 )% (1.1 )% (3.9 )% net claims and claim expense ratio – calendar year 73.8 % 64.4 % 68.5 % underwriting expense ratio 26.8 % 30.9 % 29.2 % combined ratio 100.6 % 95.3 % 97.7 % year ended december 31, 2021 property casualty and specialty other total gross premiums written $ 3,958,724 $ 3,875,074 $ — $ 7,833,798 net premiums written $ 2,868,002 $ 3,071,373 $ — $ 5,939,375 net premiums earned $ 2,608,298 $ 2,585,883 $ — $ 5,194,181 net claims and claim expenses incurred 2,163,016 1,713,071 — 3,876,087 acquisition expenses 487,178 727,680 — 1,214,858 operational expenses 143,608 68,576 — 212,184 underwriting income (loss) $ (185,504 ) $ 76,556 $ — (108,948 ) net investment income 319,479 319,479 net foreign exchange gain (loss) (41,006 ) (41,006 ) equity in earnings of other ventures 12,309 12,309 other income (loss) 10,880 10,880 net realized and unrealized gain (loss) on investments (218,134 ) (218,134 ) corporate expenses (41,152 ) (41,152 ) interest expense (47,536 ) (47,536 ) income (loss) before taxes and redeemable noncontrolling interests (114,108 ) income tax benefit (expense) 10,668 10,668 net (income) loss attributable to redeemable noncontrolling interests 63,285 63,285 dividends on preference shares (33,266 ) (33,266 ) net income (loss) available (attributable) to renaissancere common shareholders $ (73,421 ) net claims and claim expenses incurred – current accident year $ 2,396,389 $ 1,729,168 $ — $ 4,125,557 net claims and claim expenses incurred – prior accident years (233,373 ) (16,097 ) — (249,470 ) net claims and claim expenses incurred – total $ 2,163,016 $ 1,713,071 $ — $ 3,876,087 net claims and claim expense ratio – current accident year 91.9 % 66.9 % 79.4 % net claims and claim expense ratio – prior accident years (9.0 )% (0.7 )% (4.8 )% net claims and claim expense ratio – calendar year 82.9 % 66.2 % 74.6 % underwriting expense ratio 24.2 % 30.8 % 27.5 % combined ratio 107.1 % 97.0 % 102.1 % renaissancere holdings ltd. supplemental financial data - gross premiums written (in thousands of united states dollars) (unaudited) three months ended twelve months ended december 31, 2022 december 31, 2021 december 31, 2022 december 31, 2021 property segment catastrophe $ (4,019 ) $ 7,795 $ 2,076,752 $ 2,235,736 other property 376,101 376,862 1,657,489 1,722,988 property segment gross premiums written $ 372,082 $ 384,657 $ 3,734,241 $ 3,958,724 casualty and specialty segment general casualty (1) $ 359,901 $ 281,926 $ 1,560,594 $ 1,258,536 professional liability (2) 349,925 333,257 1,728,570 1,283,864 credit (3) 217,736 139,799 1,062,183 498,946 other specialty (4) 285,632 173,379 1,127,952 833,728 casualty and specialty segment gross premiums written $ 1,213,194 $ 928,361 $ 5,479,299 $ 3,875,074 (1) includes automobile liability, casualty clash, employer’s liability, umbrella or excess casualty, workers’ compensation and general liability. (2) includes directors and officers, medical malpractice, and professional indemnity. (3) includes financial guaranty, mortgage guaranty, political risk, surety and trade credit. (4) includes accident and health, agriculture, aviation, cyber, energy, marine, satellite and terrorism. lines of business such as regional multi-line and whole account may have characteristics of various other classes of business, and are allocated accordingly. renaissancere holdings ltd. supplemental financial data - total investment result (in thousands of united states dollars, except percentages) (unaudited) three months ended twelve months ended december 31, 2022 december 31, 2021 december 31, 2022 december 31, 2021 fixed maturity investments trading $ 136,019 $ 55,643 $ 382,165 $ 234,911 short term investments 23,908 464 41,042 2,333 equity investments 7,474 4,077 20,864 9,017 other investments catastrophe bonds 31,441 16,527 94,784 64,860 other 13,793 8,100 37,497 28,811 cash and cash equivalents 3,947 74 5,197 297 216,582 84,885 581,549 340,229 investment expenses (5,345 ) (4,402 ) (21,617 ) (20,750 ) net investment income 211,237 80,483 559,932 319,479 net investment income return - annualized 4.1 % 1.5 % 2.7 % 1.5 % net realized gains (losses) on fixed maturity investments trading (110,762 ) (1,472 ) (732,561 ) 79,588 net unrealized gains (losses) on fixed maturity investments trading 187,900 (99,504 ) (636,762 ) (389,376 ) net realized and unrealized gains (losses) on investments-related derivatives (3,347 ) (15,713 ) (165,293 ) (12,237 ) net realized gains (losses) on equity investments 4,397 79,589 43,035 335,491 net unrealized gains (losses) on equity investments 55,251 (5,944 ) (166,823 ) (285,882 ) other investments net realized and unrealized gains (losses) on other investments - catastrophe bonds 29,578 (9,958 ) (130,335 ) (35,033 ) net realized and unrealized gains (losses) on other investments - other 5,122 31,484 (11,746 ) 89,315 net realized and unrealized gains (losses) on investments 168,139 (21,518 ) (1,800,485 ) (218,134 ) total investment result $ 379,376 $ 58,965 $ (1,240,553 ) $ 101,345 total investment return - annualized 7.4 % 1.1 % (5.7 )% 0.5 % comments on regulation g in addition to the gaap financial measures set forth in this press release, the company has included certain non-gaap financial measures within the meaning of regulation g. the company has provided these financial measures in previous investor communications and the company’s management believes that these measures are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for comparison with other companies within or outside the industry. these measures may not, however, be comparable to similarly titled measures used by companies within or outside of the insurance industry. investors are cautioned not to place undue reliance on these non-gaap measures in assessing the company’s overall financial performance. operating income (loss) available (attributable) to renaissancere common shareholders and operating return on average common equity - annualized the company uses “operating income (loss) available (attributable) to renaissancere common shareholders” as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “operating income (loss) available (attributable) to renaissancere common shareholders” as used herein differs from “net income (loss) attributable to renaissancere common shareholders,” which the company believes is the most directly comparable gaap measure, by the exclusion of net realized and unrealized gains and losses on investments, excluding other investments - catastrophe bonds, net foreign exchange gains and losses, corporate expenses associated with the acquisition of tmr and the subsequent sale of renaissancere (uk) limited (“renaissancere uk”), the income tax expense or benefit associated with these adjustments and the portion of these adjustments attributable to the company’s redeemable noncontrolling interests. the company’s management believes that “operating income (loss) available (attributable) to renaissancere common shareholders” is useful to investors because it more accurately measures and predicts the company’s results of operations by removing the variability arising from: fluctuations in the fair value of the company’s fixed maturity investment portfolio, equity investments trading, other investments (excluding catastrophe bonds) and investments-related derivatives; fluctuations in foreign exchange rates; corporate expenses associated with the acquisition of tmr and the subsequent sale of renaissancere uk; the associated income tax expense or benefit of these adjustments; and the portion of these adjustments attributable to the company’s redeemable noncontrolling interests. the company also uses “operating income (loss) available (attributable) to renaissancere common shareholders” to calculate “operating income (loss) available (attributable) to renaissancere common shareholders per common share - diluted” and “operating return on average common equity - annualized.” the following table is a reconciliation of: (1) net income (loss) attributable to renaissancere common shareholders to “operating income (loss) available (attributable) to renaissancere common shareholders”; (2) net income (loss) attributable to renaissancere common shareholders per common share - diluted to “operating income (loss) available (attributable) to renaissancere common shareholders per common share - diluted”; and (3) return on average common equity - annualized to “operating return on average common equity - annualized.” comparative information for all prior periods has been updated to conform to the current methodology and presentation. three months ended twelve months ended (in thousands of united states dollars, except per share amounts and percentages) december 31, 2022 december 31, 2021 december 31, 2022 december 31, 2021 net income (loss) available (attributable) to renaissancere common shareholders $ 448,092 $ 210,917 $ (1,096,578 ) $ (73,421 ) adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds (138,561 ) 11,560 1,670,150 183,101 adjustment for net foreign exchange losses (gains) (10,781 ) 16,697 56,909 41,006 adjustment for corporate expenses associated with the acquisition of tmr and the subsequent sale of renaissancere uk — — — 135 adjustment for income tax expense (benefit) (1) (5,818 ) (3,628 ) (83,149 ) (11,521 ) adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) 29,221 (21,854 ) (231,776 ) (57,701 ) operating income (loss) available (attributable) to renaissancere common shareholders $ 322,153 $ 213,692 $ 315,556 $ 81,599 net income (loss) available (attributable) to renaissancere common shareholders per common share - diluted $ 10.27 $ 4.65 $ (25.50 ) $ (1.57 ) adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds (3.23 ) 0.26 38.80 3.88 adjustment for net foreign exchange losses (gains) (0.25 ) 0.37 1.32 0.87 adjustment for corporate expenses associated with the acquisition of tmr and the subsequent sale of renaissancere uk — — — — adjustment for income tax expense (benefit) (1) (0.14 ) (0.08 ) (1.93 ) (0.24 ) adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) 0.68 (0.49 ) (5.39 ) (1.22 ) operating income (loss) available (attributable) to renaissancere common shareholders per common share - diluted $ 7.33 $ 4.71 $ 7.30 $ 1.72 return on average common equity - annualized 41.2 % 14.2 % (22.0 )% (1.1 )% adjustment for net realized and unrealized losses (gains) on investments, excluding other investments - catastrophe bonds (12.8 )% 0.8 % 33.5 % 2.9 % adjustment for net foreign exchange losses (gains) (1.0 )% 1.1 % 1.1 % 0.6 % adjustment for corporate expenses associated with the acquisition of tmr and the subsequent sale of renaissancere uk — % — % — % — % adjustment for income tax expense (benefit) (1) (0.5 )% (0.2 )% (1.7 )% (0.2 )% adjustment for net income (loss) attributable to redeemable noncontrolling interests (2) 2.7 % (1.5 )% (4.6 )% (0.9 )% operating return on average common equity - annualized 29.6 % 14.4 % 6.3 % 1.3 % (1) represents the income tax (expense) benefit associated with the adjustments to net income (loss) available (attributable) to renaissancere common shareholders. the income tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors. (2) represents the portion of the adjustments above that are attributable to the company’s redeemable noncontrolling interests, including the income tax impact of those adjustments. tangible book value per common share and tangible book value per common share plus accumulated dividends the company has included in this press release “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” “tangible book value per common share” is defined as book value per common share excluding goodwill and intangible assets per share. “tangible book value per common share plus accumulated dividends” is defined as book value per common share excluding goodwill and intangible assets per share, plus accumulated dividends. the company’s management believes “tangible book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because they provide a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets. the following table is a reconciliation of book value per common share to “tangible book value per common share” and “tangible book value per common share plus accumulated dividends.” december 31, 2022 september 30, 2022 june 30, 2022 march 31, 2022 december 31, 2021 book value per common share $ 104.65 $ 94.55 $ 113.69 $ 121.44 $ 132.17 adjustment for goodwill and other intangibles (1) (5.84 ) (5.89 ) (5.90 ) (5.89 ) (5.90 ) tangible book value per common share 98.81 88.66 107.79 115.55 126.27 adjustment for accumulated dividends 25.00 24.63 24.26 23.89 23.52 tangible book value per common share plus accumulated dividends $ 123.81 $ 113.29 $ 132.05 $ 139.44 $ 149.79 quarterly change in book value per common share 10.7 % (16.8 )% (6.4 )% (8.1 )% 2.5 % quarterly change in tangible book value per common share plus change in accumulated dividends 11.9 % (17.4 )% (6.4 )% (8.2 )% 2.8 % year to date change in book value per common share (20.8 )% (28.5 )% (14.0 )% (8.1 )% (4.5 )% year to date change in tangible book value per common share plus change in accumulated dividends (20.6 )% (28.9 )% (14.0 )% (8.2 )% (4.0 )% at december 31, 2022, september 30, 2022, june 30, 2022, march 31, 2022, and december 31, 2021, the adjustment for goodwill and other intangibles included $17.8 million, $18.0 million, $18.3 million, $18.4 million, and $18.6 million, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method.
