Background
Founded in 1993, RenaissanceRe Holdings provides reinsurance and insurance to cover the risk of natural and man-made catastrophes. The company uses sophisticated computer models to construct a superior portfolio of these coverages.

RenaissanceRe’s disciplined underwriting approach, sophisticated risk models and management expertise have established the company as a leader in the property catastrophe business and led to consistently strong performance and growth.

Recently, the company has increased its premiums from certain specialty lines of reinsurance, and individual risk business.

RenaissanceRe’s principal business is property catastrophe reinsurance. A subsidiary, Renaissance Reinsurance, a Bermuda-domiciled company, is one of the world’s premier providers of this coverage. Reinsurance is offered to insurance companies and other reinsurers primarily on an excess of loss basis.
Renaissance Re’s coverage protects against large natural catastrophes, such as earthquakes and hurricanes, as well as claims arising from other natural and man-made catastrophes such as winter storms, freezes, floods, fires, tornadoes and explosions. The company uses its advanced proprietary modelling and management systems to maximise return on equity, subject to prudent risk constraints.

The company has also recently increased its premiums from specialty lines of reinsurance, which includes all lines of reinsurance written by Renaissance Re other than property-catastrophe reinsurance. It has also increased its individual risk business.

RenaissanceRe defines the individual risk segment to include underwriting that involves understanding the characteristics of the original underlying insurance policy. The individual risk segment currently provides insurance both on a direct and on a surplus lines basis and also provides reinsurance to other insureds on a quota share basis.

RenaissanceRe’s specialty business has established itself as a franchise. In specialty, the company brings the same disciplined underwriting and sophisticated analytical tools to bear that it uses in its catastrophe business.

Spotlight – Joint ventures
In addition to the business it writes for its own account, RenaissanceRe also writes property catastrophe reinsurance on behalf of joint ventures.
Founded in 1999, Top Layer Reinsurance provides high layer coverage for non-US risks. DaVinci Reinsurance, founded in 2001, writes property catastrophe reinsurance side-by-side with Renaissance Reinsurance.
RenaissanceRe acts as the exclusive underwriting manager for these joint ventures in return for management fees and a profit participation.
           
In order for this activity to work to the satisfaction of all concerned, RenaissanceRe maintains records for each venture completely separately. Reviews are conducted to ensure that the allocation of business to the joint ventures happens on the right basis. It has been the company’s experience that the joint ventures perform at least as well as the company itself.
           
By selling its expertise in this fashion, RenaissanceRe has developed a unique reputation in the reinsurance business.

Analysis
Renaissance Re, a member of the “Class of ’93” reinsurers formed in Bermuda after Hurricane Andrew, has broadened its base of operations in the past few years. The principal lines of business it now writes are:

• Property Catastrophe Reinsurance: Among the factors that have contributed to the company’s success in catastrophe reinsurance are its relationship-driven approach within the context of cost-based pricing. Quick turnaround time, creative product concepts and value added modelling/risk management are the key elements in the company’s first-class reputation in the property catastrophe reinsurance market.
  RenaissanceRe’s catastrophe reinsurance contracts are primarily property or property–related, such as business interruption. In addition to writing reinsurance contracts, the company actively consults with many clients on their catastrophe risk management issues and helps to devise practical solutions.
  
• Specialty Reinsurance: The company’s specialty reinsurance book includes all lines of reinsurance written by RenaissanceRe other than property-catastrophe reinsurance. The company brings large line size, responsive service and a relationship-driven approach to programmes that meet its risk/reward criteria.
• Structured Products: Renaissance Reinsurance employs a focused group of professionals with diverse backgrounds tasked with leveraging its core underwriting franchise for the benefit of investors and clients. RenaissanceRe has initiated and effectively managed several joint ventures organised to underwrite property catastrophe and other lines of reinsurance. It has also have developed a range of other highly structured assumed and ceded reinsurance transactions, customised to the needs of its partners.
• Primary Insurance: Renaissance Reinsurance also writes primary insurance, leveraging its expertise through a focus on business exposed to natural catastrophes. The company principally writes its primary insurance through Glencoe Insurance, which is domiciled in Bermuda, focusing on commercial property insurance on an excess and surplus lines basis. Glencoe operates as a non-admitted excess and surplus lines company in more than 50 US states and territories including California, Florida, New York, Illinois, Texas and the US Virgin Islands.

Senior management
Chairman and CEO: James Stanard
CFO: John Lummis

Financial data
(half-year to June 30, 2005)
Gross premiums written: $1.138 billion, up 3 percent
Net premiums earned: $640 million, down 3 percent
Net income: $233.5 million, down 23 percent
Shareholders’ equity: $2.823 billion, up 1 percent

Website
www.renre.com