RENAISSANCERE HOLDINGS LTD [RNR] Filings

10-Q 1 rnr-20230630.htm 10-Q rnr-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-14428

RENAISSANCERE HOLDINGS LTD.

(Exact Name Of Registrant As Specified In Its Charter)


Bermuda			98-0141974
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification Number)

Renaissance House, 12 Crow Lane, Pembroke, Bermuda HM 19

(Address of Principal Executive Offices) (Zip Code)

(441) 295-4513

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
Common Shares, Par Value $1.00 per share	RNR	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a Series F 5.750% Preference Share, Par Value $1.00 per share	RNR PRF	New York Stock Exchange
Depositary Shares, each representing a 1/1,000th interest in a Series G 4.20% Preference Share, Par Value $1.00 per share	RNR PRG	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒, Accelerated filer ☐, Non-accelerated filer ☐, Smaller reporting company ☐, Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of Common Shares, par value U.S. $1.00 per share, outstanding at July 24, 2023 was 51,181,534.

RENAISSANCERE HOLDINGS LTD.

TABLE OF CONTENTS


		Page
	GLOSSARY OF DEFINED TERMS	3
	NOTE ON FORWARD-LOOKING STATEMENTS	5

PART I
ITEM 1.	FINANCIAL STATEMENTS	7






ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	59
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	106
ITEM 4.	CONTROLS AND PROCEDURES	106

PART II
ITEM 1.	LEGAL PROCEEDINGS	107
ITEM 1A.	RISK FACTORS	107
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	110
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	110
ITEM 4.	MINE SAFETY DISCLOSURES	110
ITEM 5.	OTHER INFORMATION	110
ITEM 6.	EXHIBITS	111

SIGNATURES		112

GLOSSARY OF DEFINED TERMS

In this Form 10-Q, references to “RenaissanceRe” refer to RenaissanceRe Holdings Ltd. (the parent company) and references to “we,” “us,” “our” and the “Company” refer to RenaissanceRe Holdings Ltd. together with its subsidiaries, unless the context requires otherwise.


“AIG”			American International Group, Inc., a Delaware corporation and NYSE-listed company (together with its affiliates and subsidiaries)
“ASC”			Accounting Standards Codification
“A.M. Best”			A.M. Best Company, Inc.
“DaVinci Reinsurance”			DaVinci Reinsurance Ltd.
“DaVinci”			DaVinciRe Holdings Ltd. and its subsidiaries
“ERM”			enterprise risk management
“Exchange Act”			the Securities Exchange Act of 1934, as amended
“FAL”			a deposit that must be submitted to support the underwriting capacity of a member of Lloyd’s
“FASB”			Financial Accounting Standards Board
“FCR”			financial condition report
“Fitch”			Fitch Ratings Ltd.
“Fontana”			Fontana Holdings L.P. and its subsidiaries
“Form 10-K”			Annual Report on Form 10-K
“Form 10-Q”			this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023
“IRS”			United States Internal Revenue Service
“Medici”			RenaissanceRe Medici Fund Ltd.
“Moody’s”			Moody’s Investors Service
“Renaissance Reinsurance”			Renaissance Reinsurance Ltd.
“Renaissance Reinsurance of Europe”			Renaissance Reinsurance of Europe Unlimited Company
“Renaissance Reinsurance U.S.”			Renaissance Reinsurance U.S. Inc.
“RenaissanceRe”			RenaissanceRe Holdings Ltd.
“RenaissanceRe Finance”			RenaissanceRe Finance Inc.
“RenaissanceRe Specialty U.S.”			RenaissanceRe Specialty U.S. Ltd.
“RREAG”			RenaissanceRe Europe AG
“S&P”			Standard and Poor’s Rating Services
“SEC”			U.S. Securities and Exchange Commission
“Securities Act”			Securities Act of 1933, as amended
“Stock Purchase Agreement”			Stock Purchase Agreement, dated May 22, 2023, among RenaissanceRe Holdings Ltd. and AIG
“Syndicate 1458”			RenaissanceRe Syndicate 1458
“Talbot”			Talbot Underwriting Ltd., an affiliate of AIG
“Top Layer”			Top Layer Reinsurance Ltd.
“Tower Hill Companies”			collectively, our investments in a group of Tower Hill affiliated companies including Bluegrass Insurance Management, LLC, Tower Hill Claims Service, LLC, Tower Hill Holdings, Inc., Tower Hill Insurance Group, LLC, Tower Hill Insurance Managers, LLC, Tower Hill Re Holdings, Inc., Tower Hill Signature Insurance Holdings, Inc., Tower Hill Risk Management LLC and Tomoka Re Holdings, Inc.
“U.K.”			United Kingdom
“U.S.”			United States of America
“Upsilon Diversified”			RenaissanceRe Upsilon Diversified Fund, a segregated account of Upsilon Fund


“Upsilon Fund”			RenaissanceRe Upsilon Fund Ltd.
“Upsilon RFO”			Upsilon RFO Re Ltd.
“Validus”			Validus Holdings, Validus Specialty, and their respective subsidiaries (including Validus Re), collectively
“Validus Acquisition”			The acquisitions under the Stock Purchase Agreement, together with the other transactions contemplated in the Stock Purchase Agreement.
“Validus Business”			the collective business of Validus
“Validus Holdings”			Validus Holdings, Ltd.
“Validus Re”			Validus Reinsurance, Ltd.
“Validus Specialty”			Validus Specialty, LLC
“Vermeer”			Vermeer Reinsurance Ltd.

NOTE ON FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q of RenaissanceRe Holdings Ltd. contains forward-looking statements within the meaning of Section 27A of the Securities Act, and Section 21E of the Exchange Act. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, us. In particular, statements using words such as “may,” “should,” “estimate,” “expect,” “anticipate,” “intend,” “believe,” “predict,” “potential,” or words of similar import generally involve forward-looking statements. For example, we may include certain forward-looking statements in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” with regard to trends in results, prices, volumes, operations, investment results, margins, combined ratios, fees, reserves, market conditions, risk management and exchange rates. This Form 10-Q also contains forward-looking statements with respect to our business and industry, such as those relating to our strategy and management objectives, plans and expectations regarding our response and ability to adapt to changing economic conditions, market standing and product volumes, competition and new entrants in our industry, industry capital, insured losses from loss events, government initiatives and regulatory matters affecting the reinsurance and insurance industries. In addition, this Form 10-Q may include forward-looking statements with respect to the Validus Acquisition and its impact on our business and our relationship with AIG. In light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking statements in this Form 10-Q should not be considered as a representation by us or any other person that our current objectives or plans will be achieved. Numerous factors could cause our actual results to differ materially from those addressed by the forward-looking statements, including those set forth under “Risk Factors” in this Form 10-Q. We undertake no obligation to release publicly the results of any future revision we may make to forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

The inclusion of forward-looking statements in this report should not be considered as a representation by us or any other person that our current objectives or plans will be achieved. Numerous factors could cause our actual results to differ materially from those addressed by the forward-looking statements, including the following:

•the risk that the Validus Acquisition may not be completed within the expected timeframe, or at all;

•the risk that regulatory agencies in certain jurisdictions may impose onerous conditions following the Validus Acquisition;

•difficulties in integrating the Validus Business;

•the risk that the due diligence process that we undertook in connection with the Validus Acquisition may not have revealed all facts that may be relevant in connection with the Validus Acquisition;

•our ability to manage the growth of the Validus Business’ operations successfully following the Validus Acquisition;

•that the historical financial statements of the Validus Business are not representative of the future financial position, future results of operations or future cash flows of the Validus Business following the Validus Acquisition;

•risks from our increased debt obligations as a result of the Validus Acquisition;

•the dilutive impact on our shareholders from the issuance of common shares to AIG in connection with the Validus Acquisition;

•our exposure to natural and non-natural catastrophic events and circumstances and the variance they may cause in our financial results;

•the effect of climate change on our business, including the trend towards increasingly frequent and severe climate events;

•the effectiveness of our claims and claim expense reserving process;

•the effect of emerging claims and coverage issues;

•the performance of our investment portfolio and financial market volatility;

•the effects of inflation;

•the ability of our ceding companies and delegated authority counterparties to accurately assess the risks they underwrite;

•our ability to maintain our financial strength ratings;

•the highly competitive nature of our industry;

•our 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;

•our ability to attract and retain key executives and employees;

•our ability to successfully implement our business, strategies and initiatives;

•our exposure to credit loss from counterparties;

•our need to make many estimates and judgments in the preparation of our financial statements;

•our ability to effectively manage capital on behalf of investors in joint ventures or other entities we manage;

•changes to the accounting rules and regulatory systems applicable to our business, including changes in Bermuda and U.S. laws or regulations;

•other political, regulatory or industry initiatives adversely impacting us;

•our ability to comply with covenants in our debt agreements;

•the effect of adverse economic factors, including changes in the 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 IRS that any of our 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;

•our ability to determine any impairments taken on our investments;

•our ability to raise capital on acceptable terms, including through debt instruments, the capital markets, and third party investments in our joint ventures and managed fund partners;

•our ability to comply with applicable sanctions and foreign corrupt practices laws; and

•our dependence on the ability of our operating subsidiaries to declare and pay dividends.

As a consequence, our future financial condition and results may differ from those expressed in any forward-looking statements made by or on behalf of us. The factors listed above, which are discussed in more detail in our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 8, 2023, and Item 1A of this Quarterly Report on Form 10-Q, should not be construed as exhaustive. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to revise or update forward-looking statements to reflect new information, events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


			Page
Consolidated Balance Sheets at June 30, 2023 (unaudited) and December 31, 2022			8
Consolidated Statements of Operations for the three and six months ended June 30, 2023 and 2022			9
Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2023 and 2022			10
Consolidated Statements of Changes in Shareholders’ Equity for the three and six months ended June 30, 2023 and 2022			11
Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022			12
Notes to the Consolidated Financial Statements			13
Note 1. Organization			13
Note 2. Significant Accounting Policies			15
Note 3. Investments			15
Note 4. Fair Value Measurements			18
Note 5. Reinsurance			29
Note 6. Reserve for Claims and Claim Expenses			31
Note 7. Debt and Credit Facilities			35
Note 8. Noncontrolling Interests			36
Note 9. Variable Interest Entities			40
Note 10. Shareholders’ Equity			45
Note 11. Earnings per Share			46
Note 12. Segment Reporting			47
Note 13. Derivative Instruments			51
Note 14. Commitments and Contingencies and Other Items			57
Note 15. Acquisition of Validus			57
Note 16. Subsequent Event			58

RenaissanceRe Holdings Ltd. and Subsidiaries

Consolidated Balance Sheets

(in thousands of United States Dollars, except share and per share amounts)


	June 30, 2023		December 31, 2022
Assets	(Unaudited)		(Audited)
Fixed maturity investments trading, at fair value – amortized cost $16,398,682 at June 30, 2023 (December 31, 2022 – $15,038,551)	$	15,888,564	$	14,351,402

Short term investments, at fair value - amortized cost $6,374,957 at June 30, 2023 (December 31, 2022 - $4,671,581)	6,373,969		4,669,272
Equity investments, at fair value	93,058		625,058
Other investments, at fair value	3,091,686		2,494,954
Investments in other ventures, under equity method	89,505		79,750
Total investments	25,536,782		22,220,436
Cash and cash equivalents	943,935		1,194,339
Premiums receivable	6,490,886		5,139,471
Prepaid reinsurance premiums	1,187,177		1,021,412
Reinsurance recoverable	4,689,351		4,710,925
Accrued investment income	147,824		121,501
Deferred acquisition costs	1,300,992		1,171,738
Receivable for investments sold	508,887		350,526
Other assets	358,863		384,702
Goodwill and other intangible assets	235,218		237,828

Total assets	$	41,399,915	$	36,552,878
Liabilities, Noncontrolling Interests and Shareholders’ Equity
Liabilities
Reserve for claims and claim expenses	$	16,138,128	$	15,892,573
Unearned premiums	5,717,302		4,559,107
Debt	1,882,101		1,170,442
Reinsurance balances payable	3,780,410		3,928,281
Payable for investments purchased	547,974		493,776
Other liabilities	254,925		648,036

Total liabilities	28,320,840		26,692,215
Commitments and contingencies
Redeemable noncontrolling interests	5,676,262		4,535,389
Shareholders’ Equity
Preference shares: $1.00 par value – 30,000 shares issued and outstanding at June 30, 2023 (December 31, 2022 – 30,000)	750,000		750,000
Common shares: $1.00 par value – 51,182,221 shares issued and outstanding at June 30, 2023 (December 31, 2022 – 43,717,836)	51,182		43,718
Additional paid-in capital	1,825,215		475,647
Accumulated other comprehensive income (loss)	(14,050)		(15,462)
Retained earnings	4,790,466		4,071,371
Total shareholders’ equity attributable to RenaissanceRe	7,402,813		5,325,274


Total liabilities, noncontrolling interests and shareholders’ equity	$	41,399,915	$	36,552,878

See accompanying notes to the consolidated financial statements

RenaissanceRe Holdings Ltd. and Subsidiaries

Consolidated Statements of Operations

For the three and six months ended June 30, 2023 and 2022

(in thousands of United States Dollars, except per share amounts) (Unaudited)


	Three months ended				Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Revenues
Gross premiums written	$	2,651,621	$	2,464,639	$	5,441,882	$	5,407,603
Net premiums written	$	2,195,803	$	1,863,616	$	4,459,506	$	4,028,833
Decrease (increase) in unearned premiums	(410,541)		(407,233)		(993,694)		(1,086,025)
Net premiums earned	1,785,262		1,456,383		3,465,812		2,942,808
Net investment income	292,662		107,211		547,040		190,902
Net foreign exchange gains (losses)	(13,488)		(50,821)		(27,991)		(66,307)
Equity in earnings (losses) of other ventures	7,700		7,383		17,230		993
Other income (loss)	3,876		923		(430)		2,116
Net realized and unrealized gains (losses) on investments	(222,781)		(654,107)		56,670		(1,327,124)



Total revenues	1,853,231		866,972		4,058,331		1,743,388
Expenses
Net claims and claim expenses incurred	931,211		706,239		1,732,411		1,547,972
Acquisition expenses	422,545		361,238		854,802		737,745
Operational expenses	80,491		72,520		157,965		140,427
Corporate expenses	23,371		12,352		36,214		24,854
Interest expense	14,895		11,895		27,029		23,850
Total expenses	1,472,513		1,164,244		2,808,421		2,474,848
Income (loss) before taxes	380,718		(297,272)		1,249,910		(731,460)
Income tax benefit (expense)	(5,942)		30,534		(34,844)		67,241


Net income (loss)	374,776		(266,738)		1,215,066		(664,219)
Net (income) loss attributable to redeemable noncontrolling interests	(174,907)		(49,331)		(442,291)		(37,419)
Net income (loss) attributable to RenaissanceRe	199,869		(316,069)		772,775		(701,638)
Dividends on preference shares	(8,844)		(8,844)		(17,688)		(17,688)
Net income (loss) available (attributable) to RenaissanceRe common shareholders	$	191,025	$	(324,913)	$	755,087	$	(719,326)


Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share – basic	$	4.10	$	(7.53)	$	16.75	$	(16.64)


Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share – diluted	$	4.09	$	(7.53)	$	16.71	$	(16.64)
Dividends per common share	$	0.38	$	0.37	$	0.76	$	0.74

See accompanying notes to the consolidated financial statements

RenaissanceRe Holdings Ltd. and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

For the three and six months ended June 30, 2023 and 2022

(in thousands of United States Dollars) (Unaudited)


	Three months ended				Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Comprehensive income (loss)
Net income (loss)	$	374,776	$	(266,738)	$	1,215,066	$	(664,219)
Change in net unrealized gains (losses) on investments, net of tax	390		(3,251)		1,308		(2,417)
Foreign currency translation adjustments, net of tax	398		917		104		(1,842)

Comprehensive income (loss)	375,564		(269,072)		1,216,478		(668,478)
Net (income) loss attributable to redeemable noncontrolling interests	(174,907)		(49,331)		(442,291)		(37,419)

Comprehensive (income) loss attributable to redeemable noncontrolling interests	(174,907)		(49,331)		(442,291)		(37,419)
Comprehensive income (loss) attributable to RenaissanceRe	$	200,657	$	(318,403)	$	774,187	$	(705,897)

See accompanying notes to the consolidated financial statements

RenaissanceRe Holdings Ltd. and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

For the three and six months ended June 30, 2023 and 2022

(in thousands of United States Dollars) (Unaudited)


	Three months ended				Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Preference shares
Beginning balance	$	750,000	$	750,000	$	750,000	$	750,000


Ending balance	750,000		750,000		750,000		750,000
Common shares
Beginning balance	43,932		44,193		43,718		44,445
Issuance of shares	7,245		—		7,245		—
Repurchase of shares	—		(298)		—		(875)
Issuance of restricted stock awards	5		(14)		219		311
Ending balance	51,182		43,881		51,182		43,881
Additional paid-in capital
Beginning balance	467,623		513,631		475,647		608,121
Issuance of shares	1,344,326		—		1,344,326		—
Repurchase of shares	—		(43,799)		—		(136,656)

Change in redeemable noncontrolling interests	(676)		(3,126)		(1,782)		(3,989)
Issuance of restricted stock awards	13,942		12,379		7,024		11,609
Ending balance	1,825,215		479,085		1,825,215		479,085
Accumulated other comprehensive income (loss)
Beginning balance	(14,838)		(12,834)		(15,462)		(10,909)
Change in net unrealized gains (loss) on investments, net of tax	390		(3,251)		1,308		(2,417)
Foreign currency translation adjustments, net of tax	398		917		104		(1,842)

Ending balance	(14,050)		(15,168)		(14,050)		(15,168)
Retained earnings
Beginning balance	4,618,818		4,821,970		4,071,371		5,232,624

Net income (loss)	374,776		(266,738)		1,215,066		(664,219)
Net (income) loss attributable to redeemable noncontrolling interests	(174,907)		(49,331)		(442,291)		(37,419)

Dividends on common shares	(19,377)		(16,196)		(35,992)		(32,437)
Dividends on preference shares	(8,844)		(8,844)		(17,688)		(17,688)
Ending balance	4,790,466		4,480,861		4,790,466		4,480,861

Total shareholders’ equity	$	7,402,813	$	5,738,659	$	7,402,813	$	5,738,659

See accompanying notes to the consolidated financial statements

RenaissanceRe Holdings Ltd. and Subsidiaries

Consolidated Statements of Cash Flows

For the six months ended June 30, 2023 and 2022

(in thousands of United States Dollars) (Unaudited)


	Six months ended
	June 30, 2023		June 30, 2022
Cash flows provided by (used in) operating activities
Net income (loss)	$	1,215,066	$	(664,219)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities
Amortization, accretion and depreciation	(73,232)		9,583
Equity in undistributed (earnings) losses of other ventures	2,831		13,961
Net realized and unrealized (gains) losses on investments	(109,559)		1,220,758




Change in:
Premiums receivable	(1,351,415)		(1,626,675)
Prepaid reinsurance premiums	(165,765)		(499,843)
Reinsurance recoverable	21,574		62,210
Deferred acquisition costs	(129,254)		(240,266)
Reserve for claims and claim expenses	245,555		148,176
Unearned premiums	1,158,195		1,586,004
Reinsurance balances payable	(147,871)		524,871
Other	(39,451)		(265,391)
Net cash provided by (used in) operating activities	626,674		269,169
Cash flows provided by (used in) investing activities
Proceeds from sales and maturities of fixed maturity investments trading	8,149,227		10,527,219
Purchases of fixed maturity investments trading	(9,719,075)		(11,743,171)


Net sales (purchases) of equity investments	546,399		(286,399)
Net sales (purchases) of short term investments	(1,656,772)		939,736
Net sales (purchases) of other investments	(490,366)		(397,523)
Net sales (purchases) of investments in other ventures	(13,048)		2,391
Return of investment from investment in other ventures	2,369		2,213




Net cash provided by (used in) investing activities	(3,181,266)		(955,534)
Cash flows provided by (used in) financing activities
Dividends paid – RenaissanceRe common shares	(35,992)		(32,437)
Dividends paid – preference shares	(17,688)		(17,780)
RenaissanceRe common share issuance, net of expenses	1,352,583		—
RenaissanceRe common share repurchases	—		(141,356)
Issuance of debt, net of expenses	741,597		—
Repayment of debt	(30,000)		—




Net third-party redeemable noncontrolling interest share transactions	310,135		408,774
Taxes paid on withholding shares	(18,837)		(10,848)

Net cash provided by (used in) financing activities	2,301,798		206,353
Effect of exchange rate changes on foreign currency cash	2,390		19,088
Net increase (decrease) in cash and cash equivalents	(250,404)		(460,924)

Cash and cash equivalents, beginning of period	1,194,339		1,859,019
Cash and cash equivalents, end of period	$	943,935	$	1,398,095

See accompanying notes to the consolidated financial statements

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023

(unless otherwise noted, amounts in tables expressed in thousands of United States (“U.S.”) dollars,

except shares, per share amounts and percentages) (Unaudited)

NOTE 1. ORGANIZATION

This report on Form 10-Q should be read in conjunction with RenaissanceRe’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“Form 10-K”). RenaissanceRe was formed under the laws of Bermuda on June 7, 1993. Together with its wholly owned and majority-owned subsidiaries, joint ventures and managed funds, the Company provides property, casualty and specialty reinsurance and certain insurance solutions to its customers.

•Renaissance Reinsurance Ltd. (“Renaissance Reinsurance”), a Bermuda-domiciled reinsurance company, is the Company’s principal reinsurance subsidiary and provides property, casualty and specialty reinsurance coverages to insurers and reinsurers on a worldwide basis.

•Renaissance Reinsurance U.S. Inc. (“Renaissance Reinsurance U.S.”) is a reinsurance company domiciled in the state of Maryland that provides property, casualty and specialty reinsurance coverages to insurers and reinsurers, primarily in the Americas.

•RenaissanceRe Syndicate 1458 (“Syndicate 1458”) is the Company’s Lloyd’s syndicate. RenaissanceRe Corporate Capital (UK) Limited (“RenaissanceRe CCL”), a wholly owned subsidiary of RenaissanceRe, is Syndicate 1458’s sole corporate member. RenaissanceRe Syndicate Management Ltd. (“RSML”), a wholly owned subsidiary of RenaissanceRe, is the managing agent for Syndicate 1458.

•RenaissanceRe Europe AG (“RREAG”), a Swiss-domiciled reinsurance company, which has branches in Australia, Bermuda, the U.K. and the U.S., provides property, casualty and specialty reinsurance coverages to insurers and reinsurers on a worldwide basis.

•RenaissanceRe Specialty U.S. Ltd. (“RenaissanceRe Specialty U.S.”), a Bermuda-domiciled insurer, which operates subject to U.S. federal income tax.

•DaVinci Reinsurance Ltd. (“DaVinci Reinsurance”), a wholly-owned subsidiary of DaVinciRe Holdings Ltd. (“DaVinci”), is a managed joint venture formed by the Company to principally write property catastrophe reinsurance and certain casualty and specialty reinsurance lines of business on a global basis.

•Vermeer Reinsurance Ltd. (“Vermeer”) is a managed joint venture formed by the Company to provide capacity focused on risk remote layers in the U.S. property catastrophe market. The Company maintains a majority voting control of Vermeer, while Stichting Pensioenfonds Zorg en Welzijn (“PFZW”), a pension fund represented by PGGM Vermogensbeheer B.V., a Dutch pension fund manager, retains economic benefits.

•Fontana Holdings L.P. and its subsidiaries (collectively, “Fontana”) are a managed joint venture formed by the Company to assume casualty and specialty risks in line with the Company’s book of business. Fontana launched effective April 1, 2022.

•Top Layer Reinsurance Ltd. (“Top Layer”) is a managed joint venture formed by the Company to write high excess non-U.S. property catastrophe reinsurance.

•RenaissanceRe Underwriting Managers U.S. LLC, is licensed as a reinsurance intermediary broker in the State of Connecticut and underwrites specialty treaty reinsurance solutions on both a quota share and excess of loss basis on behalf of affiliates.

•Renaissance Underwriting Managers, Ltd. (“RUM”), a wholly-owned subsidiary of RenaissanceRe, is the exclusive underwriting manager for certain of our joint ventures or managed funds in return for a management fee, performance fee, or both.

•RenaissanceRe Fund Management Ltd. (“RFM”) is a wholly-owned Bermuda exempted company and is the exclusive investment fund manager for several of the Company’s joint ventures or managed

funds, in return for a management fee, a performance based incentive fee, or both. RFM is an Exempt Reporting Adviser with the Securities and Exchange Commission and serves as the investment adviser to third-party investors in the various private investment partnerships and insurance-related investment products offered by the Company.

•RenaissanceRe Medici Fund Ltd. (“Medici”) is an exempted company, incorporated in Bermuda and registered as an institutional fund. Medici invests, primarily on behalf of third-party investors, in various instruments that have returns primarily tied to property catastrophe risk.

•Upsilon RFO Re Ltd. (“Upsilon RFO”), an exempted company incorporated in Bermuda and registered as a segregated accounts company and as a collateralized insurer, is a managed fund formed by the Company principally to provide additional capacity to the worldwide aggregate and per-occurrence primary and retrocessional property catastrophe excess of loss market.

•RenaissanceRe Upsilon Fund Ltd., an exempted company incorporated in Bermuda and registered as a segregated accounts company and a Class A Professional Fund, provides a fund structure through which third-party investors can invest in reinsurance risk managed by the Company.

•Mona Lisa Re Ltd. (“Mona Lisa Re”), a Bermuda domiciled special purpose insurer (“SPI”), provides reinsurance capacity to subsidiaries of RenaissanceRe through reinsurance agreements which are collateralized and funded by Mona Lisa Re through the issuance of one or more series of principal-at-risk variable rate notes.

•Fibonacci Reinsurance Ltd. (“Fibonacci Re”), an exempted company incorporated in Bermuda and registered as an SPI, was formed to provide collateralized capacity to Renaissance Reinsurance and its affiliates. Fibonacci Re raises capital from third-party investors and the Company, via private placements of participating notes which are listed on the Bermuda Stock Exchange.

•The Company and Reinsurance Group of America, Incorporated formed an initiative (“Langhorne”) to source third-party capital to support reinsurers targeting large in-force life and annuity blocks. Langhorne’s capital commitment period expired at the end of December 2022 and the Langhorne entities have been, or are, in the process of winding down.

•Following the acquisition of Tokio Millennium Re AG and certain associated entities and subsidiaries (collectively, “TMR”) on March 22, 2019, the Company managed Shima Reinsurance Ltd. (“Shima Re”), Norwood Re Ltd. (“Norwood Re”) and Blizzard Re Ltd. (“Blizzard,” together with Shima Re and Norwood Re, the “TMR managed third-party capital vehicles”), which provided third-party investors with access to reinsurance risk. The TMR managed third-party capital vehicles no longer write new business. The Company ceased providing management services to Blizzard effective November 1, 2020, and to Shima Re and Norwood Re effective December 1, 2020.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES

There have been no material changes to the Company’s significant accounting policies as described in its Form 10-K for the year ended December 31, 2022, except as described below.

BASIS OF PRESENTATION

These consolidated financial statements have been prepared on the basis of accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information and in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of management, these unaudited consolidated financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of the Company’s financial position and results of operations as at the end of and for the periods presented. All significant intercompany accounts and transactions have been eliminated from these statements.

Certain comparative information has been reclassified to conform to the current presentation. Because of the seasonality of the Company’s business, the results of operations and cash flows for any interim period will not necessarily be indicative of the results of operations and cash flows for the full fiscal year or subsequent quarters.

USE OF ESTIMATES IN FINANCIAL STATEMENTS

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported and disclosed amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The major estimates reflected in the Company’s consolidated financial statements include, but are not limited to, the reserve for claims and claim expenses; reinsurance recoverable and premiums receivable, including provisions for reinsurance recoverable and premiums receivable to reflect expected credit losses; estimates of written and earned premiums; fair value, including the fair value of investments, financial instruments and derivatives; impairment charges; and the Company’s deferred tax valuation allowance.

NOTE 3. INVESTMENTS

Fixed Maturity Investments Trading

The following table summarizes the fair value of fixed maturity investments trading:



	June 30, 2023		December 31, 2022
U.S. treasuries	$	8,592,242	$	7,180,129
Corporate (1)	4,371,407		4,390,568
Agencies	476,476		395,149

Non-U.S. government	401,743		383,838



Residential mortgage-backed	788,256		710,429
Commercial mortgage-backed	209,661		213,987
Asset-backed	1,048,779		1,077,302
Total fixed maturity investments trading	$	15,888,564	$	14,351,402

(1)Corporate fixed maturity investments include non-U.S. government-backed corporate fixed maturity investments.

Contractual maturities of fixed maturity investments trading are described in the following table. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.




	June 30, 2023				December 31, 2022
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in less than one year	$	522,097	$	515,445	$	364,501	$	356,770
Due after one through five years	8,653,072		8,444,588		8,117,971		7,875,771
Due after five through ten years	4,748,683		4,578,779		4,072,142		3,805,287
Due after ten years	331,809		303,056		356,268		311,856
Mortgage-backed	1,073,223		997,917		1,009,205		924,416
Asset-backed	1,069,798		1,048,779		1,118,464		1,077,302
Total	$	16,398,682	$	15,888,564	$	15,038,551	$	14,351,402

Equity Investments

The following table summarizes the fair value of equity investments:



	June 30, 2023		December 31, 2022
Financials	$	92,890	$	103,250
Consumer	155		33,447
Communications and technology	13		48,687
Fixed income exchange traded funds	—		295,481
Equity exchange traded funds	—		90,510
Industrial, utilities and energy	—		25,326
Healthcare	—		24,617
Basic materials	—		3,740
Total	$	93,058	$	625,058

Pledged Investments

At June 30, 2023, $7.3 billion (December 31, 2022 - $7.9 billion) of cash and investments at fair value were on deposit with, or in trust accounts for the benefit of, various counterparties, including with respect to the Company’s letter of credit facilities. Of this amount, $1.3 billion (December 31, 2022 - $1.2 billion) is on deposit with, or in trust accounts for the benefit of, U.S. state regulatory authorities.

Reverse Repurchase Agreements

At June 30, 2023, the Company held $486.2 million (December 31, 2022 - $38.5 million) of reverse repurchase agreements. These loans are fully collateralized, are generally outstanding for a short period of time and are presented on a gross basis as part of short term investments on the Company’s consolidated balance sheets. The required collateral for these loans typically includes high-quality, readily marketable instruments at a minimum amount of 102% of the loan principal. Upon maturity, the Company receives principal and interest income.

Net Investment Income

The components of net investment income are as follows:



	Three months ended				Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Fixed maturity investments trading	$	169,739	$	76,547	$	325,239	$	138,964
Short term investments	50,231		4,397		83,181		5,533
Equity investments	2,766		4,516		6,165		7,270
Other investments
Catastrophe bonds	49,522		20,235		88,353		37,595
Other	20,820		6,894		45,391		12,446
Cash and cash equivalents	4,585		(95)		8,849		(136)
	297,663		112,494		557,178		201,672
Investment expenses	(5,001)		(5,283)		(10,138)		(10,770)
Net investment income	$	292,662	$	107,211	$	547,040	$	190,902

Net Realized and Unrealized Gains (Losses) on Investments

Net realized and unrealized gains (losses) on investments are as follows:



	Three months ended				Six months ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022


Net realized gains (losses) on fixed maturity investments trading	$	(74,212)	$	(287,154)	$	(178,977)	$	(408,306)
Net unrealized gains (losses) on fixed maturity investments trading	(139,793)		(149,820)		172,233		(613,997)
Net realized and unrealized gains (losses) on fixed maturity investments trading	(214,005)		(436,974)		(6,744)		(1,022,303)
Net realized and unrealized gains (losses) on investments-related derivatives(1)	(65,051)		(66,078)		(52,889)		(106,366)
Net realized gains (losses) on equity investments	(18,755)		35,592		(27,493)		35,572
Net unrealized gains (losses) on equity investments	20,627		(127,104)		59,778		(175,773)
Net realized and unrealized gains (losses) on equity investments	1,872		(91,512)		32,285		(140,201)
Net realized and unrealized gains (losses) on other investments - catastrophe bonds	38,186		(24,660)		62,312		(32,921)
Net realized and unrealized gains (losses) on other investments - other	16,217		(34,883)		21,706		(25,333)
Net realized and unrealized gains (losses) on investments	$	(222,781)	$	(654,107)	$	56,670	$	(1,327,124)

(1)Net realized and unrealized gains (losses) on investment-related derivatives includes fixed maturity investments related derivatives (interest rate futures, interest rate swaps, credit default swaps and total return swaps), and equity investments related derivatives (equity futures). See “Note 13. Derivative Instruments” for additional information.

Net Sales (Purchases) of Investments

The tables below show the Company’s cash flows in respect of gross and net purchases and sales of equity investments, short term investments, other investments and investments in other ventures for the six months ended June 30, 2023 and 2022.



Six months ended June 30, 2023	Gross Purchases		Gross Sales		Net
Equity investments	$	(1,687)	$	548,086	$	546,399
Short term investments	$	(19,067,333)	$	17,410,561	$	(1,656,772)
Other investments	$	(750,539)	$	260,173	$	(490,366)
Investments in other ventures	$	(13,048)	$	—	$	(13,048)



Six months ended June 30, 2022	Gross Purchases		Gross Sales		Net
Equity investments	$	(498,171)	$	211,772	$	(286,399)
Short term investments	$	(13,619,935)	$	14,559,671	$	939,736
Other investments	$	(682,151)	$	284,628	$	(397,523)
Investments in other ventures	$	(949)	$	3,340	$	2,391

NOTE 4. FAIR VALUE MEASUREMENTS

The use of fair value to measure certain assets and liabilities with resulting unrealized gains or losses is pervasive within the Company’s consolidated financial statements. Fair value is defined under accounting guidance currently applicable to the Company as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between open market participants at the measurement date. The Company recognizes the change in unrealized gains or losses arising from changes in fair value in its consolidated statements of operations.

FASB ASC Topic Fair Value Measurements and Disclosures prescribes a fair value hierarchy that prioritizes the inputs to the respective valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to valuation techniques that use at least one significant input that is unobservable (Level 3). The three levels of the fair value hierarchy are described below:

•Fair values determined by Level 1 inputs utilize unadjusted quoted prices obtained from active markets for identical assets or liabilities for which the Company has access at the measurement date. The fair value is determined by multiplying the quoted price by the quantity held by the Company;

•Fair values determined by Level 2 inputs utilize inputs (other than quoted prices included in Level 1) that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals, broker quotes and certain pricing indices; and

•Level 3 inputs are based all or in part on significant unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In these cases, significant management assumptions can be used to establish management’s best estimate of the assumptions used by other market participants in determining the fair value of the asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement of the asset or liability. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and the Company considers factors specific to the asset or liability.

In order to determine if a market is active or inactive for a security, the Company considers a number of factors, including, but not limited to, the spread between what a seller is asking for a security and what a buyer is bidding for the same security, the volume of trading activity for the security in question, the price of

the security compared to its par value (for fixed maturity investments), and other factors that may be indicative of market activity.

There have been no material changes in the Company’s valuation techniques, nor have there been any transfers between Level 1 and Level 2, or Level 2 and Level 3 during the period represented by these consolidated financial statements.

Below is a summary of the assets and liabilities that are measured at fair value on a recurring basis and also represents the carrying amount on the Company’s consolidated balance sheets:



At June 30, 2023	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Fixed maturity investments trading
U.S. treasuries	$	8,592,242	$	8,592,242	$	—	$	—
Corporate (1)	4,371,407		—		4,371,407		—
Agencies	476,476		—		476,476		—

Non-U.S. government	401,743		—		401,743		—



Residential mortgage-backed	788,256		—		788,256		—
Commercial mortgage-backed	209,661		—		209,661		—
Asset-backed	1,048,779		—		1,048,779		—
Total fixed maturity investments trading	15,888,564		8,592,242		7,296,322		—
Short term investments	6,373,969		94,474		6,279,495		—
Equity investments trading	93,058		93,058		—		—
Other investments
Catastrophe bonds	1,679,184		—		1,679,184		—
Term loans	100,000		—		—		100,000
Direct private equity investments	71,155		—		—		71,155

RENAISSANCERE HOLDINGS LTD [RNR] Filings
RENAISSANCERE HOLDINGS LTD [RNR-PF] Filings
RENAISSANCERE HOLDINGS LTD [RNR-PG] Filings
10-Q	[2023-07-26]
10-Q	[2023-05-03]
10-K	[2023-02-08]
10-Q	[2022-11-02]
10-Q	[2022-07-26]
10-Q	[2022-05-04]
10-K	[2022-02-04]
10-Q	[2021-10-26]
10-Q	[2021-07-23]
10-Q	[2021-04-29]
10-K	[2021-02-05]
10-Q	[2020-10-28]
10-Q	[2020-07-29]
10-Q	[2020-05-07]
10-K	[2020-02-07]
10-Q	[2019-10-30]
10-Q	[2019-07-25]
10-Q	[2019-05-08]
10-K	[2019-02-07]
10-Q	[2018-10-31]
10-Q	[2018-07-25]
10-Q	[2018-05-02]
10-K	[2018-02-09]
10-Q	[2017-11-02]
10-Q	[2017-07-26]
10-Q	[2017-05-03]
10-K	[2017-02-23]
10-Q	[2016-11-02]
10-Q	[2016-07-27]
10-Q	[2016-04-28]
10-K	[2016-02-19]
10-Q	[2015-11-06]
10-Q	[2015-07-29]
10-Q	[2015-05-06]
10-K	[2015-02-20]
10-Q	[2014-11-06]
10-Q	[2014-07-30]
10-Q	[2014-04-30]
10-K	[2014-02-21]
10-Q	[2013-11-06]
10-Q	[2013-08-01]
10-Q	[2013-05-03]
10-K	[2013-02-22]
10-Q	[2012-11-02]
10-Q	[2012-08-02]
10-Q	[2012-05-03]
10-K	[2012-02-23]

RENAISSANCERE HOLDINGS LTD [RNR] Filings

RENAISSANCERE HOLDINGS LTD [RNR-PF] Filings

RENAISSANCERE HOLDINGS LTD [RNR-PG] Filings