• Tangible Book Value Growth: Increased by 26%.
• Operating Income: Exceeded $2.2 billion.
• Operating Income Per Share: $42.99 per share.
• Underwriting Income: $1.6 billion with an 81.5% adjusted combined ratio.
• Retained Investment Income: Exceeded $1.1 billion.
• Fee Income: $327 million from Capital Partners.
• Share Repurchases: $460 million in Q4 2024, totaling over $800 million since Q2 2024.
• Casualty & Specialty Adjusted Combined Ratio: 98% for the year.
• Fourth Quarter Operating Income: $407 million.
• Annualized Operating Return on Average Common Equity: 16% for Q4.
• Net Loss for Q4: $199 million due to mark-to-market losses.
• Property Segment Adjusted Combined Ratio: 69% in Q4.
• Casualty & Specialty Adjusted Combined Ratio for Q4: 101%.
• Gross Premiums Written: $11.7 billion, up 32% for 2024.
• Net Premiums Written: $10 billion, up 33% for 2024.
• Property Catastrophe Adjusted Combined Ratio: 32.5% for 2024.
• Other Property Adjusted Combined Ratio: 88% for 2024.
• Casualty & Specialty Net Premiums Earned: $6.2 billion, up 43% for 2024.
• Fee Income Growth: 38% increase to $327 million for 2024.
• Retained Net Investment Income: $1.1 billion, up 37% for 2024.
• Operating Expense Ratio: 4.9% for 2024.
• Corporate Expenses: $135 million for 2024.
• California Wildfires Estimated Pretax Impact: $750 million based on a $50 billion market loss.

• Warning! GuruFocus has detected 7 Warning Sign with TRMK.

Release Date: January 29, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• RenaissanceRe Holdings Ltd (NYSE:RNR) reported a strong financial performance for 2024, with operating income reaching a record $2.2 billion and an operating return on average common equity of 23.5%.
• The company achieved a 26% growth in tangible book value plus accumulated dividends, demonstrating robust shareholder value creation.
• RenaissanceRe Holdings Ltd (NYSE:RNR) successfully integrated the Validus acquisition, retaining substantially all of the Validus underwriting portfolio and generating significant capital efficiencies.
• The company demonstrated effective capital management by repurchasing $815 million of its shares since the second quarter of 2024, enhancing shareholder returns.
• RenaissanceRe Holdings Ltd (NYSE:RNR) maintained a strong leadership position in specialty and credit lines, achieving favorable signings and maintaining lines despite increased competition.

Negative Points

• The Casualty & Specialty segment reported an adjusted combined ratio of 98%, up from 94% the previous year, driven by elevated loss trends in general liability lines.
• The fourth quarter saw a net loss of $199 million due to mark-to-market losses in the investment portfolio, resulting in an annualized return on average common equity of negative 8%.
• The California wildfires are expected to have a significant pretax net negative impact of $750 million, with potential for further variation due to the recency and complexity of the event.
• Property cat rates experienced high single-digit decreases during January 1 renewals, indicating increased competition and potential pressure on future profitability.
• The company acknowledged the need for continued rate increases and improved claims management in the general liability market to address ongoing challenges and maintain profitability.

Q & A Highlights

Q: My first question is on Casualty/Specialty. The combined ratio trended higher and over 100% in the fourth quarter. Why doesn't this change your forward outlook for the business? A: Kevin O'Donnell, CEO: We had a profitable year in Casualty/Specialty with favorable development. The focus is on the General Liability (GL) line. We've been using a trend of about 10% to 12% and feel comfortable with that. We've targeted the best accounts within GL and avoided problematic lines. We're confident in our guidance and comfortable with our reserves.

Q: With the California wildfires, will this impact pricing during renewals in 2025 or 2026? A: David Marra, Chief Underwriting Officer: The California wildfires will impact some nationwide and California-specific accounts. Most of our US property catastrophe accounts renew in the second quarter and are loss impacted. We expect better opportunities and rate improvements in the second quarter renewals.

Q: Given the attention on casualty, can you provide details on unique losses in the quarter? A: David Marra, Chief Underwriting Officer: Movements between classes are outcomes of our process. We construct portfolios for the best expected return and adjust reserves based on emerging news. We don't book where our clients book, and nothing in the public domain gives us concern about our position.

Q: Why are you not taking reserve charges or adding reserves to the Casualty class if trends are improving? A: Kevin O'Donnell, CEO: We recognize uncertainty and add a buffer to the loss ratio. If market behavior continues positively, this will result in prior year favorable development. It's prudent to be disciplined given market uncertainty.

Q: How far back do the general liability reserve adjustments go? A: Kevin O'Donnell, CEO: The focus is on accident years 2019 to 2022. Our portfolio was small during the soft market years (2014-2018), and we had protections for those years in acquired portfolios.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.