RenRe’s integrated underwriting strategy better serves clients: O’Donnell, CEO

Kevin J. O’Donnell, President and CEO of RenaissanceRe, explained that the company’s underwriting approach combines property lines with casualty and specialty to create an optimally efficient portfolio, enhancing its capacity to solve customers’ problems.

In his recent Letter to Shareholders, O’Donnell emphasised that each of RenRe’s business lines has a unique risk and volatility profile, contributing in distinct yet equally important ways to its Three Drivers of Profit.

He noted that property is more volatile, generating higher underwriting profits in good years, along with substantial fee income from partner capital.

Conversely, casualty and specialty lines are less volatile, producing a smaller but more predictable underwriting result, as well as some fee income from Fontana, its third-party capitalised casualty and specialty reinsurance focused joint venture.

The segment’s largest contribution in today’s market comes from investment income, driven by the significant float generated from loss reserves.

“Our approach to underwriting is to combine all these lines of business together to build an optimally efficient portfolio,” O’Donnell said.

He continued, “We do this by taking into account the contribution of each line we write to the Three Drivers of Profit, given the individual volatility and diversification characteristics of each line, and matching this against shareholder and partner capital. We continue to add more of each type of risk so long as doing so increases the efficiency of our portfolio.

“The combination of diversified underwriting, fee and investment income enhances expected risk-adjusted returns and, therefore, our ability to deliver superior longterm returns to our shareholders.”

O’Donnell also underscored that this integrated approach enhances RenRe’s ability to serve clients.

“Our ability to provide holistic solutions to our customers makes us a more valuable partner and gives us a seat at the table when programs are being designed,” he said. “We are far more likely to receive favorable signings on attractive lines, which results in a superior portfolio of risk relative to our competitors.”

For full-year 2024, RenRe reported total Group-wide gross premiums written (GPW) of $11.7 billion, up from $8.7 billion in 2023, with strong growth in both property and the casualty and specialty segments, driven by the renewal of business acquired in the Validus acquisition.

Net premiums written (NPW) rose to $9.9 billion from $7.5 billion, while net premiums earned (NPE) reached $10.1 billion, up from $7.5 billion.

Within the property segment, GPW grew 35.4% to over $4.8 billion in 2024, up from $3.6 billion in 2023. NPW increased 29.2% to $3.8 billion from $3 billion, while NPE rose 24.6% to $3.9 billion from $3.1 billion.

The casualty and specialty segment saw GPW climb 30.4% to $6.9 billion from $5.3 billion the year prior. NPW rose 36% to $6.1 billion from $4.5 billion, while NPE increased 42.6% to $6.2 billion from $4.4 billion.

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