RenaissanceRe NYSE: RNR executives told investors the company opened 2026 with what they described as a strong, diversified quarter, with underwriting, fee income and investment income all contributing to results despite heightened geopolitical and market volatility.
For the first quarter, the company reported operating income of $591 million, operating earnings per share of $13.75 and an annualized operating return on equity of 22%, according to President and CEO Kevin O’Donnell. Tangible book value per share increased 1.5% to $233.49, which O’Donnell said reflected retained mark-to-market losses of $357 million and $353 million of share repurchases “at a premium to book value.”
Diversified “drivers of profit” led by underwriting
O’Donnell said RenaissanceRe’s model is designed to reduce reliance on any single market condition, emphasizing a balance of underwriting, fee, and investment income. In the quarter, underwriting income was $589 million, which management attributed to strong current accident year performance and favorable prior year reserve development.
O’Donnell said the company benefited from about $160 million of favorable reserve development, with a “proportionally larger contribution from other property.” CFO Bob Qutub added that the company reported favorable development in both segments, “with most of it coming from other property where we fully retain in our bottom-line results.”
Qutub reported an adjusted combined ratio of 72% for the quarter. By segment, he cited:
- Property catastrophe: adjusted combined ratio of 19.2% and 10.2% reported combined ratio, including 11 percentage points of favorable development across accident years.
- Other property: current accident year loss ratio of 55.5% and adjusted combined ratio of 66.1%, including 29 percentage points of favorable development “primarily from our non-cat attritional book.”
- Casualty and Specialty: adjusted combined ratio of 99.4%, which management said was consistent with prior guidance.
Gross premiums written were $3.4 billion, down 16% year over year, which Qutub said was influenced by reinstatement premiums in the prior-year quarter following California wildfires. Excluding reinstatement premiums, gross written premiums were down 9% and property catastrophe gross written premiums were “nearly flat,” while other property was down 7% and Casualty and Specialty was down 13%.
Renewals: property cat rates down, but capital deployed into new limit
Group Chief Underwriting Officer David Marra said the January 1 renewals brought property catastrophe reinsurance rate declines in the “low teens” for the portfolio, with U.S. accounts down closer to 10% and international/global accounts closer to 15%. Even so, he said the business remained “highly accretive” with “strong rate adequacy.”
Marra said the company retained the majority of its portfolio and deployed $1 billion of new limit, focusing growth on “accounts and layers with the most attractive margins,” including select California deals impacted by wildfires and certain nationwide accounts, as well as several large U.S. clients where the company “captured new demand.”
On midyear renewals, Marra told analysts the pricing environment in early second-quarter deals looked like a continuation of first-quarter trends and that RenaissanceRe had already bound about half of its U.S. midyear portfolio, with roughly half of that on private terms. He also said industry new demand appeared to be higher than previously expected, citing estimates moving from $10 billion to “closer to $15 billion” of new U.S. catastrophe limit demand, although he cautioned the figure would not be known until renewals conclude.
Marra highlighted Florida market dynamics, pointing to “strong pricing,” reduced social inflation due to tort reform, and robust terms and conditions, and said the shift from public to private markets was increasing demand for reinsurance.
Middle East war exposure and casualty portfolio actions
Management said RenaissanceRe’s exposure to the war in the Middle East was limited and concentrated in specialty lines designed to cover such risks. Marra said war is excluded from standard property policies and that potential exposure would primarily come from “war on land and marine war,” adding that the company purchases retrocessional protection on those portfolios.
In response to an analyst question about losses tied to Iran, O’Donnell said losses were “within specialty” and specifically “within marine and marine energy,” and said they were “fully reflected” in reserves. He added the company was being cautious about releasing IBNR in the Casualty and Specialty segment given ongoing uncertainty. Later, management characterized the impact as “a couple points” in the segment.
Marra also discussed continued actions to manage casualty exposure to social inflation. He said the company had reduced exposure in general liability deals most exposed to social inflation, noting exposure to the class was down 40% over the last two years while premiums were down less due to rate increases. He said the company had shifted the portfolio mix so specialty and credit now make up more than half of the portfolio, and increased the use of ceded reinsurance, with ceded levels around 20% of Casualty and Specialty premiums compared to 13% a year ago.
Fee income outperformed expectations; investment income remained robust amid mark-to-market losses
RenaissanceRe reported total fee income of about $94 million. Qutub said that included $48 million of management fees and $46 million of performance fees. He said performance fees were higher than expected due to strong underwriting results, favorable development, and “a one-time recognition of deferred performance fees related to a return of capital by DaVinciRe.” For the second quarter, management guided to management fees of around $50 million, while performance fees were expected to vary but total around $120 million for the year absent large loss events or favorable development.
Retained net investment income was $304 million. O’Donnell said the result reflected scale, portfolio quality, and a rate environment that remained favorable. Qutub said investment income was down about 3% from the fourth quarter due to lower average interest rates in the first two months of the quarter, and he reiterated that higher Treasury yields create near-term mark-to-market pressure but improve reinvestment yields over time.
The company recorded about $350 million of retained mark-to-market losses, which Qutub said were split roughly half between fixed maturities and equities, consistent with broader market volatility.
Management also described portfolio repositioning during the quarter. Qutub said RenaissanceRe reduced gold exposure from 5% to 2%, increased exposure to high-quality investment-grade corporate credit, reduced shorter-term Treasuries, extended duration to 3.4 years from 3.0 years, and increased new money yield from 4.8% to 5.1%. O’Donnell said the gold position had been profitable in the quarter and since inception and was reduced to “lock in gains” and lower potential future volatility.
On private credit, O’Donnell said about 5% of the investment portfolio was allocated there. Qutub said the private credit portfolio is diversified by managers and strategies, emphasizes senior secured lending, and has limited exposure to strained areas such as software or BDCs. He added that the company was capturing an illiquidity premium versus investment-grade positions that “can range from 200–300 basis points,” while noting differing return profiles across direct lending, distressed and secondary strategies.
Capital management: continued buybacks; expenses and tax items
RenaissanceRe repurchased $353 million of shares in the quarter, buying 1.2 million shares at an average price of $289 per share, Qutub said. Through April 24, the company repurchased an additional $105 million, bringing year-to-date repurchases to $458 million. O’Donnell said the company has repurchased over 20% of outstanding shares since 2024—almost 11 million shares, or $2.7 billion through April 24—while remaining well-capitalized to support underwriting and growth opportunities.
Qutub said the GAAP effective tax rate was 6% due to “a few one-off items” and was expected to return to “low double digits” next quarter. He also discussed Bermuda substance-based tax credits, noting the company could recognize 75% of the value in 2026 versus 50% in 2025, with about two-thirds reflected in underwriting and a 90 basis point impact on the combined ratio, and the remainder in corporate expenses.
Operating expense ratio was 4.1% for the quarter, which Qutub said was influenced by one-time items. He reiterated expectations for the operating expense ratio to rise toward 5%–5.5% over the year as the company invests in the business, including building a new front-office system for REMS.
Looking ahead, management characterized its outlook as “continuity, not change,” with O’Donnell saying the underwriting environment remains competitive but rates remain adequate. Qutub provided second-quarter expectations including other property net premiums earned around $350 million with an attritional loss ratio in the mid-50s, and Casualty and Specialty net premiums earned of approximately $1.3 billion with an adjusted combined ratio in the high 90s. Management said retained net investment income should trend slightly higher in the second quarter.
About RenaissanceRe NYSE: RNR
RenaissanceRe Holdings Ltd. is a global provider of reinsurance and insurance solutions, specializing in property catastrophe, casualty, and specialty lines. Established in 1993 and headquartered in Bermuda, the company trades on the New York Stock Exchange under the symbol RNR. With a focus on underwriting and risk assessment, RenaissanceRe offers tailored programs designed to help insurers and corporations manage exposure to natural disasters, liability claims, and other complex risks.
The company operates through two primary segments: Reinsurance and Insurance.
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