Posted on 29 Oct 2010
RenaissanceRe Holdings Ltd.'s third-quarter earnings fell 21% as claims jumped due to an earthquake in New Zealand at the provider of property catastrophe reinsurance.
Shares were down 1.3% at $60.36 after hours as earnings missed analysts' expectations.
Investment income slid 43% while net premiums written grew 37%. Both weakened in the second quarter.
The third quarter's main worry for property insurers is always hurricanes, but this year's active season has failed to generate any pummeling storms. However, the year-earlier quarter had mild storm losses too, setting up tough comparisons.
Chief Executive Neill Currie said the results benefited from "solid underwriting profits and strong total returns in our investment portfolio." He added that while it was a quiet season for land-falling U.S. hurricanes, the results also reflect a $73.6 million negative impact from the New Zealand earthquake.
RenaissanceRe Holdings posted a profit of $215.3 million, or $3.70 a share, down from $269.2 million, or $4.12 a share, a year earlier. Operating earnings, which leave out investment gains and losses, slumped to $1.59 from $3.85. Analysts surveyed by Thomson Reuters expected $2.37.
Revenue increased 11% to $488.3 million, benefiting from a much higher gain on fixed maturity investments. The combined ratio, the percentage of each dollar in premiums spent