RenaissanceRe (RNR) 2 Nov 232023 Q3 Earnings call transcript

Good morning. My name is Chelsea, and I will be your conference operator today. At this time, I would like to welcome everyone to the RenaissanceRe Third Quarter 2023 Earnings Conference Call and Webcast. After the prepared remarks, we will open the call for your questions. Instructions will be given at that time. Instructions]. [Operator now over will Keith the turn I to call McCue. And Investor President of Vice Relations. Finance Senior and Please go ahead.

Thank to XXXX RenaissanceRe's Chelsea. Third you, Good Quarter Earnings morning, Conference and welcome Call.

President discuss Executive Qutub, President and are today and Officer. Vice our Financial me Executive Officer; to Kevin Joining O'Donnell, and Chief Chief Bob results

housekeeping some First, matters.

actual include materially It's including and today new the operations of Our important results today. expectations note the updated differ will following discussion transaction. results and expectations shared forward-looking statements, Validus from to that business may for our

information these Additional and outcomes be found regarding earnings our filings SEC can the factors shaping in in release. our

release call, today's financial available are our non-GAAP we Kevin. to Reconciliations the supplement, present website other the on And now, to over at metrics turn and Kevin? earnings information to During measures found non-GAAP I'd and financial measures. call be like concerning which will also may renre.com. GAAP our in

multiple morning, like in the outcome joining and disciplined everyone, quarter. closing the for of overall to focus presented May, and Validus you provided today many Thanks, a are and Both significant opportunities third the implementation of X many performance our strong strategy. begin streams. in acquisition Steve. Beginning have highlighting announcing our to of clarity Good work accomplishments, thank I'd the planned this our execution with acquisition necessary call. teams This working year. direct today's us have the by seize themselves consistency has of across diligently the and that Validus. been Since

at we're express to the details. I Bob who by It contributed me this been team's will achievement. transaction would this all X. and walk is to done RenRe, to the testament at everyone as able like has quickly get the through possible. goal collective to Validus AIG, financial gratitude closing to Our hard outstanding at my work that November a as

the reinsurance. [Audio our leading as accelerates it Validus a geographies. It transaction. capabilities equity of global positions us and partner competitive reflect leading like significant our what one short, new strategy they advantage. platforms common access enhances on point the in AIG, scale market further P&C drivers has best for at favorable the deepens a our by risk businesses. provides extends X Gap] further how cycle of of new to teams to the tools, outcomes industry. In insurance our the world's profit, and with through adds our premier in capital to and lines does, economic as Adding are portfolios efficient for customers, our us combining achieved acquisition and Validus a companies and valuable market this each our acquiring however, in to investments [ talents relationships making have we providing win-win would I growth makes diversification in return, the he And year. Validus highly attractive already by of of ] and lines this be X well reinsurer Before the finally, organically access provides In platform broker and to P&C us new business further existing increases

Validus have the depth. portfolio We greater in underwriting reviewed now

financial we this for excited result, transaction several and increasingly a As are about strategic reasons.

First, of billion to we premium. there of believe incremental that $X.X potential estimate upside original our is

brokers and their We consistently have has communicated this to positive. feedback our been customers and

of the with support balance to underwriting the can less portfolio as well sheets. due our our XX% This as Validus we support believe is efficiency partner capital integrated system we of Second, the capital.

our counterparty capital us As structure ideal flexible focus and the reinsurance AIG. make on for

future performance. from underwriting we portfolio's can means benefit the us in investment AIG's forward, Going jointly

AIG. The to the than large to we due a than exposure. which agreement when rate reserves interest announced higher is This Third, of have pool investment limited deal. current we with supporting we environment points is are a portfolio XXX obtaining reserve more a basis development

will Validus serve even the investment tailwind stronger result, a as As to an portfolio profitability.

pool integration Finally, of will Consequently, understand we model, of AIG the a Validus authors be have focus May, either Since always we been we the talent over processes Validus. ramped The Validus roles Re's people our full-time with extended many expected. even employees. Successful Re been working and operating systems. next team than deeper has the by impressed for to and business quality to year. closely Validus or at transition Validus

will to entity. have this Validus Our we made this portfolio Actually, as towards our to portfolio one bring goal will the X operate goal REMS. of combined progress an done just And specifically. companies received that be represented By together significant have system with to underwriters already. am access all view the same quickly that risk. in Monday, I the is I say our to e-mail that's and underwriting pleased

and into the implemented moved already they our already regarding be our have systems so on our many the acquisition of We will data, allow to have end several easily to shared together. legacy summary, promises employees technology and teams delivered collaborate by can Validus completed we that sit week. In Re. of of across rules All solutions meeting offices yesterday,

AIG. transaction. integral the And privileged this to team success want leadership to Peter his to Zaffino are the asset who of are We have acquire to such I a and had opportunity high-quality thank from

each of we outcome third is bottom for XX% outcome over will and on our bring. delivered financial quarter. equity. This of factors $XXX income the a forward the are from a strong our profit, performance AIG billion our line by financial common catastrophe solid acquisition. This our $X.X in and driven and We an X Year-to-date, This in was of to are about not future. Shifting contributions operating or persist. losses now impressive prefunding operating this and excited the in I We these of Validus the reasons: made be X to Rather, obtained onetime performance return unusual associated not In be more even drag represents circumstances. likely return Validus operating look ways financial million any earned earned performance to drivers an equity with to successful average income. results that short, contribution on including before pleased could long relationship. And we with is to XX%.

have We This will now solid overlay we financial each which upon further built profit. the Validus. foundation of bolster will a drivers of X

provide first will As foreseeable discuss quarter. excited am the value comments. year detailed about shareholder and my very our quarter, opening a future. That but the at on financial performance into opportunities end result, I our next Bob to create segment I'll our Bob? performance update call, the the next more concludes for of

everyone. hello, and Kevin, Thanks,

said, common from financially of strategically. X million, additional percentage are and delivered $XXX capital results we strong of point net These operating both operating the acquisition. we Validus another raised their an a but income for of As quarter, and Financially, return this strong $XXX on XX%. average equity million is annualized dilution reflect on Kevin operating income own,

With the set transaction has been to the of closing yesterday, been work. this capital now

financial X share our operating our transaction Validus X our highlight immediately equity. Today, to solid before book Our I recent report drivers investments the pleased of execution would our per discuss results. quarter I'll And continue corporate shareholders. Bermuda builds and will contribute provide on for continued proposal. Starting underwriting, accretive of discuss as profit in acquisition to This operating some close financials and a our foundation we income a to of also I the each earnings significant the will on tax takeaways the yesterday. well as value transaction finally, how of is more our it to key on in results Strategically, per detail. share, It an profit, strategy. the which, fees for drivers the from few return Validus we highlights. with were update including and like impact our fourth quarter I income

combined of a are First, secondary with than rates reporting benefiting industry this Much U.S. underwriting higher loss the cat in results from a we Well, years, ratio last billion, attachment exceeding a of experienced activity, and came XXXX. approaching was quarter our are level median. the XX-year we this significant a $XX quieter in and required that of in from the perils, X third delivered the XX%. quarter the we points in industry loss quarter estimates cat solid a performance

was to last compared million, up than year. XX% more the QX higher this double under year and quarter capital $XX and second last fees Second, management of results. partner year from from fee This underwriting income performance reflects increased strong

as paying position in as related well invested raised finally, for the for quarter second a we higher investment is Third, we year the from this acquisition. And retaining capital coupon income and into continued capital This with to after reflects the year. even a assets Validus million. rotation double believe the we acquisition. are ago the our quarter This Validus strong XX% security up net higher of was $XXX almost

lower opportunity third through renewals due January one, this $XXX year in attractive casualty mortgages on results this and billion starting convective our detailed to the we losses deploying first an cycle due management results our discussion points profit primarily also reduction in premiums in are ratio storms. Overall, losses with accident profitable XX% cover I'll industry our current ratio reduction approach X development. active quarter comments, a more our in segment. now catastrophe in but approaching the we XX%, we're of XX%. we with the a property nonrecurring gross severe capital of a already mentioned, premiums premiums net and business quarter third focused had reinstatement the Year-to-date, more in were book and a and we deals a down both catastrophes. activity, favorable move detail were combined XX% last to ] lower our written in even As my with driver and delivered estimated with to industry at in combined from record We underwriting. on to percentage of down quarter related [ market. I'll year solid a Across running segments, into

property several last XX% are quarters, net of been such Year-to-date, we specialty, are is catastrophe in best allocating and premiums Over excess we we up told lines capital have where premiums you and XX% specialty up loss returns. property the without or written as XX%. the have our reinstatement seeing that

reduction $XXX premiums, our significant XX% in resulted reinstatement our catastrophe significant the this combined property the catastrophe book, of we substantially quarter is written premiums and for XX%. did and to were this by premiums. Last net $XXX previous from related reinstatement the ratio The were our continued the renewal contracts. repeat which reduction written ceded million other declined risk loss current significant a to is down not losses quarters, to not with segment. year, a while continues of period of premiums net moving XX% X%, property And business. quarter. of This accident Ian down Hurricane significant Now of Property balance In million, property in relates to although reported have benefit timing year line an In increases. ratio line to reduce rate overall more. We risk third with

As significant by prior I ratio The $XX percentage and well Hurricane activity, the segment, an XX%. XX% million on premiums property favorable Idalia. this ratio quarter. year was was impact of reported was loss overall Despite would of acquisition we losses negative impact ratio the wildfires ratio. Overall, down. Otherwise, driven the elevated with mentioned property the points this results, current net other accident cat activity negative had the impact came of The ratio our been to year. contributing percentage with cat last net period, points loss Hawaiian and of year of combined XX reinstatement development. million have compared large for property a the to consolidated previously, performed events in $XX there Large from this XX

which Moving XX%. mortgage now portfolio. down last premiums million and the to from This our earn included over million Casualty several $XXX transactions of years. next year, written out or were $XXX Net Specialty by one-off

we addition, do to grow deals continued manage on In and cycle attractive not hurdles. to the that areas meet reduce in return our

by was liability. a result, other growth specialty in offset professional reductions As in

returns. percentage This specialty losses, to ratio compared which ratio. recent was primarily This combined contributed was have is which to X driven at growing relates Specialty and attractive marine combined been we the points and which Casualty by quarters. elevated slightly the XX%, energy very Our book, to

However, Year-to-date, confident Validus. Casualty feel Specialty in favorable and LICA [ the volatility continue ratio it to time is continue is the ratio our XX%, of Casualty and to to combined X.X robustness of after reported and to Specialty reserves the points ] from we expect adding exposed environment. percentage and inflationary despite a in development mid-XXs Cat segment combined time. We the

performance. million, Partners of our increased in by performance Capital $X.X capital $XX this a reflecting increase driven redeemable and relates this to where income Medici, fees fees. $XX of our business, quarter Performance Year-to-date, million, billion, $XX XX% managed to fees should Moving the DaVinci on for interest million up increase were which be capital third now than XXXX, reflecting fee to strong from net Management income strong fee more underwriting the joint noncontrolling quarter, continued ventures. accelerator half inflows the management and fees. were positive increased by continue to in in

to Moving We income million, the investments. third double now net of last is nearly retain quarter investment $XXX year.

drive yield income maturity this return, up X.X% to retaining quarter. investment to the which While net X% of continues was

at shortened end have to to retained positioned. X.X our Our investment duration down and the X.X is years reduced defensively portfolio, portfolio we which XXXX. remains of equity In years, exposure and credit from

mark-to-market losses retained led per our about fixed $XXX losses investments have million million. This in to or to quarter, share. $XXX $XX.XX maturity Retained gone unrealized rising of rates up

We expect par time. this over accrete to to

Turning X growth. to support operating by briefly our On our expenses reinstatement now ratio to ticked an basis, point, platform was increased percentage result reflect expenses. continued of which in premiums. investments the up absolute The approximately lower

now Moving acquisition. Validus to the

Validus yesterday, very said pleased $X Kevin to unlevered of shareholders' acquisition of were purchasing $X.X billion close equity the As billion. we

As a XXXX onto Validus' to we the this bring equity by efficiency to $X.X billion our lower reminder, this platform. than renewing flexible capital is business year-end

announced the point assets transaction, When of improved have benefits retaining discussed some stand high-quality reserve that I'm of acquiring pleased the the our supported is portfolio of months. I here to the we're by underwriting drivers The risk. with we're important that few profit, only say benefits billion a of in last still Validus X% RDA, the each to $X.X X investable these and I and cases, over is

they continues quarter to Validus drivers will figure premium a take The be how Starting our with very May. composition portfolio and attractive, market to own. fourth results. Let upside we believe you has $X.X to our incremental the me that similar in and that is there through these we underwriting. impact The potential billion provided

both For And or similar balance our book we the year course sheet and be to merge to the own to the we property, expect we onto X, the as over renew casualty platform. sheet. our into of Validus performance balance expect RenaissanceRe next existing

by portfolio. joint our January increased support bringing capital income. to substantial will benefit This investment partners fee business on These a AIG from includes capital to Moving the to we're into our ventures growing effective our underwriting expected X.

expect as quarter, For fees the income. similar fourth of a performance quarter, level and we third the absent continue losses. And investment in large to any net management finally,

are announced Since of continued the to investment the be a have deal, composition with future. income investment in the Validus comfortable should we to yields tailwind which We the portfolio. very net increase,

we quarter, the fourth For about $XXX investment income retained expect net million. of

in the These be Validus first actioned the will results operating our the will related that should our and to realized optimize over further coming synergies leverage. expect from We acquisition, years. benefit synergies further significant which year

transaction-related we expenses expect be Validus, onetime elevated In significant, be As corporate elevated due will due ongoing will than reflecting these corporate remain to to QX, quarter, expenses expect fourth to but the will expenses. we integration integrate be Through costs. charges. continue XXXX, lower we

As a not do transaction-related and we operating income. expenses reminder, include

Validus Now financials. moving report the plan on we how in to transaction our to

over million the shareholder we of exact discussed, but equity premium are we're paying $XXX settling we in still on Validus, As a for number.

over income. of purchase of end exclude business majority other We nearly acquired years This approximately adjustments from impact We of the includes amortization expect XX% plan will of purchased of with XXXX. to intangibles. and that be the accounting net that operating value the premium, amortizing of the by XX% this amortized XX

to metric metrics Our reflect and without from the you to goal those other operating for impact ultimately we from GAAP does operating of of impact the ensure the a accounting results by of and our we the believe of reflects intangible performance our providing so performance We of see our of performance as between shareholders. Purchase comparable also such income, true adjustments. that provide amortization distinguish greater more our income business. better purchase accounting core is that that of these expenses accounting removing ratio, adjustments. business, disclosures purchase will accounting not that impact the arise and additional to combined transparency peers plan will that our offer our can capitalized

pay we response proposal XX% still Finally, The in of let expect OECD being that may me to update the a corporate Bermuda for effective a day us will of taxes. XXXX income an in provide corporate collaborative has tax. And including recently for Bermuda proposed a more their tax on variety create Bermuda a terms but rules. approach proposal. government exciting The in competitive global government taken Bermuda very for believe this in minimum we advantage tax seeking in tax is that based reasons, feedback conclusion, We us. a income

As forward reported one we all profit. Validus in We of continued composition quarter strong with the as after acquisition. results the company from X drivers third move

We continue Kevin. as X across shareholders believe our that, will to of platform returns. to deliver back benefits power I'll turn profit. look And to forward, superior it drivers we And demonstrate our the with we that all provide of to additional Validus

Bob. Thanks,

comments our usual, Starting and Property. my segments. Property Casualty I'll divide with between As

other over resilience attractive and Our $XXX Property demonstrated million property. property ability this segment both also performed ratios in well and profit. produce in to It loss delivering quarter, underwriting its cat

perils. in will higher changes backdrop catastrophe activity. underwriting Idalia, impacted on made, the quarter a Hurricane impact dollars. Validus is area years. previous with events activity forward, in mix strong cat portfolio. Property's us made the requiring much this hurricane. had XX of a strong of sparsely we industry populated large single-digit X secondary a continuing should due August to and quarter from Peninsula had on which state, low limit of namely a is were it benefit have has the smaller on storm This the performance would loss of Going Category addition Beginning Florida the of attachment billions points. Catastrophes a this rates to each The landfall the have as than which This against

wildfires storm impacted mid-single Industrial ongoing are of Carolina. tornado are These flood of North still loss a events hit States, was third billions Kong digits a finally, there persist. And Pfizer in included Hawaiian in severe handful the a town severe other plant Hong the United in convective and estimates around by that Additionally, quarter. Lahaina in in a the August.

Over the course of XXXX, events these nature has XXXX. natural catastrophe the although has persisted, activity differed of from

have smaller events We of experienced prevalence secondary and increased perils.

to -- include believe influenced events decadal scientists in El the to factors short-term RenRe been and to that climate change. oscillation, the due slowly by transition combination scientists factors. system large-scale of volatility Our due These at have enhanced Nino weather evolving a the energy conditions Pacific

and it portfolio Moving positive activity to experienced now which attractive and our the has shaping. returned results. segment Specialty resilience. however, demonstrating some Casualty is is an in current impact quarter. This This also of underwriting the Year-to-date, segment, strong loss profit year

is customers step this performance, differentiate rates we uncertainty. in business More focus We business. In of recently, on following exposure approach been and strong best attractive most by to have years attractive a this exceeded believe 'XX risks We of while moderating. down this Specialty, more That portfolio see based of challenged. of business will traditional backdrop emphasized Consequently, to class classes are we casualty, said, in back on with cycle continue on the our the Breaking weighted terms as increased the toward we results the we rates do most these the attractive in to that the continue conditions geopolitical pockets against change credit, returns with managing returns have cycle. managing And manage to less across the while 'XX XXXX. remain and portfolio. deals remain by in working to we of disciplined cutting trend. attractive when continue

Credit Validus portfolio of increasing inclusion an business, the the will optimization focus. With become

the business, one the of Moving in last now renewal. a year, favorable in head In was renewals to recent year, dislocated position. into our renewals the This Property X we memory. upcoming January most

the a and significant Over achieved terms XXXX, course conditions. of change we and both step rates in

expectations aligned customers' are are better market likely increased. the have with the conditions now Our budgets to reinsurance and

inflation, exceed consistent system. been insurance of on new class in overall, no reinsurance. and There market billion pressure more the demand likely and have we've losses very capital instability climate once little to seen minimal puts At industry exposure. for be the time, XXXX third-party same again, the at capital. Looking XXXX drivers change geopolitical will of $XXX this are enter reinsurance The

have demand. we considerable explained, are excess position of affords robust us That Bob some meet As a additional Validus the and capital to said, prepared optionality.

substantial equally portfolio We and us allows built size casualty. already to disciplined. to flexibility have combined the of applies growth This remain the well in, strength our

many in creating favorable we anticipate that exceeding of meet lines. been we in approximate As cautious trend to the scale. I've were from soft, quickly, The business we many what XX-year hurdles. We The years a time times, this have deep XXXX about Casualty taking we reservoir scaled off cycles years coming our risk business said Consequently, not in think discipline XXXX, does exercising XXXX, an XXXX far to return over being were up prior business. Throughout -- area.

us As providing growth the in portfolio a of provides well-priced otherwise while selective. casualty, Validus be and optionality risk with large property, to acquisition the flexibility we're us guaranteeing obtaining

the ILS integration. can to for was quiet Validus now to It partners. business. Moving continue a We prepare capital our quarter in

to expected a of down facilitated on in DaVinci many investment capital it injecting the and new our Capital partially as will combination invest to track share growth is proportionately through renews of growth. underwriting shares our will capital in million Validus business. bring with selling portfolio to us Fontana. support aggregate partners. This remains year, This into next be is Partners One AIG advantages our is and $XXX because we

to strategically quarter another serve strategically, We Validus closing, as business continue successful market is far closed what in date, been years a has both Our capital of source the reported generates Validus capital-light, strong most volatility now well acquisition and to we Strategically, one yesterday. we performing so closed of earnings. In it the particularly couldn't it our positioned our are value excited I the when Validus. originally Consequently, more X each potential With over turn about for and Financially, Thank you. questions. for at of considering better be to our delivering future create continue that, added ability shareholders. profit of deliver value drivers we modeled. -- and or than to expect the of results, I'll financially. to performance low to it fees benefits the

Our Fargo. [Operator first come Elyse from Instructions] will question with Greenspan Wells

My assuming, or X on more now the on was how the first modest just for think year? January trend renewals. risk-adjusted where reinsurers, guess, Kevin, on [indiscernible] looking increases right cat for rest a the you given we for color question basis, at the rate losses could I of are side just on

the Thanks, and RenRe, into going going divide market in into is we're a with than is. year because between going Validus, answer position my this Elyse. Great. of very I'm the X/X. last to being reason where X/X where closing And were RenRe different is the we

As already company. we I in are my said one comments,

our forma reflected of our the our We risk and brokers. to week, in the with systems. all to the of have us. We've talking the And all been Validus by end risk we a clients co-located employees Validus on have, pro of basis

and Last market. required course about change was we step had a go as single position we that very, renewal company a talked accretive where is year, that the conversation was the into a in very we a very year. of into So achieved the over strong what this

experienced go of the renewal When year. because into -- think So will me when over of look achievements at we we're we into just significantly what than we the the be start going a with property. property year we easier course let what last the renewal,

in I of anticipated. in, think demand believe buyers we that didn't have demand year is that increased reset the this XXXX. the expectations. that materialize will We course One thing over come

that create relatively So think supply capital demand, We there's should pricing. not into at there'll pace. increased has a flowing an healthy be and tension the been accelerated business steady because for

perspective, rate change will a positive, a from pricing it private the So I casualty we last positive that's lines year, year is be of basis. strong but at required strong have but returns that expectations change we've year's are business XX-year because cycles. of rating manageable. From year relatively rate casualty now of environment, basis rate look disruptive. a prior we an consider of Those disruptive. to This not rate underwriting would capital, more over but -- on talked the before change more rolling right providing

we as very above many at in accretive, close to this but look which So, rate classes. trend, in is market trend parously one

reward is will So and to be inflation strategy are we're economic increasing social that our to what to of overall going companies inflation, ahead committed rate stay trend.

rewarded, that our So underwriting it's be plays construction meaning really portfolio really will and risk discipline which selection, to strength.

specialty, a not a where change We classes, in most a through strong. strong adequacy within in of property So is be all rewarded, will market I very property think market. And puts there's kind which trend. one think We of in position, but last went us good above rates the preferred casualty in like step place, a it's year. strong underwriting it believe very specialty classes

should into So underwriting strongly be that and play which will discipline hand. expertise again, rewarded, underwriting our

about incremental follow-up, mentioned that And talking you to it, something Or demand. I if much we XXXX? know, will we're of be see? incremental it the could think months had then think at you we'll couple And be right, X? you out January my all that you still demand do peg will Kevin, X/Xs, throughout come a how from but do

will It's question. great It XXXX. course throughout a the of come

early I too us think on it's available. for to what's number put a

is up People layers. will will I the demand new point the top remote think highlight come would programs. I important one more at their

reduce be With I -- there'll think peak continue be that, more it exposure to coming. retentions. difficult to will be

the be of positive to just supply constraint some concentration, some add So environment. -- there'll which overall additional will because rate

a are into come with with and calibrate quite market, much but help good will So billions, position should layer it's the play coming into difficult top the on billions. in it the position in this feel the we portfolio to we Validus expectation overall specifically, I single-digit be capital our to of exactly premier, our -- will with how demand portfolio, that sits but with

Kinar Our will next come with question Jefferies. from Yaron

the maybe more Thinking last on guess side. on follow-up I a question. the supply

So, Validus holding actually to calling return. deployed same you're talking to and ILS entrants be seems that time, haven't was at But the new a That's . waiting about the depressed seen the given XX% into I'm back. on still Validus be we capital fact

percent that generated a suggest So by or think others $XX over 'XX. XX-plus incumbent returns course at billion more good if now. does look about are capital what also generating I that of reinsurers and right the That of

think So you question 'XX? demand my will the still supply I exceed incremental course over of is, that not additional guess do

demand portfolios It's a are proportional really the is good already built. question. The that to not

So peak referenced that's which to supply pull going the primary the the portfolios because that because the come to demand need you on to driven be is on balance additional retained there would market, to what protect. to likely be it's going from earnings companies that's

which demand come the is all it's likely those need some temper that that deployed against demand, to to the cannot of -- some the market, not can -- be So layers. or is capacity but of supply top it what

what we this why will happened And exactly be bought did which raised is If summer. deployed, at that year, We we money you look money said the the over Validus. yesterday. fully what is we that

is can short be what it to Our was achieved XXX% in something portfolio prior deployed, that fully diversified and that growth. term is not similar to by which the

we strategy I market. going when at and the are think -- we to the against forecast in diversified the Validus -- how to more to where another consistent our when and look capital basis of this, change expectation recognizing important I think out, is I with it's in raised, even 'XX market point we against is buy our So the

Got it. investments. maybe And gears shifting then to

from reallocate how So into And deal to How portfolio? Bob, you referenced that? of the Validus close. more expectation with line you longer-term the get maybe investments? of for waiting in essentially much lift the you can quickly had risk-free that I do contemplate think a retained a million liquidity of in fourth holding the that of quarter. reallocation NII Obviously, Does expected and lot you're the $XXX investment

good been a That's through We've working question. that.

As million. an the we $XXX of to portfolio ability some to reposition spoke, had about we

to So then million lot portfolio prepurchase of notes. we will there. -- that billion, we months ours. a already. position and ability that repositioning in And probably billion think shorter X% million $X.X to we when allocation. The were had to $X I deploy a and able the sorry, at down $XXX us look shorter-term with billion. That come have to of We actually when the significant just to we shorter-term $X.X list we it, some that $XXX duration upside securities, five is ago, up was the invested T-bills But were little direct the the being bit take similar going portfolio to with to because pretty

And into So $XXX rate of that run reflection this expect XXXX, billion the is quarter. should as a we better see go to continued we lift.

coming portfolio? lift, higher And or a of rates just the interest that is also that continued from from reallocation

in new said that. I alluded money what is money, I Or what rate X% -- on and new to our in was now the that we're call on closing right money new

year what the X.X% this quarter, So for we've yield. X.X% upside seen we book in have at and

benefiting we'll continue as So grow see all We'll still but see it we're of now, are to are at. they around right kind from upside. where rates

come Our America. Shanker from Bank with Josh next question of will

going be term a X you X in are duration? Or to in currently you on and what's inverted ending comments smaller Given at short to a in out maybe to the securities steepening. that be to orient all a [ maybe investment the yesterday change some portfolio? Powell go whatnot, ] portfolio, this willing yield normal months and there's Fed's or Would Does have the curve allocation the and how years? X to

question. a great That's

on at a a moving the seen still fire. We portfolio between it's a agility lot around, what economy is that what team looking the do has in have longer leg the into how seems duration act rates seen said, right but balancing now. the little to be We've of Fed you've you some but dovish,

in overnight, over bond I actively looking think, market Josh, with Duration it we're of not will XX-year the good capture question. seeing at time. right X-year. it, what we'll it's But happen into took players, the lag you're So some some the a duration and now

billion obviously investments choosing. today? when that phone in That this the of you And What received $X.X are you minutes? with of and us now call after from that with in you've so securities at is all are you is Bob, this do currently in have you a right here, shape how to investing AIG just XX bunch AIG, going portfolio

had that. assets the of that's do put that we care they and allocation $XXX we has million got could and We portfolio We been assets. to it a remove administrator, prepositioned. into that of did. what -- portfolio them out from T-bills. at And directed The took fund lot it's We a of

want that of like So that not don't We like hold. are to don't there think about are securities asset-backed in got rid got that. There things rid we portfolio. most single our that that things we of of in

So the not. like portfolio than is ours more

us a I portfolio. pretty -- X%. so advantage think very a it's short-term X-point And around distinct that is just gives and under

duration. getting close our it's So to

I big the in guidance the for to having sequentially investment net income to going year get 'XX do investment last that's the can if X comparing Any And 'XX? XQ one portfolio a on what to more months in. XQ boost of

billion. existing that. in come out there will for $X that by Validus factors in and refunded of billion The portfolio that out our put $X.X be we Two

That's So you net $X million about why you're up $XXX how $XX a to is net get get change there. million. about you going of and increase billion, that's up to get to about

Our will KBW. Shields Meyer next come from question with

in that cat mentioned uptick you next for demand cover really comments, your this you year, didn't year. it you in an expect Kevin, but see

that out out you will flush play that could think you way. Something why

buyers the at ran this to identified they touched many we demand surprised were the calls they in the out may reinsurers or about rates once earlier was change on that even purchase. a With our wallet think they of that think by for I for discipline required that year. in had already have I is last wanted twice beginning that,

the this as for year. to is new the stick flexible renewal, prepared having wallet rates process they're think for that to include the seen throughout more the I limit. more They'll budget pay have a

Okay. sense. That makes

some bond Second market. any question, have cat area implications does guess where one for capital Premier? wondering, was have I in we I And the come that seen

capital year. the is has -- think had market good I a

of new a money probably designed that with coming both think something slowing to is traditional players. we Premier I it's is it to bit -- bonds in. little But be the compete for cat pace an vehicle and efficient

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[Operator question Sachs. will Instructions] Our with next come Alex Goldman Scott from

sort had I just level growth. for is one of on you First high

that? we one As like reported, to how What understand what little X/X are more It in with to willing more a at opportunity and there grow. are underlying the casualty. do where that restraint just peers have reasons you're it are drivers I seems to the your or the for seeing across relative underlying was Is of looked recently to property and decisions? those Validus does And environment? least you wanted transaction? seeing of What it yes, at around the

Yes.

seen may comments. growth Kevin and a all of Let add then couple We've year. start off, me

basis you which, reinstatement comments, rates at the my grown our by That's of most once point end I a head trend. cat to with third because difficult to XX% that the the we a year-over-year premium a We why back really prepared specialty, the Think saw look the property are in you quarter. by X/X quarter looked about wanted at of of quarter again, The half is take second grew over done by XX%. has book. on renewals our year-to-date to number. Year-to-date, out

we've by year, opportunities also dropped over lines, the we saw but we -- XX%. this professional So selected the course we of

were So that the to out made year, pointed year. growth. that And the the we to good there, back that's we've the had market and had it opportunity and we really in throughout a choices full show opportunity of we course why

can numbers great. absolutely Bob is add Actually, if I right. think look -- The I year-to-date

I had that accept book way optimized been in happened is it's underwriting were is important the Validus we brought for we book we from written reflect in-force that to positioning what yesterday through the into also reflected it. that premium. is the gross And yesterday. -- portfolio that The book REMS. And portfolio think a way in in the now perspective, an

that is yesterday have the embedded means is in-force over underwriters premium on we in amount to into the $X.X brought REMS going believe retain the upside. will forward, we $X.X We have actual portfolio. said billion billion. that's What Validus gross with touch that ability we that premium premium basis the The in-force of was that's that portfolio -- the an

premium when grown we significant we So have the optionality base have billion. $X.X against yesterday. brought And our we capital of in we about tremendously $X.X because talk billion diversified

prepared accept can't we about operational when because what to So it, today. and to of I a think portfolio about quarter talking against it that we be Validus without did isolate be to was so much

Yes. all lot of That sense. a makes

where same advantage on seeing sort work? you're capacity what just that to I demand I in for and capital maybe take is into impactful year-end I get one formation to headed you new the any is how market, Second guess had around vehicle capital of go you guess, out observations in third-party an and any the vein, ability about the to and dynamic. around And to commentary thinking supply

comment mean One don't I there believe since be will XXXX. class I of a

coming operational it's clients and to it with because think certainly we cycle in interactive for If I raising the late capital have brokers. now that equity, want conversations by be were by done It would X/X. have we can't very we in. would

would traditionally from be may late. From of rated. most put would ILS equity we're between place a others. partners that different vehicles and there but all we lens than -- it's you we perspective, now We on it, raise So an the are business what year-end, that capital our

collateral we are investor and exist on have our the the bane DaVinci. really across risks, market don't our risk platform. largest draft things that that fact we underwrite in the other So The all been RenRe the in We share [indiscernible] of platform. the

vehicle. flexibility And more provide to them traditional achieved for structures of vehicles investors in in than of ILS the comfortable. The So that's the at more there's than RenRe a that our sense many of for are feel reason, security underwriting one investors platforms.

constrained are grow to We not ILS.

want We balance want optimizing opportunities capital to and retain ILS we the to own on that the sheet. against bring the our risk platform that are we to

I be will and increase at that's certainly think disruptive challenge not the scale to to rest market our increase will a a able of to bit the remain strategy.

Our with next from Meredith question Brian UBS. comes

what talk significant in about opportunities Kevin, marketplace. Could the the other curious, there's you think been companies I'm kind some cat about some of potential perspective? you that talked as just that from reinsurance

Yes.

a I we're strong perspective, in reinsurance think from a think -- I position. well,

the to that with needed level. the to bigger be benefit capacity we're think and believe Validus, clients. recognition commissions. seem primary press portfolio ceding developing the I strongly through bigger more required We discipline increased for is coming will the reinsurers there's with rate proportional important in That [indiscernible] to on to our on

markets. attractive equally So it, at when think is at skilled look I every and equally every attractive of I leveraging business is not not into client line those

and grow those can skilled we rate things we've of that I in as think think carefully. think D&O built platform one the that we're renewal. have I most are in that all and professional of with things and But puts about us most the discussion been to be we going the strong the I position as There's in in looking scale [indiscernible] at spot into the change are about a best preferred lines. lines lot a the

the That's going billion of percentage your sheet that Bob, this, of think, much a capital And or balance and question, third-party coming my alluded but kind versus do that's then sit of helpful. to vehicles? like Great. second you $X.X on how will plus believe you via premium I

you the of Validus, not quickly. got I'll able proud coming before I Fontana extraordinarily only to turn owned and shifting the just I'm be but sheets. team tell that risk we to have to DaVinci, that's our call which When did, RenRe's the of say around into balance are to I we I this optimize sharing can said e-mail all

coming it. take Fontana its RenRe share as Limited not to DaVinci from grow. what by will shifting grow saying, is RenRe well. XX-XX. So of smaller a a will cat DaVinci Fontana Validus I property will as would question drop and XX% the simple move will as going overall ballpark We're from we're with percentage of it's the say actually and be percentage.

the reading e-mail. without that's So

think on that, we about but optimizations to So where that's come will lie. the more

Great. third-party And but view you mean, capital portfolio? more raising in do you in obviously, AIG DaVinci to handle of coming had the than some Validus I anticipate the more that.

Well, coming in in. earnings we've got retained AIG

a this and and control at at a generated capital lever generation at the DaVinci, again, then think, limited is look or And is -- that's the think if our Fontana other that I we in what's I control. going you to be vehicles.

with think relatively to flat hold we're DaVinci, bit in I on raises going maybe additional little a more Fontana.

back like additional the I you. for does O'Donnell today's or now to portion. conclude closing to turn Kevin Thank over Q&A remarks. any floor would That

at last seen few that come my have I the Thank say would and over. days probably we've portfolio the Validus Renaissance you. days exciting most and proudest been

are opportunity course about are a delighted we to diligence very we bring We're the XXXX. new think enviable our I quality team. return 'XX. at the we shareholder did think and markets position welcome bringing of the We and looking of shareholder in And to as portfolio the in reaffirm accretive Every over the servicing value. clients

we back. you for thank your time, So and look to forward reporting

Webcast. XXXX Quarter day. this and a ladies Please and your RenaissanceRe Earnings you, Third have gentlemen, this Thank concludes at time, disconnect and wonderful line the Call