Catastrophes Put PartnerRe in the Red for Q4, Year

BERMUDA'S PartnerRe Ltd. says it recorded a 2011 fourth-quarter net loss of $17.6 million and a net loss for the year of $520.3 million, down from a profit of $852.6 million in 2010.

Operating loss for 2011 was $641.6 million, compared to a profit of $491.8 million for full-year 2010.

Catastrophes headlined 2011, and PartnerRe President and CEO Costas Miranthis says although PartnerRe was affected, it remains well-positioned to take advantage of opportunities as the reinsurance market improves.  

“During the Jan. 1 renewals, we saw encouraging signs in most of our business lines,” Miranthis says in a statement. “Chronic premium-rate erosion appears to have been halted nearly everywhere, and risk-adjusted premium rates increased in several areas—some significantly and some more modestly.

“In this environment,” he adds, “we are pleased with the outcome of the January renewal. We achieved a better balanced risk profile to optimize risk-adjusted returns, and we added a number of new client relationships.”

PartnerRe recorded $1.79 billion (net of reinstatements, reinsurance and commission adjustments) in losses for 2011 due to catastrophic events, including additional catastrophe-loss estimates from events throughout the year.

For the fourth quarter, the company's non-life combined ratio was 121.7, which included 12.4 points from $120 million worth of Q4 catastrophe losses related to the Thailand floods. PartnerRe previously announced it expected a $120 million fourth-quarter charge from the devastation in Thailand.

The quarter's combined ratio also included 21.6 points from $210 million in net losses on prior-quarter events and 5.3 points from $52 million of net-favorable loss development on prior accident years.

PartnerRe's combined ratio was 125.4 for the year, which included earthquakes in Japan and New Zealand, the Thai floods, tornadoes in the U.S., an Australian cyclone, and losses related to an aggregate contract covering events in Australia and New Zealand. Plus, the company notes, there was a higher frequency of midsize losses in Q4.