RenaissanceRe posts $161.4 million loss on bond markdowns

RenaissanceRe posted a $161.4 million third-quarter net loss as rising market yields cut the value of its fixed-income holdings, reversing a $907.7 million profit in the same period last year.

The reinsurer booked $879.8 million of net realized and unrealized investment losses, including $899.6 million on fixed-maturity investments, which it attributed primarily to the increase in market yields during the quarter. Net investment income was $440.9 million, compared with $438.4 million a year earlier, helped by higher average invested assets and a shift into higher-yielding holdings. Weighted average yield to maturity on the portfolio rose to 5.8% at Sept. 30 from 4.8% at the end of 2025. The loss was $4.02 per diluted common share, against earnings of $19.40 a year earlier, the Royal Gazette Bermuda Re reported.

For shareholders, operating income available to common shareholders, which excludes certain investment gains and losses, fell to $512.6 million, or $12.71 per diluted share, from $733.7 million, or $15.62. The decline came alongside weaker underwriting. Underwriting income dropped to $426.1 million from $770.2 million, and the combined ratio rose to 79.7% from 68.4%. The casualty and specialty segment recorded a $134.5 million underwriting loss, compared with $21.3 million a year earlier, with a combined ratio of 110.6%, including 10.5 percentage points from large loss events in 2026, primarily the Middle East war and the Ras Laffan explosion.

Kevin O'Donnell, the chief executive, called it "another strong quarter," citing underwriting, fee income and net investment income. He said significantly higher new-money yields would compound net investment income over time as the company looks toward 2027.