The unprecedented COVID-19 pandemic and the consequent economic downturn has caused PartnerRe to incur $338m in pre-tax losses, net of retrocession and reinstatement premiums, in the first half of 2020.
According to an official statement from the reinsurer, these losses reflect the company’s estimates on claims incurred as of 30 June with substantially all of the losses classified as incurred but not reported reserves.
These estimates include $159m, $164m and $15m of pre-tax losses attributable to its P&C, specialty and life and health segments respectively. The losses were mainly due to business interruption and event cancellation related coverage as well as credit exposure in financial risks lines and life and health business.
For the second quarter of this year, PartnerRe reported net income available to common shareholder of $229m and a net loss attributable to common shareholder of $204m for the 1H2020. The reinsurer said it has been exposed to significant volatility in the financial markets throughout the first half of 2020.
During the second quarter of 2020, it recognised $588m of net unrealised gains, partially offset by $40m of net realised losses, on its investment portfolio. This reflected a significant recovery from 31 March.
PartnerRe’s half-year 2020 results reflected $31m of net realised investment losses and $22m of net unrealised investment losses.
Despite the recent market conditions, PartnerRe noted that its solvency position has strengthened during the second quarter of 2020 and observed improved reinsurance conditions at the latest renewal period.
The reinsurer also maintains ample liquidity with cash and cash equivalents of $1.4bn at the end of the second quarter of 2020.