Latest news with #Reinsurance
Yahoo
a day ago
- Business
- Yahoo
Billion-dollar disasters: The economic toll of wildfires, severe storms and earthquakes is soaring
Weather disasters in the first half of this year have cost the United States $93 billion in damage, according to a report released Tuesday by a German multinational insurance company. The analysis by Munich Re, the world's largest reinsurer, found that more than 70% of all damage globally from weather disasters so far this year occurred in the U.S., with uninsured Americans and their local governments experiencing a whopping $22 billion in damage. The report shows the soaring economic toll that wildfires, severe storms and other extreme events are exacting in the U.S. and globally. The findings also highlight the growing insurance crisis playing out in parts of the country that are prone to frequent weather disasters. 'We have seen some 90% of all losses for the insurance industry — so 72 out of 80 billion U.S. dollars — have happened in the U.S.,' said Tobias Grimm, Munich Re's chief climate scientist. 'That's extraordinary.' The devastating wildfires in Southern California in January topped the list of the country's costliest disasters in the first half of 2025. The two largest fires, which killed at least 30 people and displaced thousands more, ripped through the communities in Pacific Palisades and Altadena, fanned by strong Santa Ana winds. Munich Re estimated that the wildfires caused $53 billion in losses, including about $13 billion in damages for residents without insurance. The reinsurer said the Los Angeles-area blazes resulted in the 'highest wildfire losses of all time.' The wildfires' huge economic and societal toll was due in part to increased development in fire-prone areas. 'Losses are on the rise because often properties are in harm's way,' Grimm said. 'People still live in high-risk areas.' Urban development in hazard-prone areas can similarly drive up the cost of other weather-related disasters, such as hurricanes and flooding, which are becoming more frequent and severe due to climate change. Studies have shown that climate change is making wildfires more frequent because of warmer temperatures and worsening drought conditions. Blazes are also becoming more intense, as a result. A report released in late January from the World Weather Attribution group found that the hot, dry and windy conditions that helped the fires consume large swaths of Southern California were about 35% more likely because of human-caused global warming. Munich Re's own earnings have been affected by the L.A. wildfires, as was reported by CNBC. Profits were down a total of $1.9 billion for Munich Re and Hannover Re (another German reinsurer), according to their first-quarter earnings reports. Other major disasters in the U.S. so far included severe storms in March that caused $6.7 billion in damage, a series of tornadoes in May that caused about $5 billion in losses, and severe storms and flooding in April that caused $4 billion in damage. Overall, 'severe convective storms' — ones that produce excessive rainfall, strong winds, tornadoes or large hail — caused $34 billion in damage in the U.S. from January through June, according to Munich Re. Of that, $8 billion were uninsured losses, the company found, which included damage to roads and public schools. Outside of the U.S., a tropical cyclone that hit Australia in late February dumped heavy rain over parts of Queensland and New South Wales, causing an estimated $3.5 billion in damage. Internationally, the costliest disaster so far this year wasn't climate-related: A 7.7-magnitude earthquake struck Myanmar in late March. An estimated 4,500 people died after the quake rattled the cities of Sagaing and Mandalay and surrounding areas. And a magnitude-6 earthquake that struck Taiwan in January caused $1.3 billion in losses, according to Munich Re. The insurance company's report comes months after the National Oceanic and Atmospheric Administration said it would stop tracking the economic toll of the United States' costliest extreme weather events. The elimination of NOAA's 'Billion Dollar Weather and Climate Disasters' yearly reports was seen by critics as yet another way that the Trump administration has cut back or eliminated climate science at federal agencies. A NOAA spokesperson previously told NBC News that the decision to discontinue the database was made 'in alignment with evolving priorities and staffing changes.' Grimm said it's 'vital' to collaborate with NOAA and other government agencies to ensure that these types of reports contain accurate data. The resulting analyses can, for instance, be used by insurance companies and government officials to shape policies, and they are particularly important as billion-dollar disasters become more frequent. 'The probability of extreme weather is changing,' Grimm said, 'so we need to adapt and, of course, to mitigate future losses.' This article was originally published on
Yahoo
7 days ago
- Business
- Yahoo
3 Reasons to Sell RGA and 1 Stock to Buy Instead
Over the last six months, Reinsurance Group of America's shares have sunk to $196.77, producing a disappointing 12.5% loss - a stark contrast to the S&P 500's 4.3% gain. This may have investors wondering how to approach the situation. Is there a buying opportunity in Reinsurance Group of America, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it's free. Why Is Reinsurance Group of America Not Exciting? Despite the more favorable entry price, we're sitting this one out for now. Here are three reasons why there are better opportunities than RGA and a stock we'd rather own. 1. Recent EPS Growth Below Our Standards Although long-term earnings trends give us the big picture, we like to analyze EPS over a shorter period to see if we are missing a change in the business. Reinsurance Group of America's EPS grew at a weak 7.9% compounded annual growth rate over the last two years, lower than its 12.7% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded. 2. Growing BVPS Reflects Strong Asset Base Book value per share (BVPS) serves as a key indicator of an insurer's financial stability, reflecting a company's ability to maintain adequate capital levels and meet its long-term obligations to policyholders. Although Reinsurance Group of America's BVPS increased by a meager 2.7% annually over the last five years, the good news is that its growth has recently accelerated as BVPS grew at an exceptional 22.7% annual clip over the past two years (from $114.61 to $172.53 per share). 3. Previous Growth Initiatives Haven't Impressed Return on equity (ROE) is a crucial yardstick for insurance companies, measuring their ability to generate returns on the capital provided by shareholders. Insurers that consistently deliver superior ROE tend to create more value for their investors over time through strategic capital allocation and shareholder-friendly policies. Over the last five years, Reinsurance Group of America has averaged an ROE of 7.4%, uninspiring for a company operating in a sector where the average shakes out around 12.5%. Final Judgment Reinsurance Group of America isn't a terrible business, but it doesn't pass our bar. Following the recent decline, the stock trades at 1.1× forward P/B (or $196.77 per share). While this valuation is fair, the upside isn't great compared to the potential downside. We're fairly confident there are better investments elsewhere. We'd recommend looking at one of our all-time favorite software stocks. Stocks We Would Buy Instead of Reinsurance Group of America When Trump unveiled his aggressive tariff plan in April 2024, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that's already erased most losses. Don't let fear keep you from great opportunities and take a look at Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
21-07-2025
- Business
- Yahoo
Reinsurance Stocks Q1 Recap: Benchmarking Fidelis Insurance (NYSE:FIHL)
Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let's have a look at Fidelis Insurance (NYSE:FIHL) and its peers. This is a cyclical industry, and the sector benefits when there is 'hard market', characterized by strong premium rate increases that outpace loss and cost inflation, resulting in robust underwriting margins. The opposite is true in a 'soft market'. Interest rates also matter, as they determine the yields earned on fixed-income portfolios. The primary headwind remains the immense and concentrated exposure to large-scale catastrophe losses, as the growing impact of climate change challenges traditional risk models and creates significant earnings volatility. Additionally, they face the risk of adverse prior-year reserve development, where claims prove more costly than anticipated, while the eventual influx of new capital from alternative sources threatens to soften the market and compress future returns. The 7 reinsurance stocks we track reported a mixed Q1. As a group, revenues beat analysts' consensus estimates by 4.9%. While some reinsurance stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.2% since the latest earnings results. Fidelis Insurance (NYSE:FIHL) Founded in Bermuda in 2014 and designed to adapt nimbly to evolving market conditions, Fidelis Insurance (NYSE:FIHL) is a global specialty insurer and reinsurer that provides customized coverage across property, specialty, and bespoke risk solutions. Fidelis Insurance reported revenues of $658.4 million, up 26.6% year on year. This print exceeded analysts' expectations by 5.5%. Overall, it was a strong quarter for the company with a narrow beat of analysts' book value per share estimates. Dan Burrows, Group Chief Executive Officer of Fidelis Insurance Group, commented: "During the first quarter, we capitalized on new business opportunities across the portfolio and delivered 14% top-line growth. The strength of our balance sheet also enabled us to repurchase $41.5 million of common shares year-to-date, which at our current valuation, is highly accretive to our book value. Unsurprisingly, the stock is down 6.3% since reporting and currently trades at $15.98. Is now the time to buy Fidelis Insurance? Access our full analysis of the earnings results here, it's free. Best Q1: Hamilton Insurance Group (NYSE:HG) Founded in 2013 and operating through three distinct underwriting platforms across four countries, Hamilton Insurance Group (NYSE:HG) operates global specialty insurance and reinsurance platforms across Lloyd's, Ireland, Bermuda, and the United States. Hamilton Insurance Group reported revenues of $768.8 million, up 16.7% year on year, outperforming analysts' expectations by 28.3%. The business had an exceptional quarter with a solid beat of analysts' EPS and net premiums earned estimates. Hamilton Insurance Group delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 10.1% since reporting. It currently trades at $21.12. Is now the time to buy Hamilton Insurance Group? Access our full analysis of the earnings results here, it's free. Weakest Q1: Everest Group (NYSE:EG) Rebranded from Everest Re in 2023 to reflect its evolution beyond just reinsurance, Everest Group (NYSE:EG) underwrites property and casualty reinsurance and insurance worldwide, serving insurance companies, corporations, and other clients across six continents. Everest Group reported revenues of $4.26 billion, up 3.1% year on year, falling short of analysts' expectations by 4.2%. It was a disappointing quarter as it posted a significant miss of analysts' net premiums earned estimates and a significant miss of analysts' EPS estimates. As expected, the stock is down 3.4% since the results and currently trades at $333.07. Read our full analysis of Everest Group's results here. Arch Capital Group (NASDAQ:ACGL) With roots dating back to 1995 and now operating across insurance markets on six continents, Arch Capital Group (NASDAQ:ACGL) provides specialty insurance, reinsurance, and mortgage insurance services worldwide through its three main business segments. Arch Capital Group reported revenues of $4.67 billion, up 18.6% year on year. This number topped analysts' expectations by 1%. Overall, it was a strong quarter as it also logged a solid beat of analysts' net premiums earned estimates and an impressive beat of analysts' EPS estimates. The stock is down 6.4% since reporting and currently trades at $88.70. Read our full, actionable report on Arch Capital Group here, it's free. Reinsurance Group of America (NYSE:RGA) Operating behind the scenes of the insurance industry since 1973, Reinsurance Group of America (NYSE:RGA) provides life and health reinsurance services to insurance companies, helping them manage risk and meet regulatory requirements. Reinsurance Group of America reported revenues of $5.34 billion, down 17.5% year on year. This print came in 2.9% below analysts' expectations. More broadly, it was a mixed quarter as it also logged a solid beat of analysts' book value per share estimates but a significant miss of analysts' net premiums earned estimates. Reinsurance Group of America had the slowest revenue growth among its peers. The stock is down 2.5% since reporting and currently trades at $194.81. Read our full, actionable report on Reinsurance Group of America here, it's free. Market Update The Fed's interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump's presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025. Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-07-2025
- Business
- Yahoo
AM Best Downgrades Issuer Credit Rating of Cowen Reinsurance S.A.; Maintains Under Review With Negative Implications Status on Credit Ratings
AMSTERDAM, July 18, 2025--(BUSINESS WIRE)--AM Best has downgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to "bbb" (Good) from "bbb+" (Good) and affirmed the Financial Strength Rating of B++ (Good) of Cowen Reinsurance S.A. (Cowen Re) (Luxembourg). In addition, AM Best has maintained the under review with negative implications status for these Credit Ratings (ratings). These ratings reflect Cowen Re's balance sheet strength, which AM Best assesses as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM). The Long-Term ICR downgrade reflects the poor track record of Cowen Re's operating performance. Since its start of operations in 2016, Cowen Re has reported cumulative technical losses, which have been largely offset by investment gains. Cowen Re's five-year weighted average combined ratio stood at 122.9% (as calculated by AM Best). Furthermore, during its ongoing sale process that started after its acquisition by Toronto-Dominion Bank (TD Bank) in March 2023, Cowen Re is only renewing existing programmes and is not underwriting any new business, putting the company under greater expense strain. Cowen Re's ratings were initially placed under review on June 15, 2023. This was due to the uncertainty regarding Cowen Re's future ownership, given that AM Best does not expect the company to form a part of TD Bank's long-term plans. Additionally, the negative implications status also reflects the uncertainty regarding the company's strategic plans and the negative trend on the company's business profile as Cowen Re is unable to underwrite new business. Although Cowen Re reported a pre-tax profit (before movements in equalisation reserves) of USD 9.95 million, mainly driven by investment income, technical performance remained under pressure, as reflected by a combined ratio of 118.4% at year-end 2024 (as calculated by AM Best). The resolution of TD Bank's plans for the company has taken longer than AM Best originally expected. The ratings will remain under review with negative implications until AM Best has gained certainty regarding the company's long-term ownership and business plans. This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments. AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED. View source version on Contacts Valentine Gu, AAG Associate Financial Analyst +31 20 308 5421 Christopher Sharkey Associate Director, Public Relations +1 908 882 2310 Jose Berenguer, CFA Associate Director, Analytics +31 20 808 2276 Al Slavin Senior Public Relations Specialist +1 908 882 2318 Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
17-07-2025
- Business
- Yahoo
AM Best Assigns Issuer Credit Rating to Fontana Holdings L.P.; Affirms Credit Ratings of Member Companies
OLDWICK, N.J., July 17, 2025--(BUSINESS WIRE)--AM Best has assigned a Long-Term Issuer Credit Rating (Long-Term ICR) of "bbb+" (Good) to Fontana Holdings L.P. The outlook assigned to this Credit Rating (rating) is stable. Concurrently, AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term ICRs of "a+" (Excellent) of Fontana Reinsurance U.S. Ltd. and Fontana Reinsurance Ltd., which are subsidiaries of Fontana Holdings L.P. The outlook of these ratings is stable. All companies are domiciled in Bermuda and collectively referred to as Fontana. The ratings reflect Fontana's balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and very strong enterprise risk management (ERM). Fontana Holdings L.P. is a joint venture between RenaissanceRe Holdings Ltd. (RenaissanceRe) [NYSE:RNR] and various third-party capital partners. Both Fontana Reinsurance Ltd. and Fontana Reinsurance U.S. Ltd. are ultimately owned by Fontana Holdings L.P., and each company's rating considers its strategic importance to Fontana. Fontana is critical to RenaissanceRe's diversification, being the first joint venture focused on casualty and specialty risk. Fontana is managed solely by Renaissance Underwriting Managers, Ltd. (RUM) and is consolidated into RenaissanceRe's financial statements. Fontana started operations in April 2022 with USD 475 million in committed capital and has assumed a whole account quota share of RenaissanceRe's casualty and specialty book of business. Fontana's capital has been supported by its parent, which has raised capital successfully over the past years to support the growth of Fontana Reinsurance Ltd. and Fontana Reinsurance U.S. Ltd. The ratings of the Fontana entities continue to reflect the strength and depth of RenaissanceRe's management team and its leadership in ERM, as well as the benefits that should accrue to Fontana as a result of RenaissanceRe—through RUM—managing underwriting, pricing, risk selection, reserves, investments, claims, etc. AM Best notes that Fontana's operating performance and overall balance sheet strength have been maintained at levels consistent with expectations over its relatively short operating history. As the companies gain scale, AM Best expects that Fontana will generate underwriting profits and earnings to support the adequate operating performance, and that risk-adjusted capitalization will be maintained at levels to support the strong balance sheet assessment, broadly consistent with RenaissanceRe's long-term risk appetite for this entity. This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments. AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED. View source version on Contacts Antonietta Iachetta Associate Director +1 908 882 1901 Gregory Dickerson Director +1 908 882 1737 Christopher Sharkey Associate Director, Public Relations +1 908 882 2310 Al Slavin Senior Public Relations Specialist +1 908 882 2318
