RenaissanceRe Holdings Ltd. (NYSE:RNR.PRE) Q1 2016 Earnings Conference Call - Preliminary Transcript
Apr 27, 2016 • 10:00 am ET
[Operator Instructions]. Your first question comes from Kai Pan with Morgan Stanley. Please go ahead.
Good morning. Thank you. First question, I want to get a more detail on the reserve addition in the specialty line. What is like those clients, was a REIT in offshore or REIT in the U.S. and also what sort of reason behind you have to added to SEZ as they are late reporting or you have additional information you added to it. And I just wonder what that change your reserving process and practice going forward?
Thanks, Kai. So, I think and - I think may be anticipating a couple of questions around this may be it'd be useful to provide, may be expand on Kevin's description a little bit on the numbers, the processes and then any conclusions that we draw from these developments. So, as we said in the prepared remarks, the segment only had about $3.5 million of adverse development and it's important to bear in mind that that's relative to $1.8 billion in casually reserve.
So, it's relatively small, it does mask the fact that there was $17 million of favorable development on our attritional losses and then as I think I mentioned in my remarks is $21 million related to the specific of that. To answer your first question in terms of the geography for the events, somewhere in the U.S. somewhere elsewhere in the world. So, I wouldn't describe them as concentrated in any one geography.
Given our process may be talking about our process just I mean as Kevin said, historically and I suppose it's given our cat roots, we tend to look at these clients of large industry losses as more as events, almost similar to a cat event and this is consistently how we've looked at events in the specialty book overtime that include the subprime crisis the made off for our LIBOR rigging scandal, the VW situation more recently, the Tianjin explosion at China.
So we look at these events and our underwriters working with our finance team and actually make a judgment about whether or not, we have more information that makes us want to or indicates that we perhaps this event is larger than we anticipated, it would be and I think that's the case in these six particular events that we got new information that caused us to reevaluate the size of the event overall.
So lots of times we have to make an assessment of the size of the event, our potential exposure, before we have reported losses from clients and to some degree or another that's the case in this instance. And then I think in terms of what conclusions do we draw from anything that happen in the quarter, I think as Kevin said, given that these six events are related to one another in almost any way that we can think of, geography parallel line of business.
We don't take away any trend in these and thus, don't