RenaissanceRe Holdings Ltd (NYSE:RNR) Q2 2020 Earnings Conference Call - Final Transcript

Jul 29, 2020 • 11:00 am ET

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RenaissanceRe Holdings Ltd (NYSE:RNR) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions] Our first question comes from the line of Elyse Greenspan from Wells Fargo. Your line is open.

Analyst
Elyse Greenspan

Thanks, good morning. My first question, I guess, kind of goes back, Kevin, to some of your introductory remarks, where you pointed to this being an improving market that could last a couple of years is what I believe you said. So I'm just trying to tie that together to the time frame, would you guys with this over $1 billion of equity capital that you raised? Over what time period do you think that you can put that to work? Would that be 2020, 2021? Sorry, are you thinking on 2021 and beyond?

Executive
Kevin O'Donnell

That's a great question. We'll look to deploy in 2021. We might find some opportunities that come up. But yes, as you know, most of the business in reinsurance is placed in the first half of the year. So our capital raise is really targeting and deploying in 2021, obviously, January being a very important date for that. As I mentioned, we have kind of two levers we're going to pull.

One, is we're going to restructure our portfolio and the other is we're going to grow into the opportunity. The restructuring is something that is 100% in our control. So as we think about what the book looks like, we can absolutely deploy based on the target pro forma we have in 2021. And we feel confident that where the markets are and our observations of rate that we're seeing that we can deploy this in 2021 from organic perspective based on our performance as well.

Analyst
Elyse Greenspan

Okay. And then my follow-up there. We're obviously in the middle of wind season right now, right? And it seems like it could be an active storm season, but obviously, the flip side is, it could be an inactive storm season. So if there's not a high level of hurricane losses, just based off of your view of 1/1 right now, do you think that there is enough momentum? Can you just give us your initial thoughts on pricing there to put the capital to use if there is not an active storm feedback?

Executive
Kevin O'Donnell

Yes. So I think there's enough uncertainty in the market, and I feel confident about where rates are headed, that even if there's relatively light number of landfalling hurricanes or no landfalling hurricanes that we're still going to have strong momentum moving into 2021. I think there could be substantial further dislocation if there's additional large losses from hurricanes in 2020.

Analyst
Elyse Greenspan

Okay, thank you. I appreciate the color.

Executive
Kevin O'Donnell

Yes, thanks.

Operator
Operator

Our next question comes from the line of Yaron Kinar from Goldman Sachs. Your line is open.

Analyst
Yaron Kinar

Good morning, everybody. I guess, Just following up on Elyse's last question. I think we're also starting to see some capital raises and even from, I think, incumbents that are looking to get into E&S markets. How much does that impact the longer-term opportunity? I think in 2005, we kind