RenaissanceRe Annual Report 2013

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FY2013 Annual Report · RenaissanceRe

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Celebrating Twenty Years
RenaissanceRe Holdings Ltd.
2013 Annual Report

Contents

Financial Highlights

Company Overview

Letter to Shareholders

Message from the Chair

Board of Directors and Executive Committee

Twenty Years of Thought Leadership and Value Creation

Comments on Regulation G

Form 10-K

Senior Officers

Last Page

Board of Directors, Financial and Investor Information

Inside Back Cover

Board of Directors

Financial and Investor Information

RenaissanceRe Holdings Ltd.

RenaissanceRe Holdings Ltd. and Subsidiaries

Kevin J. O’Donnell
President and
Chief Executive Officer,
Global Chief Underwriting Officer,
RenaissanceRe Holdings Ltd.

Ralph B. Levy
Non-Executive Chair,
RenaissanceRe Holdings Ltd.

David C. Bushnell
Retired Chief
Administrative Officer,
Citigroup Inc.

James L. Gibbons
Chairman,
Harbour International Trust
Company Limited

Brian G. J. Gray
Former Group Chief
Underwriting Officer,
Swiss Reinsurance Company Ltd.

Jean D. Hamilton
Private Investor,
Independent Consultant

Henry Klehm III
Partner,
Jones Day

W. James MacGinnitie
Former Chairman,
RenaissanceRe Holdings Ltd.,
Independent Consultant

Anthony M. Santomero
Former President,
Federal Reserve Bank
of Philadelphia

Nicholas L. Trivisonno
Retired Chairman,
Chief Executive Officer,
ACNielsen Corporation

Edward J. Zore
Retired Chairman,
Chief Executive Officer,
The Northwestern Mutual Life
Insurance Company

General Information About the Company

For the Company’s Annual Report, press releases, Forms 10-K and
10-Q or other filings, please visit our website: www.renre.com

Or Contact:
Kekst and Company, 437 Madison Avenue,
19th Floor, New York, NY 10022
Tel: +1 212 521 4800

Investor Inquiries Should be Directed to:
Investor Relations, RenaissanceRe Holdings Ltd.
Tel: +1 441 295 4513 E-mail: investorrelations@renre.com

Additional Requests Can be Directed to:
The Company Secretary, RenaissanceRe Holdings Ltd.
Tel: +1 441 295 4513 E-mail: secretary@renre.com

Stock Information

The Company’s stock is listed on The New York Stock Exchange under
the symbol ‘RNR’.

The following table sets forth, for the period indicated, the high and low
closing prices per share of our common shares as reported in composite
New York Stock Exchange trading.

Price Range of Common Shares

2013

2012

High

Low

High

Low

$92.23

$79.83

$79.11

$71.18

95.00

90.68

97.53

82.50

83.19

89.90

80.53

78.39

82.76

72.41

70.00

75.29

Period

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Certifications

The Chief Executive Officer and Chief Financial Officer have certified
in writing to the Securities and Exchange Commission (the “SEC”) as
to the integrity of the Company’s financial statements included in this
Annual Report and in the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2013 filed with the SEC and as to
the effectiveness of the Company’s disclosure controls and procedures
and internal control over financial reporting.

The certifications are filed as Exhibits 31.1, 31.2, 32.1 and 32.2 to
our Form 10-K. Our former Chief Executive Officer has certified to
the New York Stock Exchange in 2013 that he was not aware of any
violation by the Company of the New York Stock Exchange corporate
governance listing standards.

Independent Registered Public Accounting Firm

Ernst & Young Ltd., Hamilton, Bermuda

All stocks used in this report are FSC certified. The narrative stock
contains 10% recycled fiber with chlorine free (TCF/ECF) pulp using
timber from managed forests. The financial stock contains 30% post
consumer waste.

Printed at a zero-discharge facility using soy-based inks.

Please recycle this publication.

Registrar and Transfer Agent

Computershare Shareowner Services LLC
480 Washington Boulevard
Jersey City, NJ 07310
Tel: +1 866 245 5019 or +1 201 680 6578
www.computershare.com

Financial Highlights

Financial Highlights for RenaissanceRe Holdings Ltd. and Subsidiaries

(In thousands of United States dollars, except per share amounts and percentages)

Gross premiums written

Net income (loss) available (attributable) to RenaissanceRe common shareholders

Operating income (loss) available (attributable) to RenaissanceRe common shareholders (1)

Total assets

Total shareholders’ equity

Per common share amounts

2013

2012

2011

1,605,412

1,551,591

1,434,976

665,676

630,618

566,014

(92,235)

402,366

(162,393)

8,179,131

7,928,628

7,744,912

3,904,384

3,507,056

3,608,533

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share – diluted

14.87

11.23

(1.84)

Operating income (loss) available (attributable) to RenaissanceRe common shareholders
per common share – diluted (1)

Tangible book value per common share (1)

Dividends per common share

Operating ratios

Operating return on average common equity (1)

Net claims and claim expense ratio

Underwriting expense ratio

Combined ratio

$ 14.08

79.44

1.12

7.93

67.28

1.08

(3.22)

58.45

1.04

19.4

12.6

(5.3)

15.4

28.4

43.8

30.4

27.4

57.8

90.6

28.0

118.6

Gross Managed Premiums Written (1)

Tangible Book Value Per Common Share
Plus Accumulated Dividends (1)

US$m

1,491

1,624

1,670

US$

58.61

70.43

69.37

79.28

92.56

1,600

1,200

800

400

2011–2012
Managed Catastrophe
Specialty
Lloyd’s
Insurance

2013
Managed Catastrophe
Specialty
Lloyd’s

100

2009–2012
Tangible Book Value Per Common Share
Accumulated Dividends

2013
Tangible Book Value Per Common Share
Accumulated Dividends

(1) In this Annual Report, we refer to various non-GAAP measures, which are explained in the Comments on Regulation G on pages 19 and 20.

Celebrating Twenty Years

Company Overview

RenaissanceRe is a leading provider of property catastrophe
and specialty reinsurance and insurance worldwide. An established
third-party capital manager, the Company also matches capital
markets capacity with risk across a broad spectrum of structures.

Catastrophe Reinsurance

As one of the leading providers of property catastrophe
reinsurance in the world based on managed catastrophe
premium, our principal products include catastrophe
excess of loss reinsurance and excess of loss
retrocessional reinsurance.

We underwrite our reinsurance business primarily
through Renaissance Reinsurance Ltd. (“Renaissance
Reinsurance”), DaVinci Reinsurance Ltd. (“DaVinci”),

Top Layer Reinsurance Ltd. (“Top Layer Re”) and Upsilon
Reinsurance Fund Opportunities Ltd. (“Upsilon RFO”).

Using sophisticated computer modeling and our proprietary
technology for risk analysis and management, our seasoned
team of underwriters seeks to construct a superior risk
portfolio, while cultivating long-term relationships with
clients who appreciate our problem-solving capabilities.

Specialty Reinsurance

We offer global specialty reinsurance products principally
on an excess of loss basis through Renaissance
Reinsurance and DaVinci, and on a proportional basis
through RenaissanceRe Specialty Risks Ltd.
(“RenaissanceRe Specialty Risks”) and RenaissanceRe
Specialty U.S. Ltd. (“RenaissanceRe Specialty U.S.”).
As a result of our financial strength, we have the ability
to provide significant capacity for select risks as well
as to participate in market placements.

Our coverages include aviation, casualty clash, catastrophe
exposed personal lines property, catastrophe exposed
workers’ compensation, crop, energy, financial, mortgage
guaranty, political risk, surety, terrorism, trade credit,
and certain other casualty lines including directors and
officers liability, general liability, medical malpractice and
professional indemnity.

RenaissanceRe Holdings Ltd. 2013 Annual Report

Founded in Bermuda in 1993, the Company has gained recognition
for excellence in the industry through responsive client service,
sophisticated risk analytics, disciplined underwriting and capital
management expertise. RenaissanceRe is traded on the New York
Stock Exchange under the ticker symbol ‘RNR’.

Lloyd’s

RenaissanceRe operates through RenaissanceRe Syndicate
Management Limited and RenaissanceRe Syndicate 1458
at Lloyd’s. The extensive distribution network and worldwide
licenses of the Lloyd’s marketplace complement and extend
both our global strategy and our strong underwriting platform.

RenaissanceRe Syndicate 1458 offers a range of property
and casualty insurance and reinsurance products including,
but not limited to, direct and facultative property, property
catastrophe, agriculture, medical malpractice, general
liability and professional indemnity.

Ventures

RenaissanceRe’s Ventures unit structures and manages
joint ventures as well as other strategic relationships that
leverage the Company’s underwriting expertise and
experience. We have partnered with several institutional
investors to create property catastrophe vehicles that
currently provide capacity of over $5 billion to our clients.

Our activities involve managing rated and unrated
reinsurers, special purpose vehicles and investment
funds based on market opportunities.

Additionally, we make strategic investments across a
broad range of companies where we believe our expertise
and capital help create value for our shareholders.

Celebrating Twenty Years

Letter to Shareholders

Kevin O’Donnell
President and Chief Executive Officer

Dear Shareholders,

Performance Over Time

Over the short term, our business can be one in which it is
difficult to judge the difference between luck and skill. It is
over the long run that skill becomes apparent. One could
debate what constitutes “the long run” but in 2013, we
celebrated our twentieth year of providing our clients
with risk management solutions and our investors with
superior returns. We now have twenty years of data against
which to measure our performance–more than most
of our competitors.

How have we fared these last twenty years?

From our inception, we have:
– grown common equity from $141 million to $3.5 billion;
– written over $20 billion of premium;
– paid over $8 billion in claims;
– generated over $6 billion in book value growth;
– enjoyed an average operating ROE of over 21%;
– grown tangible book value per share, plus accumulated

dividends, an average of over 23% per year;

– paid over $800 million in common share dividends

while increasing our dividend every year;

– returned an additional $2.3 billion of capital to our

common shareholders through share repurchases; and

– sponsored seven limited life vehicles, raised almost
$2 billion of third party capital and returned almost
$2 billion of capital to investors in our joint ventures.

From our start in 1993, we put our customers’ needs
first by providing much needed capacity for property
catastrophe reinsurance and paying valid claims more
quickly than anyone in the market. We were pioneers in
building risk management tools, offering new coverages
and services, and leading innovation in attracting efficient
forms of capital to provide solutions for our clients and
partners. We have outperformed over time by focusing
relentlessly on superior customer relations, superior risk
selection and superior capital management.

I have been at RenaissanceRe for all but three years of
our 20-year history and have been deeply involved in
the development and execution of our strategy. As CEO,
I assure you that this strategy will continue to be core
to our success going forward, as will our commitment
to promoting our unique culture and values.

The Year in Review

In 2013, we again delivered strong operating results, which
were boosted by light property catastrophe loss activity. More
significantly, we executed well and were able to access the
business we wanted, building an attractive portfolio. Despite
increased competition and largely flat demand, we were able
to achieve net income of $666 million, with diluted earnings
per share of $14.87. Operating income was $631 million
and we generated an operating ROE of 19.4%. Our tangible
book value per share, plus change in accumulated dividends,
increased by 19.7%.

RenaissanceRe Holdings Ltd. 2013 Annual Report

We have outperformed over time by focusing
relentlessly on superior customer relations, superior
risk selection and superior capital management.

Tangible Book Value Per Common Share
Plus Accumulated Dividends (1)

1993–2012
Tangible Book Value Per Common Share
Accumulated Dividends

2013
Tangible Book Value Per Common Share
Accumulated Dividends

US$

100

2.56

3.93

6.38

8.07

9.54 10.25 11.59 13.79 18.55 24.49 33.33 34.67 29.80 40.42 47.94 44.65 58.61 70.43 69.37 79.28 92.56

(1) In this Annual Report, we refer to various non-GAAP measures, which are explained in the Comments on Regulation G on pages 19 and 20.

During the year, we restructured the underwriting team to
allow enhanced coordination across platforms and improved
customer service. We grew business with many core
partners by listening to their needs, creating more options
for our customers to cede risk as and where they choose.
We added bench-strength and expanded our product
offerings, along with our global footprint.

As part of our specialty strategy, we opened a reinsurance
office in Connecticut, forming a U.S.-based underwriting
agency and launching a new balance sheet, RenaissanceRe
Specialty U.S. Ltd. This allowed for more direct interactions
with our U.S.-based clients and established our physical
presence in a major specialty reinsurance marketplace.

Our new agency also writes business on behalf of
our Lloyd’s syndicate. This is already adding value with
the increased contribution of the Specialty Reinsurance
segment to our bottom line in 2013.

Additionally, we established RenaissanceRe Specialty
Risks Ltd.–an entity designed, among other things, to
write a wider range of quota share reinsurance. Having
this separate, highly-rated balance sheet allows our clients
to share profitable risk in markets that were unavailable to
us in prior years. As always, discipline remains paramount
and we will focus only on opportunities where we believe
the risk/reward trade-offs are appropriate.

Celebrating Twenty Years

We have a long-term track record of being good
stewards of capital, returning it as appropriate, and
we will continue to do so considering the full range
of options available to us.

We underwrite at Lloyd’s of London
and in Bermuda.

Our Lloyd’s syndicate continued to build momentum as we
celebrated five years of underwriting, and the unit achieved
42% growth in premiums for 2013. We solidified existing
lines and deepened our expertise, and we fully expect to
expand the types of coverage we offer over the next
several years. The Lloyd’s market provides access to
business that we would not otherwise see in Bermuda, and
our syndicate is a key strategic platform to provide capacity
and solutions to our brokers and clients. Due to our
disciplined underwriting, our growth there has been steady
and deliberate, steadfastly focused on profit over volume.

During 2013, we launched our Singapore branch. We
see a significant, long-term growth potential in Asia. Our
local presence in the region will help us get closer to our
existing clients, form relationships on the ground and
access business that might not otherwise be presented to
us. The Singapore team has been well received by brokers
and customers in that market and we have started to write
business. Our strategy is a long-term one and our growth
will be measured.

We continued to bolster our reputation as a leader in
working with the capital markets to finance our broad
portfolio of reinsurance risk. We started the year by
launching Upsilon RFO, and ended it successfully renewing
the vehicle with increased size and scope. Upsilon RFO is
a dedicated aggregate retrocessional reinsurance vehicle
which includes capital from our partners, allowing us to
bring valuable capacity to the market. We also attracted
new world-class, long-term institutional investors to our
joint venture, DaVinci, and our catastrophe bond fund,
RenaissanceRe Medici Fund Ltd. Top Layer Re continued

to provide excellent security to international customers
around the world. We completed our first catastrophe bond
transaction, Mona Lisa Re Ltd., to optimize the returns of
our reinsurance portfolio.

Meanwhile, we continued to provide our investors with
attractive portfolios. We turned down offers of capital from
a broad range of potential partners and returned over
$300 million to our DaVinci investors, our largest single
capital return for that joint venture. For the same reason,
we decided not to renew our Florida sidecar, Timicuan
Reinsurance III Ltd. (48.2% return on equity in 2012),
instead returning that capital to our partners. Our goal has
always been twofold: to be in a position to bring capital
to the market when it is needed by our clients and return
it to investors when it is not, providing superior returns in
the process. Our partners appreciate this approach and
we believe that the trust we have earned will serve us
well in the future.

I was pleased with our investment and venture capital
returns for the year. We seek to allocate our investment
portfolio so that it will provide a stabilizing keel to our
underwriting business and contribute to book value growth
over time. With a focus on fixed income, the portfolio is
especially exposed to rising interest rates, as markets
experienced through the year. While the return on our
core fixed income portion was largely flat for the year, our
higher-risk/higher-expected-return allocations performed
well, including our strategic equity investments managed
by our Ventures unit. As a result, our investment portfolio
contributed meaningfully to book value growth in 2013.

RenaissanceRe Holdings Ltd. 2013 Annual Report

Credit Ratings

Renaissance Reinsurance (1)

DaVinci (1)

RenaissanceRe Specialty Risks (1)

RenaissanceRe Specialty U.S. (1)

Renaissance Reinsurance of Europe (1)

Top Layer Re (1)

RenaissanceRe Syndicate 1458
Lloyd’s Overall Market Rating (2)

RenaissanceRe (3)

A.M. Best

S&P

Moody’s

Fitch

A+

–

AA-

A+

–

AA-

–

A+

Very Strong

–

A+

–

A+

–

(1) The A.M. Best, S&P, Moody’s and Fitch ratings for these companies reflect the insurer’s financial strength rating and in addition to the insurer’s financial strength rating,

the S&P ratings reflect the insurer’s issuer credit rating.

(2) The A.M. Best, S&P and Fitch ratings for the Lloyd’s Overall Market Rating represent its financial strength rating.
(3) The S&P rating for RenaissanceRe represents rating on its Enterprise Risk Management practices.

From a capital management perspective, we bought back
over $200 million of our stock, paid down $100 million
of maturing debt and refinanced half of our perpetual
preferred stock at very attractive levels, saving $11 million
in financing costs per year. Over the past five years, we
have repurchased approximately 34% of our outstanding
common shares, which we believe reflects disciplined
capital management on behalf of our shareholders. We
have a long-term track record of being good stewards of
capital, returning it as appropriate, and we will continue to
do so considering the full range of options available to us.

During the year, we sold our Houston-based weather and
energy unit, RenRe Energy Advisors Ltd. This decision was
prompted by our commitment to streamlining our business
and better serving our core customer base. The sale did not
impact WeatherPredict Consulting Inc., our wholly-owned

affiliate, whose advanced scientists continue to provide our
underwriters with valuable natural hazards and vulnerability
modeling expertise.

We have invested significant time and resources in
regulatory compliance, particularly at Lloyd’s, and are
on target with being Solvency II compliant. I believe
that industry regulation will continue to increase and
it may have a profound impact on capitalization and
solvency over time. I look at this as an opportunity
to provide efficient capital, in whatever form, to
our customers against the increasing cost of their
compliance. We are well-positioned in that respect.
We monitor the best jurisdictions in which to domicile
our business and we remain convinced that Bermuda
is the best place to operate our holding company and
flagship reinsurance companies.

Celebrating Twenty Years

An Evolving Market

Our job is to match desirable risk with efficient capital. In
the past, abundant risk often sought scarce capital. Now,
this dynamic is inverted with abundant capital seeking to
finance a scarce or static supply of risk.

Much has been said about the convergence of insurance
and capital markets, and the impact on pricing. There is a
view that so-called “convergence capital” can require lower
returns, because of the diversification benefits that catastrophe
risk brings to a portfolio. This is most true for “peak zones”
such as southeast U.S. hurricane, but much less so outside
of peak risks, where all capital tends to benefit from
diversification and where rated reinsurance balance sheets
offer the advantage of leverage. Looking exclusively at
diversified returns can be misleading. Just as returns on
poorly underwritten mortgage debt could not be improved by
repackaging it into derivative instruments, poorly underwritten
reinsurance cannot be transformed by issuing a cat bond.
Ultimately, the fact remains there is a standalone price for
all risks that will at some point provide a floor on rate.

For this reason, the belief in the existence of “cheap
capital” is, in many cases, naïve. As a publicly-traded
company, we have access to the largest, deepest and most
efficient capital markets in the world. When we underwrite
on behalf of our third-party capital providers, we uphold the
same high standards that have served us well over the last
two decades. In order to compensate for the inherent
event-driven volatility in the risk that we assume, we always
require an adequate margin that takes into account even
very remote potential outcomes. We invest substantially

across our integrated system to bring the underwriting,
risk management, corporate governance, financial reporting
and other expertise developed over our history to our
capital partners. We do not raise capital solely because
it is available and might result in fees. As a result, we
have industry-leading access to additional capital while
strengthening and expanding ceding relationships,
providing strong service on both ends.

There is also a view that we are witnessing the “flattening”
of the underwriting cycle. While excess capital seems to
have effectively dampened the upside of the cycle for the
time being, the amplitude of the downside last year took
many by surprise. This may seem cold comfort, but it
confirms that our industry remains just as volatile today
as it was when we began business twenty years ago.
As in the past, we expect to find opportunity in that volatility.
In this environment of greater uncertainty, good underwriters
will need to be nimble enough to react to less obvious
market signals.

I believe there will be several long-term trends in our
industry. More and more, we are seeing our largest, most
sophisticated clients seeking to focus their reinsurance
relationships to a core group of well-capitalized, highly-
rated reinsurers, who can bring more than just capital
to meet their needs. Clients are increasingly forming
their own view of risk, and are bringing in house many
of the risk functions that were previously in the domain
of intermediaries. As clients continue to evolve in this
direction, we expect to see a natural progression to
fewer, larger, more sophisticated reinsurers. I believe that
reinsurers will be differentiated between “commodity”
capital and “partner” capital. Our clients will place

RenaissanceRe Holdings Ltd. 2013 Annual Report

RenaissanceRe has always been focused on the
needs of our customers and willing to expand
our capabilities to help them when and where
our support is needed.

In 2013, we opened underwriting operations
in Singapore and Connecticut, U.S.

increasing value on partner capital that helps them
manage their risk more holistically. Relationships will be
measured on willingness and ability to pay, to meet
demand with different forms of capital, and to provide a
unique perspective on risks and the market in general.

The reinsurer of the future will need expertise in managing,
warehousing and tranching risk to reduce the cost of
capital. Rated balance sheets have traditionally been the
most efficient capital for accepting most risks. This is still
true today. But industry participants will need to be better
prepared to bring the most suitable capital to risk, no
matter what form. This will be easiest for those with
underwriting and risk management expertise as they will
be best equipped to find suitable risk, and have the trust
of those for whom they are managing capital. In the future,
“risk-taker” and “purveyor of risk to capital” might become
more appropriate labels than “reinsurer”.

While our customers are the primary beneficiaries of many
of the trends discussed above, we must never lose sight
of the fact that ultimately, we must be paid adequately for
the risk we assume. Over our history, we have developed
a reputation as good stewards of capital and disciplined
underwriters. Capital providers value this and we must
ensure that we continue to earn our reputation.

Looking Forward

As I begin my tenure as this organization’s third CEO,
I am acutely aware that there is much work to be done.
Our industry is evolving rapidly and important trends
are redefining our business. But along with challenges,
I see great opportunity for 2014 and beyond.

Operating Return On Average Common Equity (1)

5.1

-13.3 37.9

27.0

7.4

27.6

16.5

-5.3

12.6

19.4

-15

(1) In this Annual Report, we refer to various non-GAAP measures, which
are explained in the Comments on Regulation G on pages 19 and 20.

Much of what concerns leaders around the world is either
uninsured or underinsured. Perils that come to mind are
cyber risk, conventional terror, pandemic, U.S. flood and
California earthquake, among others. I believe that, as
an industry and certainly as a company, we need to find
ways to provide solutions for these risks with capital that
is structured to bear it. Our industry cannot exclude its
way to greatness; RenaissanceRe has always been
focused on the needs of our customers and willing to
expand our capabilities to help them when and where
our support is needed.

Celebrating Twenty Years

We believe that being the best underwriter
of catastrophe risk is essential to our success.
This aspiration was part of our founding vision;
it will always be core to our franchise.

As China and other emerging economies continue to
develop, we can expect increased demand for risk
coverage over time, in response to the growing wealth in
those countries and the need to respond to the devastating
impacts of natural and man-made catastrophes. This will be
meaningful for our business, and we believe our Singapore
branch will play an increasingly important role in our
long-term strategy. Sustainable profitability–not short-term
growth–will be the challenge. We will be patient, focusing
as we always have on growing tangible book value per
share over the long term.

We believe that being the best underwriter of catastrophe
risk is essential to our success. This aspiration was part of
our founding vision; it will always be core to our franchise.
This does not mean that we will forego the many benefits
of diversification. Over the last two decades, we have
demonstrated an entrepreneurial zeal, not only for new
lines of business, but also for geographic expansion and
exploration of ventures outside our core business. We have
had some notable successes with this approach, including
our many joint ventures, such as DaVinci and Top Layer Re,
and sidecars such as the Tim Re, Starbound and Upsilon
entities. Effective execution of this strategy requires having
the discipline to expand and contract as circumstances
require. I am committed to continuing to push our
organization towards greater innovation, carefully
evaluating performance and promptly rectifying mistakes.

RenaissanceRe; I wish him the very best for his retirement.
I would also like to thank our Board of Directors, my
leadership team, and our employees–not only for their
support through a year of transition, but also for their
dedication and hard work. I promise to do my best to earn
their continued support.

As I look back over the last two decades, I have to say it
has been an interesting journey. I believe we were both
true pioneers of catastrophe risk management and
true innovators in bringing in increasingly efficient and
diversified capital to the reinsurance market. Great rewards
came from entering uncharted waters. As others follow
these paths, efficiencies have become more widespread
and the journey has become less costly.

There are new paths to be discovered. I believe we
are a company that is on the right course, with the
right team and the right culture, and I am proud to be
leading RenaissanceRe. It is in challenging markets that
expertise really shines, and I cannot think of any company
in our industry that is better equipped to handle the
changing risk environment we face. I will work diligently
on your behalf to continue building on the successes of
the last twenty years.

Sincerely,

In Closing

Our people continue to be our number one asset and
we would not have achieved what we did these last
twenty years without an outstanding team. I would like
to thank Neill Currie for his many years of contribution to

Kevin J. O’Donnell
President and Chief Executive Officer

RenaissanceRe Holdings Ltd. 2013 Annual Report

Message from the Chair

RenaissanceRe had a very strong year in 2013. As
described in Kevin’s letter, our team delivered excellent
financial results for our shareholders while bringing value
to clients and partners worldwide through outstanding
customer service, a broader product offering and an
expanded geographic footprint. The Board has every
confidence that these ongoing efforts and the Company’s
proven discipline in stewarding capital will continue to
support our strategy, producing superior value over time.

In July, Kevin assumed the role of Chief Executive Officer
from Neill Currie, the result of an orderly succession and
development process supported across the Board and
by senior management. On behalf of the Board, I would
like to express our appreciation of Neill’s leadership during
his long tenure of success at RenaissanceRe. Neill, a
co-founder of the Company, leaves an enduring imprint
on our culture and business practices. He has our thanks
and our best wishes. The Board has now entrusted the
leadership of RenaissanceRe with Kevin, one of our
longest-serving employees, long-time Global Chief
Underwriting Officer and champion of our underwriting-
based culture. Kevin has both our faith and our commitment
to support him and his team in perpetuating the outstanding
results consistently delivered by this Company.

The Board of Directors continually reaffirms and renews
its focus on effective fiduciary oversight of the Company’s
strategic planning, risk management approach, value
creation and performance. Looking ahead, we are
confident in RenaissanceRe’s future: our strategy is
sound, our risk management is robust, our team is
aligned, and our distinctive culture is stronger than ever.

RenaissanceRe is a great company with an exceptional
track record, a strong culture of innovation and a passion
for customer service. My fellow directors join me in
thanking the management and employee team for their
collaborative and integrated efforts, along with you, our
shareholders, for the trust you place in us to help lead
this Company into the future.

Sincerely,

Ralph B. Levy
Non-Executive Chair

Board of Directors and Executive Committee

Board of Directors

Ralph B. Levy Kevin J. O’Donnell David C. Bushnell James L. Gibbons Brian G. J. Gray Jean D. Hamilton Henry Klehm III W. James MacGinnitie Anthony M. Santomero Nicholas L. Trivisonno Edward J. Zore

Executive Committee

Kevin J. O’Donnell Peter C. Durhager Jeffrey D. Kelly Ian D. Branagan Dana J. Cuffe Ross A. Curtis Aditya K. Dutt Todd R. Fonner David E. Marra Justin D. O’Keefe Jonathan D. A. Paradine Stephen H. Weinstein Mark A. Wilcox

Dana J. Cuffe

Board of Directors

Ralph B. Levy
Non-Executive Chair,
RenaissanceRe Holdings Ltd.

David C. Bushnell
Retired Chief
Administrative Officer,
Citigroup Inc.

Brian G. J. Gray
Former Group Chief
Underwriting Officer,
Swiss Reinsurance Company Ltd.

Kevin J. O’Donnell
President and
Chief Executive Officer,
Global Chief Underwriting Officer,
RenaissanceRe Holdings Ltd.

James L. Gibbons
Chairman,
Harbour International Trust
Company Limited

Jean D. Hamilton
Private Investor,
Independent Consultant

Executive Committee

Kevin J. O’Donnell
President and
Chief Executive Officer,
Global Chief Underwriting Officer,
RenaissanceRe Holdings Ltd.

Jeffrey D. Kelly
Executive Vice President,
Chief Financial Officer,
RenaissanceRe Holdings Ltd.

Dana J. Cuffe
Senior Vice President,
Chief Information Officer,
RenaissanceRe Holdings Ltd.

Peter C. Durhager
Executive Vice President,
Chief Administrative Officer,
RenaissanceRe Holdings Ltd.

Ian D. Branagan
Senior Vice President,
Group Chief Risk Officer,
RenaissanceRe Holdings Ltd.

Ross A. Curtis
Senior Vice President,
Group Chief Underwriting Officer*
RenaissanceRe Holdings Ltd.

*Effective 1 July, 2014

RenaissanceRe Holdings Ltd. 2013 Annual Report

Ralph B. Levy Kevin J. O’Donnell David C. Bushnell James L. Gibbons Brian G. J. Gray Jean D. Hamilton Henry Klehm III W. James MacGinnitie Anthony M. Santomero Nicholas L. Trivisonno Edward J. Zore

Jonathan D. A. Paradine

Stephen H. Weinstein

Henry Klehm III
Partner,
Jones Day

Anthony M. Santomero
Former President,
Federal Reserve Bank
of Philadelphia

Edward J. Zore
Retired Chairman,
Chief Executive Officer,
The Northwestern Mutual Life
Insurance Company

W. James MacGinnitie
Former Chairman,
RenaissanceRe Holdings Ltd.,
Independent Consultant

Nicholas L. Trivisonno
Retired Chairman,
Chief Executive Officer,
ACNielsen Corporation

Aditya K. Dutt
Senior Vice President,
RenaissanceRe Holdings Ltd.
President,
Renaissance Underwriting
Managers, Ltd.

David E. Marra
Senior Vice President,
Chief Underwriting Officer
– Casualty and Specialty,
RenaissanceRe Holdings Ltd.

Todd R. Fonner
Senior Vice President,
Chief Investment Officer,
Treasurer,
RenaissanceRe Holdings Ltd.

Justin D. O’Keefe
Senior Vice President,
Chief Underwriting Officer
– Property,
RenaissanceRe Holdings Ltd.

Jonathan D. A. Paradine
Senior Vice President,
RenaissanceRe Holdings Ltd.
Chief Executive,
Renaissance Reinsurance Ltd.
(Singapore Branch)

Stephen H. Weinstein
Senior Vice President,
Group General Counsel,
Chief Compliance Officer,
Secretary,
RenaissanceRe Holdings Ltd.

Mark A. Wilcox
Senior Vice President,
Chief Accounting Officer,
Corporate Controller,
RenaissanceRe Holdings Ltd.

Twenty Years of Thought Leadership
and Value Creation

1993‑1995

Growing property
catastrophe in a hard market

Since inception,
RenaissanceRe’s
strategy has been
grounded in
three competitive
advantages
–superior customer
relations, superior
risk selection
and superior capital
management–in
support of the
innovation expected
from the industry
leader. Here, we
review the Company’s
history, as told by
highlights from prior
annual reports that
we hope you find
insightful still today.

In our first annual report,
we reviewed the reasons for
our founding and our growth
prospects:

“We formed RenaissanceRe
in June 1993 at the height
–or depth, depending
on your perspective–of
the crisis in the property
catastrophe reinsurance
market. We began business
with initial capital of $141.2
million. Within six months,
six more companies were
formed in Bermuda to do
our business, all with much
more capital than we had.
… I make this comment
about size as I write about
our history, not our strat-
egy, because it is not our
goal to be the largest and
I am sure that as market
prices fall others will pass
us in premium volume.”

Although we started small,
today our capital resources
total nearly $10 billion, a result
of growing when the market
needs growth and superior
capital management.

We took a unique approach
to building superior customer
relations:

“Our marketing is very
selective and of a colla-
borative nature. … This is
by design. Focusing on
fewer clients that cede

us substantial premium
enables us to invest more
time and resources to
understand their needs
and to provide custom
solutions. Being a client’s
major reinsurer motivates
them to invest the time
and resources necessary
to provide us with superior
underwriting information.”

RenaissanceRe has long been
well-known for superior risk
selection:

“By creating a wholly new
framework for assessing
catastrophe risk, instead
of trying to adapt traditional
methods, we have succeeded
in making a quantum leap in
the evaluation and manage-
ment of catastrophe risk.”

If there is a secret sauce, it
is the simultaneous execution
of each of the “three superiors”,
as our first annual report
described:

“These key activities–
selecting the business,
obtaining the business,
and managing capital–
form our strategy. … It is
fairly easy to be good in
one or maybe two of these
areas. Our success to date
is due to our having been
very effective in all three
simultaneously.”

To execute three competitive
advantages simultaneously, we
seek to operate the Company
as an integrated system to
match well-structured risk with
capital whose providers would
find the risk/return trade-off
attractive–the very definition
of underwriting.

Twenty Years of Thought Leadership

and Value Creation

1996‑1999

Institutionalizing
business discipline

Despite challenging soft
markets in the late 1990s,
we produced market-leading
returns every year. When others
passed us in premium volume,
we maintained underwriting
discipline. We described the
dangers of a softening market
in 1997:

“Just as an ebbing tide
brings the rocks to the
surface, decreased pricing
makes understanding
the risks you write more
important. … Understanding
‘true costs’ [expected losses]
is especially difficult in
the catastrophe business
because we only get hints
of true price discovery
every few years (in the form
of catastrophes); hence,
mistakes will not surface in
years with low catastrophe
experiences and may not
surface for many years.”

Although new forms of capital
have received much attention
recently, we established our
Ventures unit in 1998, which
we described as follows:

“RenaissanceRe’s adaptation
to changes in the reinsurance
markets is reflected in our
creation of a dedicated
group within the Company
to develop structured
solutions to catastrophe
exposures that combine
traditional reinsurance and
new financial structures.”

The catastrophe bond market
was in its infancy. Our 1997
annual report included a white
paper on the then-new product
that concluded:

“RenaissanceRe is a trader
of cat risk, and we intend
to participate in any market
where cat risk is traded–

RenaissanceRe Holdings Ltd. 2013 Annual Report

2000‑2005

Broadening our business
in response to market need

The market showed signs
of hardening in 2000, after
several years in which “anyone
writing cat business could look
good.” Our discipline caused us
to be very selective in assuming
business in the northeast U.S.,
where we believed that the
market had underpriced the risk
of hurricanes and earthquakes.

“The World Trade Center and
other losses have shown
that ‘diversification’ is not
a panacea for controlling
risk. Being diversified can
simply mean that when
there are losses, you get
them from all directions.”

Discipline paid off: RenaissanceRe
had a 20% operating return on
equity in 2001, and we wrote
confidently at January 1, 2002,
significantly building our catas-
trophe book and growing a large
and focused specialty portfolio.

“By focusing on a limited
number of specialties,
RenaissanceRe has fewer
things that can go wrong,
and we can better focus
on the unique risks of
each specialty.”

To meet demand, we raised
public capital and formed our joint
venture DaVinci. Supporting
customers with DaVinci benefited
our shareholders in a new way:

provided that the
transactions would
represent attractive
additions to our portfolio.
We look at cat bonds and
swaps as new packages
for the same risk that we
have traded with success in
the traditional reinsurance
market. Our superior
system for measuring
and managing portfolios
of cat risk positions us
for success.”

In 1999, we formed Top Layer Re,
a joint venture with an innovative
capital structure, which has
provided significant capacity for
severe worldwide perils. We also
introduced Overseas Partners
Cat Ltd., a pioneering managed
joint venture for U.S. risks.
Taken together, these initiatives
marked the start of our third
party capital management and
formed the foundation for our
market-leading franchise today.

2000‑2005

2006‑2010

Broadening our business in
response to market need (continued)

Growing in a
hard market

The market at January 1, 2005,
remained soft. A second, more
devastating year of catastrophes
in 2005 led many to reconsider
their support for catastrophe-
exposed clients. Despite the first
loss year in Company history,
RenaissanceRe never wavered.

“There is a tendency in our
business to over-steer
following large catastrophe
losses and underwrite
against the prior year’s
events. While assumptions
need to be tested against
actual results, the data we
use to calibrate our models
is more robust than the
underwriting outcome of
a single year. Given the
relatively low frequency
of catastrophic events,
underwriters in our industry
can sometimes be lulled
into a false sense of

complacency by recent
results and will often end
up under-pricing business
in regions where losses
have been light. …
We expect to continue
to participate in the
Florida market, despite
the hurricanes.”

By late 2005, we had already
incorporated data from the
storms into our loss models,
whereas vendor models were
not updated until mid-2006. As
a result, our team had enhanced
new information with which
to underwrite. In 2006,
RenaissanceRe generated a
38% operating return on equity.
These two years showed the
volatility of our core business
and why we believe that “for
disciplined companies such
as ours, the good times will
outweigh the bad.”

“[DaVinci Re Holdings] was
formed in October 2001
and wrote $188 million of
premium in 2002. The fee
income we generate from
managing our joint ventures
and other fee producing
activities now totals $54 mil-
lion. Fee income, although
it is variable, cannot be
negative and therefore does
not require any capital to
support this business, which
is an important factor in our
high returns on equity.”

We built our specialty book in a
focused way:

“Our approach to Specialty
reinsurance has been
grounded in our disciplined
underwriting … We do not
aspire to be ‘all things to
all people.’ Instead, we
focus on a relatively small
number of transactions.”

A series of four hurricanes in
2004 helped to validate our
models and careful risk selection:

“Risk selection is important.
All [Florida insurance]
companies did not perform
equally in the 2004 hurricane
losses. … Some of the
differences can be attributed
to geographic concentration,
but upfront underwriting and
risk selection, coupled with
superior claims execution,
were major contributors to
the under- or over-perfor-
mance of a company writing
business in the state.”

Losses provide an opportunity to
differentiate ourselves:

“Responding to losses is
our opportunity to deliver
value to our clients. … Our
standard is to pay valid
reinsurance claims within
48 hours of receipt.”

RenaissanceRe and our joint
ventures have been tested in
difficult catastrophe years and
have a history of supporting
clients and generating superior
returns over the long term.

RenaissanceRe Holdings Ltd. 2013 Annual Report

2011‑ present

Maintaining discipline while
building a global platform

The aftermath of eight landfall-
ing U.S. hurricanes in two years
underscored the importance
of risk mitigation. We believe
reinsurers have a responsibility
to help their clients and home-
owners reduce their risk of loss.
In 2007, we described why:

“Global growth and
ever-increasing property
development in catastrophe-
exposed regions will make
the potential risks associated
with catastrophes greater
than ever. Smarter, more
effectively planned and
more broadly implemented
loss mitigation is perhaps
the most promising strategy
to reduce these risks. …
If every home in Florida
could be built or retrofitted
to withstand winds of up
to 130 mph with minimal
damage, the economic
costs of windstorms could
be dramatically reduced.”

As part of RenaissanceRe’s
commitment to mitigation, we
support several research and
educational activities, including
our award-winning series of
Risk Mitigation Leadership
Forums, the RenaissanceRe
Wall of Wind research facility,
and co-sponsoring “StormStruck”,
one of the most popular exhibits
at Epcot® at the Walt Disney
World® Resort.

We have built core franchises in
certain specialty lines that were
formerly more opportunistic. We
invest tens of millions of dollars
a year in research, models,
systems, and tools to serve the
needs of customers. And every
day, we work with clients and
brokers to offer new products,
forms of capital, and support
for lines of business to meet
clients’ needs for efficient
risk transfer.

Echoing the words used by the
Company’s founders 20 years
ago, we concluded last year:

“Our founding principles
have enabled us to lead
many of the changes in
reinsurance and capital
management, while at the
same time avoiding less
attractive choices. Operating
the Company as an integrated
system positions us best
to continue to achieve
our mission of generating
superior returns over the
long term.”

We maintain the underwriting
discipline that has served us
well when previous markets
have weakened. Superior risk
selection, however, means more
than just avoiding underpriced
business, which we discussed
in 2009:

“In our industry, risk
management should not
be confused with risk
avoidance. We are risk-
takers, and it is our job
to pick the best risks. The
proper role of enterprise
risk management is to
allow us, when picking
risks, to make deliberate
decisions rather than
having to react to accidental
outcomes. Our goal is to
avoid being surprised by
an outcome; we aim to
capture and quantify all
the risks to which we are
exposed. We accept that

exact estimation of the
probability of a particular
risk may not always be
feasible, but nonetheless
strive to include all risks in
our modeled distributions
of potential outcomes.”

Discipline also includes superior
capital management, as we
discussed in 2010:

“By returning capital to
investors when it is abun-
dant, we build stronger
relationships with those
investors, generate the
greatest returns for them
and improve our ability
to bring that capital
back to our clients
when it is needed.”

Perhaps most importantly,
discipline requires continuing to
focus on the needs of customers
for expertise, capacity, and
service. To this end, we have
opened underwriting offices in
London, the U.S. and Singapore.

Financial Information

Comments on Regulation G

In addition to the generally accepted accounting principles (“GAAP”) financial measures set forth in this Annual Report, the Company
has included certain non-GAAP financial measures in this Annual Report within the meaning of Regulation G. The Company has
consistently provided these financial measurements in previous investor communications and the Company’s management believes
that these measurements are important to investors and other interested persons, and that investors and such other persons benefit
from having a consistent basis for comparison between years and for the comparison with other companies within the industry. These
measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors
are cautioned not to place undue reliance on these non-GAAP measures in assessing the Company’s overall financial performance.

The Company uses “operating income (loss) available (attributable) to RenaissanceRe common shareholders” as a measure to
evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “Operating
income (loss) available (attributable) to RenaissanceRe common shareholders” as used herein differs from “net income (loss) available
(attributable) to RenaissanceRe common shareholders,” which the Company believes is the most directly comparable GAAP measure,
by the exclusion of net realized and unrealized gains and losses on investments from continuing and discontinued operations, net
other-than-temporary impairments from continuing operations, the gain on sale of the Company’s ownership interest in ChannelRe
Holdings Ltd. (“ChannelRe”), net unrealized losses on credit derivatives issued by entities included in investments in other ventures,
under equity method and, commencing in 2013, also excludes net realized and unrealized gains and losses on investments-related
derivatives. Prior to 2013, investments-related derivative net realized and unrealized gains and losses were included in net investment
income and were also included in the calculation of operating income (loss) available (attributable) to RenaissanceRe common
shareholders and related measures. The Company’s management believes that “operating income (loss) available (attributable) to
RenaissanceRe common shareholders” is useful to investors because it more accurately measures and predicts the Company’s results
of operations by removing the variability arising from fluctuations in the Company’s fixed maturity investment portfolio and equity
investments portfolio, the gain associated with the sale of the Company’s ownership in ChannelRe and net unrealized losses on credit
derivatives issued by entities included in investments in other ventures, under equity method. The Company also uses “operating income
(loss) available (attributable) to RenaissanceRe common shareholders” to calculate “operating income (loss) available (attributable) to
RenaissanceRe common shareholders per common share – diluted” and “operating return on average common equity”. The following
is a reconciliation of: 1) net income (loss) available (attributable) to RenaissanceRe common shareholders to operating income (loss)
available (attributable) to RenaissanceRe common shareholders; 2) net income (loss) available (attributable) to RenaissanceRe common
shareholders per common share – diluted to operating income (loss) available (attributable) to RenaissanceRe common shareholders
per common share – diluted; and 3) return on average common equity to operating return on average common equity:

(in thousands of United States dollars, except per
share amounts and percentages)

Net income (loss) available (attributable) to
RenaissanceRe common shareholders
Adjustment for net realized and unrealized (gains)

losses on investments

Adjustment for net other-than-temporary impairments*
Adjustment for gain on sale of ChannelRe
Adjustment for net unrealized losses on

credit derivatives issued by entities included in
investments in other ventures, under equity method

Operating income (loss) available (attributable) to
RenaissanceRe common shareholders

Net income (loss) available (attributable) to
RenaissanceRe common shareholders
per common share - diluted
Adjustment for net realized and unrealized (gains)

losses on investments

Adjustment for net other-than-temporary impairments*
Adjustment for gain on sale of ChannelRe
Adjustment for net unrealized losses

on credit derivatives issued by entities included in
investments in other ventures, under equity method

Operating income (loss) available (attributable) to
RenaissanceRe common shareholders
per common share - diluted

Return on average common equity
Adjustment for net realized and unrealized

(gains) losses on investments

Adjustment for net other-than-temporary impairments*
Adjustment for gain on sale of ChannelRe
Adjustment for net unrealized losses on credit

derivatives issued by entities included in investments
in other ventures, under equity method
Operating return on average common equity

Year Ended December 31,

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

$665,676 $566,014

$(92,235) $702,613 $838,858

$(13,280)

$569,575 $761,635 $(281,413) $133,108

(35,058)
-
-

(163,991)

343

(70,710)
552
-

(151,213)
829
(15,835)

(93,162)
22,481

(10,700)
217,014

(26,806)
25,513

34,464

6,962

(23,442)

-
-

167,171

$630,618 $402,366 $(162,393) $536,394 $768,177 $193,034

$735,453 $796,099 $(274,451) $109,666

$14.87

$11.23

$(1.84)

$12.31

$13.40

$(0.21)

$7.93

$10.57

$(3.99)

$1.85

(0.79)
-
-

(3.31)
0.01

(1.39)
0.01
-

(2.72)
0.02
(0.29)

(1.52)
0.37

(0.17)
3.42

(0.38)
0.36

0.48

0.10

(0.32)

-
-

2.33

$14.08

$7.93

$(3.22)

$9.32

$12.25

$3.04

$10.24

$11.05

$(3.89)

$1.53

20.5%

17.7%

(3.0%)

21.7%

30.2%

(0.5%)

20.9%

36.3%

(13.6%)

6.2%

(1.1%)
-
-

(5.1%)
-
-

(2.3%)
-
-

(4.7%)

-
(0.5%)

(3.4%)
0.8%
-

(0.4%)
8.3%
-

(1.0%)
0.9%
-

1.6%
-
-

0.3%
-
-

(1.1%)
-
-

-
19.4%

-
12.6%

-
(5.3%)

-
16.5%

-
27.6%

-
7.4%

6.2%

27.0%

-
37.9%

-
(13.3%)

-
5.1%

*For the years ending December 31, 2006 and prior, the Company included net other-than-temporary impairments in net realized and unrealized (gains) losses on investments.

The Company has also included in this Annual Report “gross managed premiums written” and “managed catastrophe premiums.” “Gross
managed premiums written” differs from gross premiums written, which the Company believes is the most directly comparable GAAP
measure, due to the inclusion of premiums written on behalf of the Company’s joint venture, Top Layer Reinsurance Ltd. (“Top Layer Re”),
which is accounted for under the equity method of accounting. “Managed catastrophe premiums” is defined as gross catastrophe premiums
written by Renaissance Reinsurance Ltd. and its related joint ventures. “Managed catastrophe premiums” differs from total Catastrophe
Reinsurance segment premiums, which the Company believes is the most directly comparable GAAP measure, due to the inclusion of
catastrophe premiums written on behalf of the Company’s joint venture Top Layer Re, which is accounted for under the equity method of
accounting and the inclusion of catastrophe premiums written on behalf of the Company’s Lloyd’s segment. The Company’s management
believes “gross managed premiums written” and “managed catastrophe premiums” are useful to investors and other interested parties
because they provides a measure of total catastrophe reinsurance premiums assumed by the Company through its consolidated
subsidiaries and related joint ventures. The following is a reconciliation of 1) total Catastrophe Reinsurance segment premiums to
managed catastrophe premiums and 2) gross premiums written to gross managed premiums written:

(in thousands of U.S. dollars)

Total catastrophe unit premiums
Catastrophe premiums written on behalf of

our joint venture, Top Layer Re

Catastrophe premiums written in the Lloyd’s segment

Year Ended December 31,

2013

2012

2011

$1,120,379

$1,182,207 $1,177,296

63,721
37,869

72,648
36,888

55,483
27,943

Total managed catastrophe premiums

$1,221,969

$1,291,743 $1,260,722

Gross premiums written
Catastrophe premiums written on behalf of our

joint venture, Top Layer Re

$1,605,412

$1,551,591 $1,434,976

63,721

72,648

55,483

Gross managed premiums written

$1,669,133

$1,624,239 $1,490,459

The Company has also included in this Annual Report “tangible book value per common share” and “tangible book value per common
share plus accumulated dividends.” “Tangible book value per common share” is defined as book value per common share excluding
goodwill and intangible assets; “tangible book value per common share plus accumulated dividends” is defined as book value per
common share excluding goodwill and intangible assets, plus accumulated dividends. “Tangible book value per common share” differs
from book value per common share, which the Company believes is the most directly comparable GAAP measure, due to the exclusion
of goodwill and intangible assets per share. “Tangible book value per common share plus accumulated dividends” differs from book
value per common share, which the Company believes is the most directly comparable GAAP measure, due to the exclusion of
goodwill and intangible assets per share and the inclusion of accumulated dividends. The Company’s management believes “tangible
book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because
they provide a more accurate measure of the realizable value of shareholder returns, by excluding the impact of goodwill and intangible
assets. The following is a reconciliation of book value per common share to tangible book value per common share and tangible book
value per common share plus accumulated dividends:

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

At December 31,

Book value per common share
Adjustment for goodwill and other intangibles (1)

$ 80.29 $68.14
(0.86)

(0.85)

$59.27
(0.82)

$62.58
(2.03)

$51.68
(1.95)

$38.74
(2.01)

$41.03
(0.09)

$34.38
(0.08)

$24.52

$30.19
-

Tangible book value per common share
Adjustment for accumulated dividends

79.44
13.12

67.28
12.00

58.45
10.92

60.55
9.88

49.73
8.88

36.73
7.92

40.94
7.00

34.30
6.12

24.52
5.28

30.19
4.48

Tangible book value per common share plus accumulated dividends

$ 92.56 $79.28

$69.37

$70.43

$58.61

$44.65

$47.94

$40.42

$29.80

$34.67

(1) For 2013, 2012, 2011, 2010, 2009 and 2008, goodwill and other intangibles includes $29.2 million, $30.4 million, $33.5 million, $38.1 million, $43.8 million and $49.8 million, respectively, of goodwill and other
intangibles included in investments in other ventures, under equity method. For 2010 and 2009, goodwill and other intangibles includes $57.0 million and $61.4 million, respectively, of goodwill and other intangibles
included in assets of discontinued operations held for sale.

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

Book value per common share
Adjustment for goodwill and other intangibles

$29.61
-

$21.37

$16.14
(0.14)

$11.91
(0.17)

$10.17
(0.11)

$ 9.43
(0.23)

$8.89

$7.74

$6.33

$3.93

$2.56

Tangible book value per common share
Adjustment for accumulated dividends

Tangible book value per common share plus
accumulated dividends

29.61
3.72

21.37
3.12

16.00
2.55

11.74
2.05

10.06
1.53

9.20
1.05

8.89
0.65

7.74
0.33

6.33
0.05

3.93

2.56

$33.33

$24.49

$18.55

$13.79

$11.59

$10.25

$9.54

$8.07

$6.38

$3.93

$2.56

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2013

OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-14428

RENAISSANCERE HOLDINGS LTD.
(Exact Name Of Registrant As Specified In Its Charter)

Bermuda
(State or Other Jurisdiction of
Incorporation or Organization)

98-014-1974
(I.R.S. Employer
Identification Number)

Renaissance House, 12 Crow Lane, Pembroke HM 19 Bermuda
(Address of Principal Executive Offices)

(441) 295-4513
(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common Shares, Par Value $1.00 per share

Series C 6.08% Preference Shares, Par Value $1.00 per share

Series E 5.375% Preference Shares, Par Value $1.00 per share

Name of each exchange on which registered

New York Stock Exchange, Inc.

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Act. Yes

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days. Yes

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company, as defined in Rule 12b-2 of the Act. Large accelerated filer
Smaller reporting company

, Non-accelerated filer

, Accelerated filer

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes

The aggregate market value of Common Shares held by nonaffiliates of the registrant at June 30, 2013 was $3,716.7 million based
on the closing sale price of the Common Shares on the New York Stock Exchange on that date.

The number of Common Shares, par value US $1.00 per share, outstanding at February 19, 2014 was 41,665,815.

The information required by Part III of this report, to the extent not set forth herein, is incorporated by reference to the registrant’s
Definitive Proxy Statement to be filed in respect of our 2014 Annual General Meeting of Shareholders.

RENAISSANCERE HOLDINGS LTD.
TABLE OF CONTENTS

Page

ITEM 1.

ITEM 1A.

NOTE ON FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
PART I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
UNRESOLVED STAFF COMMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
LEGAL PROCEEDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
MINE SAFETY DISCLOSURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

ITEM 1B.

ITEM 2.

ITEM 4.

ITEM 3.

PART II

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER

ITEM 6.

ITEM 7.

ITEM 7A.

ITEM 8.

ITEM 9.

MATTERS AND ISSUER REPURCHASES OF EQUITY SECURITIES . . . . . . . . . . . 59
SELECTED CONSOLIDATED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. . . . . . . 141
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA . . . . . . . . . . . . . . . . . . . . . 146
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING

ITEM 9A.

ITEM 9B.

AND FINANCIAL DISCLOSURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
CONTROLS AND PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147
OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147
PART III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. . . . . . . . 148
EXECUTIVE COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND

ITEM 12.

ITEM 11.

ITEM 10.

MANAGEMENT AND RELATED SHAREHOLDER MATTERS. . . . . . . . . . . . . . . . . . 148

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR

ITEM 15.

ITEM 14.

INDEPENDENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
PRINCIPAL ACCOUNTANT FEES AND SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
PART IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES . . . . . . . . . . . . . . . . . . . . . . . 148
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . F-1
INDEX TO SCHEDULES TO CONSOLIDATED FINANCIAL STATEMENTS. . . . . . . . . S-1
EXHIBITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

NOTE ON FORWARD-LOOKING STATEMENTS

This Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act
of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). Forward-looking statements are necessarily based on estimates and
assumptions that are inherently subject to significant business, economic and competitive uncertainties and
contingencies, many of which, with respect to future business decisions, are subject to change. These
uncertainties and contingencies can affect actual results and could cause actual results to differ materially
from those expressed in any forward-looking statements made by, or on behalf of, us.

In particular, statements using words such as “may”, “should”, “estimate”, “expect”, “anticipate”, “intends”,
“believe”, “predict”, “potential”, or words of similar import generally involve forward-looking statements. For
example, we may include certain forward-looking statements in “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” with regard to trends in results, prices, volumes, operations,
investment results, margins, combined ratios, fees, reserves, market conditions, risk management and
exchange rates. This Form 10-K also contains forward-looking statements with respect to our business and
industry, such as those relating to our strategy and management objectives, market standing and product
volumes, competition and new entrants in our industry, industry capital, insured losses from loss events,
government initiatives and regulatory matters affecting the reinsurance and insurance industries.

In light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking
statements in this report should not be considered as a representation by us or any other person that our
objectives or plans will be achieved. Numerous factors could cause our actual results to differ materially
from those addressed by the forward-looking statements, including the following:

• we are exposed to significant losses from catastrophic events and other exposures that we cover,

which we expect to cause significant volatility in our financial results from time to time;

• the inherent uncertainties in our reserving process, particularly as regards to large catastrophic

events and longer tail casualty lines, the uncertainties of which we expect to increase as our product
and geographical diversity increases over time;

• the frequency and severity of catastrophic and other events which we cover could exceed our

estimates and cause losses greater than we expect;

• the risk of the lowering or loss of any of the financial strength, claims paying or enterprise wide risk
management ratings of RenaissanceRe Holdings Ltd. (“RenaissanceRe”) or of one or more of our
subsidiaries or changes in the policies or practices of the rating agencies;

• risks associated with appropriately modeling, pricing for, and contractually addressing new or

potential factors in loss emergence, such as the trend toward potentially significant global warming
and other aspects of climate change which have the potential to adversely affect our business, any of
which could cause us to underestimate our exposures and potentially adversely impact our financial
results;

• the risk we might be bound to policyholder obligations beyond our underwriting intent, or unable to
enforce our own intent in respect of retrocessional arrangements, including in each case due to
emerging claims and coverage issues;

• risks due to our increasing reliance on a small and decreasing number of reinsurance brokers and

other distribution services for the preponderance of our revenue;

• the risk that our customers may fail to make premium payments due to us, as well as the risk of

failures of our reinsurers, brokers or other counterparties to honor their obligations to us, including as
regards to large catastrophic events, and also including their obligations to make third party payments
for which we might be liable;

• a contention by the Internal Revenue Service that Renaissance Reinsurance Ltd. (“Renaissance

Reinsurance”), or any of our other Bermuda subsidiaries, is subject to U.S. taxation;

• other risks relating to potential adverse tax developments, including potential changes to the taxation
of inter-company or related party transactions, or potential changes to the tax treatment of investors
in RenaissanceRe or our joint ventures or other entities we manage;

• risks relating to adverse legislative developments that could reduce the size of the private markets we
serve, or impede their future growth, including proposals to shift United States (“U.S.”) catastrophe
risks to federal mechanisms; similar proposals at the state level in the U.S., including the risk of
legislation in Florida to expand the reinsurance coverage offered by the Florida Hurricane
Catastrophe Fund (“FHCF”) and the insurance policies written by Citizens Property Insurance
Corporation (“Citizens”), or failing to implement reforms to reduce such coverage; risks of adverse
legislation in relation to U.S. flood insurance or the failure to implement such legislation; and the risk
that new legislation will be enacted in the international markets we serve which might reduce market
opportunities in the private sector, weaken our customers or otherwise adversely impact us;

• risks relating to the inability, or delay, in the claims paying ability of Citizens, FHCF or of private

market participants in Florida, particularly following a large windstorm or of multiple smaller storms,
which we believe would weaken or destabilize the Florida market and give rise to an unpredictable
range of impacts which might be adverse to us, perhaps materially so;

• risks associated with our investment portfolio, including the risk that our investment assets may fail to

yield attractive or even positive results; and the risk that investment managers may breach our
investment guidelines, or the inability of such guidelines to mitigate investment risks;

• risks associated with implementing our business strategies and initiatives, including risks related to

developing or enhancing the operations, controls and other infrastructure necessary in respect of our
more recent, new or proposed initiatives, and the risk that we may fail to succeed in our business or
financing plans for these initiatives;

• risks that certain of our new or potentially expanding business lines could have a significant negative
impact on our financial results or cause significant volatility in our results for any particular period;

• risks associated with potential for loss of services of any one of our key senior officers, the risk that
we fail to attract or retain the executives and employees necessary to manage our business, and
difficulties associated with the transition of members of our senior management team for new or
expanded roles necessary to execute our strategic and tactical plans, including in connection with the
senior management transition we announced during the second quarter of 2013;

• risks associated with the management of our operations as our product and geographical diversity
increases over time, including the potential inability to allocate sufficient resources to our strategic
and tactical plans or to address additional industry or regulatory developments and requirements;

• changes in economic conditions, including interest rate, currency, equity and credit conditions which
could affect our investment portfolio or declines in our investment returns for other reasons which
could reduce our profitability and hinder our ability to pay claims promptly in accordance with our
strategy, which risks we believe are currently enhanced in light of the current uncertainty regarding
U.S. fiscal policy and the recent period of relative economic weakness, both globally, particularly in
respect of Eurozone countries and companies, and in the U.S.;

• risks associated with highly subjective judgments, such as valuing our more illiquid assets, and

determining the impairments taken on our investments, all of which impact our reported financial
position and operating results;

• risks associated with our retrocessional reinsurance protection, including the risks that the coverages
and protections we seek may become unavailable or only available on unfavorable terms, that the
forms of retrocessional protection available in the market on acceptable terms may give rise to more
risk in our net portfolio than we find desirable or that we correctly identify, or that we are otherwise
unable to cede our own assumed risk to third parties; and the risk that providers of protection do not
meet their obligations to us or do not do so on a timely basis;

• risks associated with inflation, which could cause loss costs to increase, and impact the performance
of our investment portfolio, thereby adversely impacting our financial position or operating results;

• operational risks, including system or human failures, which risks could result in our incurring material

losses;

• risks in connection with our management of capital on behalf of investors in joint ventures or other
entities we manage, such as failing to comply with complex laws and regulations relating to the
management of such capital or the potential rights of third party investors, which failure could result in
our incurring significant liabilities, penalties or other losses;

• risks that we may require additional capital in the future, particularly after a catastrophic event or to

support potential growth opportunities in our business, which may not be available or may be
available only on unfavorable terms;

• risks relating to our potential failure to comply with covenants in our debt agreements, which failure

could provide our lenders the right to accelerate our debt which would adversely impact us;

• the risk of potential challenges to the claim of exemption from insurance regulation of RenaissanceRe

and certain of our subsidiaries in certain jurisdictions under certain current laws and the risk of
increased global regulation of the insurance and reinsurance industry;

• risks relating to the inability of our operating subsidiaries to declare and pay dividends, which could

cause us to be unable to pay dividends to our shareholders or to repay our indebtedness;

• the risk that there could be regulatory or legislative changes adversely impacting us, as a Bermuda-
based company, relative to our competitors, or actions taken by multinational organizations having
such an impact;

• risks relating to operating in a highly competitive environment, which we expect to continue to

increase over time from new competition from traditional and non-traditional participants, particularly
as capital markets products provide alternatives and replacements for more traditional reinsurance
and insurance products, as new entrants or existing competitors attempt to replicate our business
model, and as a result of consolidation in the (re)insurance industry;

• risks arising out of possible changes in the distribution or placement of risks due to increased

consolidation of customers or insurance and reinsurance brokers; and

• risks relating to changes in regulatory regimes and/or accounting rules, which could result in

significant changes to our financial results, including but not limited to, the European Union (“EU”)
directive concerning capital adequacy, risk management and regulatory reporting for insurers.

The factors listed above should not be construed as exhaustive. Certain of these risk factors and others are
described in more detail from time to time in our filings with the SEC. We undertake no obligation to release
publicly the results of any future revisions we may make to forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of unanticipated events.

PART I

ITEM 1. BUSINESS

Unless the context otherwise requires, references in this Form 10-K to “RenaissanceRe” refers to
RenaissanceRe Holdings Ltd. (the parent company) and the “Company” refers to RenaissanceRe Holdings
Ltd. and its subsidiaries, which principally include, but are not limited to, Renaissance Reinsurance Ltd.
(“Renaissance Reinsurance”), RenaissanceRe Specialty Risks Ltd. (“RenaissanceRe Specialty Risks”),
RenaissanceRe Specialty U.S. Ltd. (“RenaissanceRe Specialty U.S.”), Renaissance Reinsurance of Europe
(“ROE”) and the Company’s Lloyd’s syndicate, RenaissanceRe Syndicate 1458 (“Syndicate 1458”).

We also underwrite reinsurance on behalf of joint ventures, principally including Top Layer Reinsurance Ltd.
(“Top Layer Re”), recorded under the equity method of accounting, Upsilon Reinsurance Fund Opportunities
Ltd. (“Upsilon RFO”), a consolidated variable interest entity, RenaissanceRe Medici Fund Ltd. (“Medici”)
and DaVinci Reinsurance Ltd. (“DaVinci”). The financial results of Medici, Medici’s parent company
RenaissanceRe Fund Management Ltd.,and DaVinci and DaVinci’s parent company, DaVinciRe Holdings
Ltd. (“DaVinciRe”), are consolidated in our financial statements. For your convenience, we have included a
“Glossary of Selected Insurance and Reinsurance Terms”. All dollar amounts referred to in this Form 10-K
are in U.S. dollars unless otherwise indicated. Any discrepancies in the tables included herein between the
amounts listed and the totals thereof are due to rounding.

OVERVIEW

RenaissanceRe was established in Bermuda in 1993 to write principally property catastrophe reinsurance
and today is a leading global provider of reinsurance and insurance coverages and related services. Our
aspiration is to be the world’s best underwriter by matching well-structured risks with efficient sources of
capital. Through our operating subsidiaries, we seek to produce superior returns for our shareholders by
being a trusted, long-term partner to our customers for assessing and managing risk, and by delivering
responsive solutions. We accomplish this by leveraging our core capabilities of risk assessment and
information management, by investing in our capabilities to serve our customers across the cycles that have
historically characterized our markets and by keeping our promises. Overall, our strategy focuses on
superior risk selection, superior customer relationships and superior capital management. We provide
value to our customers and joint venture partners in the form of financial security, innovative products, and
responsive service. We are known as a leader in paying valid reinsurance claims promptly. We principally
measure our financial success through long-term growth in tangible book value per common share plus the
change in accumulated dividends, which we believe is the most appropriate measure of our Company’s
financial performance, and believe we have delivered superior performance in respect of this measure over
time.

Our core products include property catastrophe reinsurance, which we primarily write through our principal
operating subsidiary Renaissance Reinsurance, Syndicate 1458, and joint ventures, principally DaVinci, Top
Layer Re and Upsilon RFO; specialty reinsurance written through Renaissance Reinsurance,
RenaissanceRe Specialty Risks, RenaissanceRe Specialty U.S., Syndicate 1458 and DaVinci; and certain
insurance products primarily written through Syndicate 1458 or on an excess and surplus lines basis. We
believe that we are one of the world’s leading providers of property catastrophe reinsurance. We also
believe we have a strong position in certain specialty reinsurance lines of business and a growing presence
in the Lloyd’s marketplace. Our reinsurance and insurance products are principally distributed through
intermediaries, with whom we seek to cultivate strong long-term relationships. We continually explore
appropriate and efficient ways to address the risk needs of our clients. We have created, managed, and
continue to manage multiple capital vehicles and may create additional risk bearing vehicles in the future.
As our product and geographical diversity increases, we may be exposed to new risks, uncertainties or
sources of volatility.

Since a substantial portion of the reinsurance and insurance we write provides protection from damages
relating to natural and man-made catastrophes, our results depend to a large extent on the frequency and
severity of such catastrophic events, and the coverages we offer to customers affected by these events.
We are exposed to significant losses from these catastrophic events and other exposures that we cover.
Accordingly, we expect a significant degree of volatility in our financial results and our financial results may

vary significantly from quarter-to-quarter or from year-to-year, based on the level of insured catastrophic
losses occurring around the world.

Our revenues are principally derived from three sources: (1) net premiums earned from the reinsurance and
insurance policies we sell; (2) net investment income and realized and unrealized gains from the investment
of our capital funds and the investment of the cash we receive on the policies which we sell; and (3) other
income received from our joint ventures, advisory services and various other items.

Our expenses primarily consist of: (1) net claims and claim expenses incurred on the policies of
reinsurance and insurance we sell; (2) acquisition costs which typically represent a percentage of the
premiums we write; (3) operating expenses which primarily consist of personnel expenses, rent and other
operating expenses; (4) corporate expenses which include certain executive, legal and consulting
expenses, costs for research and development, and other miscellaneous costs, including those associated
with operating as a publicly traded company; (5) redeemable noncontrolling interest, which represents the
interest of third parties with respect to the net income (loss) of DaVinciRe and Medici; and (6) interest and
dividend costs related to our debt and preference shares. We are also subject to taxes in certain
jurisdictions in which we operate. Since the majority of our income is currently earned in Bermuda, which
does not have a corporate income tax, the tax impact to our operations has historically been minimal,
however, in the future, our net tax exposure may increase as our operations expand geographically.

The underwriting results of an insurance or reinsurance company are discussed frequently by reference to
its net claims and claim expense ratio, underwriting expense ratio, and combined ratio. The net claims and
claim expense ratio is calculated by dividing net claims and claim expenses incurred by net premiums
earned. The underwriting expense ratio is calculated by dividing underwriting expenses (acquisition
expenses and operational expenses) by net premiums earned. The combined ratio is the sum of the net
claims and claim expense ratio and the underwriting expense ratio. A combined ratio below 100% generally
indicates profitable underwriting prior to the consideration of investment income. A combined ratio over
100% generally indicates unprofitable underwriting prior to the consideration of investment income. We
also discuss our net claims and claim expense ratio on an accident year basis. This ratio is calculated by
taking net claims and claim expenses, excluding development on net claims and claim expenses from
events that took place in prior fiscal years, divided by net premiums earned.

On August 30, 2013, we entered into a purchase agreement with a subsidiary of Munich-American Holding
Corporation (together with applicable affiliates, “Munich”) to sell our U.S.-based weather and weather-
related energy risk management unit, which included RenRe Commodity Advisors LLC (“RRCA”),
Renaissance Trading Ltd. (“Renaissance Trading”) and RenRe Energy Advisors Ltd. (collectively referred to
as “REAL”). REAL offered certain derivative-based risk management products primarily to address weather
and energy risk and engaged in hedging and trading activities related to those transactions. On October 1,
2013, we closed the sale of REAL to Munich. We have classified the assets and liabilities associated with
this transaction as held for sale and, at December 31, 2013, there were no remaining assets or liabilities
related to REAL included on our consolidated balance sheet, although we have certain ongoing
commitments and obligations pursuant to the sale agreement. The financial results for these operations
have been presented in our consolidated financial statements as “discontinued operations” for all periods
presented. Consideration for the transaction was $60.0 million, paid in cash at closing, subject to post-
closing adjustments for certain tax and other items. We recorded a loss on sale of $8.8 million in
conjunction with the sale, including related direct expenses to date. Refer to “Note 3. Discontinued
Operations in our Notes to Consolidated Financial Statements”, for additional information.

Our business consists of three reportable segments: (1) Catastrophe Reinsurance, which includes
catastrophe reinsurance and certain property catastrophe joint ventures managed by our ventures unit; (2)
Specialty Reinsurance, which includes specialty reinsurance and certain specialty joint ventures managed
by our ventures unit; and (3) Lloyd’s, which includes reinsurance and insurance business written through
Syndicate 1458. Previously, we disclosed Reinsurance and Lloyd’s as our reportable segments. In
addition, our Other category primarily reflects our strategic investments; investments unit; corporate
expenses; capital servicing costs; noncontrolling interests; results of our discontinued operations; and the
remnants of our Bermuda-based insurance operations not sold pursuant to our stock purchase agreement
with QBE Holdings, Inc. (“QBE”).

CORPORATE STRATEGY

We seek to produce superior returns for our shareholders over the long-term. We believe that market
leadership is required to produce the best expected returns. We pursue markets where leadership comes
from seeking to be the best underwriter. We define our pursuit of superior underwriting as the process of
matching well-structured risk with capital whose owners would find the risk-return trade-off attractive.

To support our mission to seek to be the best underwriter, our strategy is to operate an integrated system to
match well structured risk and efficient capital. Operating our business as an integrated system enables us
to pursue three competitive advantages: superior customer relationships, superior risk selection and
superior capital management. We believe that all three competitive advantages are necessary
simultaneously and that activity must be coordinated to deliver them seamlessly for the benefit of our ceding
insurers, brokers, investors in our sidecars and joint ventures, and shareholders. The strategy is supported
by our core values, our principles and our culture.

We believe our competitive advantages include:

Superior Customer Relationships. We seek to be a trusted long-term partner to our customers for
assessing and managing risk and delivering responsive solutions. We believe our modeling and technical
expertise, the risk management products that we provide our customers and keeping our promises, has
enabled us to become a provider of first choice in many lines of business to our customers worldwide. We
seek to offer stable, predictable, and consistent risk-based pricing and a prompt turnaround on our claims.

Superior Risk Selection. We seek to build a portfolio of risks that produces an attractive risk-adjusted return
on utilized capital. We develop a perspective of the risk in each business using both our underwriters’
expertise and sophisticated risk selection techniques including computer models and databases, such as
Renaissance Exposure Management System (“REMS©”). We pursue a disciplined approach to
underwriting and seek to select only those risks that we believe will produce a portfolio with an attractive
return, subject to prudent risk constraints. We manage our portfolio of risks dynamically, both within sub-
portfolios and across the Company.

Superior Capital Management. We seek to write as much attractively priced business as is available to us
and then manage our capital accordingly. We generally seek to raise capital when we forecast an
increased demand in the market, at times by accessing capital through joint ventures or other structures,
and seek to return capital to our shareholders or joint venture investors when the demand for our coverages
appears to decline and when we believe a return of capital would be beneficial to our shareholders or joint
venture investors. In using joint ventures, we intend to leverage our access to business and our
underwriting capabilities on an efficient capital base, develop fee income, generate profit commissions,
diversify our portfolio and provide attractive risk-adjusted returns to our capital providers. We routinely
evaluate and review potential joint venture opportunities and strategic investments.

We believe we are well positioned to fulfill our objectives by virtue of the experience and skill of our
management team, our integrated underwriting and operating platform, our significant financial strength,
and our strong relationships with brokers and customers. In addition, we believe our superior service, our
proprietary modeling technology, and our extensive business relationships, which have enabled us to
become a leader in the property catastrophe reinsurance market, will be instrumental in allowing us to
achieve our strategic objectives. In particular, we believe our strategy, high performance culture, and
commitment to our customers and joint venture partners help us to differentiate ourselves by offering
specialized services and products at times and in markets where capacity and alternatives may be limited.

SEGMENTS

In conjunction with changes in our management structure during 2013, including the appointment of a new
Chief Executive Officer, and changes in the mix of our reinsurance business, we revised our reportable
segments to: (1) Catastrophe Reinsurance, which includes catastrophe reinsurance and certain property
catastrophe joint ventures managed by our ventures unit; (2) Specialty Reinsurance, which includes
specialty reinsurance and certain specialty joint ventures managed by our ventures unit; and (3) Lloyd’s,
which includes reinsurance and insurance business written through Syndicate 1458. Previously, our
Catastrophe Reinsurance and Specialty Reinsurance segments were aggregated and were reported as the
Reinsurance segment. All prior periods presented have been reclassified to conform to this presentation.

In addition, our Other category primarily reflects our: strategic investments; investments unit; corporate
expenses; capital servicing costs; noncontrolling interests; results of our discontinued operations; and the
remnants of our Bermuda-based insurance operations not sold pursuant to our stock purchase agreement
with QBE.

For the year ended December 31, 2013, our Catastrophe Reinsurance, Specialty Reinsurance and Lloyd’s
segments accounted for 69.7%, 16.2% and 14.1%, respectively, of our total consolidated gross premiums
written. We currently expect contributions from our Specialty and Lloyd’s segments to increase over time,
on both an absolute and relative basis, although we cannot assure you we will succeed in meeting this
objective. Operating results relating to our segments is included in “Part II, Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations.”

Our portfolio of business continues to be characterized by relatively large transactions with ceding
companies with whom we do business, although no current relationship exceeds 10% of our gross
premiums written. Accordingly, our gross premiums written are subject to significant fluctuations depending
on our success in maintaining or expanding our relationships with these customers. We market our
reinsurance products worldwide exclusively through brokers, whose market has become extremely
consolidated in recent years. In 2013, three brokerage firms accounted for 88.2% of our Catastrophe
Reinsurance and Specialty Reinsurance segments’ gross premiums written. We believe that recent market
dynamics, and trends in our industry in respect of potential future consolidation, have increased our
exposure to the risks of broker, client and counterparty concentration.

The following table shows our gross premiums written split between our Catastrophe Reinsurance,
Specialty Reinsurance and Lloyd’s segment, respectively:

Year ended December 31,
(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other category (1)

Total gross premiums written

2013

2012

2011

$ 1,120,379 $ 1,182,207 $ 1,177,296
145,891
111,584
205
$ 1,605,412 $ 1,551,591 $ 1,434,976

259,489
226,532
(988)

209,887
159,987
(490)

(1) Included in gross premiums written in the Other category is inter-segment gross premiums written of $1.0 million for the year
ended December 31, 2013 (2012 - $0.5 million, 2011 - $0.1 million).

Catastrophe Reinsurance Segment

Property catastrophe reinsurance is our traditional core business, and is principally written for our own
account, for DaVinci and for other joint ventures such as Upsilon RFO. We believe we are one of the
world’s leading providers of this coverage, based on total catastrophe gross premiums written. This
coverage protects against large natural catastrophes, such as earthquakes, hurricanes and tsunamis, as
well as claims arising from other natural and man-made catastrophes such as winter storms, freezes,
floods, fires, wind storms, tornadoes, explosions and acts of terrorism. We offer this coverage to insurance
companies and other reinsurers primarily on an excess of loss basis. This means that we begin paying
when our customers’ claims from a catastrophe exceed a certain retained amount. We also offer
proportional coverages and other structures on a catastrophe-exposed basis and may increase these
offerings on an absolute or relative basis in the future.

Our excess of loss property catastrophe reinsurance contracts generally cover all natural perils. Our most
significant exposure is to losses from earthquakes and hurricanes and other windstorms, although we are
also exposed to claims arising from other catastrophes, such as tsunamis, freezes, floods, fires, tornadoes,
explosions and acts of terrorism in connection with the coverages we provide. Our predominant exposure
under such coverage is to property damage. However, other risks, including business interruption and other
non-property losses, may also be covered under our property reinsurance contracts when arising from a
covered peril. We offer our coverages on a worldwide basis. Because of the wide range of possible
catastrophic events to which we are exposed, including the size of such events and because of the potential
for multiple events to occur in the same time period, our catastrophe reinsurance business is volatile and
our results of operations reflect this volatility. Further, our financial condition may be impacted by this

volatility over time or at any point in time. The effects of claims from one or a number of severe
catastrophic events could have a material adverse effect on us. We expect that increases in the values and
concentrations of insured property and the effects of inflation will increase the severity of such occurrences
in the future.

We seek to moderate the volatility of our risk portfolio through superior risk selection, diversification and the
purchase of retrocessional coverages and other protections. In furtherance of our strategy, we may increase
or decrease our presence in the catastrophe reinsurance business based on market conditions and our
assessment of risk-adjusted pricing adequacy. We frequently seek to purchase reinsurance or other
protection for our own account to further reduce the financial impact that a large catastrophe or a series of
catastrophes could have on our results.

As a result of our position in the market and reputation for superior customer relationships, we believe we
have superior access to catastrophe-exposed reinsurance business we view as desirable compared to the
market as a whole. As described above, we use our proprietary underwriting tools and guidelines to
attempt to construct an attractive portfolio from these opportunities. We dynamically model policy
submissions against our current in-force underwriting portfolio, comparing our estimate of the modeled
expected returns of the contract against the amount of capital that we allocate to the contract, based on our
estimate of its marginal impact on our overall risk portfolio. At times, our approach to portfolio management
has resulted and may result in the future in our having a relatively large market share of catastrophe
reinsurance exposure in a particular geographic region, such as Florida where we historically have had a
relatively large percentage of coverage exposures, or to a particular peril, such as U.S. hurricane risk,
where we believe our analytical skills, claims paying history, large capacity, strong ratings and other
attributes offer a competitive advantage, or where the risks or class of risks otherwise adds efficiency to our
portfolio. Conversely, from time to time we may have a disproportionately low market share in certain
regions or perils where we believe our capital would be less effectively deployed.

Our principal property catastrophe reinsurance products include catastrophe excess of loss reinsurance and
excess of loss retrocessional reinsurance as described below.

Catastrophe Excess of Loss Reinsurance

We principally write catastrophe reinsurance on an excess of loss basis, which means we provide coverage
to our insureds when aggregate claims and claim expenses from a single occurrence of a covered peril
exceed the attachment point specified in a particular contract. Under these contracts, we indemnify an
insurer for all or a specified portion of the losses on underlying insurance policies in excess of a specified
amount, and up to an amount per loss specified in the contract. The coverage provided under excess of
loss reinsurance contracts may be on a worldwide basis or limited in scope to selected geographic areas.
Coverage can also vary from “all property” perils to limited coverage on selected perils, such as “earthquake
only” coverage.

Excess of Loss Retrocessional Reinsurance

We also write retrocessional reinsurance contracts that provide property catastrophe coverage to other
reinsurers or retrocedants. In providing retrocessional reinsurance, we focus on property catastrophe
retrocessional reinsurance, which covers the retrocedant on an excess of loss basis when aggregate claims
and claim expenses from a single occurrence of a covered peril and from a multiple number of reinsureds
exceed a specified attachment point. The coverage provided under excess of loss retrocessional contracts
may be on a worldwide basis or limited in scope to selected geographic areas. Coverage can also vary
from “all property” perils to limited coverage on selected perils, such as “earthquake only” coverage. The
information available to retrocessional underwriters concerning the original primary risk can be less precise
than the information received from primary companies directly. Moreover, exposures from retrocessional
business can change within a contract term as the underwriters of a retrocedant alter their book of business
after retrocessional coverage has been bound.

Insurance-Linked Securities

We also invest in insurance-linked securities. Insurance-linked securities are generally privately placed fixed
income securities as to which all or a portion of the repayment of the principal is linked to catastrophic
events; for example, the occurrence of one or more hurricanes or earthquakes producing industry losses
exceeding certain specified thresholds. We seek to underwrite, model, evaluate and monitor these

securities using similar tools and techniques used to evaluate our more traditional property catastrophe
reinsurance business assumed. In addition, we may enter into derivative transactions, such as total return
swaps, that are based on or referenced to underlying insurance-linked securities. Based on an evaluation
of the specific features of each insurance-linked security, we account for these securities as reinsurance or
at fair value, as applicable, in accordance with U.S. generally accepted accounting principles (“GAAP”). In
addition, in future periods we may utilize the growing market for insurance-linked securities to expand our
ceded reinsurance buying if we find the pricing and terms of such coverage attractive.

Mona Lisa Re Ltd. (“Mona Lisa Re”)

On March 14, 2013, Mona Lisa Re was licensed as a Bermuda domiciled special purpose insurer (“SPI”) to
provide reinsurance capacity to subsidiaries of RenaissanceRe, namely Renaissance Reinsurance and
DaVinci, through reinsurance agreements which will be collateralized and funded by Mona Lisa Re through
the issuance of one or more series of principal-at-risk variable rate notes (“Notes”) to third-party investors.

Upon issuance of a series of Notes by Mona Lisa Re, all of the proceeds from the issuance are expected to
be deposited into collateral accounts, separated by series, to fund any potential obligation under the
reinsurance agreements entered into with Renaissance Reinsurance and/or DaVinci underlying such series
of Notes. The outstanding principal amount of each series of Notes generally will be returned to holders of
such Notes upon the expiration of the risk period underlying such Notes, unless an event occurs which
causes a loss under the applicable series of Notes, in which case the amount returned will be reduced by
such noteholder’s pro rata share of such loss, as specified in the applicable governing documents of such
Notes. In addition, holders of the Notes are generally entitled to interest payments, payable quarterly as
determined by the applicable governing documents of each series of Notes.

Mona Lisa Re meets the definition of a VIE as it does not have sufficient equity capital to finance its
activities. We do not have a variable interest in Mona Lisa Re and as a result, the financial position and
results of operations of Mona Lisa Re are not consolidated by the Company. The only transactions related
to Mona Lisa Re that are recorded in the Company’s consolidated financial statements are the ceded
reinsurance agreements entered into by Renaissance Reinsurance and DaVinci. During 2013, Renaissance
Reinsurance and DaVinci have together entered into ceded reinsurance contracts with Mona Lisa Re with
gross premiums ceded of $9.2 million and $6.5 million, respectively. We have not provided any financial or
other support to Mona Lisa Re that was not contractually required to be provided.

Specialty Reinsurance Segment

We write specialty reinsurance for our own account and for DaVinci, covering principally certain targeted
classes of business where we believe we have a sound basis for underwriting and pricing the risk that we
assume. Our portfolio includes various classes of business, such as aviation, casualty clash, catastrophe
exposed personal lines property, catastrophe exposed workers’ compensation, crop, energy, financial,
mortgage guaranty, political risk, surety, terrorism, trade credit, certain other casualty lines including
directors and officers liability, general liability, medical malpractice and professional indemnity, and other
specialty lines of reinsurance that we collectively refer to as specialty reinsurance. We believe that we are
seen as a market leader in certain of these classes of business. We are seeking to expand our specialty
reinsurance operations over time. In 2013, we organized RenaissanceRe Underwriting Managers U.S. LLC
(“RenaissanceRe Underwriting Managers U.S.”), a specialty reinsurance agency domiciled in Connecticut,
to provide specialty treaty reinsurance solutions on both a quota share and excess of loss basis, as well as
to write business on behalf of RenaissanceRe Specialty U.S., a Bermuda-domiciled reinsurer launched in
June 2013 which operates subject to U.S. federal income tax, and Syndicate 1458. However, we cannot
assure you that we will succeed in growing these operations or that any growth we do attain will be
profitable and contribute meaningfully to our results or financial condition, particularly in light of current and
forecasted market conditions. Our specialty reinsurance business is significantly impacted by a comparably
small number of relatively large transactions. As with our catastrophe business, our team of experienced
professionals seeks to underwrite these lines using a disciplined underwriting approach and sophisticated
analytical tools.

We generally target lines of business where we believe we can adequately quantify the risks assumed and
where potential losses could be characterized as low frequency and high severity, similar to our catastrophe
reinsurance coverages. However, we also provide other coverage where we believe our underwriting is

robust and the market is attractive, and may grow in these lines over time. We also seek to identify market
dislocations and write new lines of business whose risk and return characteristics are estimated to exceed
our hurdle rates. Furthermore, we also seek to manage the correlations of this business with our overall
portfolio, including our aggregate exposure to single and aggregated catastrophe events. We believe that
our underwriting and analytical capabilities have positioned us well to manage our specialty reinsurance
business.

We offer our specialty reinsurance products principally on an excess of loss basis, as described above with
respect to our catastrophe reinsurance products, and also provide proportional coverage. In a proportional
reinsurance arrangement (also referred to as quota share reinsurance and pro-rata reinsurance), the
reinsurer shares a proportional part of the original premiums and losses of the reinsured. The reinsurer
pays the cedant a commission which is generally based on the cedant’s cost of acquiring the business
being reinsured (including commissions, premium taxes, assessments and miscellaneous administrative
expenses) and may also include a profit factor. Our proportional reinsurance product offerings have grown
in recent periods and are likely to continue to grow in the future. These products frequently include tailored
features such as limits or sub-limits which we believe help us manage our exposures. Any liability
exceeding, or otherwise not subject to, such limits reverts to the cedant. As with our catastrophe
reinsurance business, our specialty reinsurance frequently provides coverage for relatively large limits or
exposures, and thus we are subject to potential significant claims volatility.

We generally seek to write significant lines on our specialty reinsurance treaties. As a result of our financial
strength, we have the ability to offer significant capacity and, for select risks, we have made available
significant limits. We believe these capabilities, the strength of our specialty reinsurance underwriting team,
and our demonstrated ability and willingness to pay valid claims are competitive advantages of our specialty
reinsurance business. While we believe that these and other initiatives will support growth in our Specialty
Reinsurance segment, we intend to continue to apply our disciplined underwriting approach which, together
with currently prevailing market conditions, is likely to temper such growth in current and near-term periods.

Lloyd’s Segment

Our Lloyd’s segment includes insurance and reinsurance business written for our own account through
Syndicate 1458. The syndicate enhances our underwriting platform by providing access to Lloyd’s
extensive distribution network and worldwide licenses. RenaissanceRe Corporate Capital (UK) Limited
(“RenaissanceRe CCL”), an indirect wholly owned subsidiary of the Company, is the sole corporate member
of Syndicate 1458. RenaissanceRe Syndicate Management Limited (“RSML”), a wholly owned subsidiary
of RenaissanceRe, is the managing agent for Syndicate 1458. We anticipate that Syndicate 1458’s
absolute and relative contributions to our consolidated results of operations will have a meaningful impact
over time, although we cannot assure you we will succeed in executing our growth strategy in respect of
Syndicate 1458, or that its results will be favorable.

Syndicate 1458 generally targets lines of business where we believe we can adequately quantify the risks
assumed. We also seek to identify market dislocations and to write new lines of business whose risk and
return characteristics are attractive and add to our portfolio of risks. Furthermore, we seek to manage the
correlations of this business with our overall portfolio, including our aggregate exposure to single and
aggregated catastrophe events. We believe that our underwriting and analytical capabilities have
positioned us well to manage this business.

Syndicate 1458 offers a range of property and casualty insurance and reinsurance products including, but
not limited to, direct and facultative property, property catastrophe, agriculture, medical malpractice, general
liability and professional indemnity. Syndicate 1458 may seek to expand its coverages and capacity over
time. As with our catastrophe and specialty reinsurance business, Syndicate 1458 frequently provides
coverage for relatively large limits or exposures, and thus it is subject to potential significant claims volatility.

Ventures

We pursue a number of other opportunities through our ventures unit, which has responsibility for creating
and managing our joint ventures, executing customized reinsurance transactions to assume or cede risk
and managing certain investments directed at classes of risk other than catastrophe reinsurance.

Property Catastrophe Managed Joint Ventures

We actively manage property catastrophe-oriented joint ventures, which provide us with an additional
presence in the market, enhance our client relationships and generate fee income and profit commissions.
These joint ventures allow us to leverage our access to business and our underwriting capabilities on a
larger capital base. Currently, our principal joint ventures include DaVinci, Top Layer Re and Upsilon RFO.
Renaissance Underwriting Managers, Ltd. (“RUM”), a wholly owned subsidiary of the Company, acts as the
exclusive underwriting manager for each of these joint ventures.

DaVinci

DaVinci was established in 2001 and principally writes property catastrophe reinsurance and certain low
frequency, high severity specialty reinsurance lines of business on a global basis. In general, we seek to
construct for DaVinci a property catastrophe reinsurance portfolio with risk characteristics similar to those of
Renaissance Reinsurance’s property catastrophe reinsurance portfolio and a portfolio of certain lines of
specialty reinsurance such as terrorism and catastrophe exposed workers’ compensation. In accordance
with DaVinci’s underwriting guidelines, it can only participate in business that is underwritten by
Renaissance Reinsurance. We maintain majority voting control of DaVinciRe and, accordingly, consolidate
the results of DaVinciRe into our consolidated results of operations and financial position. We seek to
manage DaVinci’s capital efficiently over time in light of the market opportunities and needs we perceive
and believe we are able to serve. Our noncontrolling economic ownership in DaVinciRe was 27.3% at
December 31, 2013 (2012 - 30.8%). During January 2014, DaVinciRe redeemed a portion of its
outstanding shares from all existing DaVinciRe shareholders, including us, while a new DaVinciRe
shareholder purchased new shares in DaVinciRe. The Company’s noncontrolling economic ownership in
DaVinciRe subsequent to these transactions is 26.5%, effective January 1, 2014.

We expect our noncontrolling economic ownership in DaVinciRe to fluctuate over time. See “Part II, Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, Capital
Resources” for additional information with respect of DaVinci.

Top Layer Re

Top Layer Re was established in 1999 and writes high excess non-U.S. property catastrophe reinsurance.
Top Layer Re is owned 50% by State Farm Mutual Automobile Insurance Company (“State Farm”) and 50%
by Renaissance Reinsurance. State Farm provides $3.9 billion of stop loss reinsurance coverage to Top
Layer Re. We account for our equity ownership in Top Layer Re under the equity method of accounting and
our proportionate share of its results is reflected in equity in earnings (losses) of other ventures in our
consolidated statements of operations.

Upsilon RFO

Effective January 1, 2013, we formed and launched a managed joint venture, Upsilon RFO, a Bermuda
domiciled SPI (formerly known as Upsilon Reinsurance II Ltd.), to provide additional capacity to the
worldwide aggregate and per-occurrence primary and retrocessional property catastrophe excess of loss
market. Upsilon RFO’s creation further enhances our efforts to match desirable reinsurance risk with
efficient capital through a strategic capital structure. Original business was written directly by Upsilon RFO
and included $53.5 million of gross premiums written incepting January 1, 2013 under fully-collateralized
reinsurance contracts capitalized through the sale of non-voting shares to investors and an insurance
contract issued by a third party investor to the Company related to Upsilon RFO’s reinsurance portfolio.
Both Upsilon RFO and the insurance participation are managed by RUM in return for an expense override.
Through RUM, we are eligible to receive a potential underwriting profit commission in respect of Upsilon
RFO. The Company’s participation in the original risks assumed by Upsilon RFO prior to January 1, 2014
was 25.8%, inclusive of the related insurance contract, effective December 31, 2013.

During December 2013, we raised additional capital in Upsilon RFO to provide collateral for the worldwide
aggregate and per-occurrence primary and retrocessional reinsurance contracts it entered into incepting on
or after January 1, 2014.

Upsilon RFO is considered a VIE as it has insufficient equity capital to finance its activities without
additional financial support. We are the primary beneficiary of Upsilon RFO as we: (i) have the power over
the activities that most significantly impact the economic performance of Upsilon RFO and (ii) have the
obligation to absorb the losses, and right to receive the benefits, in accordance with the accounting
guidance, that could be significant to Upsilon RFO. As a result, we consolidate Upsilon RFO and all
significant inter-company transactions have been eliminated. We have not provided any financial or other
support to Upsilon RFO that was not contractually required to be provided.

Medici

Medici is an exempted fund, incorporated under the laws of Bermuda. Medici’s objective is to seek to invest
substantially all of its assets in various insurance-based investment instruments that have returns primarily
tied to property catastrophe risk. During 2013, third-party investors subscribed for a portion of the
participating, non-voting common shares of Medici. We maintain majority voting control of of Medici’s
parent, RenaissanceRe Fund Holdings Ltd. (“Fund Holdings”), as such, the results of Medici and Fund
Holdings are consolidated in our financial statements.

Strategic Investments

Ventures also pursues strategic investments where, rather than assuming exclusive management
responsibilities ourselves, we instead partner with other market participants. These investments are
directed at classes of risk other than catastrophe, and at times may also be directed at non-insurance risks.
We find these investments attractive both for their expected returns, and also because they provide us
diversification benefits and information and exposure to other aspects of the market. Examples of these
investments include our investments in Tower Hill Insurance Group, LLC. (“THIG”), Tower Hill Holdings, Inc.
(“Tower Hill”) and Tower Hill Signature Insurance Holdings, Inc. (“Tower Hill Signature” and, collectively, the
“Tower Hill Companies”), Universal Holdings Inc. (“Universal”), Angus Partners, LLC. (“Angus”) and Essent
Group Ltd. (“Essent”). THIG is a managing general agency specializing in insurance coverage for site built
and manufactured homes. Subsidiaries of THIG, namely Tower Hill Claims Services, LLC, and Tower Hill
Claims Management, LLC, provide claim adjustment services through exclusive agreements with THIG.
Tower Hill is an insurance holding company. The subsidiaries of Tower Hill, along with Tower Hill Signature,
write residential property insurance. We invested in the Tower Hill Companies, which operate primarily in
the State of Florida, to expand our core platforms by obtaining ownership in an additional distribution
channel for the Florida homeowners market and to enhance our relationships with other stakeholders.
Universal is an integrated insurance holding company performing all aspects of insurance underwriting,
distribution and claims, primarily in the Florida homeowners market. Angus provides commodity related risk
management products to third party customers. Essent provides mortgage insurance and reinsurance
coverage for mortgages located in the U.S. On October 31, 2013, Essent’s common shares began publicly
trading on the NYSE. At December 31, 2013, the fair value of our investment in Essent was $121.1 million
and we have agreed, subject to certain exceptions, not to dispose of or hedge any of the common shares of
Essent we hold prior to April 28, 2014. See “Part II, Item 7. Managements Discussion and Analysis, Net
Investment Income” for additional information with respect to our investment in Essent. The carrying value
of these investments on our consolidated balance sheet, individually or in the aggregate, may differ from the
realized value we may ultimately attain, perhaps significantly so. Other than Essent and Universal, none of
the securities we hold in respect of these investments are publicly traded.

Other Transactions

Ventures works on a range of other customized reinsurance and financing transactions. For example, we
have participated in and continuously analyze other attractive opportunities in the market for insurance-
linked securities and derivatives. We believe our products contain a number of customized features
designed to fit the needs of our partners, as well as our risk management objectives.

Business activities that appear in our consolidated underwriting results, such as DaVinci and certain
reinsurance transactions, are included in our Catastrophe Reinsurance and Specialty Reinsurance segment
results as appropriate; the results of our investments, such as Top Layer Re, and other ventures are
included in the Other category of our segment results.

Other

Our Other category primarily includes the results of: (1) our share of strategic investments in certain
markets we believe offer attractive risk-adjusted returns or where we believe our investment adds value,
and where, rather than assuming exclusive management responsibilities ourselves, we partner with other
market participants; (2) our investment unit which manages and invests the funds generated by our
consolidated operations; (3) corporate expenses, capital services costs and noncontrolling interests; (4) the
results of our discontinued operations; and (5) the remnants of our Bermuda-based insurance operations.

GEOGRAPHIC BREAKDOWN

Our exposures are generally diversified across geographic zones, but are also a function of market
conditions and opportunities. Our largest exposure has historically been to the U.S. and Caribbean market,
which represented 59.9% of the Company’s gross premiums written for the year ended December 31, 2013.
A significant amount of our U.S. and Caribbean premium provides coverage against windstorms, mainly
U.S. Atlantic hurricanes, as well as earthquakes and other natural and man-made catastrophes. The
following table sets forth the percentage of our gross premiums written allocated to the territory of coverage
exposure:

Year ended December 31,

(in thousands, except percentages)

Catastrophe Reinsurance

U.S. and Caribbean

Worldwide (excluding U.S.) (1)

Worldwide

Japan

Europe

Australia and New Zealand

Other

2013

2012

2011

Gross
Premiums
Written

Percentage
of Gross
Premiums
Written

Gross
Premiums
Written

Percentage
of Gross
Premiums
Written

Gross
Premiums
Written

Percentage
of Gross
Premiums
Written

782,211

48.7 % $

857,740

55.3 % $

786,721

146,048

99,179

39,060

25,659

22,460

5,762

9.1 %

6.2 %

2.4 %

1.6 %

1.4 %

0.4 %

139,265

81,595

43,238

37,113

18,578

4,678

9.0 %

5.3 %

2.8 %

2.4 %

1.2 %

0.3 %

164,112

124,797

49,021

31,888

16,818

3,939

54.8%

11.4%

8.7%

3.4%

2.2%

1.2%

0.3%

Total Catastrophe Reinsurance

1,120,379

69.8 %

1,182,207

76.3 %

1,177,296

82.0%

Specialty Reinsurance

Worldwide

U.S. and Caribbean

Australia and New Zealand

Europe

Worldwide (excluding U.S.) (1)

Other

151,879

91,203

12,068

2,612

1,661

9.5 %

5.7 %

0.7 %

0.2 %

0.1 %

— %

96,081

69,070

28,307

16,429

—

6.2 %

4.4 %

1.8 %

1.1 %

— %

91,032

49,832

792

3,595

—

640

6.3%

3.5%

0.1%

0.3%

—%

Total Specialty Reinsurance

259,489

16.2 %

209,887

13.5 %

145,891

10.2%

Lloyd’s

Worldwide

U.S. and Caribbean

Europe

Worldwide (excluding U.S.) (1)

Australia and New Zealand

Other

Total Lloyd’s

Other category (2)

104,249

88,535

14,763

8,071

2,948

7,966

226,532

(988)

6.5 %

5.5 %

0.9 %

0.5 %

0.2 %

0.5 %

14.1 %

(0.1)%

75,132

57,332

14,456

6,064

2,152

4,851

4.8 %

3.7 %

0.9 %

0.4 %

0.1 %

0.3 %

47,605

48,435

8,044

238

2,060

5,202

159,987

10.2 %

111,584

(490)

— %

205

3.3%

3.4%

0.6%

—%

0.1%

0.4%

7.8%

—%

Total gross premiums written

$ 1,605,412

100.0 % $ 1,551,591

100.0 % $ 1,434,976

100.0%

(1) The category “Worldwide (excluding U.S.)” consists of contracts that cover more than one geographic region (other than the

U.S.). The exposure in this category for gross premiums written to date is predominantly from Europe and Japan.

(2) The Other category consists of contracts that are primarily exposed to U.S. risks and includes inter-segment gross premiums

written of $1.0 million for the year ended December 31, 2013 (2012 - $0.5 million, 2011 - $0.1 million).

NEW BUSINESS

From time to time we consider diversification into new ventures, either through organic growth, the
formation of new joint ventures, or the acquisition of or the investment in other companies or books of
business of other companies. This potential diversification includes opportunities to write targeted,
additional classes of risk-exposed business, both directly for our own account and through possible new
joint venture opportunities. We also regularly evaluate potential strategic opportunities that we believe
might utilize our skills, capabilities, proprietary technology and relationships to support possible expansion
into further risk-related coverages, services and products. Generally, we focus on underwriting or trading
risks where reasonably sufficient data may be available, and where our analytical abilities may provide us a
competitive advantage, in order for us to seek to model estimated probabilities of losses and returns in
accordance with our approach in respect of our then current portfolio of risks.

We regularly review potential strategic transactions that might improve our portfolio of business, enhance or
focus our strategies, expand our distribution or capabilities, or provide other benefits. In evaluating potential
new ventures or investments, we generally seek an attractive estimated return on equity, the ability to
develop or capitalize on a competitive advantage, and opportunities which we believe will not detract from
our core operations. While we regularly review potential strategic transactions and periodically engage in
discussions regarding possible transactions, there can be no assurance that we will complete any such
transactions or that any such transaction would be successful or materially enhance our results of
operations or financial condition. We believe that our ability to potentially attract investment and operational
opportunities is supported by our strong reputation and financial resources, and by the capabilities and track
record of our ventures unit.

COMPETITION

The markets in which we operate are highly competitive, and we believe that competition is in general
increasing and becoming more robust. Our competitors include independent reinsurance and insurance
companies, subsidiaries and/or affiliates of globally recognized insurance companies, reinsurance divisions
of certain insurance companies, domestic and international underwriting operations, and a range of entities
offering forms of risk transfer protection on a collateralized or other non-traditional basis. As our business
evolves over time we expect our competitors to change as well.

Hedge funds, pension funds and endowments, investment banks, exchanges and other capital market
participants are increasingly active in the reinsurance market and the market for related risk. We expect
competition from, or funded by, these sources to continue to increase. In addition, we continue to anticipate
further, and perhaps accelerating, growth in financial products offered to the insurance market such as
exchange traded catastrophe options, insurance-linked securities, unrated privately held reinsurance
companies providing collateralized reinsurance, catastrophe-linked derivative agreements and other
financial products, intended to compete with traditional reinsurance. We believe that competition in the
markets we serve from products such as these has increased and will increase further in the future. It is
possible that these changing dynamics will meaningfully impact the markets in which we participate,
possibly adversely. Many of these competitors or their financial backers have greater financial, marketing
and management resources than we do. Further, we believe new entrants or existing competitors may
attempt to replicate all or part of our business model and provide further competition in the markets in which
we participate. In addition, the tax policies of the countries where our customers operate, as well as
government sponsored or backed catastrophe funds, affect demand for reinsurance, sometimes
significantly. Moreover, explicitly or implicitly government-backed entities increasingly represent competition
for the coverages that we provide directly, or for the business of our customers, reducing the potential
amount of third party private protection our clients might need or desire. We are unable to predict the
extent to which the foregoing or other new, proposed or potential initiatives may affect the demand for our
products or the risks for which we seek to provide coverage.

UNDERWRITING AND ENTERPRISE RISK MANAGEMENT

Underwriting

Our primary underwriting goal is to construct a portfolio of reinsurance and insurance contracts and other
financial risks that maximizes our return on shareholders’ equity, subject to prudent risk constraints, and to
generate long-term growth in tangible book value per common share plus the change in accumulated
dividends. We assess each new (re)insurance contract on the basis of the expected incremental return
relative to the incremental contribution to portfolio risk.

We have developed a proprietary, computer-based pricing and exposure management system, REMS©.
Since inception, we have continued to invest in and improve REMS©, incorporating our underwriting and
modeling experience, adding proprietary software and a significant amount of new industry data. REMS©
has analytic and modeling capabilities that help us to assess the risk and return of each incremental (re)
insurance contract in relation to our overall portfolio of (re)insurance contracts. We combine the analyses
generated by REMS© with other information available to us, including our own knowledge of the client
submitting the proposed program, to assess the premium offered against the risk of loss and the cost of
utilized capital which the program presents. The REMS© framework encompasses and facilitates risk
capture, analysis, correlation, portfolio aggregation and capital allocation within a single system for all of our
natural hazards and non-natural hazards (re)insurance contracts.

We generally utilize a multiple model approach combining both probabilistic and deterministic techniques.
The underlying risk models integrated into our underwriting and REMS© framework are a combination of
internally constructed and commercially available models. We use commercially available natural hazard
catastrophe models to assist with validating and stress testing our base model and REMS© results. We
continually strive to improve our analytical techniques for both natural hazard and non-natural hazard
models in REMS© and while our experience is most developed for analyzing natural hazard catastrophe
risks, we continue to make significant advances in our capabilities for assessing non-natural hazard
catastrophe risks. In addition, multiple members of our underwriting and risk management team review the
models, and their respective results.

We believe that REMS© is a robust underwriting and risk management system that has been successfully
integrated into our business processes and culture. Before we bind a (re)insurance risk, exposure data,
historical loss information and other risk data is gathered from customers. Using a combination of
proprietary software, underwriting experience, actuarial techniques and engineering expertise where we
deem appropriate, the exposure data is reviewed and augmented. We use this data as primary inputs into
the REMS© modeling system as a base to create risk distributions to represent the risk being evaluated.
We believe that the REMS© modeling system helps us to analyze each policy on a consistent basis,
assisting our determination of what we believe to be an appropriate price to charge for each policy based
upon the risk to be assumed. REMS© combines computer-generated statistical simulations that estimate
loss and event probabilities with exposure and coverage information on each client’s (re)insurance contract
to produce expected claims for (re)insurance programs submitted to us. Operationally, on a deal-by-deal
basis, our models employ simulation techniques that have the ability to generate 40,000 years of loss
activity. When deemed necessary, we stress test the 40,000 year simulations with simulations of up to
1,000,000 years. At a consolidated level, we frequently utilize simulations of 500,000 years to incorporate
reserve risk, investment risk, expenses, and operational and other risks at a portfolio and risk assuming
entity level. For natural hazards, we simulate a large range of potential industry losses in respect of events
by region and peril. For some regions and perils, the extreme tails of these simulations include industry
losses in excess of $600 billion. From these simulations, we generate a probability distribution of potential
outcomes for each policy in our portfolio and for our total portfolio. In part, through the process described
above and the utilization of REMS©, we seek to compare our estimate of the expected returns in respect of
a contract with the amount of capital that we notionally allocate to the contract based on our estimate of its
marginal impact on our portfolio of risks. A key advantage of our REMS© framework is our ability to include
additional perils, risks and geographic areas that may not be captured in commercially available natural
hazards risk models.

We periodically review the estimates and assumptions that are reflected in REMS© and our other tools. For
example, the 2011 and 2010 New Zealand Earthquakes and the Tohoku Earthquake provided new insight
on certain aspects of hazard and vulnerability to the global earthquake science community. Utilizing internal

research capabilities from our team of scientists at Weather Predict Consulting Inc. (“Weather Predict”) and
new research from the global earthquake science community, we updated several of our internal regional
representations of earthquake risk in advance of the commercially available models. In late 2012, Storm
Sandy gave rise to new data relating to storm surge, flood persistence and mid-Atlantic tropical storm
meteorology.

Our underwriters use this combination of our risk assessment and underwriting process, REMS© and other
tools in their pricing decisions, which we believe provides them with several competitive advantages. These
include the ability to:

• simulate a range of potential outcomes that adequately represents the risk to an individual contract;

• analyze the incremental impact of an individual reinsurance contract on our overall portfolio;

• better assess the underlying exposures associated with assumed retrocessional business;

• price contracts within a short time frame;

• capture various classes of risk, including catastrophe and other insurance risks;

• assess risk across multiple entities (including our various joint ventures) and across different

components of our capital structure; and

• provide consistent pricing information.

As part of our risk management process, we also use REMS© to assist us, as a retrocedant, with the
purchase of reinsurance coverage for our own account.

Our underwriting and risk management process, in conjunction with REMS©, quantifies and manages our
exposure to claims from single events and the exposure to losses from a series of events. As part of our
pricing and underwriting process, we also assess a variety of other factors, including:

• the reputation of the proposed cedant and the likelihood of establishing a long-term relationship with

the cedant;

• the geographic area in which the cedant does business and its market share;

• historical loss data for the cedant and, where available, for the industry as a whole in the relevant

regions and lines of business, in order to compare the cedant’s historical catastrophe loss experience
to industry averages;

• the cedant’s pricing strategies; and

• the perceived financial strength of the cedant and factors such as the cedant’s historical record of

making premium payments in full and on a timely basis.

In order to estimate the risk profile of each line of non-natural hazard reinsurance (i.e., our specialty and
casualty lines of business), we establish probability distributions and assess the correlations with the rest of
our portfolio. In lines with catastrophe risk, such as excess workers’ compensation and terrorism, we seek
to directly leverage our skill in modeling for our property catastrophe reinsurance risks, and seek to
appropriately estimate and manage the correlations between these specialty lines and our catastrophe
reinsurance portfolio. For other classes of business, in which we believe we have little or no natural
catastrophe exposure, and therefore less correlation with our property catastrophe reinsurance coverages,
we derive probability distributions from a variety of underlying information sources, including recent
historical experience, and the application of judgment as appropriate. The nature of some of these
businesses lends itself less to the analysis that we use for our property catastrophe (re)insurance
coverages, reflecting both the nature of available exposure information, and the impact of human factors
such as tort exposure. We produce probability distributions to represent our estimates of the related
underlying risks which our products cover, which we believe helps us to make consistent underwriting
decisions and to manage our total risk portfolio.

In addition, we also produce, utilize and report on models which measure our utilization of capital in light of
regulatory capital considerations and constraints. Our position in respect of these regulatory capital models
are reviewed by our risk management professional staff and periodically reported to and reviewed by senior
underwriting personnel and executive management with responsibility for our regulated operating entities.

Enterprise Risk Management (“ERM”)

We believe that high-quality and effective risk management is best achieved through it being a shared
cultural value throughout the organization. We have sought to develop and utilize a series of tools and
processes that support a culture of risk management and to create a robust framework of ERM within our
organization. We consider ERM to be a key process which is the responsibility of every individual within the
Company. ERM is managed by our senior executive team under the oversight of our Board of Directors,
and implemented by personnel from across our organization. We believe that ERM helps us to identify
potential events that may affect us, to quantify, evaluate and manage the risks to which we are exposed,
and to provide reasonable assurance regarding the achievement of our objectives. We believe that
effective ERM can provide us with a significant competitive advantage. We also believe that effective ERM
assists our efforts to minimize the likelihood of suffering financial outcomes in excess of the ranges which
we have estimated in respect of specific investments, underwriting decisions, or other operating or business
activities, although we do not believe this risk can be eliminated. We believe that our risk management
tools support our strategy of pursuing opportunities and help us to identify opportunities that we believe to
be the most attractive. In particular, we utilize our risk management tools to support our efforts to monitor
our capital position, on a consolidated basis and for each of our major operating subsidiaries, and to
allocate an appropriate amount of capital to support the risks that we have assumed in the aggregate and
for each of our major operating subsidiaries. We believe that our risk management efforts are essential to
our corporate strategy and our goal of achieving long-term growth in tangible book value per share plus the
change in accumulated dividends for our shareholders.

Our ERM framework comprises three primary areas of focus, as set forth below:

(1) Assumed Risk. We define assumed risk as activities where we deliberately take risk against the

Company’s capital base, including underwriting risks and other quantifiable risks such as credit risk
and interest rate risk as they relate to investments, ceded reinsurance credit risk and strategic
investment risk, each of which can be analyzed in substantial part through quantitative tools and
techniques. Of these, we believe underwriting risk to be the most material to us. In order to
understand, monitor, quantify and proactively assess underwriting risk, we seek to develop and
deploy appropriate tools to, among other things, estimate the comparable expected returns on
potential business opportunities, and estimate the impact that such incremental business could
have on our overall risk profile. We use the tools and methods described above in “Underwriting” to
seek to achieve these objectives. Embedded within our consideration of assumed risk is our
management of the Company’s aggregate, consolidated risk profile. In part through the utilization
of REMS© and our other systems and procedures, we seek to analyze our in-force aggregate
assumed risk portfolio on a daily basis. We believe this capability helps us to manage our
aggregate exposures, as well as to rigorously analyze individual proposed transactions and
evaluate them in the context of our in-force portfolio. This aggregation process captures line of
business, segment and corporate risk profiles, calculates internal and external capital tests and
explicitly models ceded reinsurance. Generally, additional data is added quarterly to our aggregate
risk framework to reflect updated or new information or estimates relating to matters such as
interest rate risk, credit risk, capital adequacy and liquidity. This information is used in day-to-day
decision making for underwriting, investments and operations and is also reviewed quarterly from
both a unit level and in respect of our consolidated financial position. We also regularly assess,
monitor and review our regulatory risk capital and related constraints.

(2) Business Environment Risk. We define this as the risk of changes in the business, political or

regulatory environment that could negatively impact our short term or long-term financial results or
the markets in which we operate. Accordingly, these risks are predominately extrinsic to the
Company and in general, our ability to alter or eliminate these risks is limited. Rather, our efforts
focus on monitoring developments, assessing potential impacts of any such changes, and investing
in cost effective means to attempt to mitigate the consequences of and ensure compliance with any
new requirements applicable to us.

(3) Operational Risk. We are subject to a number of additional risks arising out of operational,

regulatory, and other matters. We define operational risk to include the risk that we fail to create,
manage, control or mitigate the people, processes, structures or functions required to execute our
strategic and tactical plans and assemble an optimized portfolio of assumed risk, and to adjust to

and comply with the evolving requirements of business environment risk applicable to us. In light of
the rapid evolution of our markets, business environment, and business initiatives, we seek to
continually invest in the tools, processes and procedures to mitigate our exposure to operational
risk on a cost-effective basis. As with assumed risk and business environment risk, operational risk
presents intrinsic uncertainties, and we may fail to appropriately identify or mitigate applicable
operational risk.

Identification and monitoring of business environment risk and operational risk is coordinated by senior
personnel including our Chief Financial Officer (“CFO”), General Counsel and Chief Compliance Officer
(“CCO”), Corporate Controller and Chief Accounting Officer (“CAO”), Chief Administrative Officer, Chief Risk
Officer (“CRO”), Chief Information Officer and Head of Internal Audit, utilizing resources throughout the
Company.

Although financial reporting is a key area of our focus, other operational risks are addressed through our
disaster recovery program, human resource practices such as motivating and retaining top talent, our strict
tax protocols and our legal and regulatory policies and procedures.

Controls and Compliance Committee. We believe that a key component of our current operational risk
management platform is our Controls and Compliance Committee. The Controls and Compliance
Committee is comprised of our CFO, CCO, CAO, Chief Administrative Officer, CRO, Head of Internal Audit,
staff compliance professionals and representatives from our business units. The purpose of the Controls
and Compliance Committee is to establish, assess the effectiveness of, and enforce policies, procedures
and practices relating to accounting, financial reporting, internal controls, regulatory, legal, compliance and
related matters, and for striving to ensure compliance with applicable laws and regulations, the Company’s
Code of Ethics and Conduct (the “Code of Ethics”), and other relevant standards. In addition, the Controls
and Compliance Committee is charged with reviewing certain transactions that potentially raise complex
and/or significant tax, legal, accounting, regulatory, financial reporting, reputational or compliance issues.

Ongoing Development and Enhancement. We seek to reflect and categorize risks we monitor in part
through quantitative risk distributions, even where we believe that such quantitative analysis is not as robust
or well developed as our tools and models for measuring and evaluating other risks, such as catastrophe
and market risks. We also seek to improve the methods by which we measure risks. We believe effective
risk management is a core attribute of our culture and is a continual process that requires ongoing
improvement and development. We seek from time to time to identify effective new practices or additional
developments both from within our industry and from other sectors. We believe that our ongoing efforts to
embed ERM throughout our organization are important to our efforts to produce and maintain a competitive
advantage to achieve our corporate goals.

RATINGS

Financial strength ratings are an important factor in respect of the competitive position of reinsurance and
insurance companies. Rating organizations continually review the financial positions of our reinsurers and
insurers. We continue to receive high claims-paying and financial strength ratings from A.M. Best Co.
(“A.M. Best”), Standard and Poor’s Rating Services (“S&P”), Moody’s Investors Service (“Moody’s”) and
Fitch Ratings Ltd. (“Fitch”). These ratings represent independent opinions of an insurer’s financial strength,
operating performance and ability to meet policyholder obligations, and are not an evaluation directed
toward the protection of investors or a recommendation to buy, sell or hold any of our securities. See “Part
II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Capital
Resources, Ratings” for the ratings of our principal operating subsidiaries and joint ventures by segment,
and details of recent ratings actions. In addition, S&P assesses companies’ ERM practices, which is an
opinion on the many critical dimensions of risk that determine overall creditworthiness. RenaissanceRe has
been assigned an ERM rating of “Very Strong”, which is the highest rating assigned by S&P, and indicates
that S&P believes RenaissanceRe has very strong capabilities to consistently identify, measure, and
manage risk exposures and losses within RenaissanceRe’s predetermined tolerance guidelines.

RESERVES FOR CLAIMS AND CLAIM EXPENSES

We believe the most significant accounting judgment made by management is our estimate of claims and
claim expense reserves. Claims and claim expense reserves represent estimates, including actuarial and
statistical projections at a given point in time, of the ultimate settlement and administration costs for unpaid
claims and claim expenses arising from the insurance and reinsurance contracts we sell. We establish our
claims and claim expense reserves by taking claims reported to us by insureds and ceding companies, but
which have not yet been paid (“case reserves”), adding the costs for additional case reserves (“additional
case reserves”) which represent our estimates for claims previously reported to us which we believe may
not be adequately reserved as of that date, and adding estimates for the anticipated cost of claims incurred
but not yet reported to us (“IBNR”).

The following table summarizes our claims and claim expense reserves by line of business and split
between case reserves, additional case reserves and IBNR:

At December 31, 2013

(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

At December 31, 2012
(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

Case
Reserves

Additional
Case Reserves

IBNR

Total

430,166 $
113,188
45,355
14,915

603,624 $

177,518 $

81,251
14,265
2,324
275,358 $

173,303 $
311,829
158,747
40,869

780,987
506,268
218,367
58,108
684,748 $ 1,563,730

706,264 $
111,234
29,260
17,016

863,774 $

222,208 $

80,971
10,548
8,522
322,249 $

255,786 $ 1,184,258
478,313
286,108
149,470
109,662
67,336
41,798
693,354 $ 1,879,377

Our estimates of claims and claim expense reserves are not precise in that, among other matters, they are
based on predictions of future developments and estimates of future trends and other variable factors.
Some, but not all, of our reserves are further subject to the uncertainty inherent in actuarial methodologies
and estimates. Because a reserve estimate is simply an insurer’s estimate at a point in time of its ultimate
liability, and because there are numerous factors which affect reserves and claims payments that cannot be
determined with certainty in advance, our ultimate payments will vary, perhaps materially, from our
estimates of reserves. If we determine in a subsequent period that adjustments to our previously
established reserves are appropriate, such adjustments are recorded in the period in which they are
identified. During 2013, changes to prior year estimated claims reserves increased our net income by
$144.0 million (2012 - increased our net income by $158.0 million, 2011 - decreased our net loss by $132.0
million), excluding the consideration of changes in reinstatement premium, profit commissions, redeemable
noncontrolling interest - DaVinciRe, equity in net claims and claim expenses of Top Layer Re and income
tax.

The following table presents an analysis of our paid, unpaid and incurred losses and loss expenses and a
reconciliation of beginning and ending reserves for claims and claim expenses for the years indicated:

Year ended December 31,
(in thousands)
Net reserves as of January 1
Net incurred related to:

Current year
Prior years

Total net incurred
Net paid related to:

Current year
Prior years
Total net paid
Total net reserves as of December 31
Reinsurance recoverable as of December 31
Total gross reserves as of December 31

2013

2012

2011

$ 1,686,865 $ 1,588,325 $ 1,156,132

315,241
(143,954)
171,287

483,180
(157,969)
325,211

993,168
(131,989)
861,179

32,212
363,235
395,447
1,462,705
101,025

299,299
129,687
428,986
1,588,325
404,029
$ 1,563,730 $ 1,879,377 $ 1,992,354

84,056
142,615
226,671
1,686,865
192,512

Refer to “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of
Operations, Summary of Critical Accounting Estimates, Claims and Claim Expense Reserves” for additional
discussion regarding the Company’s reserving methodologies, including key assumptions and sensitivity
analysis and a discussion regarding the Company’s accounting treatment and favorable development on
prior years net claims and claim expenses.

Our reserving methodology for each line of business uses a loss reserving process that calculates a point
estimate for the Company’s ultimate settlement and administration costs for claims and claim expenses.
We do not calculate a range of estimates. We use this point estimate, along with paid claims and case
reserves, to record our best estimate of additional case reserves and IBNR in our consolidated financial
statements. Under GAAP, we are not permitted to establish estimates for catastrophe claims and claim
expense reserves until an event occurs that gives rise to a loss.

Reserving for our reinsurance claims involves other uncertainties, such as the dependence on information
from ceding companies, which among other matters, includes the time lag inherent in reporting information
from the primary insurer to us or to our ceding companies and differing reserving practices among ceding
companies. The information received from ceding companies is typically in the form of bordereaux, broker
notifications of loss and/or discussions with ceding companies or their brokers. This information can be
received on a monthly, quarterly or transactional basis and normally includes estimates of paid claims and
case reserves. We sometimes also receive an estimate or provision for IBNR. This information is often
updated and adjusted from time to time during the loss settlement period as new data or facts in respect of
initial claims, client accounts, industry or event trends may be reported or emerge in addition to changes in
applicable statutory and case laws.

assumed reinsurance. A significant portion of our reinsurance recoverable relates to the New Zealand and
Tohoku Earthquakes. There is inherent uncertainty and complexity in evaluating loss reserve levels and
reinsurance recoverable amounts, due to the nature of the losses relating to earthquake events, including
that loss development time frames tend to take longer with respect to earthquake events. The contingent
nature of business interruption and other exposures will also impact losses in a meaningful way, especially
in respect of our current reserves with regard to Storm Sandy, the Tohoku Earthquake and the Thailand
Floods, which we believe may give rise to significant complexity in respect of claims handling, claims
adjustment and other coverage issues, over time. Given the magnitude and relatively recent occurrence of
these large events, meaningful uncertainty remains regarding total covered losses for the insurance
industry and, accordingly, several of the key assumptions underlying our loss estimates. In addition, our
actual net losses from these events may increase if our reinsurers or other obligors fail to meet their
obligations.

Because of the inherent uncertainties discussed above, we have developed a reserving philosophy which
attempts to incorporate prudent assumptions and estimates, and we have generally experienced favorable
net development on prior year reserves in the last several years. However, there is no assurance that this
will occur in future periods.

Our reserving techniques, assumptions and processes differ among our Catastrophe Reinsurance,
Specialty Reinsurance and Lloyd’s segments, and Other category. Refer to “Part II, Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations, Summary of Critical Accounting
Estimates, Claims and Claim Expense Reserves” for more information on the risks we insure and reinsure,
the reserving techniques, assumptions and processes we follow to estimate our claims and claim expense
reserves, and our current estimates versus our initial estimates of our claims reserves, for each of these
units.

The following table represents the development of our GAAP balance sheet reserves for December 31,
2003 through December 31, 2013. This table does not present accident or policy year development data.
The top line of the table shows the gross reserves for claims and claim expenses at the balance sheet date
for each of the indicated years. This represents the estimated amounts of claims and claim expenses
arising in the current year and all prior years that are unpaid at the balance sheet date, including additional
case reserves and IBNR reserves. The table also shows the re-estimated amount of the previously
recorded reserves based on experience as of the end of each succeeding year. The estimate changes as
more information becomes known about the frequency and severity of claims for individual years. The
“cumulative redundancy on net reserves” represents the aggregate change to date from the indicated
estimate of the gross reserve for claims and claim expenses, net of reinsurance recoverable on the second
line of the table. The table also shows the cumulative net paid amounts as of successive years with respect
to the net reserve liability. At the bottom of the table is a reconciliation of the gross reserve for claims and
claim expenses to the net reserve for claims and claim expenses, the gross re-estimated liability to the net
re-estimated liability for claims and claim expenses, and the cumulative redundancy on gross reserves.

With respect to the information in the table below, note that each amount includes the effects of all changes in
amounts for prior periods, including the effect of foreign exchange rates.

Year ended
December 31,

(in millions)

Gross reserve

for claims and
claim
expenses
Reserve for
claims and
claim
expenses, net
of reinsurance
recoverable
1 Year Later

2 Years Later

3 Years Later

4 Years Later

5 Years Later

6 Years Later

7 Years Later

8 Years Later

9 Years Later

10 Years Later

Cumulative

redundancy
on net
reserves

Cumulative Net
Paid Losses

1 Year Later

2 Years Later

3 Years Later

4 Years Later

5 Years Later

6 Years Later

7 Years Later

8 Years Later

9 Years Later

10 Years Later

Gross reserve

for claims and
claim
expenses
Reinsurance
recoverable
on unpaid
losses

Net reserve for
claims and
claim
expenses
Gross liability
re-estimated

Reinsurance
recoverable
on unpaid
losses re-
estimated
Net liability re-
estimated
Cumulative

redundancy
on gross
reserves

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

$ 924.4

$1,295.0

$2,381.4

$1,811.0

$1,717.2

$1,758.8

$1,344.4

$1,257.8

$1,992.3

$1,879.4

$1,563.7

$ 810.6

$1,099.2

$1,742.2

$1,591.3

$1,609.5

$1,565.2

$1,260.3

$1,156.1

$1,588.3

$1,686.9

$1,462.7

661.5

379.5

362.8

332.9

312.2

301.5

266.2

251.2

241.2

244.9

878.6

844.0

749.1

717.2

683.7

628.9

609.2

604.5

612.4

—

1,610.7

1,368.3

1,412.6

1,299.0

1,449.1

1,225.9

1,199.0

1,045.1

1,333.7

1,092.2

1,231.6

1,077.8

1,022.7

1,002.8

1,009.4

—

911.1

847.2

823.5

819.1

—

997.8

923.0

878.5

858.6

—

961.4

888.7

849.2

—

958.2

857.6

770.8

727.4

—

1,024.1

1,430.3

1,543.0

895.8

849.5

—

1,345.5

—

$ 565.7

$ 486.8

$ 732.8

$ 772.2

$ 750.9

$ 716.0

$ 532.9

$ 306.6

$ 242.8

$ 143.9

—

58.0

100.6

107.5

96.4

129.8

136.1

137.3

139.2

152.1

156.4

302.8

370.8

395.7

446.8

472.7

482.7

492.2

527.6

533.9

—

354.8

548.4

712.6

782.9

812.0

833.1

879.1

890.9

—

247.6

435.8

529.5

569.4

594.2

656.1

668.7

—

337.1

469.5

553.0

605.7

690.4

703.2

—

191.5

369.1

471.6

585.8

615.3

—

182.8

301.5

420.6

456.2

—

129.7

301.5

379.3

—

142.6

484.5

—

363.2

—

$ 924.4

$1,295.0

$2,381.4

$1,811.0

$1,717.2

$1,758.8

$1,344.4

$1,257.8

$1,992.3

$1,879.4

$1,563.7

113.8

195.8

639.2

219.7

107.7

193.6

84.1

101.7

404.0

192.5

101.0

$ 810.6

$1,099.2

$1,742.2

$1,591.3

$1,609.5

$1,565.2

$1,260.3

$1,156.1

$1,588.3

$1,686.9

$1,462.7

$ 359.0

$ 809.6

$1,619.7

$1,025.2

$ 925.4

$ 987.7

$ 774.0

$ 929.5

$1,744.3

$1,711.3

—

114.1

197.2

610.3

206.1

66.8

138.5

46.6

80.0

398.8

168.3

$ 244.9

$ 612.4

$1,009.4

$ 819.1

$ 858.6

$ 849.2

$ 727.4

$ 849.5

$1,345.5

$1,543.0

—

$ 565.4

$ 485.4

$ 761.7

$ 785.8

$ 791.8

$ 771.1

$ 570.4

$ 328.3

$ 248.0

$ 168.1

—

INVESTMENTS

Our investment guidelines stress preservation of capital, market liquidity, and diversification of risk. The
majority of our investments consist of highly rated fixed income securities. We also hold a significant
amount of short term investments. Short term investments are managed as part of our investment portfolio
and have a maturity of one year or less when purchased. In addition, we have an allocation to other
investments including private equity partnerships, senior secured bank loan funds, catastrophe bonds, and
hedge funds, and to certain equity securities. We may from time to time re-evaluate our investment
guidelines and explore investment allocations to other asset classes. Our investments are subject to
market-wide risks and fluctuations, as well as to risks inherent in particular securities.

The table below shows the aggregate amounts of our invested assets:

6.4%

3.9%

6.4%

0.2%

74.7%

12.9%

0.9%

10.1%

98.6%

1.4%

At December 31,

(in thousands, except percentages)
U.S. treasuries

Agencies

Non-U.S. government (Sovereign debt)

Non-U.S. government-backed corporate

Corporate

Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed

2013

2012

$ 1,352,413

19.8% $ 1,254,547

19.8%

186,050

334,580

237,479

2.7%

4.9%

3.5%

315,154

133,198

349,514

5.0%

2.1%

5.5%

1,803,415

26.4% 1,615,207

25.4%

341,908

257,938

314,236

15,258

5.0%

3.8%

4.6%

0.2%

408,531

248,339

406,166

12,954

Total fixed maturity investments, at fair value

4,843,277

70.9% 4,743,610

Short term investments, at fair value

Equity investments trading, at fair value

Other investments, at fair value

Total managed investment portfolio

1,044,779

15.3%

254,776

573,264

3.7%

8.5%

821,163

58,186

644,711

6,716,096

98.4% 6,267,670

Investments in other ventures, under equity method

105,616

1.6%

87,724

Total investments

$ 6,821,712

100.0% $ 6,355,394

100.0%

For additional information regarding the investment portfolio, refer to “Part II, Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operations, Liquidity and Capital Resources,
Investments”.

MARKETING

We believe that our modeling and technical expertise, the risk management products that we provide to our
customers, and our reputation for paying claims promptly has enabled us to become a provider of first
choice in many lines of business to our customers worldwide. We market our products worldwide primarily
through reinsurance brokers and we focus our marketing efforts on targeted brokers and partners. We
believe that our existing portfolio of business is a valuable asset and, therefore, we attempt to continually
strengthen relationships with our existing brokers and customers. We target prospects that are capable of
supplying detailed and accurate underwriting data and that potentially add further diversification to our book
of business.

We believe that primary insurers’ and brokers’ willingness to use a particular reinsurer is based not just on
pricing, but also on the financial security of the reinsurer, its claim paying ability ratings and demonstrated
willingness to promptly pay valid claims, the quality of a reinsurer’s service, the reinsurer’s willingness and
ability to design customized programs, its long-term stability and its commitment to provide reinsurance
capacity. We believe we have established a reputation with our brokers and customers for prompt
response on underwriting submissions, for fast claims payments and for providing creative solutions to our
customers’ needs. Since we selectively write large lines on a limited number of property catastrophe and
specialty reinsurance contracts, we can establish terms and conditions on those contracts that are attractive

in our judgment, make large commitments to the most attractive programs and provide superior client
responsiveness. We believe that our willingness and ability to design customized programs and to provide
bespoke risk management products has helped us to develop long-term relationships with brokers and
customers.

Our brokers assess client needs and perform data collection, contract preparation and other administrative
tasks, enabling us to market our products cost effectively by maintaining a smaller staff. We believe that by
maintaining close relationships with brokers, we are able to obtain access to a broad range of potential
reinsureds. In recent years, our distribution has become increasingly reliant on a small and relatively
decreasing number of such relationships reflecting consolidation in the broker sector. We expect this
concentration to continue and perhaps increase.

The following table shows the percentage of our Catastrophe Reinsurance and Specialty Reinsurance
segments’ gross premiums written generated through our largest brokers:

Catastrophe Reinsurance

Specialty Reinsurance

Year ended December 31,

AON Benfield

Marsh Inc.
Willis Group

Total of largest brokers

All others

2012

2013
50.6% 54.0% 56.7% 40.0% 37.4% 31.9%

2013

2011

2012

21.5% 20.3% 21.0% 27.5% 30.4% 33.7%
9.8% 25.4% 26.6% 33.3%
14.9%

8.6%

87.0% 82.9% 87.5% 92.9% 94.4% 98.9%

13.0% 17.1% 12.5%

7.1%

5.6%

1.1%

Total percentage of segment gross

premiums written

100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

The following table shows the number of brokers for which we issued authorization for coverage on
programs, the number of program submissions received and the number and percent of authorizations
issued, split between our Catastrophe Reinsurance, Specialty Reinsurance and Lloyd’s segments for 2013:

Year ended December 31, 2013

Number of brokers

Program submissions

Programs authorized

Programs authorized as a percentage of program

submissions

Catastrophe
Reinsurance
16

Specialty
Reinsurance
12

2,863

876

31%

402

184

46%

Lloyd’s

3,459

875

25%

EMPLOYEES

At February 19, 2014, we employed 285 people worldwide (February 20, 2013 - 309, February 15, 2012 -
311). As part of the sale of REAL, which closed on October 1, 2013, our overall headcount was reduced by
31 employees. We believe our strong employee relations are among our most significant strengths. None
of our employees are subject to collective bargaining agreements. We are not aware of any current efforts
to implement such agreements at any of our subsidiaries. The Company has historically looked for
opportunities to strengthen its operations during periods of softening markets in anticipation of improving
market conditions, however, we may from time to time reevaluate our operational needs based on various
factors, including the changing nature of such market conditions and changes in our strategy or tactical
plans. We currently expect to continue to experience a degree of employee growth in the U.K. and other
markets outside Bermuda, which may lead to, in certain cases, new or expanded human resource
requirements.

INFORMATION TECHNOLOGY

Our information technology infrastructure is important to our business. Our information technology platform,
supported by a team of professionals, is maintained across various office locations. Additional information
technology assets are maintained at the other office locations of our operating subsidiaries. We have
implemented backup procedures that seek to ensure that our key business systems and data are backed
up, generally on a daily basis, and can be restored promptly if and as needed. In addition, we generally
store backup information at off-site locations, in order to seek to minimize our risk of loss of key data in the
event of a disaster.

We depend on the proper functioning and availability of our information technology platform. This includes
communications and data processing systems used in operating our business. These systems consist of
proprietary software programs that are integral to the efficient operation of our business (including REMS©,
our proprietary computer-based pricing and exposure management system). In addition, we frequently
transmit and receive personal, confidential and proprietary information by email and other electronic means,
as required in connection with our business, with our internal operations and with facilitating the oversight
conducted by our Board of Directors. Computer viruses, hackers, employee misuse or misconduct and
other external hazards could expose our data systems to security breaches, cyber attacks or other
disruptions.

We believe that the preponderance of our business and support functions utilize information systems that
provide critical services to both our employees and our customers. We are also required to effect electronic
transmissions with third parties including brokers, clients, vendors and others with whom we do business.
While we seek to ensure that our information is appropriately protected by these parties by performing third
party risk assessments, we may be unable to establish secure capabilities with all of them; in addition,
these third parties may not have appropriate controls in place to protect the confidentiality of the
information.

Cyber incidents that impact the availability, reliability, speed, accuracy or other proper functioning of these
systems could have a significant impact on our operations, and potentially on our results. Publicly reported
instances of cyber security threats and incidents have increased over recent periods, and it is possible that
cyber-related risks for us or the costs to us of complying with new or developing regulatory requirements
has or will increase. In 2011, the United States Securities and Exchange Commission (the “SEC”) drafted
informal staff-level guidance for public companies to use when considering whether to disclose cyber
attacks and their impact on a company's financial condition, and it is possible that the SEC or other
agencies which regulate or oversee us will adopt new standards or requirements with which we would be
required to comply. We also operate in a number of jurisdictions with strict data privacy and other related
laws, which could be violated in the event of a significant cybersecurity incident, or by our personnel.
Failure to comply with these obligations can give rise to monetary fines and other penalties, which could be
significant.

We seek to protect our information systems through physical and electronic safeguards as well as backup
systems considered appropriate by management. However, it is not practicable to protect against every
potential power loss, telecommunications failure, cybersecurity attack or similar event that may arise.
Moreover, the safeguards we have chosen to utilize are subject to human implementation and maintenance
and to other uncertainties.

A significant cyber incident, including system failure, security breach, disruption by malware or other
damage could interrupt or delay our operations. Cyber incidents may result in a violation of applicable
privacy and other laws and could damage our reputation potentially causing a loss of customers.
Management is not aware of a cybersecurity incident that has had a material effect on our operations,
although there can be no assurances that a cyber incident that could have a material impact on us will not
occur in the future. We do however periodically perform security penetration test scenarios and provide
regular security risk staff education awareness sessions, to evaluate our preparedness and enhance both
our system and user ability to detect, alert and respond to such an incident.

We have implemented and periodically test our disaster recovery plans with respect to our information
technology infrastructure. Among other things, our recovery plans involve arrangements with off-site,
secure data centers in alternative locations. We believe we will be able to access our systems from these
facilities in the event that our primary systems are unavailable due to various scenarios, such as natural
disasters. However, we have not prepared for every conceivable disaster or every scenario which might
arise in respect of the disaster for which we have prepared, and cannot assure you our efforts in respect of
disaster recovery will succeed, or will be sufficiently rapid to avoid harm to our business.

REGULATION

U.S. Regulation

Dodd-Frank Act. On July 21, 2010, President Obama signed into law the Dodd-Frank Act which effects
sweeping reforms of the financial services industries. Although the Dodd-Frank Act does not change the
state-based system of insurance regulation in the U.S., it does establish federal measures that will impact
the U.S. insurance business and preempt certain state insurance laws. Over time, the Dodd-Frank Act or
those agencies responsible for its enforcement may lay the foundation for ultimately establishing some form
of U.S. federal regulation of insurance.

The Dodd-Frank Act created the Financial Stability Oversight Council (“FSOC”) to identify and respond to
risks to the financial stability of the U.S. and to promote market discipline. FSOC is authorized to designate
a nonbank financial company as “systemically significant” if its material financial distress could threaten the
financial stability of the U.S. In 2013, FSOC designated three nonbank financial companies, including two
insurance groups, as systemically significant. Those designated entities will be subject to supervision by
the Board of Governors of the Federal Reserve System as well as enhanced prudential standards, including
stress tests, liquidity requirements, annual resolution plans or “living wills,” and enhanced public
disclosures. FSOC’s potential recommendation of measures to address systemic risk in the insurance
industry could affect our insurance and reinsurance operations as could a determination that we or our
counterparties are systemically significant.

The Dodd-Frank Act also created the first office in the Federal government focused on insurance - the
Federal Insurance Office (“FIO”). Although FIO has preemption authority over state insurance laws that
conflict with certain international agreements, FIO does not have general supervisory or regulatory authority
over the business of insurance. Certain functions of FIO relate to systemic risk. Specifically, FIO is
authorized to monitor the U.S. insurance industry and identify potential regulatory gaps that could contribute
to systemic risk. In addition, FIO may recommend to FSOC the designation of systemically important
insurers.

FIO has a particular role in connection with international insurance matters. FIO represents the U.S. at the
International Association of Insurance Supervisors (“IAIS”); in 2012, FIO participated in IAIS’s Financial
Stability Committee and joined IAIS’s Executive Committee. The Dodd-Frank Act authorizes the Secretary
of the Treasury and U.S. Trade Representative to enter into international agreements of mutual recognition
regarding the prudential regulation of insurance (a “Covered Agreement”). Significantly, FIO is authorized to
preempt state measures that (i) are inconsistent with a Covered Agreement and (ii) disfavor non-U.S.
insurers subject to a Covered Agreement.

FIO is required to report to Congress annually on the insurance industry and any preemption actions
regarding Covered Agreements. A FIO report to Congress describing the breadth of the global reinsurance
market and its critical role in supporting the U.S. insurance system scheduled for September 2012 has not
yet been produced. On December 12, 2013, however, FIO delivered a report to Congress on how to
modernize and improve the system of insurance regulation in the U.S. The report recommended that, in the
short term, the U.S. system of insurance regulation can be modernized through state-based improvements
combined with certain federal actions. The report identified areas for direct federal involvement in
international standard setting, FIO participation in supervisory colleges which monitor the regulation of large
national and internationally active insurance groups and federal pursuit of Covered Agreements to afford
nationally uniform treatment of reinsurance collateral requirements. The report also made several
recommendations for state reform of insurance regulation, including changes to the state regulation of
insurance company solvency, group supervision and corporate governance. The FIO report stated that the
system of U.S. insurance regulation can be modernized and improved in the short-term, while warning that

if the various U.S. states do not act in the near term to effectively regulate matters on a consistent and
cooperative basis, in FIO’s view, there will be a greater role for federal regulation of insurance. The
potential impact of the Dodd-Frank Act on our U.S. cedants and on the U.S. treatment of global reinsurance
matters is not clear at this time. We are monitoring developments at FSOC and FIO in connection with the
possible impact on our U.S. insurance and reinsurance business. It is possible FIO will issue
recommendations in respect of the reinsurance market that would, if enacted, impact our markets or our
operations significantly, perhaps adversely. The Dodd-Frank Act also provides for the specific preemption
of certain state insurance laws in the areas of reinsurance and surplus insurance regulation.

At this time, it is difficult to predict the extent to which the Dodd-Frank Act or the resulting regulations will
impact our business. However, compliance with these new laws and regulations has resulted in additional
costs. Although we do not expect these costs to be material to us as a whole, we cannot be certain that this
expectation will prove accurate or that the Dodd-Frank Act will not impact our business more adversely than
we currently estimate.

Reinsurance Regulation. Our Bermuda-domiciled insurance operations and joint ventures principally
consist of Renaissance Reinsurance, DaVinci, Top Layer Re, RenaissanceRe Specialty Risks,
RenaissanceRe Specialty U.S. and Upsilon RFO. All are admitted to transact insurance business in
Bermuda. The insurance laws of each state of the U.S. regulate the sale of reinsurance to ceding insurers
authorized in the state by non-admitted alien reinsurers, acting from locations outside the state. With some
exceptions, the sale of insurance or reinsurance within a jurisdiction where the insurer is not admitted to do
business is prohibited. Our Bermuda-domiciled insurance operations and joint ventures do not maintain an
office or solicit, advertise, settle claims or conduct other insurance activities in any jurisdiction, other than
Bermuda, where the conduct of such activities would require that any company be so admitted.

In 2013, we organized RenaissanceRe Underwriting Managers U.S., a specialty reinsurance agency
domiciled in Connecticut, to provide specialty treaty reinsurance solutions on both a quota share and
excess of loss basis, as well as to write business on behalf of RenaissanceRe Specialty U.S., a Bermuda-
domiciled reinsurer launched in 2013 which operates subject to U.S. federal income tax, and Syndicate
1458. RenaissanceRe Underwriting Managers U.S. is licensed by the Connecticut Department of
Insurance as a reinsurance intermediary broker and is required to maintain its reinsurance intermediary
broker license in force in order to conduct its reinsurance operations in Connecticut.

Although, in general, reinsurance contract terms and rates are not subject to regulation by state insurance
authorities, a primary U. S. insurer ordinarily will enter into a reinsurance agreement only if it can obtain
credit on its statutory financial statements for the reinsurance ceded. State insurance regulators permit U.S.
ceding insurers to take credit for reinsurance ceded to non-admitted, non-U.S. (alien) reinsurers if the
reinsurance contract contains certain minimum provisions and if the reinsurance obligations of the non-U.S.
reinsurer are appropriately collateralized. Qualifying collateral may be established by an alien reinsurer
exclusively for a single U.S. ceding company. Alternatively, an alien reinsurer that is accredited by a state
may establish a multi-beneficiary trust with qualifying assets equal to its reinsurance obligations to all U.S.
ceding insurers, plus a trusteed surplus amount. Renaissance Reinsurance and DaVinci are each an
accredited reinsurer in New York and Florida and have established multi-beneficiary trusts with a qualifying
financial institution in New York for the benefit of their U.S. cedants.

States have generally required alien reinsurers to provide collateral equal to one hundred percent of their
reinsurance obligations to U.S. ceding insurers. However, recently eighteen states have changed their
credit for reinsurance laws to permit US ceding insurers to take full credit for reinsurance when a “certified”
reinsurer posts reduced collateral amounts. Under these amended credit for reinsurance laws, qualifying
alien reinsurers may reduce their collateral for future reinsurance agreements based on a secure rating
assigned by the U.S. insurance regulator. The secure rating is assigned by the state upon an assessment
of the reinsurer’s financial condition, financial strength ratings and other factors. In addition, the alien
reinsurer must be domiciled in a jurisdiction that is “qualified” under state law. In February 2014, Bermuda
was the first foreign jurisdiction to be added to the National Association of Insurance Commissioners’ (the
“NAIC”) list of conditional qualified jurisdictions, and states that have amended their credit for reinsurance
laws may accept such conditional qualification in assessing reinsurers for certification. Of the eighteen
states that have changed their credit for reinsurance laws, only Connecticut, New York and Florida have
approved any reinsurers for collateral reduction. Florida has approved Renaissance Reinsurance and
DaVinci for collateral reduction.

The Dodd-Frank Act also addresses states’ extraterritorial regulation of credit for reinsurance and the
solvency regulation of U.S. reinsurers. The Dodd-Frank Act prohibits a state in which a U.S. ceding insurer
is licensed, but not domiciled, from denying credit for reinsurance if the ceding insurer’s domestic state
recognizes credit for reinsurance for the insurer’s ceded risk and is a state accredited by the NAIC (or has
substantially similar financial solvency requirements). With limited exceptions, the provisions of the Dodd-
Frank Act affecting reinsurance became effective July 21, 2011.

Although these changes may benefit our Bermuda based reinsurers by prohibiting states’ extraterritorial
application of credit for reinsurance laws and streamlining the credit for reinsurance process, states may
also impose heightened standards on U.S. ceding insurers’ in their selection of reinsurers which could have
an adverse impact on our business.

Excess and Surplus Lines Regulation. RenaissanceRe Specialty Risks, domiciled in Bermuda, is not
licensed in the U.S. but is eligible to offer coverage in the U.S. exclusively in the surplus lines market.
RenaissanceRe Specialty Risks is listed on the NAIC’s International Insurers Department’s Quarterly List of
Alien Insurers as an eligible alien surplus lines insurer. Under the Dodd Frank Act, states may not prohibit a
surplus lines broker from placing insurance with an alien insurer that appears in the Quarterly List of Alien
Insurers maintained by the International Insurers Department. In accordance with certain provisions of the
NAIC Nonadmitted Insurance Model Act, which provisions have been adopted by a number of states,
RenaissanceRe Specialty Risks has established, and is required to maintain, a trust funded to a minimum
amount as a condition of its status as an eligible, non-admitted insurer in the U.S. Although surplus lines
business is generally less regulated than the admitted market, strict regulations apply to surplus lines
placements under the laws of every state, and the regulation of surplus lines insurance may undergo
changes in the future.

Legislative and Regulatory Proposals. Government intervention in the insurance and reinsurance markets
in the U.S. continues to evolve. Although U.S. state regulation is currently the primary form of regulation of
insurance and reinsurance, in addition to changes brought about by the Dodd-Frank Act, Congress has
considered over the past years various proposals relating to the creation of an optional federal charter,
repeal of the insurance company antitrust exemption from the McCarran Ferguson Act, and tax law
changes, including changes to increase the taxation of reinsurance premiums paid to off-shore affiliates
with respect to U.S. risks. We are unable to predict what reforms will be proposed or adopted or the effect,
if any, that such reforms would have on our operations and financial condition.

In 2007, Florida enacted legislation which enabled the FHCF to offer increased amounts of coverage in
addition to the mandatory coverage amount, at below-market rates. Further, the legislation expanded the
ability of the state-sponsored insurer, Citizens, to compete with private insurance companies, and other
companies that cede business to us. This legislation reduced the role of the private insurance and
reinsurance markets in Florida, a key target market of ours. In May 2009, the Florida legislature took steps
to strengthen the financial condition of FHCF and Citizens, which a government-appointed task force
determined to have been impaired by issues including the crisis in the credit markets, widespread rate
inadequacy, and issues arising out of the application of discounts for housing retrofits and mitigation
features. A bill was passed in 2009 permitting Citizens to raise its rates by up to 10% starting in 2010 and
every year thereafter until its current shortfall is corrected and Citizens has sufficient funds to pay its claims
and expenses. The bill provided for the gradual phase out of $12.0 billion in optional reinsurance coverage
under the FHCF over the succeeding five years. The rate increases and cut back on coverage by FHCF
and Citizens have supported, over this period, a relatively increased role for private insurers in Florida, a
market in which we have established substantial market share. However, we cannot assure you that this
increased role will continue or be maintained, or that adverse new legislation will not be passed.

It is possible that other states, particularly those with Atlantic or Gulf Coast exposures, may enact new or
expanded legislation based on the earlier Florida precedent, or may otherwise enact legislation which would
further diminish aggregate private market demand for our products. Alternatively, legislation adversely
impacting the private markets could be enacted on a regional or Federal level. For example, in the past,
federal bills have been proposed in Congress (and, in prior Congressional sessions, passed by the House
of Representatives) which would, if enacted, create a federal reinsurance backstop or guarantee
mechanism for catastrophic risks, including those we currently insure and reinsure in the private markets.
In 2009, the Catastrophe Obligation Guarantee Act was introduced in the Senate and House (S. 886) to
federally guarantee bond issuances by certain government entities, potentially including the FHCF, the

Texas Windstorm Insurance Association, the California Earthquake Authority, and others. In August 2012,
Congressman Albio Sires introduced the Taxpayers’ Protection Act (HR 6477). The bill would establish a
federal catastrophe fund where eligible states can purchase reinsurance directly from the federal
government. In January 2013, Congresswoman Frederica Wilson introduced the Homeowners’ Defense
Act which would, if enacted, provide for the creation of (i) a federal reinsurance catastrophe fund; (ii) a
federal consortium to facilitate qualifying state residual markets and catastrophe funds in securing
reinsurance; and (iii) a federal bond guarantee program for state catastrophe funds in qualifying state
residual markets. In January 2013, Congressman Dennis Ross introduced the Homeowners’ Insurance
Protection Act (HR 240), which would create a federal catastrophe reinsurance program to back up federal
reinsurance programs. If enacted, any of these bills, or legislation similar to these proposals, would, we
believe, likely contribute to the growth of state entities offering below market priced insurance and
reinsurance in a manner adverse to us and market participants more generally, and could accordingly
adversely impact our financial results, perhaps materially. Moreover, we believe that numerous modeled
potential catastrophes could exceed the actual or politically acceptable bonded capacity of Citizens and of
the FHCF, which could lead either to a severe dislocation or the increased likelihood of federal intervention
in the Florida market, either of which would adversely impact the private insurance and reinsurance
industry. See “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of
Operations, Current Outlook, Legislative and Regulatory Update” for further information regarding recent
legislative and regulatory proposals.

The potential for further expansion into additional insurance markets could expose us or our subsidiaries to
increasing regulatory oversight, including the oversight of countries other than Bermuda and the U.S.
However, we intend to continue to conduct our operations so as to minimize the likelihood that Renaissance
Reinsurance, DaVinci, Top Layer Re, RenaissanceRe Specialty Risks, RenaissanceRe Specialty U.S.,
Upsilon RFO, or any of our other Bermudian subsidiaries will become subject to direct U.S. regulation.

Bermuda Regulation

All Bermuda companies must comply with the provisions of the Companies Act 1981. In addition, the
Insurance Act 1978 and related regulations (collectively the “Insurance Act”), regulate the business of our
Bermuda insurance, reinsurance and management company subsidiaries.

As a holding company, RenaissanceRe is not currently subject to the Insurance Act. However, the
Insurance Act regulates the insurance and reinsurance business of our operating insurance companies.
RenaissanceRe’s most significant operating subsidiaries include Renaissance Reinsurance and DaVinci
which are registered as Class 4 general business insurers, RenaissanceRe Specialty Risks and
RenaissanceRe Specialty U.S. which are registered as Class 3B general business insurers, and Top Layer
Re which is registered as a Class 3A general business insurer under the Insurance Act. RenaissanceRe
also has operating subsidiaries registered as SPIs under the Insurance Act, including most recently, Upsilon
RFO. RUM and RenaissanceRe Underwriting Management Ltd. are each registered as insurance
managers under the Insurance Act.

The Insurance Act imposes solvency and liquidity standards as well as auditing and reporting requirements
and confers on the Bermuda Monetary Authority (the “BMA”) powers to supervise, investigate and intervene
in the affairs of insurance companies. Significant requirements of the Insurance Act include the appointment
of an independent auditor and loss reserve specialist (both of whom must be approved by the BMA), the
filing of an annual financial return and provisions relating to the payment of distributions and dividends. In
particular:

• Each Class 3A, Class 3B and Class 4 general business insurer is required to submit annual statutory
financial statements as part of its statutory financial return no later than four months after the insurer’s
financial year end (unless specifically extended). The annual statutory financial statements give
detailed information and analyses regarding premiums, claims, reinsurance, reserves and
investments. The statutory financial return includes, among other items: a report of the approved
independent auditor on the statutory financial statements; a declaration of statutory ratios; a solvency
certificate; the statutory financial statements themselves; the opinion of the approved loss reserve
specialist; and details concerning ceded reinsurance.

• In addition to preparing statutory financial statements, all Class 3A, Class 3B and Class 4 insurers
must prepare financial statements in respect of their insurance business in accordance with GAAP,
International Financial Reporting Standards (“IFRS”) or other acceptable accounting standards.

• A general business insurer’s statutory assets must exceed its statutory liabilities by an amount, equal

to or greater than the prescribed minimum solvency margin, which varies with the category of its
registration and net premiums written and loss reserves posted (“Minimum Solvency Margin”). The
Minimum Solvency Margin that must be maintained by a Class 4 insurer is the greater of (i) $100.0
million, or (ii) 50% of net premiums written (with a credit for reinsurance ceded not exceeding 25% of
gross premiums) or (iii) 15% of net aggregate loss and loss expense provisions and other insurance
reserves. The Minimum Solvency Margin for a Class 3A or Class 3B insurer is the greater of (i) $1.0
million, or (ii) 20% of the first $6.0 million of net premiums written; if in excess of $6.0 million, the
figure is $1.2 million plus 15% of net premiums written in excess of $6.0 million, or (iii) 15% of net
aggregate loss and loss expense provisions and other insurance reserves.

• In addition, each Class 3A, Class 3B and Class 4 insurer must maintain its capital at a level equal to
its enhanced capital requirement (“ECR”) which is established by reference to the Bermuda Solvency
Capital Requirement (“BSCR”) model. Alternatively, under the Insurance Act, insurers may, subject to
the terms of the Insurance Act and to the BMA’s oversight, elect to utilize an approved internal capital
model to determine regulatory capital. In either case, the ECR shall at all times equal or exceed the
respective Class 3A, Class 3B and Class 4 insurer’s Minimum Solvency Margin and may be adjusted
in circumstances where the BMA concludes that the insurer’s risk profile deviates significantly from
the assumptions underlying its ECR or the insurer’s assessment of its risk management policies and
practices used to calculate the ECR applicable to it. While not specifically referred to in the Insurance
Act, the BMA has also established a target capital level (“TCL”) for each Class 3A, Class 3B and
Class 4 insurer equal to 120% of the respective ECR. While a Class 3A, Class 3B and Class 4
insurer is not currently required to maintain its statutory capital and surplus at this level, the TCL
serves as an early warning tool for the BMA and failure to maintain statutory capital at least equal to
the TCL will likely result in increased BMA regulatory oversight.

• An insurer engaged in general business is required to maintain the value of its relevant assets at not

less than 75% of the amount of its relevant liabilities (“Minimum Liquidity Ratio”).

• Class 3A, Class 3B and Class 4 insurers are prohibited from declaring or paying any dividends if in

breach of the required Minimum Solvency Margin or Minimum Liquidity Ratio (the “Relevant Margins”)
or if the declaration or payment of such dividend would cause the insurer to fail to meet the Relevant
Margins. Further, Class 3B and Class 4 insurers are prohibited from declaring or paying in any
financial year dividends of more than 25% of its total statutory capital and surplus (as shown on its
previous financial year’s statutory balance sheet) unless it files (at least seven days before payment
of such dividends) with the BMA an affidavit stating that it will continue to meet its Relevant Margins.
Class 3A, Class 3B and Class 4 insurers must obtain the BMA’s prior approval for a reduction by 15%
or more of the total statutory capital as set forth in its previous year’s financial statements. These
restrictions on declaring or paying dividends and distributions under the Insurance Act are in addition
to the solvency requirements under the Companies Act which apply to all Bermuda companies.

• Unlike other (re)insurers, SPIs are fully funded to meet their (re)insurance obligations and are not
exposed to insolvency, therefore the application and supervision processes are streamlined to
facilitate the transparent structure. Further, SPIs are currently not required to file annual loss reserve
specialist opinions and the BMA has the discretion to modify such insurer’s accounting requirements
under the Insurance Act. Like other (re)insurers, the principal representative of an SPI has a duty to
inform the BMA in relation to solvency matters, where applicable. In December 2013, the BMA issued
a notice in which it proposed to amend the statutory reporting requirements for SPIs. Under this
notice, the BMA will likely require SPIs to submit additional schedules together with the existing
statutory financial return. These enhancements are likely to be effective for the 2013 statutory
financial return, to be filed on or before April 30, 2014.

• The BMA maintains supervision over the controllers (as defined herein) of all Bermuda registered

insurers. Currently the Insurance Act states that no person shall become a controller of any
description of a registered insurer unless he has first served the BMA notice in writing stating that he
intends to become such a controller. A controller includes the managing director and chief executive

of the registered insurer or its parent company; a 10%, 20%, 33% or 50% shareholder controller; and
any person in accordance with whose directions or instructions the directors of the registered insurer
or of its parent company are accustomed to act. In addition, all Bermuda insurers are also required to
give the BMA written notice of the fact that a person has become, or ceased to be, a controller or
officer of the registered insurer within 45 days of becoming aware of such fact. An officer in relation to
a registered insurer includes a director, secretary, chief executive or senior executive by whatever
name called.

• All registered insurers are required to give the BMA 14 days’ notice of certain matters that are likely to

be of material significance (each a “Material Change”) to the BMA in carrying out its supervisory
function under the Insurance Act.

• All Bermuda insurers are required to comply with the BMA’s Insurance Code of Conduct which
establishes duties, requirements and standards to be complied with to ensure each insurer
implements sound corporate governance, risk management and internal controls. Failure to comply
with these requirements will be a factor taken into account by the BMA in determining whether an
insurer is conducting its business in a sound and prudent manner under the Insurance Act.

• Pursuant to the Insurance Act, the BMA acts as the group supervisor of the RenaissanceRe group of
companies (the “RenaissanceRe Group”) and it has designated Renaissance Reinsurance to be the
“designated insurer” in respect of the RenaissanceRe Group. The designated insurer is required to
ensure that the RenaissanceRe Group complies with the provisions of the Insurance Act pertaining to
groups and all related group solvency and group supervision rules (together, the “Group Rules”).
Under the Group Rules, the RenaissanceRe Group is required to annually prepare and submit to the
BMA group GAAP financial statements, group statutory financial statements, a group statutory
financial return and a group capital and solvency return. Further, our Board of Directors has
established solvency self assessment procedures for the RenaissanceRe Group that factor in all
foreseeable material risks; Renaissance Reinsurance must ensure that the RenaissanceRe Group’s
assets exceed the amount of the RenaissanceRe Group’s liabilities by the aggregate minimum
margin of solvency of each qualifying member; and our Board of Directors has established and
effectively implement corporate governance policies and procedures designed to ensure they support
the overall organizational strategy of the RenaissanceRe Group. In addition, the RenaissanceRe
Group is required to prepare and submit a quarterly financial return comprising unaudited
consolidated group financial statements, a schedule of intra-group transactions and a schedule of risk
concentrations.

• The BMA has certain powers of investigation and intervention relating to insurers and their holding
companies, subsidiaries and other affiliates, which it may exercise in the interest of such insurer’s
policyholders or if there is any risk of insolvency or of a breach of the Insurance Act or the insurer’s
license conditions.

• Under the provisions of the Insurance Act, the BMA may, from time to time, conduct “on site” visits at
the offices of insurers it regulates. Over the past several years, the BMA has conducted several “on
site” reviews in respect of our Bermuda-domiciled operating insurers. No remedial actions were
communicated to us as a result of any of the on-site reviews to date.

• The BMA may cancel an insurer’s registration on certain grounds specified in the Insurance Act.

Given the delays announced in late 2012 in respect of the implementation timetable related to Solvency II,
as discussed below, the BMA has indicated that it will remain committed to the regulatory equivalence
process in relation to Solvency II for Bermuda’s commercial insurance sector. However, the BMA has noted
that its overall adoption of progressive, risk-based supervision will go beyond this single regulatory initiative.
The BMA has expressed its desire to implement changes to Bermuda’s regulatory regime on a schedule
that enables Bermuda’s (re)insurers to transition to enhanced requirements on a phased basis where
appropriate.

At the present time, there is no Bermuda income or profits tax, withholding tax, capital gains tax, capital
transfer tax, estate duty or inheritance tax payable by us or by our shareholders in respect of our shares.
We have obtained an assurance from the Minister of Finance of Bermuda under the Exempted
Undertakings Tax Protection Act 1966 that, in the event that any legislation is enacted in Bermuda imposing
any tax computed on profits or income, or computed on any capital asset, gain or appreciation or any tax in

the nature of estate duty or inheritance tax, such tax shall not, until March 31, 2035, be applicable to us or
to any of our operations or to our shares, debentures or other obligations except insofar as such tax applies
to persons ordinarily resident in Bermuda or is payable by us in respect of real property owned or leased by
us in Bermuda.

U.K. Regulation

Lloyd’s Regulation

General. The operations of RSML are subject to oversight by Lloyd’s, substantially effected through the
Lloyd’s Franchise Board, which was formally constituted on January 1, 2003. The Franchise Board
establishes guidelines and operates a business planning and monitoring process for all Lloyd’s syndicates.
RSML’s business plan for Syndicate 1458 requires annual approval by the Lloyd’s Franchise Board
including maximum underwriting capacity. The Lloyd’s Franchise Board may require changes to any
business plan presented to it or additional capital to be provided to support the underwriting plan. Lloyd’s
also imposes various charges and assessments on its members. If material changes in the business plan
for Syndicate 1458 were required by the Lloyd’s Franchise Board, or if charges and assessments payable
to Lloyd’s by RenaissanceRe CCL were to increase significantly, these events could have an adverse effect
on the operations and financial results of RSML. The Company has deposited certain assets with Lloyd’s to
support RenaissanceRe CCL’s underwriting business at Lloyd’s. Dividends from a Lloyd’s managing agent
and a Lloyd’s corporate member can be declared and paid provided the relevant company has sufficient
profits available for distribution.

By entering into a membership agreement with Lloyd’s, RenaissanceRe CCL has undertaken to comply with
all Lloyd’s bye-laws and regulations as well as the provisions of the Lloyd’s Acts and the Financial Services
and Markets Act 2000, as amended by the Financial Services Act 2012 (the “FSMA”), in particular that are
applicable to it.

Capital Requirements. Capital is supplied on the basis of an annual venture, with continuing support from
capital providers and the members of Lloyd’s, and requires affirmation each year. The underwriting capacity
of a member of Lloyd’s must be supported by providing a deposit (referred to as “Funds at Lloyd’s”) in the
form of cash, securities or letters of credit in an amount determined under the Individual Capital Adequacy
regime of the U.K.’s Prudential Regulation Authority (the “PRA”). The amount of such deposit is calculated
for each member through the completion of an annual capital adequacy exercise. Under these
requirements, Lloyd’s must demonstrate that each member has sufficient assets to meet its underwriting
liabilities plus a required solvency margin.

Restrictions. A Reinsurance to Close (“RITC”) generally is put in place after the third year of operations of a
syndicate year of account. On successful conclusion of a RITC, any profit from the syndicate’s operations
for that year of account can be remitted by the managing agent to the syndicate’s members. If the
syndicate’s managing agency concludes that an appropriate RITC cannot be determined or negotiated on
commercially acceptable terms in respect of a particular underwriting year, it must determine that the
underwriting year remain open and be placed into run-off. During this period, there cannot be a release of
the Funds at Lloyd’s of a member of that syndicate without the consent of Lloyd’s and such consent will only
be considered where the member has surplus Funds at Lloyd’s over and above the capital requirement.

The financial security of the Lloyd’s market is regularly assessed by three independent rating agencies
(A.M. Best, S&P and Fitch). A satisfactory credit rating issued by an accredited rating agency is necessary
for Lloyd’s syndicates to be able to trade in certain classes of business at current levels. RSML and
RenaissanceRe CCL would be adversely affected if Lloyd’s current ratings were downgraded.

Intervention Powers. The Council of Lloyd’s has wide discretionary powers to regulate members’
underwriting at Lloyd’s. It may, for instance, change the basis on which syndicate expenses are allocated or
vary the Funds at Lloyd’s requirements or the investment criteria applicable to the provision of Funds at
Lloyd’s. Exercising any of these powers might affect the return on the corporate member’s participation in a
given underwriting year. If a member of Lloyd’s is unable to pay its debts to policyholders, the member may
obtain financial assistance from the Lloyd’s Central Fund, which in many respects acts as an equivalent to a
state guaranty fund in the U.S. If Lloyd’s determines that the Central Fund needs to be increased, it has the
power to assess premium levies on current Lloyd’s members. The Council of Lloyd’s has discretion to call
or assess up to 3% of a member’s underwriting capacity in any one year as a Central Fund contribution.

PRA and FCA Regulation

The PRA currently has ultimate responsibility for the prudential supervision of the Lloyd’s market and the
Financial Conduct Authority (the “FCA”) has responsibility for market conduct regulation. Both the PRA and
FCA have substantial powers of intervention in relation to Lloyd’s managing agents, such as RSML,
including the power to remove an agent’s authorization to manage Lloyd’s syndicates. In addition, each
year the PRA requires Lloyd’s to satisfy an annual solvency test which measures whether Lloyd’s has
sufficient assets in the aggregate to meet all outstanding liabilities of its members, both current and run-off.
If Lloyd’s fails this test, the PRA may require the entire Lloyd’s market to cease underwriting or individual
Lloyd’s members may be required to cease or reduce their underwriting.

Lloyd’s as a whole is authorized by the PRA and regulated by both the FCA and PRA. Lloyd’s is required to
implement certain rules prescribed by the PRA and by the FCA; such rules are to be implemented by
Lloyd’s pursuant to its powers under the Lloyd’s Act 1982 relating to the operation of the Lloyd’s market.
Lloyd’s prescribes, in respect of its managing agents and corporate members, certain minimum standards
relating to their management and control, solvency and various other requirements. The PRA and FCA
directly monitor Lloyd’s managing agents’ compliance with the systems and controls prescribed by Lloyd’s.
If it appears to either the PRA or the FCA that either Lloyd’s is not fulfilling its delegated regulatory
responsibilities or that managing agents are not complying with the applicable regulatory rules and
guidance, the PRA or the FCA may intervene at their discretion. Future regulatory changes or rulings by the
PRA or FCA could impact RSML’s business strategy or financial assumptions, possibly resulting in an
adverse effect on RSML’s financial condition and operating results.

Change of Control. The PRA and the FCA currently regulate the acquisition of control of any Lloyd’s
managing agent which is authorized under the FSMA. Any company or individual that, together with its or
his associates, directly or indirectly acquires 10% or more of the shares in a Lloyd’s managing agent or its
parent company, or is entitled to exercise or control the exercise of 10% or more of the voting power in such
Lloyd’s managing agent or its parent company, would be considered to have acquired control for the
purposes of the relevant legislation, as would a person who had significant influence over the management
of such Lloyd’s managing agent or its parent company by virtue of his shareholding or voting power in
either. A purchaser of 10% or more of RenaissanceRe’s common shares or voting power would therefore
be considered to have acquired control of RSML. Under the FSMA, any person or entity proposing to
acquire control over a Lloyd’s managing agent must give prior notification to the PRA and the FCA of his or
the entity’s intention to do so. The PRA and FCA would then have sixty working days to consider the
application to acquire control. Failure to make the relevant prior application could result in action being
taken against RSML by the PRA or the FCA of both of them. Lloyd’s approval is also required before any
person can acquire control (using the same definition as for the PRA and FCA) of a Lloyd’s managing agent
or Lloyd’s corporate member.

Other Applicable Laws. Lloyd’s worldwide insurance and reinsurance business is subject to various
regulations, laws, treaties and other applicable policies of the EU, as well as of each nation, state and
locality in which it operates. Material changes in governmental requirements and laws could have an
adverse effect on Lloyd’s and its member companies, including RSML and RenaissanceRe CCL.

Solvency II

Solvency II was adopted by the European Parliament in April of 2009. The timing for the implementation of
Solvency II in European Member States by the European Commission (“EC”), previously scheduled for
January 1, 2014, has been delayed so that a start date for full implementation of Solvency II of January 1,
2016 seems increasingly likely, although as yet still not certain. In the meantime, the Lloyd’s Solvency II
implementation plans are designed to facilitate a January 1, 2016 implementation date, however Lloyd’s
has noted to its managing agents that this is a planning assumption only and is subject to change as further
clarification from the EC emerges. Upon its adoption, Solvency II will replace the current solvency
requirements and implement a risk-based approach to insurance regulation. Its principal goals are to
improve the correlation between capital and risk, effect group supervision of insurance and reinsurance
affiliates, implement a uniform capital adequacy structure for (re)insurers across the EU Member States,
establish consistent corporate governance standards for insurance and reinsurance companies, and
establish transparency through standard reporting of insurance operations. Under Solvency II, an insurer’s
or reinsurer’s capital adequacy in relation to various insurance and business risks may be measured with

an internal model developed by the insurer or reinsurer and approved for use by the Member State’s
regulator or pursuant to a standard formula developed by the EC. Lloyd’s requires all managing agents to
develop internal models for the syndicate they manage. The 2014 capital requirement for Syndicate 1458
was based on RSML’s internal model in line with this process. We continue to monitor the ongoing
legislative and regulatory steps in relation to the adoption of Solvency II.

Singapore Regulation

A branch of Renaissance Reinsurance based in the Republic of Singapore (the “Singapore Branch”)
received a license to carry on insurance business as a general reinsurer on October 28, 2013. The
activities of the Singapore Branch are primarily regulated by the Monetary Authority of Singapore pursuant
to Singapore’s Insurance Act. Additionally, the Singapore Branch is regulated by the Accounting and
Corporate Regulatory Authority (the “ACRA”) as a foreign company pursuant to Singapore’s Companies
Act. Prior to the establishment of the Singapore Branch, Renaissance Reinsurance had maintained a
representative office in Singapore since April 2012. In addition, an application for a branch of DaVinci in the
Republic of Singapore to carry on insurance business as a general reinsurer is under review by the
Monetary Authority of Singapore and approval is anticipated in early 2014.

Renaissance Services of Asia Pte. Ltd., our Singapore-based service company, was established as a
private company limited by shares in Singapore on March 15, 2012 and is registered with the ACRA and
subject to Singapore’s Companies Act.

ENVIRONMENTAL AND CLIMATE CHANGE MATTERS

Our principal coverages and services relate to natural disasters and catastrophes, such as earthquakes and
hurricanes. We believe, and believe the consensus view of current scientific studies substantiates, that
changes in climate conditions, primarily global temperatures and expected sea levels are likely to increase
the severity, and possibly the frequency, of weather related natural disasters and catastrophes relative to
the historical experience over the past 100 years. Coupled with currently projected demographic trends in
catastrophe-exposed regions, we currently estimate that this expected increase in severe weather, such as
tropical cyclone intensity, over coming periods will increase the average economic value of expected losses,
increase the number of people exposed per year to natural disasters and in general exacerbate disaster
risk, including risks to infrastructure, global supply chains and agricultural production.

Accordingly, we currently estimate that these trends will increase the risk of claims arising from our property
and casualty lines of business, particularly with respect to properties located in coastal areas, among
others. While a substantial portion of our coverages may be adversely impacted by climate change, we
have taken certain measures, to the extent permissible by law and prevailing market conditions, to mitigate
against such losses by giving consideration to these risks in our underwriting decisions. We seek to
continuously monitor and adjust, as we believe appropriate, our risk management models to reflect our
judgment of how to interpret current developments and information such as the studies referred to
above. However, it is possible that, even after these assessments, we will have underestimated the
frequency or severity of tropical cyclones or of other catastrophes. To the extent broad environmental
factors, exacerbated by climate change or otherwise, lead to increases in insured losses, particularly if
those losses exceed expectations and the prior estimates of market participants, regulators or other
stakeholders, the markets and clients we serve may be disrupted and adversely impacted, and we may be
adversely affected, directly or indirectly. Further, certain of our investments such as catastrophe-linked
securities and property catastrophe managed joint ventures related to hurricane coverage, could also be
adversely impacted by climate change.

An increasing number of federal, state, local and foreign government requirements and international
agreements apply to environmental and climate change, in particular by seeking to limit or penalize the
discharge of materials such as greenhouse gas (“GHG”) into the environment or otherwise relating to the
protection of the environment. Although our operations are characterized by a small number of professional
office facilities, and we have not been directly, materially impacted by these changes to date, it is our policy
to monitor and seek to ensure compliance with these requirements, as applicable. We believe that, as a
general matter, our policies, practices and procedures are properly designed to identify and manage
environmental and climate-related risks, particularly the risks of potential financial liability in connection with
our reinsurance, insurance and trading businesses. However, we believe that some risk of environmental

damage is inherent in respect of any commercial operation, and may increase for us if our business
continues to expand and diversify by business we write or investments we make. Certain of our
investments may also be adversely affected by climate change and increased governmental regulation of,
or international agreements pertaining to, GHG emissions. Moreover, our evaluation may be flawed or may
reflect inaccurate or incomplete information, and it is possible our exposure to climate change or other
environmental risks is greater than we have currently estimated.

At this time, we do not believe that any existing or currently pending climate change legislation, regulation,
or international treaty or accord known to us would be reasonably likely to have a material effect in the
foreseeable future on our business or on our results of operations, capital expenditures or financial position.
However, it is possible that future developments, such as increasingly strict environmental laws and
standards and enforcement policies, could give rise to more severe exposure, more costly compliance
requirements, or otherwise bring into question our current policies and practices. In addition, it is possible
that state insurance regulation could impact the ability of our insurance and reinsurance customers, or of
the Company, to manage property exposures in areas vulnerable to significant climate-driven losses. For
example, if our insurance and reinsurance customers or operations are unable to utilize actuarially sound,
risk-based pricing, to modify policy terms if necessary to reflect changes in the underlying risks, or to
otherwise manage exposures appropriately to reflect the risk of increased loss from both large scale natural
catastrophes and smaller scale weather events, our markets, customers, or our own financial results may
all be adversely affected. We will continue to monitor emerging developments in this area.

GLOSSARY OF SELECTED INSURANCE AND REINSURANCE TERMS

Accident year

Year of occurrence of a loss. Claim payments and reserves for claims and
claim expenses are allocated to the year in which the loss occurred for
losses occurring contracts and in the year the loss was reported for claims
made contracts.

Acquisition expenses

The aggregate expenses incurred by a company for acquiring new
business, including commissions, underwriting expenses, premium taxes
and administrative expenses.

Additional case reserves

Additional case reserves represent management’s estimate of reserves for
claims and claim expenses that are allocated to specific contracts, less
paid and reported losses by the client.

Attachment point

The dollar amount of loss (per occurrence or in the aggregate, as the case
may be) above which excess of loss reinsurance becomes operative.

Bordereau

Bound

Broker

Capacity

A report providing premium or loss data with respect to identified specific
risks. This report is periodically furnished to a reinsurer by the ceding
insurers or reinsurers.

A (re)insurance policy is considered bound, and the (re)insurer
responsible for the risks of the policy, when both parties agree to the terms
and conditions set forth in the policy.

An intermediary who negotiates contracts of insurance or reinsurance,
receiving a commission for placement and other services rendered,
between (1) a policy holder and a primary insurer, on behalf of the insured
party, (2) a primary insurer and reinsurer, on behalf of the primary insurer,
or (3) a reinsurer and a retrocessionaire, on behalf of the reinsurer.

The percentage of surplus, or the dollar amount of exposure, that an
insurer or reinsurer is willing or able to place at risk. Capacity may apply to
a single risk, a program, a line of business or an entire book of business.
Capacity may be constrained by legal restrictions, corporate restrictions or
indirect restrictions.

Case reserves

Loss reserves, established with respect to specific, individual reported
claims.

Casualty insurance or
reinsurance

Insurance or reinsurance that is primarily concerned with the losses
caused by injuries to third persons and their property (in other words,
persons other than the policyholder) and the legal liability imposed on the
insured resulting there from. Also referred to as liability insurance.

Catastrophe

A severe loss, typically involving multiple claimants. Common perils
include earthquakes, hurricanes, hailstorms, severe winter weather,
floods, fires, tornadoes, explosions and other natural or man-made
disasters. Catastrophe losses may also arise from acts of war, acts of
terrorism and political instability.

Catastrophe excess of loss
reinsurance

A form of excess of loss reinsurance that, subject to a specified limit,
indemnifies the ceding company for the amount of loss in excess of a
specified retention with respect to an accumulation of losses resulting from
a “catastrophe.”

Catastrophe-linked securities;
cat-linked securities

Cat-linked securities are generally privately placed fixed income securities
where all or a portion of the repayment of the principal is linked to
catastrophic events. This includes securities where the repayment is
linked to the occurrence and/or size of, for example, one or more
hurricanes or earthquakes, or insured industry losses associated with
these catastrophic events.

Cede; cedant; ceding
company

When a party reinsures its liability with another, it “cedes” business and is
referred to as the “cedant” or “ceding company.”

Claim

Request by an insured or reinsured for indemnification by an insurance
company or a reinsurance company for losses incurred from an insured
peril or event.

Claims made contracts

Contracts that cover claims for losses occurring during a specified period
that are reported during the term of the contract.

Claims and claim expense
ratio, net

The ratio of net claims and claim expenses to net premiums earned
determined in accordance with either statutory accounting principles or
GAAP.

Claim reserves

Combined ratio

Liabilities established by insurers and reinsurers to reflect the estimated
costs of claim payments and the related expenses that the insurer or
reinsurer will ultimately be required to pay in respect of insurance or
reinsurance policies it has issued. Claims reserves consist of case
reserves, established with respect to individual reported claims, additional
case reserves and “IBNR” reserves. For reinsurers, loss expense reserves
are generally not significant because substantially all of the loss expenses
associated with particular claims are incurred by the primary insurer and
reported to reinsurers as losses.

The combined ratio is the sum of the net claims and claim expense ratio
and the underwriting expense ratio. A combined ratio below 100%
generally indicates profitable underwriting prior to the consideration of
investment income. A combined ratio over 100% generally indicates
unprofitable underwriting prior to the consideration of investment income.

Decadal

Refers to events occurring over a 10-year period, such as an oscillation
whose period is roughly 10 years.

Excess and surplus lines
reinsurance

Any type of coverage that cannot be placed with an insurer admitted to do
business in a certain jurisdiction. Risks placed in excess and surplus lines
markets are often substandard as respects adverse loss experience,
unusual, or unable to be placed in conventional markets due to a shortage
of capacity.

Excess of loss

Reinsurance or insurance that indemnifies the reinsured or insured
against all or a specified portion of losses on underlying insurance policies
in excess of a specified amount, which is called a “level” or “retention.”
Also known as non-proportional reinsurance. Excess of loss reinsurance is
written in layers. A reinsurer or group of reinsurers accepts a layer of
coverage up to a specified amount. The total coverage purchased by the
cedant is referred to as a “program” and will typically be placed with
predetermined reinsurers in pre-negotiated layers. Any liability exceeding
the outer limit of the program reverts to the ceding company, which also
bears the credit risk of a reinsurer’s insolvency.

Exclusions

Those risk, perils, or classes of insurance with respect to which the
reinsurer will not pay loss or provide reinsurance, notwithstanding the
other terms and conditions of reinsurance.

Expense override

An amount paid to a ceding company in addition to the acquisition cost to
compensate for overhead expenses.

Frequency

The number of claims occurring during a given coverage period.

Funds at Lloyd’s

Funds of an approved form that are lodged and held in trust at Lloyd’s as
security for a member’s underwriting activities. They comprise the
members’ deposit, personal reserve fund and special reserve fund and
may be drawn down in the event that the member’s syndicate level
premium trust funds are insufficient to cover its liabilities. The amount of
the deposit is related to the member’s premium income limit and also the
nature of the underwriting account.

Generally Accepted
Accounting Principles in the
United States (“GAAP”)

Accounting principles as set forth in opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants and/or
statements of the Financial Accounting Standards Board and/or their
respective successors and which are applicable in the circumstances as of
the date in question.

Gross premiums written

Total premiums for insurance written and assumed reinsurance during a
given period.

Incurred but not reported
(“IBNR”)

Reserves for estimated losses that have been incurred by insureds and
reinsureds but not yet reported to the insurer or reinsurer, including
unknown future developments on losses that are known to the insurer or
reinsurer.

Insurance-linked securities

Financial instruments whose values are driven by (re)insurance loss
events. For the Company, insurance-linked securities are generally linked
to property losses due to natural catastrophes.

International Financial
Reporting Standards (“IFRS”)

Accounting principles, standards and interpretations as set forth in
opinions of the International Accounting Standards Board which are
applicable in the circumstances as of the date in question.

Layer

Line

The interval between the retention or attachment point and the maximum
limit of indemnity for which a reinsurer is responsible.

The amount of excess of loss reinsurance protection provided to an
insurer or another reinsurer, often referred to as limit.

Line of business

The general classification of insurance written by insurers and reinsurers,
e.g. fire, allied lines, homeowners and surety, among others.

Lloyd’s

Loss; losses

Loss reserve

Depending on the context, this term may refer to (a) the society of
individual and corporate underwriting members that insure and reinsure
risks as members of one or more syndicates (i.e., Lloyd’s is not an
insurance company); (b) the underwriting room in the Lloyd’s building in
which managing agents underwrite insurance and reinsurance on behalf
of their syndicate members (in this sense Lloyd’s should be understood as
a market place); or (c) the Corporation of Lloyd’s which regulates and
provides support services to the Lloyd’s market.

An occurrence that is the basis for submission and/or payment of a claim.
Whether losses are covered, limited or excluded from coverage is
dependent on the terms of the policy.

For an individual loss, an estimate of the amount the insurer expects to
pay for the reported claim. For total losses, estimates of expected
payments for reported and unreported claims. These may include amounts
for claims expenses.

Managing agent

An underwriting agent which has permission from Lloyd’s to manage a
syndicate and carry on underwriting and other functions for a member.

Net claims and claim
expenses

The expenses of settling claims, net of recoveries, including legal and
other fees and the portion of general expenses allocated to claim
settlement costs (also known as claim adjustment expenses or loss
adjustment expenses) plus losses incurred with respect to net claims.

Net claims and claim expense
ratio

Net claims and claim expenses incurred expressed as a percentage of net
earned premiums.

Net premiums earned

The portion of net premiums written during or prior to a given period that
was actually recognized as income during such period.

Net premiums written

Gross premiums written for a given period less premiums ceded to
reinsurers and retrocessionaires during such period.

Non-proportional reinsurance See “Excess of loss.”

Perils

Profit commission

This term refers to the causes of possible loss in the property field, such
as fire, windstorm, collision, hail, etc. In the casualty field, the term
“hazard” is more frequently used.

A provision found in some reinsurance agreements that provides for profit
sharing. Parties agree to a formula for calculating profit, an allowance for
the reinsurer’s expenses, and the cedant’s share of such profit after
expenses.

Property insurance or
reinsurance

Insurance or reinsurance that provides coverage to a person with an
insurable interest in tangible property for that person’s property loss,
damage or loss of use.

Property per risk

Reinsurance on a treaty basis of individual property risks insured by a
ceding company.

Proportional reinsurance

A generic term describing all forms of reinsurance in which the reinsurer
shares a proportional part of the original premiums and losses of the
reinsured. (Also known as pro-rata reinsurance, quota share reinsurance
or participating reinsurance.) In proportional reinsurance, the reinsurer
generally pays the ceding company a ceding commission. The ceding
commission generally is based on the ceding company’s cost of acquiring
the business being reinsured (including commissions, premium taxes,
assessments and miscellaneous administrative expense) and also may
include a profit factor. See also “Quota Share Reinsurance”.

Quota share reinsurance

A form of proportional reinsurance in which the reinsurer assumes an
agreed percentage of each insurance policy being reinsured and shares
all premiums and losses according with the reinsured. See also
“Proportional Reinsurance”.

Reinstatement premium

The premium charged for the restoration of the reinsurance limit of a
catastrophe contract to its full amount after payment by the reinsurer of
losses as a result of an occurrence.

Reinsurance

An arrangement in which an insurance company, the reinsurer, agrees to
indemnify another insurance or reinsurance company, the ceding
company, against all or a portion of the insurance or reinsurance risks
underwritten by the ceding company under one or more policies.
Reinsurance can provide a ceding company with several benefits,
including a reduction in net liability on insurances and catastrophe
protection from large or multiple losses. Reinsurance also provides a
ceding company with additional underwriting capacity by permitting it to
accept larger risks and write more business than would be possible
without an equivalent increase in capital and surplus, and facilitates the
maintenance of acceptable financial ratios by the ceding company.
Reinsurance does not legally discharge the primary insurer from its liability
with respect to its obligations to the insured.

Reinsurance to Close

Also referred to as a RITC, it is a contract to transfer the responsibility for
discharging all the liabilities that attach to one year of account of a
syndicate into a later year of account of the same or different syndicate in
return for a premium.

Retention

The amount or portion of risk that an insurer retains for its own account.
Losses in excess of the retention level are paid by the reinsurer. In
proportional treaties, the retention may be a percentage of the original
policy’s limit. In excess of loss business, the retention is a dollar amount of
loss, a loss ratio or a percentage.

Retrocedant

A reinsurer who cedes all or a portion of its assumed insurance to another
reinsurer.

Retrocessional reinsurance;
Retrocessionaire

A transaction whereby a reinsurer cedes to another reinsurer, the
retrocessionaire, all or part of the reinsurance that the first reinsurer has
assumed. Retrocessional reinsurance does not legally discharge the
ceding reinsurer from its liability with respect to its obligations to the
reinsured. Reinsurance companies cede risks to retrocessionaires for
reasons similar to those that cause primary insurers to purchase
reinsurance: to reduce net liability on insurances, to protect against
catastrophic losses, to stabilize financial ratios and to obtain additional
underwriting capacity.

Risks

A term used to denote the physical units of property at risk or the object of
insurance protection that are not perils or hazards. Also defined as chance
of loss or uncertainty of loss.

Risks attaching contracts

Contracts that cover claims that arise on underlying insurance policies that
incept during the term of the reinsurance contract.

Solvency II

Specialty lines

Statutory accounting
principles

Stop loss

Submission

Syndicate

Treaty

Underwriting

A proposed set of regulatory requirements that would codify and
harmonize the EU insurance and reinsurance regulation. Among other
things, these requirements would impact the amount of capital that EU
insurance and reinsurance companies would be required to hold.
Solvency II was scheduled to come into effect on January 1, 2014,
however this is expected to be delayed until at least January 1, 2016.

Lines of insurance and reinsurance that provide coverage for risks that are
often unusual or difficult to place and do not fit the underwriting criteria of
standard commercial products carriers.

Recording transactions and preparing financial statements in accordance
with the rules and procedures prescribed or permitted by Bermuda, U.S.
state insurance regulatory authorities including the NAIC and/or in
accordance with Lloyd’s specific principles, all of which generally reflect a
liquidating, rather than going concern, concept of accounting.

A form of reinsurance under which the reinsurer pays some or all of a
cedant’s aggregate retained losses in excess of a predetermined dollar
amount or in excess of a percentage of premium.

An unprocessed application for (i) insurance coverage forwarded to a
primary insurer by a prospective policyholder or by a broker on behalf of
such prospective policyholder, (ii) reinsurance coverage forwarded to a
reinsurer by a prospective ceding insurer or by a broker or intermediary on
behalf of such prospective ceding insurer or (iii) retrocessional coverage
forwarded to a retrocessionaire by a prospective ceding reinsurer or by a
broker or intermediary on behalf of such prospective ceding reinsurer.

A member or group of members underwriting (re)insurance business at
Lloyd’s through the agency of a managing agent or substitute agent to
which a syndicate number is assigned.

A reinsurance agreement covering a book or class of business that is
automatically accepted on a bulk basis by a reinsurer. A treaty contains
common contract terms along with a specific risk definition, data on limit
and retention, and provisions for premium and duration.

The insurer’s or reinsurer’s process of reviewing applications submitted for
insurance coverage, deciding whether to accept all or part of the coverage
requested and determining the applicable premiums.

Underwriting capacity

The maximum amount that an insurance company can underwrite. The
limit is generally determined by a company’s retained earnings and
investment capital. Reinsurance serves to increase a company’s
underwriting capacity by reducing its exposure from particular risks.

Underwriting expense ratio

The ratio of the sum of the acquisition expenses and operational expenses
to net premiums earned.

Underwriting expenses

The aggregate of policy acquisition costs, including commissions, and the
portion of administrative, general and other expenses attributable to
underwriting operations.

Unearned premium

The portion of premiums written representing the unexpired portions of the
policies or contracts that the insurer or reinsurer has on its books as of a
certain date.

AVAILABLE INFORMATION

We maintain a website at http://www.renre.com. The information on our website is not incorporated by
reference in this Form 10-K.

We make available, free of charge through our website, our Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we
electronically file such material with, or furnish such material to, the SEC. We also make available, free of
charge from our website, our Audit Committee Charter, Compensation and Corporate Governance
Committee Charter, Corporate Governance Guidelines, and Code of Ethics. Such information is also
available in print for any shareholder who sends a request to RenaissanceRe Holdings Ltd., Attn: Office of
the Corporate Secretary, P.O. Box HM 2527, Hamilton, HMGX, Bermuda. Reports filed with the SEC may
also be viewed or obtained at the SEC Public Reference Room at 100 F Street, N.E., Washington, DC
20549. Information on the operation of the SEC Public Reference Room may be obtained by calling the
SEC at 1-800-SEC-0330. The SEC maintains an internet site that contains reports, proxy and information
statements, and other information regarding issuers, including the Company, that file electronically with the
SEC. The address of the SEC’s website is http://www.sec.gov.

ITEM 1A. RISK FACTORS

Factors that could cause our actual results to differ materially from those in the forward-looking statements
contained in this Form 10-K and other documents we file with the SEC include the following:

Risks Related to Our Company

Our exposure to catastrophic events and other exposures that we cover could cause our financial results to
vary significantly from one period to the next.

Our largest product based on total gross premiums written is property catastrophe reinsurance. We also sell
lines of specialty reinsurance products and insurance products that are exposed to catastrophe risk. We
therefore have a large overall exposure to natural and man-made disasters, such as earthquakes,
hurricanes, tsunamis, winter storms, freezes, floods, fires, tornadoes, hailstorms, drought and other natural
or man-made disasters, such as acts of terrorism. Our relative exposure to catastrophe risk has recently
increased, including as a result of the sale of substantially all of our U.S.-based insurance operations in
early 2011 and our sale of REAL in October 2013, which diminished the diversification of our exposure to
non-catastrophe perils to a degree. As a result, our operating results have historically been, and we expect
will continue to be, significantly affected by loss events of low frequency and high severity.

We expect claims from catastrophic events to cause substantial volatility in our financial results for any
fiscal quarter or year; moreover, catastrophic claims could adversely affect our financial condition, results of
operations and cash flows. Our ability to write new business could also be affected. We believe that factors
including increases in the value and geographic concentration of insured property, particularly along coastal
regions, the increasing risk of extreme weather events reflecting changes in climate, ocean temperatures
and sea levels, and the effects of inflation may continue to increase the severity of claims from catastrophic
events in the future.

From time to time, we expect to have greater exposures in one or more specific geographic areas than our
overall share of the worldwide market would otherwise suggest. Accordingly, when and if catastrophes
occur in these areas, we may experience relatively more severe net negative impacts from such events
than our competitors. In particular, we have historically had a relatively large percentage of our coverage
exposures concentrated in the U.S. southeast, and may develop other significant exposures in catastrophe-
exposed zones in the future.

Our claims and claim expense reserves are subject to inherent uncertainties.

Our claims and claim expense reserves reflect our estimates, using actuarial and statistical projections at a
given point in time, of our expectations of the ultimate settlement and administration costs of claims
incurred. Although we use actuarial and computer models as well as historical reinsurance and insurance
industry loss statistics, we also rely heavily on management’s experience and judgment to assist in the
establishment of appropriate claims and claim expense reserves. However, because of the many

assumptions and estimates involved in establishing reserves, the reserving process is inherently uncertain.
Our estimates and judgments are based on numerous factors, and may be revised as additional experience
and other data become available and are reviewed, as new or improved methodologies are developed, as
loss trends and claims inflation impact future payments, or as current laws or interpretations thereof
change.

Our specialty reinsurance operations are expected to produce claims which at times can only be resolved
through lengthy and unpredictable litigation or other dispute resolution processes. The measures required
to resolve such claims, including the adjudication process, present different and potentially more varied
reserve challenges than property losses (which, on the whole, tend to be reported comparatively more
promptly and to be settled within a relatively shorter period of time, although every catastrophic event is
comprised of a unique set of circumstances). Actual net claims and claim expenses paid and reported may
deviate, perhaps materially, from the reserve estimates reflected in our financial statements.

We expect that some of our assumptions or estimates will prove to be inaccurate, and that our actual net
claims and claim expenses paid and reported will differ, perhaps materially, from the reserve estimates
reflected in our financial statements. To the extent that our actual claims and claim expenses exceed our
expectations, we would be required to increase claims and claim expense reserves. This would reduce our
net income by a corresponding amount in the period in which the deficiency is identified. To the extent that
our actual claims and claim expenses are lower than our expectations, we would be required to decrease
claims and claim expense reserves and this would increase our net income.

Estimates of losses are based on, among other things, a review of potentially exposed contracts,
information reported by and discussions with counterparties, and our estimate of losses related to those
contracts and are subject to change as more information is reported and becomes available.

As an example, our estimates of losses from catastrophic events are based on factors including currently
available information derived from claims information from certain customers and brokers, industry
assessments of losses from the events, proprietary models, and the terms and conditions of our contracts.
Due to the magnitude and unusual complexity of the legal and claims issues relating to these events,
particularly Storm Sandy, the Thailand Floods, and the major earthquakes which occurred in 2011 and
2010, meaningful uncertainty remains regarding total covered losses for the insurance industry and,
accordingly, several of the key assumptions underlying our loss estimates. In addition, actual losses from
these events may increase if our reinsurers or other obligors fail to meet their obligations to us. Our actual
losses from these events will likely vary, perhaps materially, from these current estimates due to the
inherent uncertainties in reserving for such losses, including the nature of the available information, the
potential inaccuracies and inadequacies in the data provided by customers and brokers, the potential
lengthy claims development period, the inherent uncertainty of modeling techniques and the application of
such techniques, the effects of any demand surge on claims activity and complex coverage and other legal
issues.

As described in more detail herein, we have made substantial investments to develop proprietary analytic
and modeling capabilities to facilitate our underwriting, risk management, capital modeling and allocation,
and risk assessments relating to the risks we assume. See “Part I, Item 1. Business, Underwriting and
Enterprise Risk Management.” These models and other tools help us to manage our risks, understand our
capital utilization and risk aggregation, inform management and other stakeholders of capital requirements
and seek to improve the risk/return profile or optimize the efficiency of the amount of capital we apply to
cover the risks in the individual contracts we sell and in our portfolio as a whole. However, given the
inherent uncertainty of modeling techniques and the application of such techniques, the possibility of human
or systems error, the challenges inherent in consistent application of complex methodologies in a fluid
business environment and other factors, our models, tools and databases may not accurately address the
risks we currently cover or the emergence of new matters which might be deemed to impact certain of our
coverages. Accordingly, our models may understate the exposures we are assuming and our results from
operations and financial condition may be adversely impacted, perhaps significantly. Conversely, our
models may prove too conservative and contribute to factors which would impede our ability to grow in
respect of new markets or perils or in connection with our current portfolio of coverages. In general, our
techniques for evaluating catastrophe risk are much better developed than those for other classes of risk in
businesses that we have entered into more recently. Accordingly, these risks may increase if we succeed in

increasing the contributions from our Specialty Reinsurance segment or from our Lloyd’s segment, either on
an absolute or relative basis.

A decline in the ratings assigned to our financial strength may adversely impact our business, perhaps
materially so.

Third party rating agencies assess and rate the financial strength, claims paying ability and enterprise wide
risk management of reinsurers and insurers, such as Renaissance Reinsurance, DaVinci, RenaissanceRe
Specialty Risks, Top Layer Re and certain of our other operating subsidiaries and joint ventures. These
ratings are based upon criteria established by the rating agencies. Periodically, the rating agencies evaluate
us and may downgrade or withdraw their financial strength ratings in the future if we do not continue to
meet the criteria of the ratings previously assigned to us. The financial strength and claims paying ratings
assigned by rating agencies to reinsurance or insurance companies are based upon factors relevant to
policyholders and are not directed toward the protection of investors.

These ratings are subject to periodic review and may be revised or revoked by the agencies which issue
them. In addition, from time to time one or more rating agencies have effected changes in their capital
models and rating methodologies, which have generally served to increase the amounts of capital required
to support the ratings, and it is possible that legislation arising as a result of the financial crisis that
preceded the recent period of relative economic weakness may result in additional changes. Negative
ratings actions in the future could have an adverse effect on our ability to fully realize the market
opportunities we currently expect to participate in. In addition, many reinsurance contracts contain
provisions permitting cedants to cancel coverage pro-rata if the reinsurer is downgraded below a certain
rating level. Whether a client would exercise this right would depend, among other factors, on the reason for
such a downgrade, the extent of the downgrade, the prevailing market conditions and the pricing and
availability of replacement reinsurance coverage. Therefore, in the event of a downgrade, it is not possible
to predict in advance the extent to which this cancellation right would be exercised, if at all, or what effect
such cancellations would have on our financial condition or future operations, but such effect potentially
could be material. To date, we are not aware that we have experienced such a cancellation.

Our ability to compete with other reinsurers and insurers, and our results of operations, could be materially
adversely affected by any such ratings downgrade. For example, following a ratings downgrade we might
lose customers to more highly rated competitors or retain a lower share of the business of our customers.

For the current ratings of certain of our subsidiaries and joint ventures, refer to “Part II, Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, Liquidity and
Capital Resources, Ratings” for additional information.

The emergence of matters which may impact certain of our coverages, such as the asserted trend toward
potentially significant climate change, could cause us to underestimate our exposures and potentially
adversely impact our financial results, perhaps significantly.

We use analytic and modeling capabilities that help us to assess the risk and return of each reinsurance
contract in relation to our overall portfolio of reinsurance contracts. See “Part I, Item 1. Business,
Underwriting and Enterprise Risk Management.”

We believe, and believe the consensus view of current scientific studies substantiates, that changes in
climate conditions, primarily increasing global temperatures and expected sea levels, are likely to increase
the severity and possibly the frequency of natural catastrophes relative to the historical experience over the
past 100 years. Coupled with currently projected demographic trends in catastrophe-exposed regions, we
currently estimate that this expected increase in tropical cyclone intensity over coming periods may
significantly increase the average economic value of expected losses, increase the number of people
exposed per year to natural disasters and in general exacerbate disaster risk, including risks to
infrastructure, global supply chains and agricultural production.

Accordingly, we currently estimate that these trends may increase claims under our property and casualty
lines of business, particularly with respect to properties located in coastal and flood-exposed areas, among
others. While we believe a substantial portion of our insureds may be adversely impacted by climate
change, we have taken certain measures, to the extent permissible by law and prevailing market conditions,
to mitigate against such losses by giving consideration to these risks in our underwriting decisions. We
continuously monitor and adjust, as we believe appropriate, our risk management models to reflect our

judgment of how to interpret current developments and information such as these studies. However, it is
possible that, even after these assessments, we will have underestimated the scale of the risks, such as the
frequency or severity of hurricanes or other catastrophes or may have failed to identify new or increased
risks. To the extent broad environmental factors, exacerbated by climate change or otherwise, lead to
increases in likely insured losses, particularly if those losses exceed expectations and the prior estimates of
market participants, regulators or other stakeholders, the markets and clients we serve may be disrupted
and adversely impacted, and we may be adversely affected, directly or indirectly. Further, certain of our
investments such as insurance-linked securities and property catastrophe managed joint ventures related to
hurricane coverage could also be adversely impacted by climate change.

Emerging claim and coverage issues, or other litigation, could adversely affect us.

Unanticipated developments in the law as well as changes in social and environmental conditions could
potentially result in unexpected claims for coverage under our insurance and reinsurance contracts. These
developments and changes may adversely affect us, perhaps materially so. For example, we could be
subject to developments that impose additional coverage obligations on us beyond our underwriting intent,
or to increases in the number or size of claims to which we are subject. We believe our property
catastrophe results have been adversely impacted over recent periods by increasing primary claims level
fraud and abuses, as well as other forms of social inflation, and that these trends may continue, particularly
in certain U.S. jurisdictions in which we focus, including Florida and Texas.

With respect to our specialty reinsurance operations, these legal, social and environmental changes may
not become apparent until some point in time after their occurrence. For example, we could be deemed
liable for losses arising out of a matter, such as the potential for industry losses arising out of a pandemic
illness that we had not anticipated or had attempted to contractually exclude. Moreover, irrespective of the
clarity and inclusiveness of policy language, there can be no assurance that a court or arbitration panel will
limit enforceability of policy language or not issue a ruling adverse to us. Our exposure to these
uncertainties could be exacerbated by the increased willingness of some market participants to dispute
insurance and reinsurance contract and policy wordings. Alternatively, potential efforts by us to exclude
such exposures could, if successful, reduce the market’s acceptance of our related products. The full effects
of these and other unforeseen emerging claim and coverage issues are extremely hard to predict. As a
result, the full extent of our liability under our coverages may not be known for many years after a contract
is issued. We expect that our exposure to this uncertainty will grow as our “long-tail” casualty businesses
grow, because in these lines claims can typically be made for many years, making them more susceptible to
these trends than our traditional catastrophe business, which is typically more “short-tail.” While we
continually seek to improve the effectiveness of our contracts and claims capabilities, we may fail to
mitigate our exposure to these growing uncertainties. We are also subject to indemnification obligations
and unknown liabilities relating to businesses and assets that we have disposed; such liabilities may exceed
our estimated exposures or otherwise result in a loss which could have a material adverse effect on us.

Because we depend on a few insurance and reinsurance brokers in our Catastrophe Reinsurance and
Specialty Reinsurance segments for a preponderance of our revenue, loss of business provided by them
could adversely affect us.

Our Catastrophe Reinsurance and Specialty Reinsurance markets insurance and reinsurance products
worldwide exclusively through a limited number of insurance and reinsurance brokers. Three brokerage
firms accounted for 88.2% of our aggregate Catastrophe Reinsurance and Specialty Reinsurance
segments’ gross premiums written for the year ended December 31, 2013 (2012 - 84.6%). Subsidiaries
and affiliates of AON Benfield, Marsh Inc. and the Willis Group accounted for approximately 48.6%, 22.7%
and 16.9%, respectively, of our aggregate Catastrophe Reinsurance and Specialty Reinsurance segments’
gross premiums written in 2013 (2012 - 51.5%, 21.4% and 11.7%, respectively). As our business is heavily
reliant on the use of brokers, the loss of a broker through a merger or other business combination could
result in the loss of a substantial portion of our business which would have a material adverse effect on us.
Our ability to market our products could decline as a result of any loss of the business provided by these
brokers and it is possible that our premiums written would decrease. Further, due to the concentration of
our brokers, our brokers may have increasing power to dictate the terms and conditions of our
arrangements with them, which could have a negative impact on our business.

We are exposed to counterparty credit risk, including with respect to reinsurance brokers.

In accordance with industry practice, we pay virtually all amounts owed on claims under our policies to
reinsurance brokers, and these brokers, in turn, pay these amounts over to the insurers that have reinsured
a portion of their liabilities with us (we refer to these insurers as ceding insurers). Likewise, premiums due to
us by ceding insurers are virtually all paid to brokers, who then pass such amounts on to us. In many
jurisdictions, we have contractually agreed that if a broker were to fail to make such a payment to a ceding
insurer, we would remain liable to the ceding insurer for the deficiency. Conversely, in many jurisdictions,
when the ceding insurer pays premiums for these policies to reinsurance brokers for payment over to us,
these premiums are considered to have been paid by the cedants and the ceding insurer will no longer be
liable to us for those amounts, whether or not we have actually received the premiums. Consequently, in
connection with the settlement of reinsurance balances, we assume a substantial degree of credit risk
associated with brokers around the world.

We are also exposed to the credit risk of our customers, who, pursuant to their contracts with us, frequently
pay us over time. Our premiums receivable at December 31, 2013 totaled $474.1 million, and these
amounts are generally not collateralized. At December 31, 2013, we had recorded $101.0 million of
reinsurance recoverables, net of a valuation allowance of $1.7 million for uncollectible recoverables, a
significant portion of which are not collateralized. We cannot assure you that such receivables or
recoverables will ever be collected or that additional amounts will not be required to be written down in 2014
or future periods. To the extent our customers or retrocedants become unable to pay future premiums, we
would be required to recognize a downward adjustment to our premiums receivable or reinsurance
recoverables, as applicable, in our financial statements.

As a result of the recent period of relative economic weakness, our consolidated credit risk, reflecting our
counterparty dealings with agents, brokers, customers, retrocessionaires, capital providers, parties
associated with our investment portfolio, and others has increased, perhaps materially so.

Weakness in business and economic conditions generally or specifically in the principal markets in which
we do business could adversely affect our business and operating results.

The U.S. and numerous other leading markets around the world continue to experience slow recoveries or
more challenging economic conditions, and we believe meaningful risk remains of returned deterioration in
economic conditions and of substantial and continuing financial market disruptions in certain large
economies. While many governments, including the U.S. federal government, have taken substantial steps
to stabilize economic conditions in an effort to increase liquidity and capital availability, if economic
conditions should weaken, the business environment in our principal markets would be adversely affected,
which accordingly could adversely affect demand for the products sold by us or our customers. In addition,
adverse conditions of volatility in the U.S. and other securities markets may adversely affect our investment
portfolio or the investment results of our clients, potentially impeding their operations or their capacity to
invest in our products. Conditions in the global financial markets and economic and geopolitical conditions
throughout the world are outside of our control and difficult to predict, being influenced by factors such as
national and international political circumstances (including governmental instability, wars, terrorist acts or
security operations), interest rates, market volatility, asset or market correlations, equity prices, availability
of credit, inflation rates, economic uncertainty, changes in laws or regulation including as regards taxation,
trade barriers, commodity prices, interest rates, currency exchange rates and controls. In addition, during
an economic downturn we believe our consolidated credit risk, reflecting our counterparty dealings with
agents, brokers, customers, retrocessionaires, capital providers and parties associated with our investment
portfolio, among others, is likely to be increased.

U.S. taxing authorities could contend that one or more of our Bermuda subsidiaries are subject to U.S.
corporate income tax, as a result of changes in law or regulations, or otherwise.

If the IRS were to contend successfully that one or more of our Bermuda subsidiaries is engaged in a trade
or business in the U.S., such subsidiary would, to the extent not exempted from tax by the U.S.-Bermuda
income tax treaty, be subject to U.S. corporate income tax on that portion of its net income treated as
effectively connected with a U.S. trade or business, as well as the U.S. corporate branch profits tax.
Although we would vigorously contest such an assertion, if we were ultimately held to be subject to taxation,
our earnings would correspondingly decline.

In addition, benefits of the U.S.-Bermuda income tax treaty which may limit any such tax to income
attributable to a permanent establishment maintained by one or more of our Bermuda subsidiaries in the
U.S. are only available to any of such subsidiaries if more than 50% of its shares are beneficially owned,
directly or indirectly, by individuals who are Bermuda residents or U.S. citizens or residents. Our Bermuda
subsidiaries may not be able to continually satisfy such beneficial ownership test or be able to establish it to
the satisfaction of the IRS. Finally, it is unclear whether the U.S.-Bermuda income tax treaty (assuming
satisfaction of the beneficial ownership test) applies to income other than premium income, such as
investment income.

Changes in U.S. tax law or regulations could increase the costs of our products and services or otherwise
reduce our profitability.

Congress is reported to be considering legislation relating to the tax treatment of offshore insurance that
would adversely affect reinsurance between affiliates and offshore insurance and reinsurance more
generally. In past Congressional sessions, U.S. Rep. Richard Neal introduced one such proposal, H.R.
3424 (the “Neal Bill”) which would have provided that foreign insurers and reinsurers would be capped in
deducting reinsurance premiums ceded from U.S. units to offshore affiliates. The Obama Administration
has included similar provisions in its formal budgetary proposals. We believe that passage of such
legislation could adversely affect us, perhaps materially, depending on various factors, including the
magnitude of our U.S.-based operations. We could also be adversely impacted if final legislation actually
enacted, if any, differs from the proposed language previously introduced or described.

On February 7, 2013, U.S. Senator Bernard Sanders introduced legislation in the U.S. Senate entitled the
“Corporate Tax Dodging Prevention Act”. Similar legislation was also proposed in 2012, 2011 and 2010. If
enacted, this legislation would, among other things, cause to be treated as a U.S. corporation for U.S. tax
purposes generally, certain corporate entities if the “management and control” of such a corporation is,
directly or indirectly, treated as occurring primarily within the U.S. The proposed legislation provides that a
corporation will be so treated if substantially all of the executive officers and senior management of the
corporation who exercise day-to-day responsibility for making decisions involving strategic, financial, and
operational policies of the corporation are located primarily within the U.S. To date, this legislation has not
been approved by either the House of Representatives or the Senate. However, we can provide no
assurance that this legislation or similar legislation will not ultimately be adopted. While we do not believe
that the legislation would negatively impact us, it is possible that an adopted bill would include additional or
expanded provisions which could negatively impact us, or that the interpretation or enforcement of the
current proposal, if enacted, would be more expansive or adverse than we currently estimate.

A decline in our investment performance could reduce our profitability and hinder our ability to pay claims
promptly in accordance with our strategy.

We have historically derived a meaningful portion of our income from our invested assets, which are
comprised of, among other things, fixed maturity securities, such as bonds, asset-backed securities,
mortgage-backed securities, equity securities and investments in bank loan funds, hedge funds and private
equity partnerships. Accordingly, our financial results are subject to a variety of investment risks, including
risks relating to general economic conditions, market volatility, interest rate fluctuations, foreign currency
risk, liquidity risk and credit and default risk. Additionally, with respect to certain of our investments, we are
subject to pre-payment or reinvestment risk.

A failure to successfully execute our investment strategy could have a material adverse effect on our overall
results. In the event of a significant or total loss in our investment portfolio, our ability to pay any claims
promptly in accordance with our strategy could be adversely affected.

The market value of our fixed maturity investments is subject to fluctuation depending on changes in
various factors, including prevailing interest rates and widening credit spreads.

Increases in interest rates could cause the market value of our investment portfolio to decrease, perhaps
substantially. Conversely, a decline in interest rates could reduce our investment yield, which would reduce
our overall profitability. Interest rates are highly sensitive to many factors, including governmental monetary
policies, domestic and international economic and political conditions and other factors beyond our control.
Any measures we take that are intended to manage the risks of operating in a changing interest rate
environment may not effectively mitigate such interest rate sensitivity.

A portion of our investment portfolio is allocated to other classes of investments which we expect to have
different risk characteristics than our investments in traditional fixed maturity securities and short term
investments. These other classes of investments include equity securities and interests in alternative
investment vehicles such as private equity partnerships, hedge funds, senior secured bank loan funds and
catastrophe bonds, and are recorded on our consolidated balance sheet at fair value. For the
aforementioned classes of investments, the fair value of the assets comprising the portfolio of an
investment vehicle, and likewise the net asset value of the investment vehicle itself, are generally
established on the basis of the valuation criteria applied by the investment managers as set forth in the
governing documents of such investment vehicles. Such valuations may differ significantly from the values
that would have been used had ready markets existed for the shares, partnership interests, notes or other
securities representing interests in the relevant investment vehicles. Interests in many of the investment
classes described above are subject to restrictions on redemptions and sales which are determined by the
governing documents or otherwise by contract and limit our ability to liquidate these investments in the short
term. These classes of investments expose us to market risks including interest rate risk, foreign currency
risk, equity price risk and credit risk. The performance of these classes of investments is also dependent on
the individual investment managers and the investment strategies. It is possible that the investment
managers will leave and/or the investment strategies will become ineffective or that such managers will fail
to follow our investment guidelines. Any of the foregoing could result in a material adverse change to our
investment performance, and accordingly adversely affect our financial results.

In addition to the foregoing, we may from time to time re-evaluate our investment approach and guidelines
and explore investment opportunities in respect of other asset classes not previously discussed above,
including, without limitation, by expanding our relatively small portfolio of direct investments in the equity
markets. Any such investments could expose us to systemic and price volatility risk, interest rate risk and
other market risks. Any investment in equity securities carries with it inherent volatility and there can be no
assurance that such an investment will prove profitable and we could, in fact, lose the value of our
investment. Accordingly, any such investment could impact our financial results, perhaps materially, over
both the short and the long term.

We may from time to time modify our business and strategic plan, and these changes could adversely affect
us and our financial condition.

We regularly evaluate our business plans and strategies. These evaluations often result in changes to our
business plans and initiatives, some of which may be material. Given the increasing importance of strategic
execution in our industry, we are subject to increasing risks related to our ability to successfully implement
our evolving plans and strategies, particularly as the pace of change in our industry continues to increase.
Changing plans and strategies requires significant management time and effort, and may divert
management’s attention from our core and historically successful operations and competencies. Moreover,
modifications we undertake to our operations may not be immediately reflected in our financial statements.
Therefore, risks associated with implementing or changing our business strategies and initiatives, including
risks related to developing or enhancing the operations, controls and other infrastructure necessary in
respect of our more recent, new or proposed initiatives, may not have an impact on our publicly reported
results until many years after implementation. The risk that we may fail to have the ability to carry out our
business plans may have an adverse effect on our long-term results of operations and financial condition.

The loss of key senior members of management could adversely affect us.

Our success has depended, and will continue to depend, in substantial part upon our ability to attract and
retain our senior officers. The loss of services of members of our senior management team in the future,
and the uncertain transition of new members of our senior management team, as applicable, may strain our
ability to execute our strategic initiatives. Given our reliance on a relatively small management team, the
loss of one or more of our senior officers could adversely impact our business, by, for example, making it
more difficult to retain customers, attract or maintain our capital support, or other needs of our business,
which depend in part on the service of the departing officer. While we seek to engage in robust
organizational development, we may encounter unforeseen, or fail to adequately address potential,
difficulties associated with the transition of members of our senior management team for new or expanded
roles necessary to execute our strategic and tactical plans, including in connection with our anticipated
geographic diversification as well as those which may arise from the senior management transition we

announced during the second quarter of 2013. We do not currently maintain key man life insurance policies
with respect to any of our employees.

In addition, our ability to execute our business strategy is dependent on our ability to attract and retain a
staff of qualified underwriters and service personnel. The location of our global headquarters in Bermuda
may impede our ability to recruit and retain highly skilled employees. Under Bermuda law, non-Bermudians
(other than spouses of Bermudians, holders of Permanent Residents’ Certificates and holders of Working
Residents’ Certificates) may not engage in any gainful occupation in Bermuda without a valid government
work permit. Substantially all of our officers are working in Bermuda under work permits that will expire over
the next three to five years. The Bermuda government could refuse to extend these work permits, which
would adversely impact us. A work permit is issued with an expiry date (up to ten years) and no assurances
can be given that any work permit will be issued or, if issued, renewed upon the expiration of the relevant
term. If any of our senior officers or key contributors were not permitted to remain in Bermuda, or if we
experience delays or failures to obtain permits for a number of our professional staff, our operations could
be disrupted and our financial performance could be adversely affected as a result.

In late 2011, the Bermuda Parliament passed the Incentives for Job Makers Act 2011 (the “Job Makers
Act”), which provides that a limited number of non-Bermudian executives of Bermuda companies may,
subject to their and their company meeting the requirements under the Job Makers Act, apply for
permission to reside and work in Bermuda exempt from the requirement for a work permit. At this time we
cannot assure you that the Job Makers Act diminishes our risks of retaining and attracting senior executives
to our Bermuda headquarters location.

Some of our investments are relatively illiquid and are in asset classes that may experience significant
market valuation fluctuations.

Although we invest primarily in highly liquid securities in order to ensure our ability to pay valid claims in a
prompt manner, we do hold certain investments subject to transfer restrictions, or that may lack liquidity,
such as certain of our equity securities, investments in other ventures and alternative investments, which
include, but are not limited to, private equity investments, hedge funds, bank loan fund investments,
insurance-linked securities and certain high-yield debt securities. If we require significant amounts of cash
on short notice in excess of our normal cash requirements or are required to post or return collateral in
connection with our investment portfolio we may, be restricted from, have difficulty selling these investments
in a timely manner, or be forced to sell them for less than we otherwise would have been able to realize, or
both.

At times, the reported value of our relatively illiquid types of investments and of our high quality, generally
more liquid asset classes, do not necessarily reflect the lowest current market price for the asset. If we were
forced to sell certain of our assets in the current market, there can be no assurance that we will be able to
sell them for the prices at which we have recorded them and we may be forced to sell them at significantly
lower prices. Certain of our investments are held subject to contractual or regulatory transfer restrictions
and may not be sold in a timely manner; thus, upon a sale we may not be able to recognize the current
market price of these investments.

A reduction in market liquidity may make it difficult to value certain of our securities as trading becomes less
frequent. As such, valuations may include assumptions or estimates that may be more susceptible to
significant period-to-period changes which could have a material adverse effect on our consolidated results
of operations or financial condition.

The determination of impairments taken on our investments, investments in other ventures, under equity
method, goodwill and other intangible assets and loans is highly subjective and could materially impact our
financial position or results of operations.

The determination of impairments taken varies by type of asset and is based upon our periodic evaluation
and assessment of known and inherent risks associated with the respective asset class. Such evaluations
and assessments are revised as conditions change and new information becomes available. Management
updates its evaluations regularly and reflects impairments in operations as such evaluations are revised.
There can be no assurance that our management has accurately assessed the level of impairments taken
in our financial statements. Furthermore, additional impairments may need to be taken in the future, which
could materially impact our financial position or results of operations. Historical trends may not be indicative
of future impairments.

Retrocessional reinsurance may become unavailable on acceptable terms, or may not provide the coverage
we intended to obtain.

As part of our risk management, we buy reinsurance for our own account. This type of insurance when
purchased to protect reinsurance companies is known as “retrocessional reinsurance.” From time to time,
market conditions have limited, and in some cases have prevented, insurers and reinsurers from obtaining
reinsurance. Accordingly, we may not be able to obtain our desired amounts of retrocessional reinsurance.
In addition, even if we are able to obtain such retrocessional reinsurance, we may not be able to negotiate
terms as favorable to us as in the past. This could limit the amount of business we are willing to write, or
decrease the protection available to us as a result of large loss events.

When we purchase reinsurance or retrocessional reinsurance for our own account, the insolvency of any of
our reinsurers, or inability or reluctance of any of our reinsurers to make timely payments to us under the
terms of our reinsurance agreements could have a material adverse effect on us. Generally, we believe
that the “willingness to pay” of some reinsurers and retrocessionaires is declining. This risk may be more
significant to us at present than at many times in the past. Complex coverage issues or coverage disputes
may impede our ability to collect amounts we believe we are owed. A large portion of our reinsurance
protection is concentrated with a relatively small number of reinsurers. The risk of such concentration of
retrocessional coverage may be increased by recent and future consolidation within the industry.

We may be adversely impacted by inflation.

We monitor the risk that the principal markets in which we operate could experience increased inflationary
conditions, which would, among other things, cause loss costs to increase, and impact the performance of
our investment portfolio. The onset, duration and severity of an inflationary period cannot be estimated with
precision.

Our utilization of third parties to support our business exposes us to operational and financial risks.

With respect to our reinsurance operations, we do not separately evaluate each primary risk assumed
under our reinsurance contracts and, accordingly, like other reinsurers, are heavily dependent on the
original underwriting decisions made by our ceding companies. We are therefore subject to the risk that our
customers may not have adequately evaluated the risks to be reinsured, or that the premiums ceded to us
will not adequately compensate us for the risks we assume, perhaps materially so. We have recently
increased, and are seeking to continue to increase, the absolute and, potentially, the relative amount of
proportional coverages we offer, which will increase our aggregate exposure to risks of this nature.

Operational risks, including systems or human failures, are inherent in business, including ours.

We are subject to operational risks including fraud, employee errors, failure to document transactions
properly or to obtain proper internal authorization, failure to comply with regulatory requirements or
obligations under our agreements, failure of our service providers, such as investment custodians,
actuaries, information technology providers, etc., to comply with our service agreements, or information
technology failures. Losses from these risks may occur from time to time and may be significant.

We are exposed to risks in connection with our management of capital on behalf of investors in joint
ventures or other entities we manage.

Our operating subsidiaries may owe certain legal duties and obligations to third party investors (including
reporting obligations) and are subject to a variety of often complex laws and regulations relating to the
management of third party capital. Compliance with some of these laws and regulations, all of which are
subject to change, requires significant management time and attention. Although we seek to continually
monitor our policies and procedures to attempt to ensure compliance, faulty judgments, simple errors or
mistakes, or the failure of our personnel to adhere to established policies and procedures, could result in
our failure to comply with applicable laws or regulations which could result in significant liabilities, penalties
or other losses to the Company, and seriously harm our business and results of operations. In connection
with our goal of matching well-structured risk with capital whose owners would find the risk-return trade-off
attractive, we may invest capital in new and increasingly complex ventures in which we do not have a
significant amount of experience, which may increase our exposure to legal, regulatory and reputational
risks.

In addition to the foregoing, our third party capital providers may redeem their interests in our joint ventures,
which could materially impact the financial condition of such joint ventures, and could in turn materially
impact our financial condition and results of operations. Certain of our joint venture capital providers
provide significant capital investment and other forms of capital support in respect of our joint ventures; the
loss, or alternation, of any of this capital support could be detrimental to our financial condition and results
of operations. Moreover, we can provide no assurance that we may be able to attract and raise additional
third party capital for our existing joint ventures or for potential new joint ventures and therefore we may
forego existing and/or potential attractive fee income and other income generating opportunities.

We may be adversely affected by foreign currency fluctuations.

Our functional currency is the U.S. dollar; however, as we expand geographically, an increasing portion of
our premium is, and likely will be, written in currencies other than the U.S. dollar and a portion of our claims
and claim expense reserves is also in non-U.S. dollar currencies. Moreover, we maintain a portion of our
cash and investments in currencies other than the U.S. dollar. Although we generally seek to hedge
significant non-U.S. dollar positions, we may, from time to time, experience losses resulting solely from
fluctuations in the values of these foreign currencies, which could cause our consolidated earnings to
decrease. In addition, failure to manage our foreign currency exposures could cause our results of
operations to be more volatile. Adverse, unforeseen or rapidly shifting currency valuations in key markets
for us, such as the Eurozone jurisdictions or Japan, may magnify these risks over time.

We may require additional capital in the future, which may not be available or only available on unfavorable
terms.

We monitor our capital adequacy on a regular basis. The capital requirements of our business depend on
many factors, including our ability to write new business successfully and to establish premium rates and
reserves at levels sufficient to cover losses. Our ability to sell our reinsurance, insurance and other products
is largely dependent upon the quality of our claims paying and financial strength ratings as evaluated by
independent rating agencies. To the extent that our existing capital is insufficient to support our future
operating requirements, we may need to raise additional funds through financings or limit our growth. While
we do not currently expect to require additional external capital in the near term due to our strong current
capital position, our operations are subject to the ever present potential for significant volatility in capital due
to our exposure to potentially significant catastrophic events. Any further equity or debt financing, or
capacity needed for letters of credit, if available at all, may be on terms that are unfavorable to us. Our
ability to raise such capital successfully would depend upon the facts and circumstances at the time,
including our financial position and operating results, market conditions, and applicable legal issues. If we
are unable to obtain adequate capital if and when needed, our business, results of operations and financial
condition would be adversely affected. In addition, in the future we may be unable to raise new capital for
our managed joint ventures and other private alternative investment vehicles, which would reduce our future
fee income and market capacity.

The covenants in our debt agreements limit our financial and operational flexibility, which could have an
adverse effect on our financial condition.

We have incurred indebtedness, and may incur additional indebtedness in the future. At December 31,
2013, we had an aggregate of $249.4 million of indebtedness outstanding and $584.4 million of outstanding
letters of credit. In addition, we have in place committed debt facilities which would permit us to borrow,
subject to their respective terms and conditions, up to another $250.0 million. Our indebtedness primarily
consists of publicly traded notes and letter of credit and revolving credit facilities. For more details on our
indebtedness, see “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations, Capital Resources”.

The agreements covering our indebtedness, particularly our bank loans, contain covenants that limit our
ability, among other things, to borrow money, make particular types of investments or other restricted
payments, sell assets, merge or consolidate. These agreements also require us to maintain specific
financial ratios. If we fail to comply with these covenants or meet these financial ratios, the lenders under
our credit facilities could declare a default and demand immediate repayment of all amounts owed to them,
cancel their commitments to lend or issue letters of credit, or both, and require us to pledge additional or a
different type of collateral.

Regulatory challenges in the U.S. or elsewhere to our Bermuda operations’ claims of exemption from
certain insurance regulation could restrict our ability to operate, increase our costs, or otherwise adversely
impact us.

Certain of our operating subsidiaries are not licensed or admitted in any jurisdiction except Bermuda,
conduct business only from their principal offices in Bermuda and do not maintain offices in the U.S. The
insurance and reinsurance regulatory framework continues to be subject to increased scrutiny in many
jurisdictions, including the U.S. and Europe. If our Bermuda insurance or reinsurance operations become
subject to the insurance laws of any state in the U.S., jurisdictions in the EU, or elsewhere, we could face
inquiries or challenges to the future operations of these companies.

Moreover, we could be put at a competitive disadvantage in the future with respect to competitors that are
licensed and admitted in U.S. jurisdictions. Among other things, jurisdictions in the U.S. do not permit
insurance companies to take credit for reinsurance obtained from unlicensed or non-admitted insurers on
their statutory financial statements unless security is posted. Our contracts generally require us to post a
letter of credit or provide other security (e.g., through a multi-beneficiary reinsurance trust) after a reinsured
reports a claim. In order to post these letters of credit, issuing banks generally require collateral. It is
possible that the EU or other countries might adopt a similar regime in the future, or that U.S. regulations
could be altered in a way that treats Bermuda-based companies disproportionately. Any such development,
or if we are unable to post security in the form of letters of credit or trust funds when required, could
significantly and negatively affect our operations.

RenaissanceRe Specialty Risks is currently an eligible, non-admitted excess and surplus lines insurer in 49
States within the U.S., the District of Columbia, Puerto Rico and the U.S. Virgin Islands, and is subject to
certain regulatory and reporting requirements of these jurisdictions. However, RenaissanceRe Specialty
Risks is not admitted or licensed in any U.S. jurisdiction; moreover, RenaissanceRe Specialty Risks only
conducts business from Bermuda. Accordingly, the scope of RenaissanceRe Specialty Risks’ activities in
the U.S. is limited, which could adversely affect its ability to compete. Although surplus lines business is
generally less regulated than the admitted market, the regulation of surplus lines insurance may undergo
changes in the future. Federal and/or state measures may be introduced and promulgated that could result
in increased oversight and regulation of surplus lines insurance.

Our current or future business strategy could cause one or more of our currently unregulated subsidiaries to
become subject to some form of regulation. Any failure to comply with applicable laws could result in the
imposition of significant restrictions on our ability to do business, and could also result in fines and other
sanctions, any or all of which could adversely affect our financial results and operations.

We could be required to allocate considerable time and resources to comply with any new or additional
regulatory requirements, and any such requirements may impact the operations of our insurance and/or
non-insurance subsidiaries and ultimately could impact our financial condition as well. In addition, we could
be adversely affected if a regulatory authority believed we had failed to comply with applicable law or
regulation.

Because we are a holding company, we are dependent on dividends and payments from our subsidiaries.

As a holding company with no direct operations, we rely on investment income, cash dividends and other
permitted payments from our subsidiaries to make principal and interest payments on our debt and to pay
dividends to our shareholders. The holding company does not have any operations and from time to time
may not have significant liquid assets. Bermuda law and various U.S. insurance regulations may limit the
ability of our subsidiaries to pay dividends. If our subsidiaries are restricted from paying dividends to us, we
may be unable to pay dividends or to repay our indebtedness.

Acquisitions or strategic investments that we have made or may make could turn out to be unsuccessful.

As part of our strategy, we frequently monitor and analyze opportunities to acquire or make a strategic
investment in new or other businesses that will not detract from our core operations. The negotiation of
potential acquisitions or strategic investments as well as the integration of an acquired business or new
personnel could result in a substantial diversion of management resources. Acquisitions could involve
numerous additional risks such as potential losses from unanticipated litigation or levels of claims and
inability to generate sufficient revenue to offset acquisition costs. Should we pursue or consummate a
strategic transaction or investment, we may mis-value the acquired or funded company or operations, fail to

integrate the acquired operations appropriately into our own operations, expend unforeseen costs during
the acquisition or integration process, or encounter other unanticipated risks or challenges. Having
consummated a strategic investment, should we succeed in doing so, we may fail to value it accurately or
succeed in divesting it or otherwise realizing the value which we originally invested or have subsequently
reflected in our consolidated financial statements. Any failure by us to effectively limit such risks or
implement our acquisitions or strategic investment strategies could have a material adverse effect on our
business, financial condition or results of operations.

We are subject to cybersecurity risks and may incur increasing costs in an effort to minimize those risks.

We depend on the proper functioning and availability of our information technology platform, including
communications and data processing systems, in operating our business. These systems include
proprietary software programs that are integral to the efficient operation of our business, including our
proprietary pricing and exposure management system. We are also required to effect electronic
transmissions with third parties including brokers, clients vendors and others with whom we do business,
and to facilitate the oversight conducted by our Board of Directors. Security breaches could expose us to a
risk of loss or misuse of our information, litigation and potential liability. In addition, cyber incidents that
impact the availability, reliability, speed, accuracy or other proper functioning of these systems could have a
significant impact on our operations, and potentially on our results. We may not have the resources or
technical sophistication to anticipate or prevent rapidly evolving types of cyber attacks. A significant cyber
incident, including system failure, security breach, disruption by malware or other damage could interrupt or
delay our operations, result in a violation of applicable privacy and other laws, damage our reputation,
cause a loss of customers or give rise to monetary fines and other penalties, which could be significant.
See “Part I, Item 1. Business, Information Technology”.

Some aspects of our corporate structure may discourage third party takeovers and other transactions or
prevent the removal of our current board of directors and management.

Some provisions of our Amended and Restated Bye-Laws have the effect of making more difficult or
discouraging unsolicited takeover bids from third parties or preventing the removal of our current board of
directors and management. In particular, our Bye-Laws prohibit transfers of our capital shares if the transfer
would result in a person owning or controlling shares that constitute 9.9% or more of any class or series of
our shares. In addition, our Bye-Laws reduce the total voting power of any shareholder owning, directly or
indirectly, beneficially or otherwise, as described in our Bye-laws, more than 9.9% of our common shares to
not more than 9.9% of the total voting power of our capital stock unless otherwise waived at the discretion
of the Board. The primary purpose of these provisions is to reduce the likelihood that we will be deemed a
“controlled foreign corporation” within the meaning of the Internal Revenue Code for U.S. federal tax
purposes. However, these provisions may also have the effect of deterring purchases of large blocks of
common shares or proposals to acquire us, even if some or a majority of our shareholders might deem
these purchases or acquisition proposals to be in their best interests.

In addition, our Bye-Laws provide for, among other things:

• a classified Board, whose size is fixed and whose members may be removed by the shareholders

only for cause upon a 66 2/3% vote;

• restrictions on the ability of shareholders to nominate persons to serve as directors, submit

resolutions to a shareholder vote and requisition special general meetings;

• a large number of authorized but unissued shares which may be issued by the Board without further

shareholder action; and

• a 66 2/3% shareholder vote to amend, repeal or adopt any provision inconsistent with several

provisions of the Bye-Laws.

These Bye-Law provisions make it more difficult to acquire control of us by means of a tender offer, open
market purchase, proxy contest or otherwise. These provisions are designed to encourage persons seeking
to acquire control of us to negotiate with our directors, which we believe would generally best serve the
interests of our shareholders. However, these provisions could have the effect of discouraging a prospective
acquirer from making a tender offer or otherwise attempting to obtain control of us. In addition, these Bye-
Law provisions could prevent the removal of our current board of directors and management. To the extent

these provisions discourage takeover attempts, they could deprive shareholders of opportunities to realize
takeover premiums for their shares or could depress the market price of the shares.

In respect of our ownership of RSML, our Lloyd’s managing agent, the PRA and FCA regulate the
acquisition of control of any Lloyd’s managing agent which is authorized under the FSMA. Any company or
individual that, together with its or his associates, directly or indirectly acquires 10% or more of the shares in
a Lloyd’s managing agent or its parent company, or is entitled to exercise or control the exercise of 10% or
more of the voting power in such Lloyd’s managing agent or its parent company, would be considered to
have acquired control for the purposes of the relevant legislation, as would a person who had significant
influence over the management of such Lloyd’s managing agent or its parent company by virtue of his
shareholding or voting power in either. Lloyd’s approval is also required before any person can acquire
control (using the same definition as for the PRA and FCA) of a Lloyd’s managing agent or Lloyd’s
corporate member.

Investors may have difficulties in serving process or enforcing judgments against us in the U.S.

We are a Bermuda company. In addition, certain of our officers and directors reside in countries outside the
U.S. All or a substantial portion of our assets and the assets of these officers and directors are or may be
located outside the U.S. Investors may have difficulty effecting service of process within the U.S. on our
directors and officers who reside outside the U.S. or recovering against us or these directors and officers on
judgments of U.S. courts based on civil liabilities provisions of the U.S. federal securities laws whether or
not we appoint an agent in the U.S. to receive service of process.

Risks Related to Our Industry

The reinsurance and insurance businesses are historically cyclical and the pricing and terms for our
products may decline, which would affect our profitability.

The reinsurance and insurance industries have historically been cyclical, characterized by periods of
decreasing prices followed by periods of increasing prices. Reinsurers have experienced significant
fluctuations in their results of operations due to numerous factors, including the frequency and severity of
catastrophic events, perceptions of risk, levels of capacity, general economic conditions and underwriting
results of other insurers and reinsurers. All of these factors may contribute to price declines generally in the
reinsurance and insurance industries. Following an increase in capital in our industry after the 2005
catastrophe events and the subsequent period of substantial dislocation in the financial markets, the
reinsurance and insurance markets have experienced a prolonged period of generally softening markets.

The catastrophe-exposed lines in which we are a market leader are affected significantly by volatile and
unpredictable developments, including natural and man-made disasters. The occurrence, or
nonoccurrence, of catastrophic events, the frequency and severity of which are inherently unpredictable,
affects both industry results and consequently prevailing market prices of our products.

We expect premium rates and other terms and conditions of trade to vary in the future. If demand for our
products falls or the supply of competing capacity rises, our prospects for potential growth, due in part to
our disciplined approach to underwriting, may be adversely affected. In particular, we might lose existing
customers or decline business, which we might not regain when industry conditions improve.

In recent years, hedge funds, pension funds, endowments and investment banks have been increasingly
active in the reinsurance market and markets for related risks. Further, we believe new entrants or existing
competitors may attempt to replicate all or part of our business model and provide further competition in the
markets in which we participate. We generally expect increased competition from a wider range of entrants
over time. It is possible that such new or alternative capital could cause reductions in prices of our
products, or reduce the duration or amplitude of attractive portions of the historical market cycles.
Moreover, explicitly or implicitly government-backed entities increasingly represent competition for the
coverages that we provide directly, or for the business of our customers, reducing the potential amount of
third party private protection our clients might need or desire. To the extent that industry pricing of our
products does not meet our hurdle rate, we would generally expect to reduce our future underwriting
activities thus resulting in reduced premiums and a reduction in expected earnings.

Recent or future legislation may decrease the demand for our property catastrophe reinsurance products
and adversely affect our business and results of operations.

In 2007, the State of Florida enacted legislation to expand the FHCF’s provision of below-market rate
reinsurance to up to $28.0 billion per season (the “2007 Florida Bill”). We believe that the 2007 Florida Bill
and other regulatory actions since the introduction of the 2007 Florida Bill contributed to instability in the
Florida primary insurance market, where many insurers reported substantial and continuing losses from
2009 through 2012, despite an unusually low period for catastrophe losses in the state. Because of our
position as one of the largest providers of catastrophe-exposed coverage, both on a global basis and in
respect of the Florida market, the 2007 Florida Bill and the weakened financial position of Florida insurers
may have a disproportionate adverse impact on us compared to other reinsurance market participants. In
addition, it is possible that other regulatory or legislative changes in, or impacting, Florida could affect our
ability to sell certain of our products and could therefore have a material adverse effect on our operations.

It is also possible that other states, particularly those with Atlantic or Gulf Coast exposures, may enact new
or expanded legislation based on the Florida precedent, or may otherwise enact legislation, which would
further diminish aggregate private market demand for our products. Alternatively, legislation adversely
impacting the private markets could be enacted on a regional or at the federal level. For example, in the
past, federal bills have been proposed in Congress (and, in prior congressional sessions, passed by the
House of Representatives) which would, if enacted, create a federal reinsurance backstop or guarantee
mechanism for catastrophic risks, including those we currently insure and reinsure in the private
markets. Such legislation, if enacted, would, we believe, likely contribute to growth of state insurance
entities or to their inception or alteration in a manner adverse to us. If enacted, bills of this nature would
likely further erode the role of private market catastrophe reinsurers and could adversely impact our
financial results, perhaps materially. Moreover, we believe that numerous modeled potential catastrophes
could exceed the actual or politically acceptable bonded capacity of Citizens and of the FHCF, which could
lead either to a severe dislocation or the necessity of federal intervention in the Florida market, either of
which would adversely impact the private insurance and reinsurance industry.

In June 2012, Congress passed the Biggert-Waters Flood Insurance Reform and Modernization Act of 2012
(the “Biggert-Waters Bill”), which provided for a five-year renewal of the National Flood Insurance Program
(the “NFIP”) and effected substantial reforms in the program. Among other things, the bill increased the
annual limitation on program premium increases from 10% to 20% of the average of the risk premium rates
for certain properties; established a four-year phase-in, after the first year, in annual 20% increments, of full
actuarial rates for a newly mapped risk premium rate area; instructed FEMA to establish new flood
insurance rate maps; allowed multi-family properties to purchase NFIP policies; and introduced minimum
deductibles for flood claims. Many market participants anticipated that that these reforms could increase
the role of private risk-bearing capital in respect of U.S. flood perils, a coverage we provide globally,
perhaps significantly. However, in February 2014, legislation was passed in the U.S. Senate, entitled the
“Homeowner Flood Insurance Affordability Act of 2014”, which would, if enacted into law, impose a four-year
delay in most rate reforms required by the enacted version of the Biggert-Waters Bill, and would require
FEMA, which administers the flood program, to complete an affordability study and propose regulations that
address affordability issues. Subsequently, members of the House of Representatives have announced
that the House will consider a bill which may have a substantially similar impact as the Senate legislation,
and potentially could be more adverse than the Senate bill. It is likely that a version of this legislation, or
broader alternatives, will be adopted by Congress and adversely impact the prospects for increased U.S.
private flood insurance demand, as well as adversely impacting the stability of the NFIP, the primary
insurers that produce policies for the NFIP or offer private coverages, or the communities they serve.

Internationally, in the wake of recent large natural catastrophes, a number of proposals have been
introduced to alter the financing of natural catastrophes in several of the markets in which we operate. For
example, the Thailand government has announced it is studying proposals for a natural catastrophe fund,
under which the government would provide coverage for natural disasters in excess of an industry retention
and below a certain limit, after which private reinsurers would continue to participate. The government of
the Philippines has announced that it is considering similar proposals. A range of proposals from varying
stakeholders have been reported to have been made to alter the current regimes for insuring flood risk in
the U.K., flood risk in Australia and earthquake risk in New Zealand. If these proposals are enacted and
reduce market opportunities for our clients or for the reinsurance industry, we could be adversely impacted.

See “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of
Operations, Current Outlook, Legislative and Regulatory Update” for further information.

Other political, regulatory and industry initiatives could adversely affect our business.

The insurance and reinsurance regulatory framework is subject to heavy scrutiny by the U.S. and individual
state governments as well as an increasing number of international authorities. Government regulators are
generally concerned with the protection of policyholders to the exclusion of other constituencies, including
shareholders. Governmental authorities in both the U.S. and worldwide seem increasingly interested in the
potential risks posed by the reinsurance industry as a whole, and to commercial and financial systems in
general. While we do not believe these inquiries have identified meaningful new risks posed by the
reinsurance industry, and we cannot predict the exact nature, timing or scope of possible governmental
initiatives, we believe it is likely there will be increased regulatory intervention in our industry in the future.
For example, the U.S. federal government has increased its scrutiny of the insurance regulatory framework
in recent years (including as specifically addressed in the Dodd-Frank Act), and some state legislators have
considered or enacted laws that will alter and likely increase state regulation of insurance and reinsurance
companies and holding companies. Moreover, the NAIC, which is an association of the insurance
commissioners of all 50 states and the District of Columbia and state insurance regulators, regularly
reexamine existing laws and regulations. Due to this increased legislative and regulatory scrutiny on the
reinsurance industry, our cost of compliance with applicable laws may increase, which could result in a
decrease to both our profitability and the amount of time that our senior management allocates to running
the day-to-day operations of the Company.

For example, we could be adversely affected by proposals or enacted legislation to:

• provide insurance and reinsurance capacity in markets and to consumers that we target, such as the

legislation enacted in Florida in 2007 or the proposed federal legislation described above;

• expand the scope of coverage under existing policies for perils such as hurricanes or earthquakes or

for a pandemic disease outbreak;

• increasingly mandate the terms of insurance and reinsurance policies;

• expand the proposed scope of the FIO or establish a new federal insurance regulator;

• revise laws, regulations, or contracts under which we operate;

• disproportionately benefit the companies of one country over those of another; or

• repeal or diminish the insurance company antitrust exemption from the McCarran Ferguson Act.

With respect to the Dodd-Frank Act, it is difficult to predict the extent to which this Act or the regulations
resulting therefrom will impact our business. However, compliance with these new laws and regulations will
result in additional costs, which may adversely impact our results of operations, financial condition or
liquidity. Although we do not expect these costs to be material to the Company as a whole, we cannot
assure you this expectation will prove accurate or that the Dodd-Frank Act or other legislation will not impact
our business more adversely than we currently estimate.

While the timing for the implementation of Solvency II in the EU Member States by the European
Commission remains uncertain, implementation of Solvency II will also require us to utilize a significant
amount of resources to ensure compliance. The EU is in the process of considering the Solvency II
equivalence of Bermuda’s insurance regulatory and supervisory regime. The EU equivalence assessment
considers whether Bermuda’s regulatory regime provides a similar level of policyholder protection as
provided under Solvency II. While we currently expect that Bermuda’s insurance regulatory regime will be
found equivalent in respect of oversight of internationally operating reinsurers and insurers such as
RenaissanceRe, an adverse or highly qualified finding could have an adverse effect on our reinsurance
operations and on our group solvency calculations. We are monitoring the ongoing legislative and
regulatory steps following adoption of Solvency II. The principles, standards and requirements of Solvency
II may also, directly or indirectly, impact the future supervision of additional operating subsidiaries of ours.

We are incorporated in Bermuda and are therefore subject to changes in Bermuda law and regulation that
may have an adverse impact on our operations, including imposition of tax liability or increased regulatory
supervision or change in regulation. In addition, we are subject to changes in the political environment in

Bermuda, which could make it difficult to operate in, or attract talent to, Bermuda. The Bermuda insurance
and reinsurance regulatory framework recently has become subject to increased scrutiny in many
jurisdictions, including in the U.S. and in various states within the U.S. We are unable to predict the future
impact on our operations of changes in the laws and regulations to which we are or may become subject.
Moreover, our exposure to potential regulatory initiatives could be heightened by the fact that our principal
operating companies are domiciled in, and operate exclusively from, Bermuda. For example, Bermuda, a
small jurisdiction, may be disadvantaged in participating in global or cross border regulatory matters as
compared with larger jurisdictions such as the U.S. or the leading EU and Asian countries. In addition,
Bermuda, which is currently an overseas territory of the U.K., may consider changes to its relationship with
the U.K. in the future. These changes could adversely affect Bermuda or the international reinsurance
market focused there, either of which could adversely impact us commercially. Further, as we continue to
expand our business operations to different regions of the world outside of Bermuda, we are increasingly
subject to new and additional regulations with respect to our operations, including, for example, laws
relating to anti-corruption and anti-bribery which have received increasing scrutiny in recent years.

We operate in a highly competitive environment.

The reinsurance industry is highly competitive. We compete, and will continue to compete, with major U.S.
and non-U.S. insurers and property catastrophe reinsurers, including other Bermuda-based reinsurers.
Many of our competitors have greater financial, marketing and management resources than we do.
Historically, periods of increased capacity levels in our industry generally have led to increased competition,
and decreased prices for our products.

We believe that our principal competitors in the property catastrophe reinsurance market include other
companies active in the Bermuda market, currently including ACE Limited, Allied World Assurance
Company, AG, Arch Capital Group Ltd., Aspen Insurance Holdings Limited, Axis Capital Holdings Limited,
Endurance Specialty Holdings Ltd., Everest Re Group, Ltd., Hamilton Re Ltd. (“Hamilton Re”), Montpelier
Re Holdings Ltd., PartnerRe Ltd., Platinum Underwriters Holdings, Ltd. (“Platinum”), Third Point
Reinsurance Ltd. (‘Third Point”), Validus Holdings, Ltd., White Mountains Insurance Group, Ltd. and XL
Group plc, as well as a growing number of private, unrated reinsurers offering predominately collateralized
reinsurance. We also compete with certain Lloyd’s syndicates active in the London market, as well as with
a number of other industry participants, such as American International Group, Inc., Berkshire Hathaway
Inc., Hannover Rückversicherung AG (“Hannover Re”), Ironshore Inc., Münchener Rückversicherungs-
Gesellschaft Aktiengesellschaft in München (“Munich Re”) and Swiss Re Ltd. As our business evolves over
time, we expect our competitors to change as well. Also, hedge funds, pension funds, endowments,
investment banks and investment managers (such as Nephila Capital Ltd.) are increasingly active in the
reinsurance market, either through the formation of reinsurance companies (which include Greenlight
Reinsurance Ltd. and new Bermuda-based entrants, including Aeolus Re Ltd., AQR Re Management Ltd.,
Hamilton Re (formerly known as SAC Re), Swan Re Ltd. and Third Point) or through the use of other
financial products, such as catastrophe bonds, other insurance-linked securities and collateralized
reinsurance investment funds. In addition, we may not be aware of other companies that may be planning
to enter the reinsurance market or of existing companies that may be planning to raise additional capital.
We cannot predict what effect any of these developments may have on our businesses.

Consolidation in the (re) insurance industry could adversely impact us.

The (re)insurance industry has been consolidating and we believe that several (re)insurance industry
participants are seeking to consolidate. Should the market continue to consolidate, there can be no
assurance that we would remain a leading insurer and property catastrophe reinsurer. These consolidated
competitor enterprises may try to use their enhanced market power to negotiate price reductions for our
products and services and/or obtain a larger market share through increased line sizes. If competitive
pressures reduce our prices, we would generally expect to reduce our future underwriting activities thus
resulting in reduced premiums and a reduction in expected earnings. As the insurance industry
consolidates, competition for customers will become more intense and the importance of acquiring and
properly servicing each customer will become greater. We could incur greater expenses relating to
customer acquisition and retention, further reducing our operating margins. In addition, insurance
companies that merge may be able to spread their risks across a consolidated, larger capital base so that
they require less reinsurance. The number of companies offering retrocessional reinsurance may decline.
Reinsurance intermediaries could also continue to consolidate, potentially adversely impacting our ability to

access business and distribute our products. We could also experience more robust competition from
larger, better capitalized competitors. Any of the foregoing could adversely affect our business or our
results of operation.

The Organization for Economic Cooperation and Development (the “OECD”) and the EU may pursue
measures that might increase our taxes and reduce our net income.

The OECD has published reports and launched a global dialogue among member and non-member
countries on measures to limit harmful tax competition. These measures are largely directed at
counteracting the effects of jurisdictions perceived by the OECD to be tax havens or to offer preferential tax
regimes. The OECD has not listed Bermuda as an uncooperative tax haven jurisdiction because Bermuda
has committed to eliminate harmful tax practices and to embrace international tax standards for
transparency, exchange of information and the elimination of any aspects of the regimes for financial and
other services that attract business with no substantial domestic activity. We are not able to predict what
changes will arise from the commitment or whether such changes will subject us to additional taxes.

Regulatory regimes and changes to accounting rules may adversely impact financial results irrespective of
business operations.

Accounting standards and regulatory changes may require modifications to our accounting principles, both
prospectively and for prior periods and such changes could have an adverse impact on our financial results.
In particular, the SEC continues to discuss the potential to either converge or transition to an international
set of accounting standards that would be applied to financial statements filed with the SEC. Such changes,
if ultimately adopted, could have a significant impact on our financial reporting, impacting key matters such
as our loss reserving policies and premium and expense recognition. For example, the Financial Accounting
Standards Board and the International Accounting Standards Board are considering adopting respective
accounting standards that would require all reinsurance and insurance contracts to be accounted for under
a new measurement basis, which standards are considered to be more closely related to fair value than the
current measurement basis. We are currently evaluating how the above initiatives will impact us, including
with respect to our loss reserving policy and the effect it might have on recognizing premium revenue and
policy acquisition costs. Required modification of our existing principles, either with respect to these issues
or other issues in the future, could have an impact on our results of operations, including changing the
timing of the recognition of underwriting income, increasing the volatility of our reported earnings and
changing our overall financial statement presentation and increasing our expenses in order to implement
and comply with any new requirements.

Heightened scrutiny of issues and practices in the insurance industry may adversely affect our business.

Certain government authorities, including state officials in Florida, New York and Connecticut, as well as
U.S. federal agencies, have from time to time scrutinized and investigated a number of issues and practices
within the insurance and reinsurance industry. It is possible such scrutiny could expand to include us in the
future, and it is also possible that these investigations or related regulatory developments will mandate or
otherwise give rise to changes in industry practices in a fashion that increases our costs or requires us to
alter how we conduct our business.

We cannot predict the ultimate effect that these investigations, and any changes in industry practice,
including future legislation or regulations that may become applicable to us, will have on the insurance
industry, the regulatory framework, or our business.

As noted above, because we frequently assume the credit risk of the counterparties with whom we do
business throughout our insurance and reinsurance operations, our results of operations could be adversely
affected if the credit quality of these counterparties is severely impacted by investigations in the insurance
industry or by changes to industry practices.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

We lease office space in Bermuda, which houses our executive offices and operations for our Catastrophe
Reinsurance, Specialty Reinsurance and Lloyd’s segments. Certain U.S. based subsidiaries lease office
space in a number of U.S. states. Certain of our subsidiaries also lease office space in London, U.K.,
Dublin, Ireland and Singapore. While we believe that for the foreseeable future our current office space is
sufficient for us to conduct our operations, it is likely that we will expand into additional facilities and perhaps
new locations to accommodate future growth. To date, the cost of acquiring and maintaining our office
space has not been material to us as a whole.

ITEM 3. LEGAL PROCEEDINGS

We and our subsidiaries are subject to lawsuits and regulatory actions in the normal course of business that
do not arise from or directly relate to claims on reinsurance treaties or contracts or direct surplus lines
insurance policies. This category of business litigation may involve allegations of underwriting or claims-
handling errors or misconduct, employment claims, regulatory actions or disputes arising from our business
ventures. Our operating subsidiaries are subject to claims litigation involving, among other things, disputed
interpretations of policy coverages. Generally, our direct surplus lines insurance operations are subject to
greater frequency and diversity of claims and claims-related litigation than our reinsurance operations and,
in some jurisdictions, may be subject to direct actions by allegedly injured persons or entities seeking
damages from policyholders. These lawsuits, involving claims on policies issued by our subsidiaries which
are typical to the insurance industry in general and in the normal course of business, are considered in its
loss and loss expense reserves which are discussed in its loss reserves discussion. In addition, we may
from time to time engage in litigation or arbitration related to claims for payment in respect of ceded
reinsurance, including disputes that challenge our ability to enforce our underwriting intent. Such matters
could result, directly or indirectly, in providers of protection not meeting their obligations to us or not doing
so on a timely basis. We may also be subject to other disputes from time to time, relating to operational or
other matters distinct from insurance or reinsurance claims. Any litigation or arbitration, or regulatory
process, contains an element of uncertainty, and the value of an exposure or a gain contingency related to
a dispute is difficult to estimate accordingly. Currently, we believe that no individual litigation or arbitration to
which we are presently a party is likely to have a material adverse effect on our financial condition, business
or operations.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS
AND ISSUER REPURCHASES OF EQUITY SECURITIES

PRICE RANGE OF COMMON SHARES

Our common shares began publicly trading on June 27, 1995 on the New York Stock Exchange (“NYSE”)
under the symbol “RNR.” The following table sets forth, for the periods indicated, the high and low prices
per share of our common shares as reported in composite NYSE trading:

2013
First Quarter
Second Quarter
Third Quarter
Fourth Quarter

2012
First Quarter
Second Quarter
Third Quarter
Fourth Quarter

Price Range
of Common Shares

High

Low

92.23 $
95.00
90.68
97.53

79.11 $
80.53
78.39
82.76

79.83
82.50
83.19
89.90

71.18
72.41
70.00
75.29

On February 19, 2014, the last reported sale price for our common shares was $93.80 per share and there
were 124 holders of record of our common shares.

PERFORMANCE GRAPH

The following graph compares the cumulative return on our common shares including reinvestment of our
dividends on our common shares to such return for the S&P 500 Composite Stock Price Index (“S&P 500”)
and S&P’s Property-Casualty Industry Group Stock Price Index (“S&P P/C”), for the five-year period
commencing January 1, 2009 and ending December 31, 2013, assuming $100 was invested on January 1,
2009. Each measurement point on the graph below represents the cumulative shareholder return as
measured by the last sale price at the end of each calendar year during the period from January 1, 2009
through December 31, 2013. As depicted in the graph below, during this period, the cumulative return was
(1) 93.4% on our common shares; (2) 127.2% for the S&P 500; and (3) 100.9% for the S&P P&C.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN

DIVIDEND POLICY

Historically, we have paid dividends on our common shares every quarter, and have increased our dividend
during each year since our initial public offering. The Board of Directors declared regular quarterly
dividends of $0.28 per common share to shareholders of record on March 15, June 14, September 13 and
December 13, 2013, respectively. The Board of Directors declared regular quarterly dividends of $0.27 per
common share to shareholders of record on March 15, June 15, September 14 and December 14, 2012,
respectively. On February 19, 2014, RenaissanceRe’s Board of Directors approved an increased dividend
of $0.29 per common share, payable on March 31, 2014, to shareholders of record on March 14, 2014.
The declaration and payment of dividends are subject to the discretion of the Board and depend on, among
other things, our financial condition, general business conditions, legal, contractual and regulatory
restrictions regarding the payment of dividends by us and our subsidiaries and other factors which the
Board may in the future consider to be relevant.

ISSUER REPURCHASES OF EQUITY SECURITIES

The Company’s share repurchase program may be effected from time to time, depending on market
conditions and other factors, through open market purchases and privately negotiated transactions. On
February 19, 2014, RenaissanceRe’s Board of Directors approved a renewal of the authorized share
repurchase program for an aggregate amount of $500.0 million. Unless terminated earlier by resolution of
RenaissanceRe’s Board of Directors, the program will expire when the Company has repurchased the full
value of the shares authorized. The table below details the repurchases that were made under the program
during the three months ended December 31, 2013, and also includes other shares purchased which
represents withholdings from employees surrendered in respect of withholding tax obligations on the
vesting of restricted stock, or in lieu of cash payments for the exercise price of employee stock options.

Total shares purchased Other shares purchased

Shares purchased under
repurchase program

Shares
purchased

Average
price per
share

Shares
purchased

Average
price per
share

Shares
purchased

Average
price per
share

Dollar
amount
still
available
under
repurchase
program
(in millions)

489.2

— $

461

—
92.99

— $

461

—
92.99

— $

—

9,243

727,470

737,174

92.35

91.82

91.83

1,895

5,447

7,803

92.74

97.28

95.92

7,348

722,023

729,371

92.25

91.78

—

10.8

500.0

(0.7)
(66.3)
433.1

Beginning dollar amount

available to be
repurchased

October 1 - 31, 2013

November 1 - 14, 2013

November 14, 2013 -

renewal of authorized
share repurchase
program of $500.0 million

Dollar amount available to

be repurchased

November 14 - 30, 2013

December 1 - 31, 2013

Total

In the future, the Company may adopt additional trading plans or authorize purchase activities under the
remaining authorization, which the Board may increase in the future. During 2013, the Company
repurchased an aggregate of 2.5 million common shares in open market transactions and a privately
negotiated transaction at an aggregate cost of $207.9 million and at an average share price of $84.80.

Subsequent to December 31, 2013 and through the period ended February 19, 2014, the Company
repurchased 2.0 million common shares in open market transactions at an aggregate cost of $185.8 million
and at an average share price of $91.66.

ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA

The following tables set forth our selected consolidated financial data and other financial information at the
end of and for each of the years in the five-year period ended December 31, 2013. Comparative figures for
2010 and 2009 have not been reclassified for discontinued operations. See “Note 3. Discontinued
Operations in our Notes to Consolidated Financial Statements” for additional information regarding
discontinued operations. The selected consolidated financial data should be read in conjunction with our
consolidated financial statements and related notes thereto and “Part II, Item 7. Management’s Discussion
and Analysis of Financial Condition and Results of Operations” included in this filing and all other
information appearing elsewhere or incorporated into this filing by reference.

Year ended December 31,

2013

2012

2011

2010

2009

(in thousands, except share and per share data
and percentages)
Statements of Operations Data:
Gross premiums written
Net premiums written
Net premiums earned
Net investment income
Net realized and unrealized gains on

investments

Net other-than-temporary impairments
Net claims and claim expenses incurred
Acquisition expenses
Operational expenses
Underwriting income (loss)
Income (loss) from continuing operations
Income (loss) from discontinued operations
Net income (loss)
Net income (loss) available (attributable) to
RenaissanceRe common shareholders
Income (loss) from continuing operations

available (attributable) to RenaissanceRe
common shareholders per common share –
diluted

Net income (loss) available (attributable) to

RenaissanceRe common shareholders per
common share – diluted
Dividends per common share
Weighted average common shares outstanding

– diluted

Return on average common equity
Combined ratio

At December 31,
Balance Sheet Data:
Total investments
Total assets
Reserve for claims and claim expenses
Unearned premiums
Debt
Capital leases
Preferred shares
Total shareholders’ equity attributable to

RenaissanceRe

Common shares outstanding
Book value per common share
Accumulated dividends
Book value per common share plus

accumulated dividends

$ 1,605,412
1,203,947
1,114,626
208,028

$ 1,551,591
1,102,657
1,069,355
165,725

$ 1,434,976
1,012,773
951,049
146,871

$ 1,165,295
848,965
864,921
212,081

$ 1,228,881
838,333
882,204
313,271

35,076

—
171,287
125,501
191,105
626,733
839,346
2,422
841,768

163,121

(343)
325,211
113,542
179,151
451,451
765,425
(16,476)
748,949

43,956

(552)
861,179
97,376
169,661
(177,167)
(38,833)
(51,559)
(90,392)

136,318

(829)
129,345
94,961
166,042
474,573
798,482
62,670
861,152

98,587

(22,450)
(70,698)
104,150
153,552
695,200
1,045,959
6,700
1,052,659

665,676

566,014

(92,235)

702,613

838,858

14.82

11.56

(0.82)

11.18

13.29

14.87

1.12

11.23

1.08

(1.84)

1.04

12.31

1.00

13.40

0.96

44,128

49,603

50,747

55,641

61,210

20.5%
43.8%

17.7%
57.8%

(3.0)%
118.6 %

21.7%
45.1%

30.2%
21.2%

2013

2012

2011

2010

2009

$ 6,821,712
8,179,131
1,563,730
477,888
249,430
27,138
400,000

$ 6,355,394
7,928,628
1,879,377
399,517
349,339
27,428
400,000

6,202,001
7,744,912
1,992,354
347,655
349,247
25,366
550,000

$ 6,100,212
8,138,278
1,257,843
286,183
549,155
25,706
550,000

$ 6,015,259
7,926,212
1,344,433
317,592
300,000
26,014
650,000

3,904,384

3,503,065

3,605,193

3,936,325

3,840,786

43,646
80.29
13.12

93.41

45,542
68.14
12.00

80.14

51,543
59.27
10.92

70.19

54,110
62.58
9.88

72.46

61,745
51.68
8.88

60.56

Change in book value per common share plus

change in accumulated dividends

19.5%

16.8%

(3.6)%

23.0%

35.9%

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The following is a discussion and analysis of our results of operations for 2013, compared to 2012, and
2012, compared to 2011, respectively. The following also includes a discussion of our liquidity and capital
resources at December 31, 2013. This discussion and analysis should be read in conjunction with the
audited consolidated financial statements and notes thereto included in this filing. This filing contains
forward-looking statements that involve risks and uncertainties. Actual results may differ materially from the
results described or implied by these forward-looking statements. See “Note on Forward-Looking
Statements.”

OVERVIEW

RenaissanceRe was established in Bermuda in 1993 to write principally property catastrophe reinsurance
and today is a leading global provider of reinsurance and insurance coverages and related services. Our
aspiration is to be the world’s best underwriter by matching well-structured risks with efficient sources of
capital. Through our operating subsidiaries, we seek to produce superior returns for our shareholders by
being a trusted, long-term partner to our customers for assessing and managing risk, and by delivering
responsive solutions. We accomplish this by leveraging our core capabilities of risk assessment and
information management, by investing in our capabilities to serve our customers across the cycles that have
historically characterized our markets and by keeping our promises. Overall, our strategy focuses on
superior customer relationships, superior risk selection and superior capital management. We provide
value to our customers and joint venture partners in the form of financial security, innovative products, and
responsive service. We are known as a leader in paying valid reinsurance claims promptly. We principally
measure our financial success through long-term growth in tangible book value per common share plus the
change in accumulated dividends, which we believe is the most appropriate measure of our Company’s
financial performance, and believe we have delivered superior performance in respect of this measure over
time.

Our core products include property catastrophe reinsurance, which we primarily write through our principal
operating subsidiary Renaissance Reinsurance, Syndicate 1458, and joint ventures, principally DaVinci,
Upsilon RFO and Top Layer Re; specialty reinsurance written through Renaissance Reinsurance,
RenaissanceRe Specialty Risks, RenaissanceRe Specialty U.S., Syndicate 1458 and DaVinci; and certain
insurance products primarily written through Syndicate 1458 or on an excess and surplus lines basis. We
believe that we are one of the world’s leading providers of property catastrophe reinsurance. We also
believe we have a strong position in certain specialty reinsurance lines of business and a growing presence
in the Lloyd’s marketplace. Our reinsurance and insurance products are principally distributed through
intermediaries, with whom we seek to cultivate strong long-term relationships. We continually explore
appropriate and efficient ways to address the risk needs of our clients. We have created, managed, and
continue to manage capital vehicles and may create additional risk bearing vehicles in the future. As our
product and geographical diversity increases, we may be exposed to new risks, uncertainties or sources of
volatility.

expenses, costs for research and development, and other miscellaneous costs, including those associated
with operating as a publicly traded company; (5) redeemable noncontrolling interest, which represents the
interest of third parties with respect to the net income (loss) of DaVinciRe and Medici; and (6) interest and
dividend costs related to our debt and preference shares. We are also subject to taxes in certain
jurisdictions in which we operate. Since the majority of our income is currently earned in Bermuda, which
does not have a corporate income tax, the tax impact to our operations has historically been minimal,
however, in the future, our net tax exposure may increase as our operations expand geographically.

Segments

In conjunction with changes in our management structure during 2013, including the appointment of a new
Chief Executive Officer, and changes in the mix of our reinsurance business, we revised our reportable
segments to: (1) Catastrophe Reinsurance, which includes catastrophe reinsurance and certain property
catastrophe joint ventures managed by our ventures unit; (2) Specialty Reinsurance, which includes
specialty reinsurance and certain specialty joint ventures managed by our ventures unit; and (3) Lloyd’s,
which includes reinsurance and insurance business written through Syndicate 1458. Previously, we
disclosed Reinsurance and Lloyd’s as our reportable segments. All prior periods presented have been
reclassified to conform to this presentation.

In addition, our Other category primarily reflects our strategic investments; investments unit; corporate
expenses; capital servicing costs; noncontrolling interests; results of our discontinued operations; and the
remnants of our Bermuda-based insurance operations not sold pursuant to our stock purchase agreement
with QBE. Refer to “Part I, Item 1. Business, Overview and Segments” for more information about our
segments.

Catastrophe Reinsurance Segment

Property catastrophe reinsurance is our traditional core business and is principally written for our own
account, for DaVinci and for other joint ventures such as Upsilon RFO. We believe we are one of the
world’s leading providers of this coverage, based on total catastrophe gross premiums written. This
coverage protects against large natural catastrophes, such as earthquakes, hurricanes and tsunamis, as
well as claims arising from other natural and man-made catastrophes such as winter storms, freezes,
floods, fires, wind storms, tornadoes, explosions and acts of terrorism. We offer this coverage to insurance
companies and other reinsurers primarily on an excess of loss basis. This means that we begin paying
when our customers’ claims from a catastrophe exceed a certain retained amount. In recent periods, our
catastrophe-exposed proportional reinsurance product offerings have grown and may continue to grow in
the future.

Our principal property catastrophe reinsurance products include catastrophe excess of loss reinsurance and
excess of loss retrocessional reinsurance. Our catastrophe reinsurance premiums are prone to significant
volatility due to the timing of contract inception and also due to the business being characterized by a
relatively small number of relatively large transactions.

Specialty Reinsurance Segment

Our Specialty Reinsurance segment writes, for our own account and for DaVinci, certain targeted classes of
business where we believe we have a sound basis for underwriting and pricing the risk that we assume.
Our portfolio includes various classes of business, such as aviation, casualty clash, catastrophe exposed
personal lines property, catastrophe exposed workers’ compensation, crop, energy, financial, mortgage
guaranty, political risk, surety, terrorism, trade credit, certain other casualty lines including directors and
officers liability, general liability, medical malpractice and professional indemnity, and other specialty lines of
reinsurance that we collectively refer to as specialty reinsurance. We believe that we are seen as a market
leader in certain of these classes of business. We are seeking to expand our specialty reinsurance
operations over time. In 2013, we organized RenaissanceRe Underwriting Managers U.S., a specialty
reinsurance agency domiciled in Connecticut, to provide specialty treaty reinsurance solutions on both a
quota share and excess of loss basis, as well as to write business on behalf of RenaissanceRe Specialty
U.S., a Bermuda-domiciled reinsurer launched in June 2013 which operates subject to U.S. federal income
tax, and Syndicate 1458. However, we cannot assure you that we will succeed in growing these operations
or that any growth we do attain will be profitable and contribute meaningfully to our results or financial
condition, particularly in light of current and forecasted market conditions. Our specialty reinsurance
business may be significantly impacted by a comparably small number of relatively large transactions.

Lloyd’s Segment

Our Lloyd’s segment includes insurance and reinsurance business written for our own account through
Syndicate 1458. The syndicate enhances our underwriting platform by providing access to Lloyd’s
extensive distribution network and worldwide licenses. RenaissanceRe CCL, an indirect wholly owned
subsidiary of RenaissanceRe, is the sole corporate member of Syndicate 1458. RSML, a wholly owned
subsidiary of RenaissanceRe, is the managing agent for Syndicate 1458. We anticipate that Syndicate
1458’s absolute and relative contributions to our consolidated results of operations will have a meaningful
impact over time, although we cannot assure you we will succeed in executing our growth strategy in
respect of Syndicate 1458, or that its results will be favorable.

Syndicate 1458 offers a range of property and casualty insurance and reinsurance products including, but
not limited to, direct and facultative property, property catastrophe, agriculture, medical malpractice, general
liability and professional indemnity. Syndicate 1458 may seek to expand its coverages and capacity over
time. As with our catastrophe and specialty reinsurance businesses, Syndicate 1458 frequently provides
coverage for relatively large limits or exposures, and thus it is subject to potential significant claims volatility.

Other

New Business

into further risk-related coverages, services and products. Generally, we focus on underwriting or trading
risks where reasonably sufficient data may be available, and where our analytical abilities may provide us a
competitive advantage, so that we may seek to model estimated probabilities of losses and returns in
accordance with our approach in respect of our then current portfolio of risks.

We regularly review potential strategic transactions and investments that might improve our portfolio of
business, enhance or focus our strategies, expand our distribution or capabilities, or to seek other benefits.
In evaluating potential new ventures or investments, we generally seek an attractive estimated return on
equity, the ability to develop or capitalize on a competitive advantage, and opportunities which we believe
will not detract from our core operations. While we regularly review potential strategic transactions and
investments, and periodically engage in discussions regarding possible transactions and investments, there
can be no assurance that we will complete any such transaction or investment, or that any such transaction
or investment would be successful or materially enhance our results of operations or financial condition.
We believe that our ability to potentially attract investment and operational opportunities is supported by our
strong reputation and financial resources, and by the capabilities and track record of our ventures unit.

Risk Management

We seek to develop and effectively utilize sophisticated computer models and other analytical tools to
assess and manage the risks that we underwrite and attempt to optimize our portfolio of reinsurance and
insurance contracts and other financial risks. Our policies, procedures, tools and resources to monitor and
assess our operational risks companywide, as well as our global enterprise-wide risk management
practices, are overseen by our Chief Risk Officer, who reports directly to our Chief Financial Officer.

Since 1993, we have developed and continuously seek to improve our proprietary, computer-based pricing
and exposure management system, REMS©. We believe that REMS©, as updated from time to time, is a
more robust underwriting and risk management system than is currently commercially available elsewhere
in the reinsurance industry and offers us a significant competitive advantage. REMS© was originally
developed to analyze catastrophe risks, though we continuously seek ways to enhance the system in order
to analyze other classes of risk. For information related to Risk Management, refer to “Part I, Item 1.
Business, Underwriting and Enterprise Risk Management”.

Discontinued Operations

REAL

On August 30, 2013, we entered into a purchase agreement with Munich to sell REAL. REAL offered
certain derivative-based risk management products primarily to address weather and energy risk and
engaged in hedging and trading activities related to those transactions. On October 1, 2013, we closed the
sale of REAL to Munich. We have classified the assets and liabilities associated with this transaction as
held for sale and, at December 31, 2013, there were no remaining assets or liabilities related to REAL
included on our consolidated balance sheet. The financial results for these operations have been
presented in our consolidated financial statements as “discontinued operations” for all periods presented.
Except as explicitly described as held for sale or as discontinued operations, and unless otherwise noted,
all discussions and amounts presented herein relate to our continuing operations. Prior years presented
have been reclassified to conform to this new presentation.

Consideration for the transaction was $60.0 million, paid in cash at closing, subject to post-closing
adjustments for certain tax and other items. We recorded a loss on sale of $8.8 million in conjunction with
the sale, including related direct expenses to date.

U.S.-Based Insurance Operations

During the fourth quarter of 2010, we made the strategic decision to divest substantially all of our U.S.-
based insurance operations in order to focus on the business encompassed within our then Reinsurance
and Lloyd’s segments and our other businesses.

On November 18, 2010, we entered into a stock purchase agreement with QBE to sell substantially all of
our U.S.-based insurance operations, including our U.S. property and casualty business underwritten
through managing general agents, our crop insurance business underwritten through Agro National Inc.

(“Agro National”), our commercial property insurance operations and our claims operations. We have
classified the assets and liabilities associated with this transaction as held for sale and, at December 31,
2013, there were no remaining assets or liabilities related to our former U.S.-based insurance operations
included on our consolidated balance sheet. The financial results for these operations have been
presented as discontinued operations in our Consolidated Statements of Operations.

Consideration for the transaction was book value at December 31, 2010, for the aforementioned
businesses, payable in cash at closing and subject to adjustment for certain tax and other items. The
transaction closed on March 4, 2011 and we received net consideration of $269.5 million.

Pursuant to the stock purchase agreement, RenaissanceRe’s U.S.-based insurance operations sold to QBE
were subject to a post-closing review following December 31, 2011 of the net reserve for claims and claim
expenses for loss events occurring on or prior to December 31, 2010 (the “Reserve Collar”). Effective May
23, 2012, RenaissanceRe and QBE reached an agreement in respect of the Reserve Collar, and
RenaissanceRe paid QBE the sum of $9.0 million on June 1, 2012, representing full and final settlement of
the Reserve Collar. See “Note 3. Discontinued Operations in our Notes to Consolidated Financial
Statements” for additional information.

SUMMARY OF CRITICAL ACCOUNTING ESTIMATES

Claims and Claim Expense Reserves

General Description

The following table summarizes our claims and claim expense reserves by line of business and split
between case reserves, additional case reserves and IBNR:

At December 31, 2013

(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

At December 31, 2012
(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

Case
Reserves

Additional
Case Reserves

IBNR

Total

430,166 $
113,188
45,355
14,915

603,624 $

177,518 $

81,251
14,265
2,324
275,358 $

173,303 $
311,829
158,747
40,869

780,987
506,268
218,367
58,108
684,748 $ 1,563,730

706,264 $
111,234
29,260
17,016

863,774 $

222,208 $

80,971
10,548
8,522
322,249 $

255,786 $ 1,184,258
478,313
286,108
149,470
109,662
67,336
41,798
693,354 $ 1,879,377

Activity in the liability for unpaid claims and claim expenses is summarized as follows:

Year ended December 31,

(in thousands)
Net reserves as of January 1
Net incurred related to:

Current year
Prior years

Total net incurred
Net paid related to:

Current year
Prior years
Total net paid
Net reserves as of December 31
Reinsurance recoverable as of December 31
Gross reserves as of December 31

2013

2012

2011

$ 1,686,865 $ 1,588,325 $ 1,156,132

315,241
(143,954)
171,287

483,180
(157,969)
325,211

993,168
(131,989)
861,179

32,212
363,235
395,447
1,462,705
101,025

299,299
129,687
428,986
1,588,325
404,029
$ 1,563,730 $ 1,879,377 $ 1,992,354

84,056
142,615
226,671
1,686,865
192,512

Our estimates of losses from large events are based on factors including currently available information
derived from the Company’s claims information from certain customers and brokers, industry assessments
of losses from the events, proprietary models, and the terms and conditions of our contracts. The
uncertainty of our estimates for certain of these large events is additionally impacted by the preliminary
nature of the information available, the magnitude and relative infrequency of the events, the expected
duration of the respective claims development period, inadequacies in the data provided to the relevant
date by industry participants and the potential for further reporting lags or insufficiencies (particularly in
respect of our current reserves arising from the Chilean, 2010 New Zealand, 2011 New Zealand and
Tohoku Earthquakes); and in the case of Storm Sandy and the Thailand Floods, significant uncertainty as to
the form of the claims and legal issues, under the relevant terms of insurance and reinsurance contracts. In
addition, a significant portion of the net claims and claim expenses associated with Storm Sandy and the
New Zealand and Tohoku Earthquakes are concentrated with a few large clients and therefore the loss
estimates for these events may vary significantly based on the claims experience of those clients. Loss
reserve estimation in respect of our retrocessional contracts poses further challenges compared to directly
assumed reinsurance. A significant portion of our reinsurance recoverable relates to the New Zealand and
Tohoku Earthquakes. There is inherent uncertainty and complexity in evaluating loss reserve levels and
reinsurance recoverable amounts, due to the nature of the losses relating to earthquake events, including
that loss development time frames tend to take longer with respect to earthquake events. The contingent
nature of business interruption and other exposures will also impact losses in a meaningful way, especially
in respect of our current reserves with regard to Storm Sandy, the Tohoku Earthquake and the Thailand
Floods, which we believe may give rise to significant complexity in respect of claims handling, claims

adjustment and other coverage issues, over time. Given the magnitude and relatively recent occurrence of
these large events, meaningful uncertainty remains regarding total covered losses for the insurance
industry and, accordingly, several of the key assumptions underlying our loss estimates. In addition, our
actual net losses from these events may increase if our reinsurers or other obligors fail to meet their
obligations.

Prior Year Development of Reserve for Net Claims and Claim Expenses

As detailed in the table and discussed in further detail below, changes to prior year estimated claims
reserves increased our net income by $144.0 million during the year ended December 31, 2013, (2012 -
increased our net income by $158.0 million, 2011 - decreased our net loss by $132.0 million), excluding the
consideration of changes in reinstatement premium, profit commissions, redeemable noncontrolling interest
- DaVinciRe, equity in net claims and claim expenses of Top Layer Re and income tax.

Year ended December 31,

2013

2012

2011

(in thousands)
Catastrophe

Specialty
Lloyd’s
Other

102,037 $

110,568 $

34,111
8,256
(450)

34,146
16,202
(2,947)

59,137
77,761
(478)
(4,431)

Total favorable development of prior accident years net

claims and claim expenses

143,954 $

157,969 $

131,989

Our reserving techniques, assumptions and processes differ between our Catastrophe Reinsurance,
Specialty Reinsurance and Lloyd’s segments. Following is a discussion of the risks we insure and reinsure,
the reserving techniques, assumptions and processes we follow to estimate our claims and claim expense
reserves, our current estimates versus our initial estimates of our claims reserves, and the sensitivity
analysis we apply with respect to our key reserving judgments for each of our segments.

Catastrophe Reinsurance Segment

Within our Catastrophe Reinsurance segment, we principally write property catastrophe excess of loss
reinsurance contracts to insure insurance and reinsurance companies against natural and man-made
catastrophes. Under these contracts, we indemnify an insurer or reinsurer when its aggregate paid claims
and claim expenses from a single occurrence of a covered peril exceed the attachment point specified in
the contract, up to an amount per loss specified in the contract. In recent periods, our catastrophe-exposed
proportional reinsurance product offerings have grown and may continue to grow in the future. Our most
significant exposure is to losses from earthquakes and hurricanes and other windstorms, although we are
also exposed to claims arising from other catastrophes, such as tsunamis, freezes, floods, fires, tornadoes,
explosions and acts of terrorism. Our predominant exposure under such coverage is to property damage.
However, other risks, including business interruption and other non-property losses, may also be covered
under our property catastrophe reinsurance contracts when arising from a covered peril. Our coverages are
offered on either a worldwide basis or are limited to selected geographic areas.

Coverage can also vary from “all property” perils to limited coverage on selected perils, such as “earthquake
only” coverage. We also enter into retrocessional contracts that provide property catastrophe coverage to
other reinsurers or retrocedants. This coverage is generally in the form of excess of loss retrocessional
contracts and may cover all perils and exposures on a worldwide basis or be limited in scope to selected
geographic areas, perils and/or exposures. The exposures we assume from retrocessional business can
change within a contract term as the underwriters of a retrocedant may alter their book of business after the
retrocessional coverage has been bound. We also offer dual trigger reinsurance contracts which require us
to pay claims based on claims incurred by insurers and reinsurers in addition to the estimate of insured
industry losses as reported by referenced statistical reporting agencies.

Our property catastrophe reinsurance business is generally characterized by loss events of low frequency
and high severity. Initial reporting of paid and incurred claims in general, tends to be relatively prompt. We
consider this business “short-tail” as compared to the reporting of claims for “long-tail” products, which
tends to be slower. However, the timing of claims payment and reporting also varies depending on various
factors, including: whether the claims arise under reinsurance of primary insurance companies or
reinsurance of other reinsurance companies; the nature of the events (e.g., hurricanes, earthquakes or
terrorism); the geographic area involved; post-event inflation which may cause the cost to repair damaged
property to increase significantly from current estimates, or for property claims to remain open for a longer
period of time, due to limitations on the supply of building materials, labor and other resources; complex
policy coverage and other legal issues; and the quality of each client’s claims management and reserving
practices. Management’s judgments regarding these factors are reflected in our reserve for claims and
claim expenses.

Reserving for most of our property catastrophe reinsurance business does not involve the use of traditional
actuarial techniques. Rather, claims and claim expense reserves are estimated by management after a
catastrophe occurs by completing an in-depth analysis of the individual contracts which may potentially be
impacted by the catastrophic event. The in-depth analysis generally involves: 1) estimating the size of
insured industry losses from the catastrophic event; 2) reviewing our portfolio of reinsurance contracts to
identify those contracts which are exposed to the catastrophic event; 3) reviewing information reported by
customers and brokers; 4) discussing the event with our customers and brokers; and 5) estimating the
ultimate expected cost to settle all claims and administrative costs arising from the catastrophic event on a
contract-by-contract basis and in aggregate for the event. Once an event has occurred, during the then
current reporting period we record our best estimate of the ultimate expected cost to settle all claims arising
from the event. Our estimate of claims and claim expense reserves is then determined by deducting
cumulative paid losses from our estimate of the ultimate expected loss for an event and our estimate of
IBNR is determined by deducting cumulative paid losses, case reserves and additional case reserves from
our estimate of the ultimate expected loss for an event. Once we receive a notice of loss or payment
request under a catastrophe reinsurance contract, we are generally able to process and pay such claims
promptly.

Because the events from which claims arise under policies written by our property catastrophe reinsurance
business are typically prominent, public occurrences such as hurricanes and earthquakes, we are often
able to use independent reports as part of our loss reserve estimation process. We also review catastrophe
bulletins published by various statistical reporting agencies to assist us in determining the size of the
industry loss, although these reports may not be available for some time after an event. In addition to the
loss information and estimates communicated by cedants and brokers, we also use industry information
which we gather and retain in our REMS© modeling system. The information stored in our REMS©
modeling system enables us to analyze each of our policies in relation to a loss and compare our estimate
of the loss with those reported by our policyholders. The REMS© modeling system also allows us to
compare and analyze individual losses reported by policyholders affected by the same loss event. Although
the REMS© modeling system assists with the analysis of the underlying loss and provides us with the
information and ability to perform increased analysis, the estimation of claims resulting from catastrophic
events is inherently difficult because of the variability and uncertainty associated with property catastrophe
claims and the unique characteristics of each loss.

For smaller events including localized severe weather events such as windstorms, hail, ice, snow, flooding,
freezing and tornadoes, which are not necessarily prominent, public occurrences, we initially place greater
reliance on catastrophe bulletins published by statistical reporting agencies to assist us in determining what
events occurred during the reporting period than we do for large events. This includes reviewing

catastrophe bulletins published by Property Claim Services for U.S. catastrophes. We set our initial
estimates of reserves for claims and claim expenses for these smaller events based on a combination of
our historical market share for these types of losses and the estimate of the total insured industry property
losses as reported by statistical reporting agencies, although we may make significant adjustments based
on our current exposure to the geographic region involved as well as the size of the loss and the peril
involved. This approach supplements our approach for estimating losses for larger catastrophes, which as
discussed above, includes discussions with brokers and ceding companies, reviewing individual contracts
impacted by the event, and modeling the loss in our REMS© system. Approximately one year from the date
of loss for these small events, we estimate IBNR for these events by using the paid Bornhuetter-Ferguson
actuarial method. The loss development factors for the paid Bornhuetter-Ferguson actuarial method are
selected based on a review of our historical experience and these factors are reviewed at least annually.
There were no changes to our paid loss development factors over the last three years.

In general, our property catastrophe reinsurance reserves for our more recent reinsured catastrophic events
are subject to greater uncertainty and, therefore, greater potential variability, and are likely to experience
material changes from one period to the next. This is due to the uncertainty as to the size of the industry
losses from the event, uncertainty as to which contracts have been exposed to the catastrophic event,
uncertainty due to complex legal and coverage issues that can arise out of large or complex catastrophic
events such as the events of September 11, 2001, Hurricane Katrina and Storm Sandy, and uncertainty as
to the magnitude of claims incurred by our customers. As our property catastrophe reinsurance claims age,
more information becomes available and we believe our estimates become more certain, although there is
no assurance this trend will continue in the future.

Prior Year Development of Reserve for Net Claims and Claim Expenses

Within our property catastrophe reinsurance business, we seek to review substantially all of our claims and
claim expense reserves quarterly. Our quarterly review procedures include identifying events that have
occurred up to the latest balance sheet date, determining our best estimate of the ultimate expected cost to
settle all claims and administrative costs associated with those new events which have arisen during the
reporting period, reviewing the ultimate expected cost to settle claims and administrative costs associated
with those events which occurred during previous periods, and considering new estimation techniques,
such as additional actuarial methods or other statistical techniques, that can assist us in developing a best
estimate. This process is judgmental in that it involves reviewing changes in paid and reported losses each
period and adjusting our estimates of the ultimate expected losses for each event if there are developments
that are different from our previous expectations. If we determine that adjustments to an earlier estimate
are appropriate, such adjustments are recorded in the period in which they are identified. As noted above,
the level of our claims and claim expenses associated with certain catastrophes can be very large. As a
result, small percentage changes in the estimated ultimate claims from large catastrophe events can
significantly impact our reserves for claims and claim expenses in subsequent periods.

The following table details the development of our liability for unpaid claims and claim expenses for the
Catastrophe Reinsurance segment for the year ended December 31, 2013 split between catastrophe net
claims and claim expenses and attritional net claims and claim expenses:

Year ended December 31, 2013

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events
Storm Sandy (2012)

Tohoku Earthquake and Tsunami (2011)

Hurricanes Gustav & Ike (2008)

New Zealand Earthquake (2011)

Windstorm Kyrill (2007)

Hurricane Isaac (2012)

New Zealand Earthquake (2010)

Other

Total large catastrophe events

Small catastrophe events

U.S. PCS 83 Wind and Thunderstorm (2012)

U.S. PCS 76 Wind and Thunderstorm (2012)

U.S. PCS 70 Wind and Thunderstorm (2012)

Other

Total small catastrophe events

Catastrophe
Reinsurance
Segment

44,460

18,033

16,261

10,944

8,244

(2,610)

(11,040)

776

85,068

3,500

300

(8,225)

21,394

16,969

Total favorable development of prior accident years net claims and claim expenses

102,037

The favorable development of prior accident years net claims and claim expenses within our Catastrophe
Reinsurance segment in 2013 of $102.0 million was primarily due to $44.5 million, $18.0 million, $16.3
million and $10.9 million of favorable development related to reductions in the expected ultimate net loss for
Storm Sandy, the Tohoku Earthquake, the 2008 Hurricanes and the 2011 New Zealand Earthquake,
respectively, as reported claims came in better than expected, and $34.2 million of net favorable
development related to a number of other catastrophes principally the result of reported claims coming in
less than expected, resulting in decreases to the ultimate claims for these events through the application of
our formulaic actuarial reserving methodology. Partially offsetting the reductions noted above was adverse
development on the 2010 New Zealand Earthquake, U.S. PCS 70 and Hurricane Isaac of $11.0 million,$8.2
million and $2.6 million, respectively, associated with an increase in reported gross ultimate losses.

The following table details the development of our liability for unpaid claims and claim expenses for our
Catastrophe Reinsurance segment for the year ended December 31, 2012:

Year ended December 31, 2012

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events
Chile Earthquake (2010)

Hurricanes Gustav & Ike (2008)

U.K. Floods (2007)

Hurricanes Katrina, Rita and Wilma (2005)

Hurricane Irene (2011)

Thailand Floods (2011)

Tohoku Earthquake and Tsunami (2011)

Windstorm Kyrill (2007)

New Zealand Earthquake (2010)

New Zealand Earthquake (2011)

Other

Total large catastrophe events

Small catastrophe events
Danish Floods (2011)

U.S. PCS 63 Winter Storm (2011)

U.S. PCS 42 Winter Storm (2011)

U.S. PCS 53 Winter Storm (2011)

Other

Total small catastrophe events

Catastrophe
Reinsurance
Segment

24,575

17,541

17,271

6,420

4,630

3,933

3,896

3,417

(3,570)

(17,912)

2,542

62,743

5,000

2,560

2,558

32,707

47,825

Total favorable development of prior accident years claims and claim expenses

110,568

The favorable development of prior accident years claims and claim expenses within our Catastrophe
Reinsurance segment in 2012 of $110.6 million was primarily due to net reductions of $84.2 million arising
from the estimated ultimate claims of large catastrophe events, including the 2010 Chilean Earthquake, the
2008 Hurricanes, the 2007 U.K. Flooding, the 2005 Hurricanes, Hurricane Irene of 2011, the 2011 Thailand
Floods and the Tohoku Earthquake, as reported claims came in better than expected. The remainder of the
favorable development of prior accident years claims and claim expenses of $47.8 million was due to a
reduction in ultimate claims on a number of relatively small catastrophes, all principally the result of reported
claims coming in less than expected, principally resulting in formulaic decreases to the ultimate claims for
these events. Partially offsetting the reductions noted above was a $17.9 million and $3.6 million increase
in net claims and claim expenses from the 2011 and 2010 New Zealand Earthquake, respectively, primarily
as a result of increased cedant gross ultimate loss estimates.

The following table details the development of our liability for unpaid claims and claim expenses for our
Catastrophe Reinsurance segment reinsurance unit for the year ended December 31, 2011:

Year ended December 31, 2011

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events

Tropical Cyclone Tasha (2010)

Hurricanes Katrina, Rita and Wilma (2005)

Chilean Earthquake (2010)

World Trade Center (2001)

Hurricanes Charley, Francis, Ivan and Jeanne (2004)

U.K. Floods (2007)

Windstorm Kyrill (2007)

New Zealand Earthquake (2010)

Total large catastrophe events

Small catastrophe events

U.S. PCS 21 Wildland Fire (2007)

U.S. PCS 33 Great Midwest Storm (2010)

U.S. PCS 31 Wind and Thunderstorm (2010)

U.S. PCS 96 Wind and Thunderstorm (2010)

Other

Total small catastrophe events

Catastrophe
Reinsurance
Segment

13,922

10,008

8,455

4,701

4,076

3,635

2,494

(15,179)

32,112

4,554

3,125

3,039

2,288

14,019

27,025

59,137

Total favorable development of prior accident years net claims and claim expenses

The favorable development of prior accident years net claims and claim expenses within our Catastrophe
Reinsurance segment in 2011 of $59.1 million was due to net reductions of $47.3 million arising from the
estimated ultimate claims of large catastrophe events, including the 2005 Hurricanes and the World Trade
Center, for which the claims are principally paid and the amount of additional reported claims has slowed
considerably and therefore the ultimate claims were reduced, and Tropical Cyclone Tasha and the Chilean
Earthquake, as reported claims came in better than expected in 2011. Partially offsetting the above
reductions in estimated ultimate claims during 2011, we increased our estimated ultimate claims for the
2010 New Zealand Earthquake by $15.2 million due to additional claims reporting information being
available to us. The remainder of the favorable development of prior accident years claims and claim
expenses of $27.0 million was due to a reduction in ultimate claims on a large number of relatively small
catastrophes, all principally the result of reported claims coming in less than expected, resulting in formulaic
decreases to the ultimate claims and claim expenses for these events.

Actual Results vs. Initial Estimates

The table below summarizes our initial assumptions and changes in those assumptions for claims and claim
expense reserves within our Catastrophe Reinsurance segment. As discussed above, the key assumption
in estimating reserves for our Catastrophe Reinsurance segment is our estimate of ultimate claims and
claim expenses. The table shows our initial estimates of ultimate claims and claim expenses for each
accident year and how these initial estimates have developed over time. The initial estimate of accident
year claims and claim expenses represents our estimate of the ultimate settlement and administration costs
for claims incurred from catastrophic events occurring during a particular accident year, and as reported as
of December 31 of that year. The re-estimated ultimate claims and claim expenses as of December 31,
2011, 2012 and 2013, represent our revised estimates as reported as of those dates. The cumulative
favorable (adverse) development shows how our most recent estimates as reported at December 31, 2013
differ from our initial accident year estimates. Favorable development implies that our current estimates are

lower than our initial estimates while adverse development implies that our current estimates are higher
than our original estimates. Total reserves as of December 31, 2013 reflect the unpaid portion of our
estimates of gross ultimate claims and claim expenses. The table is presented on a gross basis and
therefore does not include the benefit of reinsurance recoveries. It also does not consider the impact of loss
related premium or redeemable noncontrolling interest – DaVinciRe.

Actual vs. Initial Estimated Property Catastrophe Reinsurance Claims and Claim Expense Reserve Analysis

(in thousands,
except percentages)

Re-estimated Claims and
Claim Expenses
as of December 31,

Initial
Estimate
of
Accident
Year
Claims
and Claim
Expenses

Accident
Year

Cumulative
Favorable
(Adverse)
Development

% Decrease
(Increase)
from
Initial
Ultimate

Claims and
Claim
Expense
Reserves
as of
December
31, 2013

% of
Claims
and Claim
Expenses
Unpaid as
of
December
31, 2013

2011

2012

2013

1994

1995

1996
1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

100,816

137,498

137,130

72,561

67,671
43,050

129,171

267,981

54,600

257,285

155,573

126,312

61,345

45,209
9,040

151,951

198,257

17,803

205,078

65,436

69,057

61,345

45,219
9,041

152,038

197,849

17,787

201,140

65,118

67,608

762,392
1,473,974

815,773

815,915

1,272,485

1,263,198

121,754

245,892

599,481

90,800

385,207
1,243,138

345,776

133,187
$ 6,676,621

60,313

138,329

481,878

47,189

355,564

58,392

116,568

455,909

42,288

321,522

1,243,138

1,246,752

1,218,178

—

345,776

—

284,279

133,187

$ 5,375,343

$ 5,620,595

$ 5,639,491

137,093
61,404

45,217
9,041

152,016

197,703
17,747

200,558
65,008

67,398

814,704

1,260,825
57,456

107,872

436,055
40,905

332,845

(36,277)
11,157

22,454
34,009

(22,845)
70,278
36,853

56,727

90,565

58,914

(52,312)

213,149
64,298

138,020

163,426
49,895

52,362

24,960

61,497

—
1,037,130

(36.0)% $

15.4 %

33.2 %
79.0 %

(17.7)%

26.2 %

67.5 %

22.0 %

58.2 %

46.6 %

(6.9)%

14.5 %

52.8 %

56.1 %

27.3 %

55.0 %

13.6 %

2.0 %

17.8 %

— %

274

11
5

546

236

12
7,229

164

595

2,532

1,301

8,626

18,183

3,207

151,665

336,835

153,528
96,017

15.8 % $

780,987

0.2%
—%
—%
0.1%

0.4%

0.1%

3.6%

0.3%
—%
0.1%

0.2%

2.3%

8.0%

4.2%

7.8%
45.6%
27.7%
54.0%
72.1%
13.8%

As quantified in the table above, since the inception of the Company in 1993, while we have experienced
adverse development from time to time, on a cumulative basis we have experienced $1,037.1 million of net
favorable development on the run-off of our gross reserves within our Catastrophe Reinsurance segment.
This represents 15.8% of our initial estimated gross claims and claim expenses for accident years 2012 and
prior of $6.5 billion and is calculated based on our estimates of claims and claim expense reserves as of
December 31, 2013, compared to our initial estimates of ultimate claims and claim expenses, as of the end
of each accident year. As described above, given the complexity in reserving for claims and claims
expenses associated with catastrophe losses for property catastrophe excess of loss reinsurance contracts,
we have experienced development, both favorable and unfavorable, in any given accident year. For
example, our 2005 accident year developed favorably by $213.1 million, which is 14.5% better than our
initial estimates of claims and claim expenses for the 2005 accident year as estimated as of December 31,
2005, while our 2004 accident year developed unfavorably by $52.3 million, or negative 6.9%. On a net
basis, our cumulative favorable or unfavorable development is generally reduced by offsetting changes in
our reinsurance recoverables, as well as changes to loss related premiums such as reinstatement
premiums, and redeemable noncontrolling interest for changes in claims and claim expenses that impact
DaVinciRe, all of which generally move in the opposite direction to changes in our ultimate claims and claim
expenses.

The percentage of claims unpaid at December 31, 2013 for each accident year reflects both the speed at
which claims and claim expenses for each accident year have been paid and our estimate of claims and
claim expenses for that accident year. As seen above, claims and claim expenses for the 2005 and prior
accident years have generally been paid, with the exception of 2001 which has 3.6% remaining unpaid.
This is driven in part by the mix of our business, which primarily included property catastrophe excess of
loss reinsurance for personal lines property coverage, rather than commercial property coverage or
retrocessional coverage, and the speed of the settlement and payment of claims by our underlying cedants.
In contrast, our 2001 accident year, which includes losses from the events of September 11, 2001, includes
a higher mix of commercial business and retrocessional coverage where the underlying claims of our
cedants tend to be settled and paid more slowly. In addition, our 2007 accident year has also paid out more
slowly due to increased complexity surrounding claims of our underlying cedants as a result of the notable
losses during 2007, including European windstorm Kyrill. As noted in the table above, the percentage of
claims and claims expenses unpaid as of December 31, 2013 related to more recent years, such as 2010
through 2013, range from 45.6% to 72.1%, with higher percentages driven by the recency of these accident
years, combined with the complexity surrounding claims of our underlying cedants and the nature of the
events, such as the 2010 and 2011 New Zealand Earthquakes, the Tohoku Earthquake, the Thailand Floods
and Storm Sandy.

Sensitivity Analysis

The table below shows the impact on our ultimate claims and claim expenses, net income and
shareholders’ equity as of and for the year ended December 31, 2013 of reasonably likely changes to our
estimates of ultimate losses for claims and claim expenses incurred from catastrophic events within our
Catastrophe Reinsurance segment. The reasonably likely changes are based on an historical analysis of
the period-to-period variability of our ultimate costs to settle claims from catastrophic events, giving due
consideration to changes in our reserving practices over time. In general, our claim reserves for our more
recent catastrophic events are subject to greater uncertainty and, therefore, greater variability and are likely
to experience material changes from one period to the next. This is due to the uncertainty as to the size of
the industry losses from the event, uncertainty as to which contracts have been exposed to the catastrophic
event, and uncertainty as to the magnitude of claims incurred by our clients. As our claims age, more
information becomes available and we believe our estimates become more certain, although there is no
assurance this trend will continue in the future. As a result, the sensitivity analysis below is based on the
age of each accident year, our current estimated ultimate claims and claim expenses for the catastrophic
events occurring in each accident year, and the reasonably likely variability of our current estimates of
claims and claim expenses by accident year. The impact on net income and shareholders’ equity assumes
no increase or decrease in reinsurance recoveries, loss related premium or redeemable noncontrolling
interest – DaVinciRe.

Property Catastrophe Reinsurance Claims and Claim Expense Reserve Sensitivity Analysis

Ultimate Claims
and
Claim
Expenses at
December 31,
2013

$ 6,145,076 $
5,639,491
$ 5,133,906 $

$ Impact of
Change on
Ultimate
Claims
and Claim
Expenses
at
December 31,
2013
505,585
—
(505,585)

% Impact of
Change
on Reserve for
Claims
and Claim
Expenses
at
December 31,
2013

% Impact of
Change on Net
Income for
the Year Ended
December 31,
2013

% Impact of
Change on
Shareholders’
Equity at
December 31,
2013

32.3 %
— %
(32.3)%

(60.1)%
— %
60.1 %

(12.9)%
— %
12.9 %

(in thousands, except
percentages)
Higher
Recorded
Lower

be liable for events for which we have not estimated claims and claim expenses or for exposures we do not
currently believe are covered under our policies. These changes could result in significantly larger changes
to our estimated ultimate claims and claim expenses, net income and shareholders’ equity than those noted
above. We also caution the reader that the above sensitivity analysis is not used by management in
developing our reserve estimates and is also not used by management in managing the business.

Specialty Reinsurance Segment

Within our Specialty Reinsurance segment, we write a number of reinsurance lines such as aviation,
casualty clash, catastrophe exposed personal lines property, catastrophe exposed workers’ compensation,
crop, energy, financial, mortgage guaranty, political risk, surety, terrorism, trade credit, certain other casualty
lines including directors and officers liability, general liability, medical malpractice and professional
indemnity, and other specialty lines of reinsurance that we collectively refer to as specialty reinsurance. We
offer our specialty reinsurance products principally on an excess of loss basis, as described above with
respect to our property catastrophe reinsurance products, and we also provide specialty protection or
proportional coverage which we expect to grow on an absolute or relative basis within this segment in the
future. In a proportional reinsurance arrangement (also referred to as quota share reinsurance or pro-rata
reinsurance), the reinsurer shares a proportional part of the original premiums and losses of the reinsured.
We offer our specialty reinsurance products to insurance companies and other reinsurance companies and
provide coverage for specific geographic regions or on a worldwide basis.

Our Specialty Reinsurance segment can generally be characterized as providing coverage for low
frequency and high severity losses, similar to our property catastrophe reinsurance business. As with our
property catastrophe reinsurance business, our specialty reinsurance contracts frequently provide coverage
for relatively large limits or exposures. As a result of the foregoing, our specialty reinsurance business is
subject to significant claims volatility. In periods of low claims frequency or severity, our results will generally
be favorably impacted while in periods of high claims frequency or severity our results will generally be
negatively impacted. We have more recently positioned RenaissanceRe Specialty Risks to accept a wider
range of quota share risks, facilitating our efforts to expand trading relationships with core clients via a
separate, highly-rated balance sheet. While we remain focused on underwriting discipline, and are seeking
to remain focused on opportunities amenable to stochastic representation and supported by strong data
and analytics, this expanded product suite through RenaissanceRe Specialty Risks may pose new,
unmodelled or unforeseen risks for which we may not be adequately compensated and may also result in a
higher level of attritional claims and claim expenses.

Our processes and methodologies in respect of loss estimation for the coverages we offer through our
specialty reinsurance operation differ from those used for our property catastrophe-oriented coverages. For
example, our specialty reinsurance coverages are more likely to be impacted by factors such as long-term
inflation and changes in the social and legal environment, which we believe gives rise to greater uncertainty
in our claims reserves. Moreover, in reserving for our specialty reinsurance coverages we do not have the
benefit of a significant amount of our own historical experience in certain lines of business and may have
little or no related corporate reserving history in new lines of business. We believe this makes our Specialty
Reinsurance segment reserving subject to greater uncertainty than our Catastrophe Reinsurance segment.

When initially developing our reserving techniques for our specialty reinsurance coverages, we considered
estimating reserves utilizing several actuarial techniques such as paid and reported loss development
methods. We elected to use the Bornhuetter-Ferguson actuarial method because this method is
appropriate for lines of business, such as our specialty reinsurance business, where there is a lack of
historical claims experience. This method allows for greater weight to be applied to expected results in
periods where little or no actual experience is available, and, hence, is less susceptible to the potential
pitfall of being excessively swayed by one year or one quarter of actual paid and/or reported loss data. This
method uses initial expected loss ratio expectations to the extent that the expected paid or reported losses
are zero, and it assumes that past experience is not fully representative of the future. As our reserves for
claims and claim expenses age, and actual claims experience becomes available, this method places less
weight on expected experience and places more weight on actual experience. This experience, which
represents the difference between expected reported claims and actual reported claims is reflected in the
respective reporting period as a change in estimate. We reevaluate our actuarial reserving techniques on a
periodic basis.

The utilization of the Bornhuetter-Ferguson actuarial method requires us to estimate an expected ultimate
claims and claim expense ratio and select an expected loss reporting pattern. We select our estimates of
the expected ultimate claims and claim expense ratios and expected loss reporting patterns by reviewing
industry results for similar business and adjusting for the terms of the coverages we offer. The estimated
expected claims and claim expense ratio may be modified to the extent that reported losses at a given point
in time differ from what would be expected based on the selected loss reporting pattern. Our estimate of
IBNR is the product of the premium we have earned, the initial expected ultimate claims and claim expense
ratio and the percentage of estimated unreported losses. In addition, certain of our specialty reinsurance
coverages may be impacted by natural and man-made catastrophes. We estimate claim reserves for these
losses after the event giving rise to these losses occurs, following a process that is similar to our
Catastrophe Reinsurance segment described above.

Prior Year Development of Reserve for Net Claims and Claim Expenses

Within our specialty reinsurance business, we seek to review substantially all of our claims and claim
expense reserves quarterly. Typically, our quarterly review procedures include reviewing paid and reported
claims in the most recent reporting period, reviewing the development of paid and reported claims from prior
periods, and reviewing our overall experience by underwriting year and in the aggregate. We monitor our
expected ultimate claims and claim expense ratios and expected loss reporting assumptions on a quarterly
basis and compare them to our actual experience. These actuarial assumptions are generally reviewed
annually, based on input from our actuaries, underwriters, claims personnel and finance professionals,
although adjustments may be made more frequently if needed. Assumption changes are made to adjust for
changes in the pricing and terms of coverage we provide, changes in industry results for similar business,
as well as our actual experience, to the extent we have enough data to rely on our own experience. If we
determine that adjustments to an earlier estimate are appropriate, such adjustments are recorded in the
period in which they are identified.

The following table details the development of our liability for unpaid claims and claim expenses for our
Specialty Reinsurance segment for the year ended December 31, 2013 split between catastrophe net
claims and claim expenses and attritional net claims and claim expenses:

Year ended December 31, 2013

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events

Tohoku Earthquake and Tsunami (2011)

New Zealand Earthquake (2010)

Other

Total large catastrophe events

Total catastrophe net claims and claim expenses

Attritional net claims and claim expenses

Bornhuetter-Ferguson actuarial method - actual reported claims less than expected

claims

Actuarial assumption changes

Total attritional net claims and claim expenses

Total favorable development of prior accident years net claims and claim expenses

Specialty
Reinsurance
Segment

1,000

(300)

1,763

2,463

21,216

10,432

31,648

34,111

The favorable development of prior accident years net claims and claim expenses within our Specialty
Reinsurance segment in 2013 of $34.1 million was primarily driven by $10.4 million associated with
actuarial assumption changes in the first quarter of 2013, principally in our casualty clash and casualty risk
lines of business, and primarily as a result of revised initial expected claims ratios and claim development
factors due to actual experience coming in better than expected and $23.7 million related to actual reported
loss activity coming in better than expected, as a result of the application of our formulaic actuarial reserving
methodology.

The following table details the development of our liability for unpaid net claims and claim expenses for our
Specialty Reinsurance segment for the year ended December 31, 2012 split between catastrophe net
claims and claim expenses and attritional net claims and claim expenses:

Year ended December 31, 2012

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events

Hurricanes Katrina, Rita and Wilma (2005)

Total catastrophe net claims and claim expenses

Attritional net claims and claim expenses

Bornhuetter-Ferguson actuarial method - actual reported claims less than expected

claims

Actuarial assumption changes

Total attritional net claims and claim expenses

Total favorable development of prior accident years net claims and claim expenses

Specialty
Reinsurance
Segment

3,000

16,747

14,399

31,146

34,146

The favorable development of prior accident years net claims and claim expenses within our Specialty
Reinsurance segment in the year ended December 31, 2012 of $34.1 million includes $14.4 million
associated with actuarial assumption changes, principally in our casualty and medical malpractice lines of
business, and primarily as a result of revised initial expected claims ratios and claim development factors
due to actual experience coming in better than expected, $16.7 million related to actual reported loss
activity coming in better than expected, as a result of the application of our formulaic actuarial reserving
methodology, and $3.0 million due to a reduction in ultimate losses on the 2005 Hurricanes.

The following table details the development of our liability for unpaid net claims and claim expenses for our
Specialty Reinsurance segment for the year ended December 31, 2011 split between catastrophe net
claims and claim expenses and attritional net claims and claim expenses:

Year ended December 31, 2011

(in thousands)

Catastrophe net claims and claim expenses
Hurricanes Katrina, Rita and Wilma (2005)

Chilean Earthquake (2010)

Tropical Cyclone Tasha (2010)

Total catastrophe net claims and claim expenses

Attritional net claims and claim expenses

Bornhuetter-Ferguson actuarial method - actual reported claims less than expected

claims

Actuarial assumption changes

Total attritional net claims and claim expenses

Total favorable development of prior accident years net claims and claim expenses

Specialty
Reinsurance
Segment

6,215

4,688

3,000

13,903

37,058

26,800

63,858

77,761

The favorable development on prior year reserves in 2011 within our Specialty Reinsurance segment of
$77.8 million includes $26.8 million associated with actuarial assumption changes, principally in our
workers’ compensation quota share and risk, property risk and energy risk lines of business, and primarily
as a result of revised initial expected claims ratios and claim development factors due to actual experience
coming in better than expected, $13.9 million due to reductions in case reserves and additional case
reserves for certain large catastrophe events and the remainder of $37.1 million due to reported claims

coming in better than expected in 2011 on prior accident years events, as a result of the application of our
formulaic actuarial reserving methodology.

Actual Results vs. Initial Estimates

The table below summarizes our key actuarial assumptions in reserving for our Specialty Reinsurance
segment. As noted above, the key actuarial assumptions include the estimated ultimate claims and claim
expense ratios and the estimated loss reporting patterns. The table shows our initial estimates of the
ultimate claims and claim expense ratio by underwriting year. The table shows how our initial estimates of
these ratios have developed over time, with the re-estimated ratios reflecting a combination of the amount
and timing of paid and reported losses compared to our initial estimates. The initial estimate is based on
the actuarial assumptions that were in place at the end of that year. A decrease in the ultimate claims and
claim expense ratio implies that our current estimates are lower than our initial estimates while an increase
in the ultimate claims and claim expense ratio implies that our current estimates are higher than our initial
estimates. The result would be a corresponding favorable impact on shareholders’ equity and net income
or a corresponding unfavorable impact on shareholders’ equity and net income, respectively. The table also
shows how our initial estimated ultimate claims and claim expense ratios have changed from one
underwriting year to the next. The table below reflects a summary of the weighted average assumptions for
all classes of business written within our Specialty Reinsurance segment. The table is presented on a
gross loss basis and therefore does not include the benefit of reinsurance recoveries or loss related
premium.

Actual vs. Initial Estimated Specialty Reinsurance Claims and Claim Expense Reserve Analysis –
Estimated Ultimate Claims and Claim Expense Ratio

Underwriting Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013

Estimated Ultimate Claims and Claim Expenses Ratio

Initial Estimate
77.2%
76.8%
78.2%
78.2%
76.6%
62.9%
57.9%
55.4%
56.5%
58.7%
56.3%
57.6%

December 31, 2011
20.5%
26.2%
37.1%
29.1%
31.2%
55.6%
75.4%
36.9%
67.9%
67.5%
—%
—%

Re-estimate at

December 31, 2012
19.6%
25.3%
37.2%
28.1%
29.3%
56.1%
64.5%
34.2%
61.3%
59.9%
82.6%
—%

December 31, 2013
19.7%
25.4%
36.8%
28.3%
26.3%
55.8%
64.1%
29.5%
57.4%
49.2%
59.8%
59.7%

The table above shows our initial estimated ultimate claims and claim expense ratios for attritional losses
for each new underwriting year within our Specialty Reinsurance segment. Until 2007, our initial estimated
ultimate claims and claim expense ratios remained relatively constant between 76.6% in 2006 and 78.2% in
2004 and 2005. This reflects the fact that management had not made significant changes to its initial
estimates of expected ultimate claims and claim expense ratios from one underwriting year to the next. The
decrease in the initial estimated ultimate claims and claim expense ratio from 2006 and prior, to 2007
through 2013, reflects assumption changes made for certain classes of business where our experience, and
the industry experience in general, has been better than expected and, as a result, we decreased our initial
estimated ultimate claims and claim expense ratio for these classes of business.

As each underwriting year has developed, our re-estimated expected ultimate claims and claim expense
ratios have changed. In particular, our re-estimated ultimate claims and claim expense ratios decreased
significantly from the initial estimates for the 2002 through 2006 underwriting years. This was principally
due to our 2005 reserve review. During our 2005 reserve review, we further segmented the specialty

business with the aim of grouping risks into more homogeneous categories which respond to the evolution
of actual exposures. This became possible as the volume of this business increased over the three
preceding years. This further segmentation required the selection of loss reporting patterns to be applied to
these new groups. We also updated our assumptions for our original loss reporting patterns based on a
combination of new industry information and actual experience accumulated over the three preceding
years. The assumptions for the new loss reporting patterns were applied to all prior underwriting years. In
addition, we made explicit allowances for commuted contracts whereas previously these were considered in
the overall reserving assumptions. We also reviewed substantially all of our case reserves and additional
case reserves. The result of the foregoing was a decrease in our specialty reinsurance re-estimated
ultimate claims and claim expense reserves in 2005. Subsequent to this reserve review, the results of our
specialty book of business have been mixed. The 2006 underwriting year includes favorable development
as actual paid and reported losses during 2006 have overall been less than expected, which has resulted in
a reduction in our expected ultimate claims and claim expense ratio for this year. However, the 2008, 2010,
and 2012 underwriting years have performed worse than expected and our current estimates are higher
than our initial estimates. This is due in part to the losses in our casualty clash line of business in 2008,
associated with exposure to the deterioration of the credit and capital markets in 2008 as well as the Madoff
matter discovered in the fourth quarter of 2008. In comparison, our 2010 and 2011 underwriting years were
impacted by a number of relatively large catastrophe events, including the 2010 New Zealand and Chilean
Earthquakes in 2010, and in 2011, the 2011 New Zealand and Tohoku Earthquakes, the large U.S.
tornadoes, the Australian Floods, losses arising from certain aggregate contracts, Hurricane Irene and the
Thailand Floods (collectively referred to as the “2011 Large Losses”). In addition, our 2012 underwriting
year was impacted by Storm Sandy. As noted above, our specialty reinsurance business is in general
characterized by events of low frequency and high severity which results in actual experience that can be
significantly better or worse than long-term trends or industry results for similar business may imply.

As noted above, some of our specialty reinsurance contracts are exposed to net claims and claim expenses
from large natural and man-made catastrophes. Net claims and claim expenses from these large
catastrophes are reserved for after the events which gave rise to the claims in a manner which is consistent
with our property catastrophe reinsurance reserving practices as discussed above. The large catastrophes
occurring during the period from 2002 to 2013 impacting our Specialty Reinsurance segment principally
include Hurricanes Katrina, Rita and Wilma, which occurred in 2005. Our estimate of ultimate net claims
and claim expenses from Hurricanes Katrina, Rita and Wilma, within our Specialty Reinsurance segment,
net of reinsurance recoveries and assumed and ceded loss related premium, totaled $48.3 million at
December 31, 2013 (2012 - $48.6 million, 2011 - $51.6 million).

Sensitivity Analysis

The table below quantifies the impact on our reserves for claims and claim expenses, net income and
shareholders’ equity as of and for the year ended December 31, 2013 of reasonably likely changes to the
actuarial assumptions used to estimate our December 31, 2013 claims and claim expense reserves within
our Specialty Reinsurance segment. The table quantifies reasonably likely changes in our initial estimated
ultimate claims and claim expense ratios and estimated loss reporting patterns. The changes to the initial
estimated ultimate claims and claim expense ratios represent percentage increases or decreases to our
current estimated ultimate claims and claim expense ratios. The change to the reporting patterns represent
claims reporting that is both faster and slower than our current estimated claims reporting patterns. The
impact on net income and shareholders’ equity assumes no increase or decrease in reinsurance recoveries,
loss related premium or redeemable noncontrolling interest – DaVinciRe.

Specialty Reinsurance Claims and Claim Expense Reserve Sensitivity Analysis

$ Impact of
Change
on Reserves
for
Claims and
Claim
Expenses at
December 31,
2013

% Impact of
Change
on Reserve
for
Claims and
Claim
Expenses at
December 31,
2013

% Impact of
Change on
Net Income
for the Year
Ended
December 31,
2013

% Impact of
Change on
Shareholders’
Equity at
December 31,
2013

178,230

11.4 %

(21.2)%

(4.6)%

77,957

5.0 %

(9.3)%

(2.0)%

(8,454)

(0.5)%

1.0 %

0.2 %

80,218

5.1 %

(9.5)%

(2.1)%

—

— %

(69,129)

(4.4)%

8.2 %

1.8 %

(17,794)

(1.1)%

2.1 %

0.5 %

(77,957)

(5.0)%

9.3 %

2.0 %

(129,804)

(8.3)%

15.4 %

3.3 %

Estimated
Loss
Reporting
Pattern
Slower
reporting

Expected
reporting

Faster
reporting

Slower
reporting

Expected
reporting
Faster
reporting

Slower
reporting

Expected
reporting

Faster
reporting

(in thousands,except percentages)
Increase expected claims and
claim expense ratio by 25%

Increase expected claims and
claim expense ratio by 25%

Expected claims and claim

expense ratio

Expected claims and claim

expense ratio

Expected claims and claim

expense ratio

Decrease expected claims and
claim expense ratio by 25%

We believe that ultimate claims and claim expense ratios 25.0 percentage points above or below our
estimated assumptions constitute reasonably likely outcomes based on our experience to date and our
future expectations. In addition, we believe that the adjustments that we made to speed up or slow down
our estimated loss reporting patterns are reasonably likely changes. While we believe these are reasonably
likely changes, we do not believe the reader should consider the above sensitivity analysis an actuarial
reserve range. In addition, we caution the reader that the above sensitivity analysis only reflects reasonably
likely changes. It is possible that our initial estimated claims and claim expense ratios and loss reporting
patterns could be significantly different from the sensitivity analysis described above. For example, we
could be liable for events which we have not estimated reserves for or for exposures we do not currently
think are covered under our contracts. These changes could result in significantly larger changes to
reserves for claims and claim expenses, net income and shareholders’ equity than those noted above. We
also caution the reader that the above sensitivity analysis is not used by management in developing our
reserve estimates and is also not used by management in managing the business.

Lloyd’s Segment

Within our Lloyd’s segment, we write property catastrophe excess of loss reinsurance contracts to insure
insurance and reinsurance companies against natural and man-made catastrophes, and write a number of
specialty reinsurance lines, insurance policies and quota share reinsurance that involves understanding the
characteristics of the underlying insurance policy.

We use the Bornhuetter-Ferguson actuarial method to estimate claims and claim expenses within our
Lloyd’s segment for our specialty reinsurance and insurance lines of business. The comments discussed
above relating to our reserving techniques and processes for our Specialty Reinsurance segment apply to
the specialty reinsurance and insurance lines of business within our Lloyd’s segment. In addition, certain of
our coverages may be impacted by natural and man-made catastrophes. We estimate claim reserves for
these losses after the event giving rise to these losses occurs, following a process that is similar to our
Catastrophe Reinsurance segment as noted above.

Prior Year Development of Reserve for Net Claims and Claim Expenses

The following table details the development of our liability for unpaid claims and claim expenses for our
Lloyd’s segment for the year ended December 31, 2013 split between catastrophe net claims and claim
expenses and attritional net claims and claim expenses:

Year ended December 31, 2013

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events
Storm Sandy (2012)

Other

Total large catastrophe events

Total catastrophe net claims and claim expenses

Attritional net claims and claim expenses

Bornhuetter-Ferguson actuarial method - actual reported claims less than expected

claims

Actuarial assumption changes

Total attritional net claims and claim expenses

Total favorable development of prior accident years net claims and claim expenses

Lloyd’s
Segment

3,825

1,442

5,267

3,263

(274)

2,989

8,256

The favorable development of prior accident years net claims and claim expenses within our Lloyd’s
segment of $8.3 million during 2013 was principally driven by a $5.3 million decrease in the estimated
ultimate net claims and claim expenses related to large catastrophes, including $3.8 million related to Storm
Sandy, and $3.3 million related to reported claims coming in lower than expected on prior accident years
events as a result of the application of our formulaic actuarial reserving methodology and partially offset by
adverse development of $0.3 million related to assumption changes.

Year ended December 31, 2012

(in thousands)

Catastrophe net claims and claim expenses

Large catastrophe events
Thailand Floods (2011)

Hurricane Irene (2011)

Other

Total large catastrophe events

Total catastrophe net claims and claim expenses

Attritional net claims and claim expenses

Bornhuetter-Ferguson actuarial method - actual reported claims less than expected

claims

Actuarial assumption changes

Total attritional net claims and claim expenses

Total favorable development of prior accident years net claims and claim expenses

Lloyd’s
Segment

5,500

2,500

1,476

9,476

8,011

(1,285)

6,726

16,202

The favorable development of prior accident years net claims and claim expenses within our Lloyd’s
segment of $16.2 million during 2012 was principally due to favorable development of $8.0 million due to
reported claims coming in lower than expected on a number of prior accident years events, as a result of
the application of the Company’s formulaic actuarial reserving methodology, $5.5 million related to the 2011
Thailand Floods, $2.5 million related to Hurricane Irene, and $1.5 million due to lower than expected

reported claims for catastrophe losses within our Lloyd’s segment’s property catastrophe reinsurance book
of business, partially offset by $1.3 million of adverse development related to actuarial assumption changes.

The Company commenced its Lloyd’s operations in mid-2009 and the prior accident years reserve
development in this segment for the year ended December 31, 2011 amounted to $0.5 million which
principally related to the 2010 New Zealand Earthquake.

Actual Results vs. Initial Estimates

The table below summarizes our initial assumptions and changes in those assumptions for catastrophe
claims and claim expense reserves associated with our property catastrophe reinsurance business within
our Lloyd’s segment. Similar to our Catastrophe Reinsurance segment, the key assumption in estimating
reserves for property catastrophe reinsurance losses in our Lloyd’s segment is our estimate of the ultimate
claims and claim expenses. The table shows our initial estimates of ultimate claims and claim expenses for
each accident year and how these initial estimates have developed over time. The initial estimate of
accident year claims and claim expenses represents our estimate of the ultimate settlement and
administration costs for claims incurred from catastrophic events occurring during a particular accident year,
and as reported as of December 31 of that year. The re-estimated ultimate claims and claim expenses
represent our revised estimates as reported as at the respective year end. The cumulative favorable
(adverse) development shows how our most recent estimates as reported at December 31, 2013 differ from
our initial accident year estimates. Favorable development implies that our current estimates are lower than
our initial estimates while adverse development implies that our current estimates are higher than our
original estimates. Total reserves as of December 31, 2013 reflect the unpaid portion of our estimates of
ultimate claims and claim expenses. The table is presented on a gross basis and therefore does not
include the benefit of reinsurance recoveries or loss related premium such as reinstatement premium.

Actual vs. Initial Estimated Lloyd’s Segment Catastrophe Claims and Claim Expense Reserve Analysis for
Property Catastrophe Reinsurance Business

(in thousands, except percentages)

Initial
Estimate
of Accident
Year
Claims and
Claim
Expenses

Re-estimated Claims and
Claim Expenses
as of December 31,

2011

2012

2013

Cumulative
Favorable
(Adverse)
Development

% Decrease
(Increase)
from Initial
Ultimate

Claims
and Claim
Expense
Reserves
at
December
31,
2013

% of
Claims
and Claim
Expenses
Unpaid at
December
31,
2013

5,277

5,986

6,310

6,018

(741)

(14.0)% $

30,121

10,957

5,977

30,121

—

24,037

10,957

—

23,565

8,770

5,977

52,332

$ 36,107

$ 41,304

$ 44,330

6,556

2,187

—

8,002

21.8 %

20.0 %

— %

5,491

2,404

6,334

5,929

17.3 % $

20,158

91.2 %

10.2 %

72.2 %

99.2 %

45.5 %

Accident Year

2010

2011

2012

2013

As quantified in the table above, since our Lloyd’s segment commenced writing business in mid-2009, we
have experienced $8.0 million of net favorable development on our gross reserves related to catastrophe
events for our property catastrophe reinsurance business within our Lloyd’s segment. As described above
and similar to our Catastrophe Reinsurance segment, given the complexity in reserving for claims and
claims expenses associated with catastrophe losses for property catastrophe reinsurance business, we
have experienced development, both favorable and unfavorable, in any given accident year. For example,
our 2011 accident year has developed favorably by $6.6 million, which is 21.8% better than our initial
estimates of claims and claim expenses for the 2011 accident year as estimated as of December 31, 2011,
while our 2010 accident year has developed unfavorably by $0.7 million, or negative 14.0%. On a net
basis, our cumulative favorable or unfavorable development is generally reduced by offsetting changes in
our reinsurance recoverables, as well as changes to loss related premiums such as reinstatement
premiums, all of which generally move in the opposite direction to changes in our ultimate claims and claim
expenses.

The percentage of claims unpaid at December 31, 2013 for each accident year reflects both the speed at
which claims and claim expenses for each accident year have been paid and our estimate of claims and
claim expenses for that accident year. This is driven in part by the mix of our business and the speed of the
settlement and payment of claims by our underlying cedants.

Actual vs. Initial Estimated Lloyd’s Segment Attritional Claims and Claim Expense Reserve Analysis –
Estimated Ultimate Claims and Claim Expense Ratio

The table below summarizes our key actuarial assumptions in reserving for attritional losses for our
specialty reinsurance and insurance lines of business in our Lloyd’s segment. As noted above, the key
actuarial assumptions include the estimated ultimate claims and claim expense ratios and the estimated
loss reporting patterns. The table shows our initial estimates of the ultimate claims and claim expense ratio
by underwriting year. The initial estimate is based on the actuarial assumptions that were in place at the
end of that year. A decrease in the ultimate claims and claim expense ratio implies that our current
estimates are lower than our initial estimates while an increase in the ultimate claims and claim expense
ratio implies that our current estimates are higher than our initial estimates. The result would be a
corresponding favorable impact on shareholders’ equity and net income or a corresponding unfavorable
impact on shareholders’ equity and net income, respectively. The table below reflects a summary of the
weighted average assumptions for all classes of specialty reinsurance and insurance business in our
Lloyd’s segment for which we reserve for attritional losses using the Bornhuetter-Ferguson actuarial
method. The table is presented on a gross loss basis and therefore does not include the benefit of
reinsurance recoveries or loss related premium such as reinstatement premium.

Estimated Ultimate Claims and Claim Expenses Ratio

Underwriting Year
2010
2011
2012
2013

Initial Estimate
63.3%
66.0%
58.4%
60.6%

December 31, 2011
56.5%
83.0%
—%
—%

Re-estimate at

December 31, 2012
53.5%
60.6%
87.4%
—%

December 31, 2013

50.2%
55.1%
69.5%
67.9%

The table above shows our initial estimated ultimate claims and claim expense ratios for attritional losses
for each new underwriting year within specialty insurance and reinsurance in our Lloyd’s segment. The
principal reason for changes from one underwriting year to the next is changes in the mix and relative
volume of business.

As each underwriting year has developed, our re-estimated expected ultimate claims and claim expense
ratios have changed. In particular, our re-estimated ultimate claims and claim expense ratios decreased
from the initial estimates for the 2010 and 2011 underwriting years and increased for the 2012 and 2013
underwriting years. The decrease in the re-estimated ultimate claims and claim expense ratio for the 2010
and 2011 underwriting years at December 31, 2013 was principally due to the application of our formulaic
actuarial reserving methodology with the reductions being due to actual paid and reported claim activity
being more favorable to date than what was originally anticipated when setting the initial reserves combined
with reductions to estimated ultimate claims and claim expenses on certain large events. However, the
increase in the re-estimated ultimate claims and claim expense ratio for the 2012 and 2013 underwriting
years at December 31, 2013 was the result of those underwriting years performing worse than expected,
due in part to experiencing claims and claim expenses related to large property losses, including Storm
Sandy in 2012, and a number of smaller property-related loss events in 2013. As noted above, our
specialty reinsurance and insurance lines of business are in general characterized by events of low
frequency and high severity which results in actual experience that can be significantly better or worse than
long-term trends or industry results for similar business may imply.

Sensitivity Analysis

The table below shows the impact on our ultimate claims and claim expenses, net income and
shareholders’ equity as of and for the year ended December 31, 2013 of reasonably likely changes to our
estimates of ultimate losses for claims and claim expenses incurred from catastrophic events associated
with property catastrophe reinsurance business within our Lloyd’s segment. The reasonably likely changes
are based on a historical analysis of the period-to-period variability of our ultimate costs to settle claims
from catastrophic events, giving due consideration to changes in our reserving practices over time. In
general, our claim reserves for our more recent catastrophic events are subject to greater uncertainty and,
therefore, greater variability and are likely to experience material changes from one period to the next. This
is due to the uncertainty as to the size of the industry losses from the event, uncertainty as to which
contracts have been exposed to the catastrophic event, and uncertainty as to the magnitude of claims
incurred by our clients. As our claims age, more information becomes available and we believe our
estimates become more certain, although there is no assurance this trend will continue in the future. As a
result, the sensitivity analysis below is based on the age of each accident year, our current estimated
ultimate claims and claim expenses for the catastrophic events occurring in each accident year, and the
reasonably likely variability of our current estimates of claims and claim expenses by accident year.

Lloyd’s Segment Property Catastrophe Reinsurance Claims and Claim Expense Reserve Sensitivity
Analysis

$ Impact of
Change
on Ultimate
Claims
and Claim
Expenses
at
December 31,
2013

% Impact of
Change
on Reserve for
Claims
and Claim
Expenses
at
December 31,
2013

Ultimate
Claims and
Claim
Expenses at
December 31,
2013

% Impact of
Change
on Net Income
for
the Year Ended
December 31,
2013

% Impact of
Change
on
Shareholders’
Equity at
December 31,
2013

53,657 $
44,330
35,003 $

9,327
—
(9,327)

0.6 %
— %
(0.6)%

(1.1)%
— %
1.1 %

(0.2)%
— %
0.2 %

(in thousands, except
percentages)
Higher
Recorded
Lower

We believe the changes we made to our estimated ultimate claims and claim expenses represent
reasonably likely outcomes based on our experience to date and our future expectations. While we believe
these are reasonably likely outcomes, we do not believe the reader should consider the above sensitivity
analysis an actuarial reserve range. In addition, the sensitivity analysis only reflects reasonably likely
changes in our underlying assumptions. It is possible that our estimated ultimate claims and claim
expenses could be significantly higher or lower than the sensitivity analysis described above. For example,
we could be liable for events for which we have not estimated claims and claim expenses or for exposures
we do not currently believe are covered under our policies. These changes could result in significantly
larger changes to our estimated ultimate claims and claim expenses, net income and shareholders’ equity
than those noted above. We also caution the reader that the above sensitivity analysis is not used by
management in developing our reserve estimates and is also not used by management in managing the
business.

Lloyd’s Segment Attritional Claims and Claim Expense Reserve Sensitivity Analysis

$ Impact of
Change
on Reserves
for
Claims and
Claim
Expenses at
December 31,
2013

% Impact of
Change
on Reserves
for
Claims and
Claim
Expenses at
December 31,
2013

% Impact of
Change on
Net Income
for the Year
Ended
December 31,
2013

% Impact of
Change on
Shareholders’
Equity at
December 31,
2013

85,986

5.5 %

(10.2)%

(2.2)%

38,456

2.5 %

(4.6)%

(1.0)%

(15,373)

(1.0)%

1.8 %

0.4 %

38,025

2.4 %

(4.5)%

(1.0)%

—

— %

(43,063)

(2.8)%

5.1 %

1.1 %

(9,937)

(0.6)%

1.2 %

0.3 %

(38,456)

(2.5)%

4.6 %

1.0 %

(70,753)

(4.5)%

8.4 %

1.8 %

Estimated
Loss
Reporting
Pattern
Slower
reporting

Expected
reporting

Faster
reporting

Slower
reporting

Expected
reporting
Faster
reporting

Slower
reporting

Expected
reporting

Faster
reporting

(in thousands,except percentages)
Increase expected claims and
claim expense ratio by 25%

Increase expected claims and
claim expense ratio by 25%

Expected claims and claim

expense ratio

Expected claims and claim

expense ratio

Expected claims and claim

expense ratio

Decrease expected claims and
claim expense ratio by 25%

Other

Included in the Other category are the remnants of our Bermuda-based insurance operations not sold
pursuant to the stock purchase agreement with QBE. These operations are in run-off and no new business
is being underwritten. Our outstanding claims and claim expense reserves for these operations include
insurance policies and quota share reinsurance with respect to risks including: 1) commercial property,
which principally included catastrophe-exposed commercial property products; 2) commercial multi-line,
which included commercial property and liability coverage, such as general liability, automobile liability and
physical damage, building and contents, professional liability and various specialty products; and 3)
personal lines property, which principally included homeowners personal lines property coverage and
catastrophe exposed personal lines property coverage and totaled $58.1 million at December 31, 2013.

We use the Bornhuetter-Ferguson actuarial method to estimate claims and claim expenses within the Other
category for our property and casualty insurance and quota share reinsurance business. The comments
discussed above relating to our reserving techniques and processes for our Specialty Reinsurance segment
also apply to our Other category. In addition, certain of our coverages may be impacted by natural and

1,389

4,243

—

man-made catastrophes. We estimate claim reserves for these losses after the event giving rise to these
losses occurs, following a process that is similar to our Catastrophe Reinsurance segment.

Development of Prior Year Liability for Unpaid Claims and Claim Expenses

The following table details the development of our liability for unpaid claims and claim expenses for our
Other category split between large catastrophe events and attritional claims and claim expenses:

At December 31,

(in thousands)

2013

2012

2011

Attritional claims and claim expenses

(2,179) $

3,265 $

Catastrophe events
Loss portfolio transfer

Actuarial assumption changes

1,729

—

1,171

(7,383)

—

(10,063)

Total adverse development of prior accident years net claims

and claim expenses

(450) $

(2,947) $

(4,431)

The net adverse development on prior accident years of $0.5 million for 2013 within our Other category was
principally the result of $2.2 million related to the application of our formulaic actuarial reserving
methodology with the increases being due to actual paid and reported claim activity coming in higher than
what was originally anticipated when setting the initial reserves; partially offset by favorable development of
$1.7 million related to prior period large catastrophe events.

The net adverse development on prior accident years of $2.9 million for 2012 within our Other category was
principally the result of a loss portfolio transfer entered into by us on October 1, 2012, in respect of our
contractor’s liability book of business within RenaissanceRe Specialty Risks, whereby we paid
consideration of $36.5 million to transfer net liabilities of $29.1 million, resulting in a loss of $7.4 million
which is recorded above as prior accident years attritional claims and claims expenses in our Other
category, partially offset by reductions in reported losses on certain attritional loss contracts and favorable
development related to catastrophe events, primarily the 2008 Hurricanes.

The net adverse development on prior accident years of $4.4 million in 2011 within our Other category was
principally due to the construction defect book of business, which experienced higher than expected
reported losses, and was subsequently subject to a comprehensive actuarial review during the fourth
quarter of 2011, which review resulted in an increase of $10.1 million to the estimated ultimate claims and
claim expenses related to this book of business due to changes in the actuarial assumptions. Partially
offsetting the adverse development on prior accident years within the construction defect book of business,
noted above, was favorable development of $4.2 million related to large catastrophe events, of which $4.6
million related to the 2005 Hurricanes, and $1.4 million related to the application of our formulaic actuarial
reserving methodology with the reductions being due to actual paid and reported claim activity being more
favorable to date than what was originally anticipated when setting the initial reserves.

Reinsurance Recoverables

We enter into reinsurance agreements in order to help reduce our exposure to large losses and to help
manage our risk portfolio. Amounts recoverable from reinsurers are estimated in a manner consistent with
the claims and claim expense reserves associated with the related assumed reinsurance. For multi-year
retrospectively rated contracts, we accrue amounts (either assets or liabilities) that are due to or from
assuming companies based on estimated contract experience. If we determine that adjustments to earlier
estimates are appropriate, such adjustments are recorded in the period in which they are determined.

The estimate of reinsurance recoverables can be more subjective than estimating the underlying claims and
claim expense reserves as discussed under the heading “Claims and Claim Expense Reserves” above. In
particular, reinsurance recoverables may be affected by deemed inuring reinsurance, industry losses
reported by various statistical reporting services, and other factors. Reinsurance recoverables on dual
trigger reinsurance contracts require us to estimate our ultimate losses applicable to these contracts as well
as estimate the ultimate amount of insured losses for the industry as a whole that will be reported by the
applicable statistical reporting agency, as per the contract terms. In addition, the level of our additional case

reserves and IBNR reserves has a significant impact on reinsurance recoverables. These factors can
impact the amount and timing of the reinsurance recoverables to be recorded.

The majority of the balance we have accrued as recoverable will not be due for collection until some point in
the future. The amounts recoverable ultimately collected are open to uncertainty due to the ultimate ability
and willingness of reinsurers to pay our claims, for reasons including insolvency and elective run-off,
contractual dispute and various other reasons. In addition, because the majority of the balances
recoverable will not be collected for some time, economic conditions as well as the financial and operational
performance of a particular reinsurer may change, and these changes may affect the reinsurer’s willingness
and ability to meet their contractual obligations to us. To reflect these uncertainties, we estimate and record
a valuation allowance for potential uncollectible reinsurance recoverable which reduces reinsurance
recoverable and net income (loss).

We estimate our valuation allowance by applying specific percentages against each reinsurance
recoverable based on our counterparty’s credit rating. The percentages applied are based on historical
industry default statistics developed by major rating agencies and are then adjusted by us based on
industry knowledge and our judgment and estimates. We also apply case-specific valuation allowances
against certain recoveries that we deem unlikely to be collected in full. We then evaluate the overall
adequacy of the valuation allowance based on other qualitative and judgmental factors. The valuation
allowance recorded against reinsurance recoverable was $1.7 million at December 31, 2013 (2012 - $4.5
million). The reinsurers with the three largest balances accounted for 28.2%, 19.9% and 11.0%,
respectively, of our reinsurance recoverable balance at December 31, 2013 (2012 - 14.3%, 14.3% and
12.6%, respectively). The three largest company-specific components of the valuation allowance
represented 14.2%, 12.5% and 3.1%, respectively, of our total valuation allowance at December 31, 2013
(2012 - 44.1%, 26.7% and 6.1%, respectively).

Fair Value Measurements and Impairments

Fair Value

The use of fair value to measure certain assets and liabilities with resulting unrealized gains or losses is
pervasive within our financial statements. Fair value is defined under accounting guidance currently
applicable to us to be the price that would be received upon the sale of an asset or paid to transfer a liability
in an orderly transaction between open market participants at the measurement date. We recognize the
change in unrealized gains and losses arising from changes in fair value in our consolidated statements of
operations, with the exception of changes in unrealized gains and losses on our fixed maturity investments
available for sale, which are recognized as a component of accumulated other comprehensive income in
shareholders’ equity.

FASB ASC Topic Fair Value Measurements and Disclosures prescribes a fair value hierarchy that prioritizes
the inputs to the respective valuation techniques used to measure fair value. The hierarchy gives the
highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and
the lowest priority to valuation techniques that use at least one significant input that is unobservable (Level
3). The three levels of the fair value hierarchy are described below:

• Fair values determined by Level 1 inputs utilize unadjusted quoted prices obtained from active

markets for identical assets or liabilities for which we have access. The fair value is determined by
multiplying the quoted price by the quantity held by us;

• Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1

that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted
prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are
observable for the asset or liability, such as interest rates and yield curves that are observable at
commonly quoted intervals, broker quotes and certain pricing indices; and

• Level 3 inputs are based all or in part on significant unobservable inputs for the asset or liability, and
include situations where there is little, if any, market activity for the asset or liability. In these cases,
significant management assumptions can be used to establish management’s best estimate of the
assumptions used by other market participants in determining the fair value of the asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its
entirety falls has been determined based on the lowest level input that is significant to the fair value
measurement of the asset or liability. Our assessment of the significance of a particular input to the fair
value measurement in its entirety requires judgment, and we consider factors specific to the asset or
liability.

In order to determine if a market is active or inactive for a security, we consider a number of factors, including,
but not limited to, the spread between what a seller is asking for a security and what a buyer is bidding for the
same security, the volume of trading activity for the security in question, the price of the security compared to
its par value (for fixed maturity investments), and other factors that may be indicative of market activity.

Other than the transaction noted below, there have been no material changes in the Company’s valuation
techniques, nor have there been any transfers between Level 1 and Level 2, or Level 2 and 3 during the
periods represented by these consolidated financial statements. As discussed in greater detail below, the
Company transferred its investment in the common shares of Essent, a U.S. mortgage guaranty insurance
company, from Level 3 to Level 1, effective October 31, 2013, the date which Essent became a publicly
traded company on the NYSE. The fair value transferred from Level 3 to Level 1 was $85.6 million.

Below is a summary of the assets and liabilities that are measured at fair value on a recurring basis and
also represents the carrying amount of such assets and liabilities on our consolidated balance sheet:

At December 31, 2013

(in thousands)
Fixed maturity investments

U.S. treasuries
Agencies
Non-U.S. government (Sovereign debt)
Non-U.S. government-backed corporate
Corporate
Agency mortgage-backed
Non-agency mortgage-backed
Commercial mortgage-backed
Asset-backed
Total fixed maturity investments

Short term investments
Equity investments trading
Other investments

Private equity partnerships
Senior secured bank loan funds
Catastrophe bonds
Hedge funds
Total other investments
Other assets and (liabilities)

Derivatives (1)
Other
Total other assets and (liabilities)

Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)

Total

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

$ 1,352,413 $ 1,352,413 $

— $

186,050
334,580
237,479
1,803,415
341,908
257,938
314,236
15,258
4,843,277
1,044,779
254,776

322,391
18,048
229,016
3,809
573,264

4,758
(12,991)
(8,233)

186,050
—
334,580
—
—
237,479
— 1,775,835
341,908
—
257,938
—
314,236
—
15,258
—
3,463,284
1,352,413
— 1,044,779
—

254,776

—
—
—
—
—

823
—
823

—
—
229,016
—
229,016

6,425
(12,991)
(6,566)

$ 6,707,863 $ 1,608,012 $ 4,730,513 $

—
—
—
—
27,580
—
—
—
—
27,580
—
—

322,391
18,048
—
3,809
344,248

(2,490)
—
(2,490)
369,338

(1) See "Note 19. Derivative Instruments in our Notes to Consolidated Financial Statements” for additional information related to the

fair value by type of contract, of derivatives entered into by us.

As at December 31, 2013, we have classified $371.8 million and $2.5 million of our assets and liabilities,
respectively, at fair value on a recurring basis using Level 3 inputs. This represented 4.5% and 0.1% of our
total assets and liabilities, respectively. Level 3 fair value measurements are based on valuation techniques
that use at least one significant input that is unobservable. These measurements are made under
circumstances in which there is little, if any, market activity for the asset or liability. We use valuation
models or other pricing techniques that require a variety of inputs including contractual terms, market prices
and rates, yield curves, credit curves, measures of volatility, prepayment rates and correlations of such
inputs, some of which may be unobservable, to value these Level 3 assets and liabilities. Our assessment
of the significance of a particular input to the fair value measurement in its entirety requires judgment. In
making the assessment, we considered factors specific to the asset or liability. In certain cases, the inputs
used to measure fair value of an asset or a liability may fall into different levels of the fair value hierarchy. In
such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety is
classified is determined based on the lowest level input that is significant to the fair value measurement of
the asset or liability.

See to “Note 6. Fair Value Measurements in our Notes to Consolidated Financial Statements” for additional
information about fair value measurements.

Impairments

The amount and timing of asset impairment is subject to significant estimation techniques and asset
impairment is a critical accounting estimate for us. The more significant impairment reviews we complete
are for our equity method investments, goodwill and other intangible assets, and fixed maturity investments
available for sale, as described in more detail below.

Investments in Other Ventures, Under Equity Method

Investments in which we have significant influence over the operating and financial policies of the investee
are classified as investments in other ventures, under equity method, and are accounted for under the
equity method of accounting. Under this method, we record our proportionate share of income or loss from
such investments in our results for the period. Any decline in the value of investments in other ventures,
under equity method, including goodwill and other intangible assets arising upon acquisition of the investee,
considered by management to be other-than-temporary, is reflected in our consolidated statements of
operations in the period in which it is determined. As of December 31, 2013, we had $105.6 million (2012 -
$87.7 million) in investments in other ventures, under equity method on our consolidated balance sheets,
including $12.5 million of goodwill and $16.7 million of other intangible assets (2012 – $10.8 million and
$19.6 million). The carrying value of our investments in other ventures, under equity method, individually or
in the aggregate, may, and likely will, differ from the realized value we may ultimately attain, perhaps
significantly so.

In determining whether an equity method investment is impaired, we look at a variety of factors including
the operating and financial performance of the investee, the investee’s future business plans and
projections, recent transactions and market valuations of publicly traded companies where available,
discussions with the investee’s management, and our intent and ability to hold the investment until it
recovers in value. In doing this, we make assumptions and estimates in assessing whether an impairment
has occurred and if, in the future, our assumptions and estimates made in assessing the fair value of these
investments change, this could result in a material decrease in the carrying value of these investments.
This would cause us to write-down the carrying value of these investments and could have a material
adverse effect on our results of operations in the period the impairment charge is taken. We do not have
any current plans to dispose of these investments, and cannot assure you that we will in the future
consummate transactions in which we realize the value at which these holdings are reflected in our financial
statements. During the year ended December 31, 2013, we recorded $Nil (2012 - $Nil, 2011 - $Nil) other-
than-temporary impairment charges related to investments in other ventures, under the equity method.

Goodwill and Other Intangible Assets

Goodwill and other intangible assets acquired are initially recorded at fair value. Subsequent to initial
recognition, finite lived other intangible assets are amortized over their estimated useful life, subject to
impairment, and goodwill and indefinite lived other intangible assets are carried at the lower of cost or fair
value. If goodwill or other intangible assets are impaired, they are written down to their estimated fair
values with a corresponding expense reflected in our consolidated statements of operations.

We test goodwill and other intangible assets for impairment in the fourth quarter of each year, or more
frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable.
For purposes of the annual impairment evaluation, goodwill is assigned to the applicable reporting unit of
the acquired entities giving rise to the goodwill and other intangible assets and is tested based on the cash
flows they produce. There are generally many assumptions and estimates underlying the fair value
calculation. Principally, we identify the reporting unit or business entity that the goodwill or other intangible
asset is attributed to, and review historical and forecasted operating and financial performance and other
underlying factors affecting such analysis, including market conditions. Other assumptions used could
produce significantly different results which may result in a change in the value of goodwill or our other
intangible assets and related charge in our consolidated statements of operations. An impairment charge
could be recognized in the event of a significant decline in the implied fair value of those operations where
the goodwill or other intangible assets are applicable. As at December 31, 2013, excluding the amounts
recorded in investments in other ventures, under equity method, as noted above, our consolidated balance
sheets include $5.9 million of goodwill (2012 - $5.9 million) and $2.3 million of other intangible assets (2012
- $2.6 million). Impairment charges were $Nil during the year ended December 31, 2013 (2012 - $Nil, 2011
- $5.2 million). In the future it is possible that we will hold more goodwill, which would increase the degree
of judgment and uncertainty embedded in our financial statements, and potentially increase the volatility of
our reported results.

Fixed Maturity Investments Available For Sale

At December 31, 2013, we had $34.2 million (2012 - $83.4 million) of fixed maturity investments available
for sale on our consolidated balance sheet. Included in accumulated other comprehensive income at
December 31, 2013 was $4.0 million of gross unrealized gains (2012 - $12.1 million) and $17 thousand of
gross unrealized losses (2012 - $103 thousand), related to our portfolio of fixed maturity investments
available for sale. Our quarterly process for assessing whether declines in the fair value of our fixed
maturity investments available for sale represent impairments that are other-than-temporary includes
reviewing each fixed maturity investment available for sale that is impaired and determining: (i) if we have
the intent to sell the debt security or (ii) if it is more likely than not that we will be required to sell the debt
security before its anticipated recovery; and (iii) whether a credit loss exists, that is, where we expect that
the present value of the cash flows expected to be collected from the security are less than the amortized
cost basis of the security. For the year ended December 31, 2013 we recognized $Nil (2012 - $0.3 million,
2011 - $0.6 million) of net other-than-temporary impairments in our consolidated statements of operations
related to our portfolio of fixed maturity investments available for sale.

Income Taxes

Income taxes have been provided in accordance with the provisions of FASB ASC Topic Income Taxes.
Deferred tax assets and liabilities result from temporary differences between the amounts recorded in our
consolidated financial statements and the tax basis of the Company’s assets and liabilities. Such temporary
differences are primarily due to net operating loss carryforwards and GAAP versus tax basis accounting
differences related to interest expense, underwriting results, accrued expenses and investments. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date. A valuation allowance against deferred tax assets is recorded if it is more
likely than not that all, or some portion, of the benefits related to deferred tax assets will not be realized.

At December 31, 2013, our net deferred tax asset (prior to our valuation allowance) and valuation allowance
were $56.3 million (2012 - $34.9 million) and $56.1 million (2012 - $35.1 million), respectively (see “Note 15.
Taxation in our Notes to Consolidated Financial Statements” for additional information). At each balance
sheet date, we assess the need to establish a valuation allowance that reduces the net deferred tax asset
when it is more likely than not that all, or some portion, of the deferred tax assets will not be realized. The

valuation allowance is based on all available information including projections of future GAAP taxable
income from each tax-paying component in each tax jurisdiction. Losses incurred within our U.S. tax-
paying subsidiaries in the fourth quarter of 2011 were significant enough to result in a cumulative GAAP
taxable loss at the U.S. tax-paying subsidiaries for the three year period ended December 31, 2011. We
reassess our valuation allowance on a quarterly basis and commencing with our reassessment effective
December 31, 2011, we determined that it is more likely than not that we would not be able to recover our
U.S. net deferred tax asset and as a result, recognized a full valuation allowance in the fourth quarter of
2011. At December 31, 2013, our U.S. tax-paying subsidiaries had a net deferred tax asset of $43.9 million
(2012 - $24.6 million), for which a full valuation allowance has been provided as we continued to remain in a
cumulative three year GAAP taxable loss position at our U.S. tax-paying subsidiaries throughout 2013,
among other facts. In addition, our Ireland, U.K. and Singapore operations have each produced cumulative
GAAP taxable losses, among other facts, and as a result, we continue to provide a valuation allowance
against our net deferred tax assets for these operations.

The Company has unrecognized tax benefits of $Nil as of December 31, 2013 (2012 - $Nil). Interest and
penalties related to unrecognized tax benefits, would be recognized in income tax expense. At
December 31, 2013, interest and penalties accrued on unrecognized tax benefits were $Nil (2012 - $Nil).
Income tax returns filed for tax years 2009 through 2012, 2009 through 2012, 2012 and 2012, are open for
examination by the Internal Revenue Service, Irish tax authorities, U.K. tax authorities, and Singapore tax
authorities, respectively. The Company does not expect the resolution of these open years to have a
significant impact on its consolidated statements of operations and financial condition.

SUMMARY OF RESULTS OF OPERATIONS

Year ended December 31,

2013

2012

2011

(in thousands, except per share amounts and percentages)
Statements of operations highlights
Gross premiums written

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Underwriting income (loss)

Net investment income

Net realized and unrealized gains on investments

Income (loss) from continuing operations

Income (loss) from discontinued operations

Net income (loss)

Net income (loss) available (attributable) to
RenaissanceRe common shareholders

$1,605,412

$1,551,591

$1,434,976

1,203,947

1,114,626

1,102,657

1,069,355

171,287

626,733

208,028

35,076

839,346

2,422

841,768

325,211

451,451

165,725

163,121

765,425

(16,476)

748,949

1,012,773

951,049

861,179

(177,167)

146,871

43,956

(38,833)

(51,559)

(90,392)

665,676

566,014

(92,235)

Income (loss) from continuing operations available

(attributable) to RenaissanceRe common shareholders
per common share – diluted

Income (loss) from discontinued operations per common

share – diluted

Net income (loss) available (attributable) to

RenaissanceRe common shareholders per common
share – diluted

Dividends per common share

14.82

11.56

(0.82)

0.05

(0.33)

(1.02)

14.87

1.12

11.23

1.08

(1.84)

1.04

Key ratios
Net claims and claim expense ratio – current accident year

Net claims and claim expense ratio – prior accident years

Net claims and claim expense ratio – calendar year

Underwriting expense ratio

Combined ratio

28.3 %

(12.9)%

15.4 %

28.4 %

43.8 %

45.2 %

(14.8)%

30.4 %

27.4 %

57.8 %

104.4 %

(13.8)%

90.6 %

28.0 %

118.6 %

Return on average common equity

20.5 %

17.7 %

(3.0)%

Book value
Book value per common share

Accumulated dividends per common share

Book value per common share plus accumulated

dividends

Change in book value per common share plus change in

accumulated dividends

Balance sheet highlights
Total assets

December 31,
2013
80.29

December 31,
2012
68.14

December 31,
2011
59.27

13.12

12.00

10.92

93.41

80.14

70.19

19.5 %

16.8 %

(3.6)%

December 31,
2013
$8,179,131

December 31,
2012
$7,928,628

December 31,
2011
$7,744,912

Total shareholders’ equity attributable to RenaissanceRe

$3,904,384

$3,503,065

$3,605,193

Below is a discussion of the results of operations for 2013 compared to 2012.

Net income available to RenaissanceRe common shareholders was $665.7 million in 2013, compared to
$566.0 million in 2012, an increase of $99.7 million. As a result of our net income available to
RenaissanceRe common shareholders in 2013, we generated an annualized return on average common
equity of 20.5% and our book value per common share increased from $68.14 at December 31, 2012 to
$80.29 at December 31, 2013, a 19.5% increase, after considering the change in accumulated dividends
paid to our common shareholders.

The most significant items affecting our financial performance during 2013, on a comparative basis to 2012,
include:

• Improved Underwriting Results - our underwriting income of $626.7 million in 2013 increased $175.3
million from $451.5 million in 2012 and was positively impacted by a decrease in net claims and claim
expenses of $153.9 million, principally due to lower insured losses in respect of large events. Included
in underwriting income for 2013 was $22.9 million and $12.7 million of underwriting losses related to the
May 2013 U.S. Tornadoes and the European Floods. In comparison, Storm Sandy and Hurricane Isaac
resulted in $149.1 million and $26.3 million of underwriting losses in 2012, respectively. Favorable
development on prior accident years was $144.0 million in 2013, compared to $158.0 million in 2012,
primarily driven by the Catastrophe Reinsurance segment, as discussed further below; partially offset
by

• Lower Total Investment Result - our total investment result of $235.1 million in 2013, which includes the
sum of net investment income of $208.0 million, net realized and unrealized gains on investments of
$35.1 million, net other-than-temporary impairments of $Nil and the decrease in net unrealized gains on
fixed maturity investments available for sale of $8.0 million, decreased by $94.0 million in 2013, from
$329.1 million in 2012. The decrease in the total investment result was primarily due to lower total
returns in our fixed maturity investment portfolio as a result of a rising interest rate environment in 2013,
compared to the significant contraction in credit spreads yielding higher returns from our fixed maturity
investment portfolio in 2012; partially offset by realized and unrealized gains in our portfolio of equity
investments trading in 2013, compared to 2012, and improved returns in our portfolio of other
investments, primarily driven by our investment in the common shares of Essent; and

• Net Income Attributable to Noncontrolling Interests - our net income attributable to noncontrolling

interests was $151.1 million in 2013, compared to $148.0 million in 2012, an increase of $3.1 million
and was primarily due to our noncontrolling economic ownership percentage in DaVinciRe decreasing
to 27.3% at December 31, 2013, compared to 30.8% at December 31, 2012, resulting in an increase in
the portion of DaVinciRe’s net income attributable to noncontrolling interests.

Below is a discussion of the results of operations for 2012 compared to 2011.

Net income available to RenaissanceRe common shareholders was $566.0 million in 2012, compared to a
net loss attributable to RenaissanceRe common shareholders of $92.2 million in 2011, an improvement of
$658.2 million. As a result of our net income available to RenaissanceRe common shareholders in 2012,
we generated an annualized return on average common equity of 17.7% and our book value per common
share increased from $59.27 at December 31, 2011 to $68.14 at December 31, 2012, a 16.8% increase,
after considering the change in accumulated dividends paid to our common shareholders.

The most significant items affecting our financial performance during 2012, on a comparative basis to 2011,
include:

• Increased Gross Premiums Written - gross premiums written increased $116.6 million, or 8.1%, to
$1,551.6 million. Excluding the impact of $20.1 million and $160.3 million of net reinstatement
premiums written from large losses in 2012 and 2011, respectively, gross premiums written increased
$256.8 million, or 20.1% for the year, due to a combination of improved pricing during the 2012
renewals within our core markets, and continued growth across most lines of business within our
Specialty Reinsurance and Lloyd’s segments;

• Significantly Improved Underwriting Results - underwriting income of $451.5 million and a combined
ratio of 57.8% in 2012, compared to an underwriting loss of $177.2 million and a combined ratio of
118.6% in 2011, was positively impacted by the increase in gross premiums written, noted above, and a

decrease in net claims and claim expenses of $536.0 million due to significantly lower insured losses
with respect of large events. Included in underwriting income for 2012 was $149.1 million and $26.3
million of underwriting losses related to Storm Sandy and Hurricane Isaac, respectively, which added a
total of 19.0 percentage points to our 2012 combined ratio. The 2011 Large Losses resulted in $725.2
million of underwriting losses and added 85.4 percentage points to our combined ratio, as detailed in
the table below;

• Higher Investment Results - our net investment income and net realized and unrealized gains on
investments increased $18.9 million and $119.2 million, respectively, in 2012, compared to 2011,
primarily due to higher total returns in our fixed maturity investments portfolio as a result of the
significant tightening of credit spreads combined with higher average invested assets and improved
valuations in our portfolio of other investments, specifically our senior secured bank loan funds;

• Equity in Earnings of Other Ventures - our equity in earnings of other ventures improved to earnings of
$23.2 million in 2012, compared to a loss of $36.5 million in 2011. The $59.8 million improvement is
primarily due to our equity investment in Top Layer Re which generated income of $20.8 million in 2012,
compared to a loss of $37.5 million in 2011, an improvement of $58.3 million, principally due to the
absence of large losses during 2012, compared to claims and claim expenses incurred in 2011 in Top
Layer Re related to the 2011 New Zealand and Tohoku Earthquakes; and

• Lower Net Loss Attributable to Discontinued Operations - our loss from discontinued operations was
$16.5 million in 2012, compared to a loss of $51.6 million in 2011, primarily driven by $20.8 million of
trading losses within REAL during 2012 compared to trading losses of $45.0 million in 2011; and
partially offset by

• Other Loss - our other loss deteriorated $46.5 million to a loss of $2.1 million in 2012, compared to

income of $44.3 million in 2011, primarily the result of ceded reinsurance contracts accounted for at fair
value which incurred a loss of $4.6 million in 2012, compared to income of $37.4 million in 2011, due to
net recoverables on the Tohoku Earthquake in the first quarter of 2011 which did not reoccur in 2012;
and

• Net (Income) Loss Attributable to Redeemable Noncontrolling Interest - DaVinciRe - our net income

attributable to redeemable noncontrolling interest - DaVinciRe was $147.5 million in 2012, compared to
net loss attributable to redeemable noncontrolling interest - DaVinciRe of $33.7 million in 2011, a
change of $181.2 million, principally due to a significant improvement in underwriting income as a result
of the decrease in current accident year net claims and claim expenses and higher investment results,
as noted above, which also impacted DaVinciRe, and together resulted in net income of $212.5 million
for DaVinciRe in 2012, compared to net loss of $61.3 million for DaVinciRe in 2011. In addition, our
noncontrolling economic ownership in DaVinciRe decreased from 42.8% at December 31, 2011 to
30.8% at December 31, 2012, consequently increasing redeemable noncontrolling interest - DaVinciRe.

Net Negative Impact of Specific Events

Net negative impact includes the sum of estimates of net claims and claim expenses incurred, earned
reinstatement premiums assumed and ceded, profit commissions and redeemable noncontrolling interest.
Net negative impact of the 2011 Large Losses also includes equity in the net claims and claim expenses of
Top Layer Re, and other income in respect of ceded reinsurance contracts accounted for at fair value. Our
estimates are based on a review of our potential exposures, preliminary discussions with certain
counterparties and catastrophe modeling techniques. Given the magnitude and recent occurrence of
certain of these events, delays in receiving claims data, the contingent nature of business interruption and
other exposures, potential uncertainties relating to reinsurance recoveries and other uncertainties inherent
in loss estimation, meaningful uncertainty remains regarding losses from these events. In addition, a
significant portion of the net claims and claim expenses associated with the 2011 New Zealand and Tohoku
Earthquakes and Storm Sandy are concentrated with a few large clients, and therefore, the loss estimates
for these events may vary significantly based on the claims experience of those clients. Accordingly, our
actual net negative impact from these events will vary from these preliminary estimates, perhaps materially
so. Changes in these estimates will be recorded in the period in which they occur.

See the financial data below for additional information detailing the net negative impact of the European
Floods and May 2013 U.S. Tornadoes on our consolidated financial statements for 2013.

Twelve months ended December 31, 2013

(in thousands, except percentages)

May 2013
U.S.
Tornadoes

European
Floods

Total

Net claims and claim expenses incurred

(26,245) $

(15,145) $

(41,390)

Reinstatement premiums earned

Profit commissions

Net negative impact on underwriting result

Redeemable noncontrolling interest

Net negative impact

Percentage point impact on consolidated combined ratio

Net negative impact on Catastrophe Reinsurance segment

underwriting result

Net negative impact on Lloyd’s segment underwriting result

Net negative impact on underwriting result

2,969

391

2,098

388

5,067

779

(22,885) $

(12,659)

(35,544)

4,001

2,230

6,231

(18,884) $

(10,429) $

(29,313)

2.2

1.3

3.5

(21,903) $
(982)

(10,742) $
(1,917)

(32,645)
(2,899)

(22,885) $

(12,659) $

(35,544)

During the fourth quarter of 2013, we experienced favorable development on prior accident years net claims
and claim expenses related to Storm Sandy which had a net positive impact on our consolidated financial
statements, as detailed in the table below.

Twelve months ended December 31, 2013

(in thousands, except percentages)

Net claims and claim expenses incurred

Reinstatement premiums earned

Ceded reinstatement premiums earned

Profit commissions

Net positive impact on underwriting result

Redeemable noncontrolling interest

Net positive impact

Percentage point impact on consolidated combined ratio

Storm Sandy

48,285

(12,894)

341

657

36,389

(5,706)

30,683

(3.8)

Net positive impact on Catastrophe Reinsurance segment underwriting result

32,805

Net positive impact on Specialty Reinsurance segment underwriting result

Net positive impact on Lloyd’s segment underwriting result

Net positive impact on underwriting result

3,556

36,389

See the financial data below for additional information detailing the net negative impact of Hurricane Isaac
and Storm Sandy on our consolidated financial statements in 2012.

Year ended December 31, 2012

(in thousands, except percentages)

Hurricane
Isaac

Storm Sandy

Total

Net claims and claim expenses incurred

(33,185) $ (187,944) $ (221,129)

Reinstatement premiums earned

Ceded reinstatement premiums earned

Profit commissions

Net negative impact on underwriting result

Redeemable noncontrolling interest - DaVinciRe

8,863

—

(2,016)

37,437

46,300

(385)

1,771

(385)

(245)

(26,338)

(149,121)

(175,459)

8,925

22,160

31,085

Net negative impact

(17,413) $ (126,961) $ (144,374)

Percentage point impact on consolidated combined ratio

2.8

16.0

19.0

Net negative impact on Catastrophe Reinsurance segment

underwriting result

Net negative impact on Specialty Reinsurance segment

underwriting result

Net negative impact on Lloyd’s segment underwriting result

(25,857) $ (121,061) $ (146,918)

—

(481)

(11,000)

(17,060)

(11,000)

(17,541)

Net negative impact on underwriting result

(26,338) $ (149,121) $ (175,459)

See the financial data below for additional information detailing the net negative impact of the 2011 Large
Losses on our consolidated financial statements in 2011.

Year ended December
31, 2011

(in thousands, except
percentages)

Net claims and claim
expenses incurred

Assumed reinstatement
premiums earned

Ceded reinstatement
premiums earned

Lost profit commissions

Net negative impact on
underwriting result

Equity in net claims and
claim expenses of
Top Layer Re

Recoveries from ceded

reinsurance contracts
accounted for at fair
value

Redeemable

noncontrolling
interest - DaVinciRe

2011 New
Zealand
Earthquake

Tohoku
Earthquake

Australian
Floods

Large U.S.
Tornadoes

Aggregate
Contracts

Hurricane
Irene

Thailand
Floods

Total

2011 Large Losses

(273,596) $

(284,348) $

(12,273) $

(135,090) $

(33,080) $

(32,530) $

(76,437) $

(847,354)

49,878

60,914

1,694

23,273

1,524

5,874

17,144

160,301

(3,542)

(7,522)

(26,004)

(331)

—

(348)

—

(151)

—

(245)

(29,546)

(8,597)

(234,782)

(249,769)

(10,927)

(111,968)

(31,556)

(26,656)

(59,538)

(725,196)

(23,757)

(26,243)

—

45,000

—

(50,000)

—

45,000

55,748

53,669

1,182

32,941

4,944

7,698

14,474

170,656

Net negative impact

(202,791) $

(177,343) $

(9,745) $

(79,027) $

(26,612) $

(18,958) $

(45,064) $

(559,540)

Percentage point impact

on consolidated
combined ratio

Net negative impact on

Catastrophe
Reinsurance
segment underwriting
result

Net negative impact on

Specialty
Reinsurance
segment underwriting
result

Net negative impact on
Lloyd’s segment
underwriting result

Net negative impact on
underwriting result

25.0

26.5

1.1

11.6

3.3

2.7

6.0

85.4

(222,256) $

(229,980) $

(4,927) $

(109,043) $

(31,556)

(24,156)

(47,538)

(669,456)

(6,500)

(7,500)

(6,000)

—

(6,026)

(12,289)

—

(2,925)

—

(6,000)

(26,000)

(2,500)

(6,000)

(29,740)

(234,782) $

(249,769) $

(10,927) $

(111,968) $

(31,556) $

(26,656) $

(59,538) $

(725,196)

Underwriting Results by Segment

Catastrophe Reinsurance

Below is a summary of the underwriting results and ratios for our Catastrophe Reinsurance segment:

Catastrophe Reinsurance Segment Overview

Year ended December 31,

2013

2012

2011

(in thousands, except percentages)
Catastrophe Reinsurance gross premiums written

Renaissance
DaVinci

Total Catastrophe Reinsurance gross premiums

written

Net premiums written
Net premiums earned
Net claims and claim expenses incurred
Acquisition expenses
Operational expenses
Underwriting income (loss)

$ 729,887
390,492

$ 733,963
448,244

$ 742,236
435,060

$1,120,379
$ 753,078
$ 723,705
7,908
49,161
108,130
$ 558,506

$1,182,207
$ 766,035
$ 781,738
165,209
66,665
103,811
$ 446,053

$1,177,296
$ 773,560
$ 737,545
770,350
62,882
100,932
$ (196,619)

Net claims and claim expenses incurred – current accident

year

$ 109,945

$ 275,777

$ 829,487

Net claims and claim expenses incurred – prior

accident years

Net claims and claim expenses incurred – total

(102,037)
7,908

(110,568)
$ 165,209

(59,137)
$ 770,350

Net claims and claim expense ratio – current accident year
Net claims and claim expense ratio – prior accident years
Net claims and claim expense ratio – calendar year
Underwriting expense ratio
Combined ratio

15.2 %
(14.1)%
1.1 %
21.7 %
22.8 %

35.3 %
(14.2)%
21.1 %
21.8 %
42.9 %

112.5 %
(8.1)%
104.4 %
22.3 %
126.7 %

Catastrophe Reinsurance Gross Premiums Written – In 2013, our Catastrophe Reinsurance segment gross
premiums written decreased by $61.8 million, or 5.2%, to $1,120.4 million, compared to $1,182.2 million in
2012, primarily reflecting reduced risk-adjusted pricing in the catastrophe markets we serve, including the
Florida market as a whole, and the non-renewal of a number of contracts during the January and June 2013
renewals; net negative reinstatement premiums written of $24.1 million principally related to Storm Sandy,
the Tohoku Earthquake and the Thailand Floods; and partially offset by $65.6 million of gross premiums
written related to increased quota share premium and $27.0 million associated with a multi-year transaction.

Excluding the impact of the $24.1 million of net negative reinstatement premiums written and $17.1 million
of net positive reinstatement premiums written in 2013 and 2012, respectively, gross premiums written
decreased $20.6 million, or 1.8% primarily due to the reduction in gross premiums written, discussed above.

In 2012, our Catastrophe Reinsurance segment gross premiums written increased by $4.9 million, or 0.4%,
to $1,182.2 million, compared to $1,177.3 million in 2011. Excluding the impact of $17.1 million and $159.8
million of net reinstatement premiums written in 2012 and 2011, our Catastrophe Reinsurance segment
gross premiums written increased $147.6 million, or 14.5%, in 2012, primarily due to improved market
conditions on a risk-adjusted basis within our core lines of business during the key January and June 2012
renewals, and inclusive of $37.4 million and $37.7 million of gross premiums written on behalf of our then
fully-collateralized joint ventures, Upsilon RFO and Tim Re III.

100

Our Catastrophe Reinsurance segment premiums are prone to significant volatility due to the timing of
contract inception and also due to the business being characterized by a relatively small number of
relatively large transactions. In addition, our property catastrophe reinsurance gross premiums written
continue to be characterized by a large percentage of U.S. and Caribbean premium, as we have found
business derived from exposures in Europe or the rest of the world to be, in general, less attractive on a
risk-adjusted basis during recent periods. A significant amount of our U.S. and Caribbean premium
provides coverage against windstorms, notably including U.S. Atlantic windstorms, as well as earthquakes
and other natural and man-made catastrophes.

Year ended December 31,

(in thousands)

2013

2012

2011

Ceded premiums written - Catastrophe Reinsurance

segment

367,301 $

416,172 $

403,736

Catastrophe Reinsurance Ceded Premiums Written – Ceded premiums written in our Catastrophe
Reinsurance segment decreased $48.9 million to $367.3 million in 2013, compared to $416.2 million in
2012, primarily reflecting the non-renewal of a number of transactions when we constructed our portfolio
during the June renewals, thereby retaining more of the attractive risks given the current market conditions,
and the non-renewal of Timicuan Reinsurance III Limited (“Tim Re III”) which resulted in $37.7 million of
ceded premiums written in 2012, partially offset by the inception of new contracts, including the external
cession of $37.5 million of premium related to Upsilon RFO during 2013.

Ceded premiums written in our Catastrophe Reinsurance segment increased by $12.4 million in 2012,
compared to 2011. Excluding the impact of $1.0 million and $28.0 million of reinstatement premiums
related to recoveries on certain large losses in 2012 and 2011, respectively, ceded premiums written
increased by $39.4 million or 9.8%, primarily due to ceded premiums written of $48.5 million related to our
managed joint ventures, Upsilon and Tim Re III.

Due to the potential volatility of the property catastrophe reinsurance contracts which we sell, we purchase
reinsurance to reduce our exposure to large losses and to help manage our risk portfolio. We use our
REMS© modeling system to evaluate how each purchase interacts with our portfolio of reinsurance
contracts we write, and with the other ceded reinsurance contracts we purchase, to determine the
appropriateness of the pricing of each contract and whether or not it helps us to balance our portfolio of
risks.

To the extent that appropriately priced coverage is available, we anticipate continued use of reinsurance to
reduce the impact of large losses on our financial results and to manage our portfolio of risk; however, the
buying of ceded reinsurance in our Catastrophe Reinsurance segment is based on market opportunities
and is not based on placing a specific reinsurance program each year. In addition, in future periods we may
utilize the growing market for insurance-linked securities to expand our ceded reinsurance buying if we find
the pricing and terms of such coverages attractive.

Catastrophe Reinsurance Underwriting Results – Our Catastrophe Reinsurance segment generated
underwriting income of $558.5 million in 2013, compared to $446.1 million in 2012, an increase of $112.5
million. In 2013, our Catastrophe Reinsurance segment generated a net claims and claim expense ratio of
1.1%, an underwriting expense ratio of 21.7% and a combined ratio of 22.8%, compared to 21.1%, 21.8%
and 42.9%, respectively, in 2012.

The $112.5 million increase in the Catastrophe Reinsurance segment’s underwriting result and 20.1
percentage point decrease in the combined ratio were driven by a relatively light catastrophe loss year
resulting in a $165.8 million decrease in current accident year net claims and claim expenses, combined
with a $17.5 million decrease in acquisition expenses, partially offset by a $58.0 million decrease in net
premiums earned. Included in underwriting results for the Catastrophe Reinsurance segment in 2013 are
$21.9 million and $10.7 million of underwriting losses related to the May 2013 U.S. Tornadoes and the
European Floods, respectively. The decrease in acquisition expenses is primarily attributable to increases
in profit commissions on certain ceded reinsurance contracts entered into which are netted with acquisition
expenses, as discussed further below.

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In addition, the net positive impact on the Catastrophe Reinsurance segment‘s underwriting results from our
review of Storm Sandy during the fourth quarter of 2013 was $32.8 million, or 6.8 percentage points on the
combined ratio, as detailed in the table below.

Year ended December 31, 2013

(in thousands, except percentages)

Net claims and claim expenses incurred

Reinstatement premiums earned

Ceded reinstatement premiums earned

Profit commissions

Storm Sandy

44,460

(12,653)

341

657

Net positive impact on Catastrophe Reinsurance segment underwriting result

32,805

Percentage point impact on Catastrophe Reinsurance segment combined ratio

(6.8)

Our Catastrophe Reinsurance segment generated underwriting income of $446.1 million in 2012, compared
to incurring an underwriting loss of $196.6 million in 2011, an improvement of $642.7 million. The
improvement in underwriting income was driven by an increase in net premiums earned of $44.2 million
principally due to the increase in gross premiums written noted above and a $553.7 million decrease in
current accident year claims and claim expenses as a result of the relatively low level of insured
catastrophe losses during 2012 which included $191.2 million of net claims and claim expenses related to
Hurricane Isaac and Storm Sandy, compared to 2011 which was negatively impacted by net claims and
claim expenses related to the 2011 Large Losses of $792.7 million. In addition, favorable development on
prior accident years claims and claim expenses within our Catastrophe Reinsurance segment was $110.6
million in 2012, compared to $59.1 million in 2011, an increase of $51.4 million, as discussed below.

In 2012, our Catastrophe Reinsurance segment generated a net claims and claim expense ratio of 21.1%,
an underwriting expense ratio of 21.8% and a combined ratio of 42.9%, compared to 104.4%, 22.3% and
126.7%, respectively, in 2011. Current accident year net claims and claim expenses of $275.8 million
includes $158.5 million related to Storm Sandy, $35.0 million related to the tornado outbreaks across the
Midwestern region of the U.S. during late February and early March (PCS 66 and 67, respectively), $32.7
million related to Hurricane Isaac and $8.2 million related to the June 29, 2012 derecho (PCS 83) which
impacted the Midwest to Mid-Atlantic coast of the U.S., with the remainder due primarily to a number of
other relatively small events throughout the U.S. During 2012, Hurricane Isaac and Storm Sandy had a net
negative impact of $146.9 million, or 23.3 percentage points, on our Catastrophe Reinsurance segment’s
underwriting result and combined ratio, respectively, as detailed in the table below. Operating expenses of
$103.8 million in 2012 remained relatively flat compared to $100.9 million in 2011.

See the financial data below for additional information detailing the net negative impact of Hurricane Isaac
and Storm Sandy on our Catastrophe Reinsurance segment in 2012.

Year ended December 31, 2012

(in thousands, except percentages)

Hurricane
Isaac

Storm Sandy

Total

Net claims and claim expenses incurred

(32,685) $

(158,477) $

(191,162)

Reinstatement premiums earned

Ceded reinstatement premiums earned

Profit commissions

8,844

—

(2,016)

36,030

(385)

1,771

44,874

(385)

(245)

Net negative impact on Catastrophe Reinsurance segment

underwriting result

(25,857) $

(121,061) $

(146,918)

Percentage point impact on Catastrophe Reinsurance

segment combined ratio

4.8

21.0

23.3

Losses from our Catastrophe Reinsurance segment can be infrequent, but severe, as demonstrated by our
2011 results. Although 2012 was generally considered to be the third most costly year for industry-wide
insured property catastrophe losses, behind only 2011 and 2005, we incurred a relatively low level of net
claims and claim expenses. During periods in which we experience relatively low levels of property

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catastrophe loss activity, such as 2013 and 2012, we have the potential to produce a low level of losses and
a related increase in underwriting income. As described herein, we believe there is likely to be an increase
in the severity, and possibly the frequency, of weather related natural disasters and catastrophes relative to
the historical experience over the past 100 years, including the frequency and severity of hurricanes that
have the potential to make landfall in the U.S., potentially as a result of decadal ocean water temperature
cyclical trends, changes in expected sea levels and a longer-term trend towards global warming.

During 2013, we experienced $102.0 million of favorable development on prior year reserves within the
Catastrophe Reinsurance segment, compared to $110.6 million in 2012, primarily due to $44.5 million,
$18.0 million, $16.3 million and $10.9 million of favorable development related to reductions in the expected
ultimate net loss for Storm Sandy (as detailed in the table above), the Tohoku Earthquake, the 2008
Hurricanes and the 2011 New Zealand Earthquake, respectively, as reported claims on these events came
in lower than expected, and $34.2 million of net favorable development related to a number of other
catastrophes principally the result of reported claims coming in lower than expected, resulting in decreases
to the ultimate claims for these events through the application of our formulaic actuarial reserving
methodology. Partially offsetting the reductions noted above was adverse development on the 2010 New
Zealand Earthquake, U.S. PSC 70 and Hurricane Isaac of $11.0 million, $8.2 million and $2.6 million,
respectively, associated with an increase in reported gross ultimate losses.

During 2012, we experienced $110.6 million of favorable development on prior year reserves within the
Catastrophe Reinsurance segment, compared to $59.1 million of favorable development on prior years
reserves in 2011. The favorable development on prior year reserves in 2012 was primarily due to
reductions in estimated ultimate losses on the 2010 Chilean Earthquake of $24.6 million, the 2008
Hurricanes of $17.5 million, the June 2007 U.K. Floods of $17.3 million, the 2005 Hurricanes of $6.4 million,
Hurricane Irene of $4.6 million, the Tohoku Earthquake of $3.9 million and a number of other catastrophes
totaling $57.7 million, and partially offset by adverse development related to the 2010 and 2011 New
Zealand Earthquakes of $21.5 million primarily due to increase in estimated ultimate losses.

See “Part II, Item 7. Summary of Critical Accounting Estimates, Claims and Claim Expense Reserves” for
additional discussion of our reserving techniques and prior year development of net claims and claim
expenses.

We have entered into joint ventures and specialized quota share cessions of our book of business. In
accordance with the joint venture and quota share agreements, we are entitled to certain profit commissions
and fee income. We record these profit commissions and fees as a reduction in acquisition and operating
expenses and, accordingly, these profit commissions and fees have reduced our underwriting expense
ratios. These profit commissions and fees totaled $86.0 million, $65.4 million and $58.3 million in 2013,
2012 and 2011, respectively, and resulted in a corresponding decrease to the Catastrophe Reinsurance
segment underwriting expense ratio of 11.9%, 8.4% and 7.9%, respectively. In addition, we are entitled to
certain fee income and profit commissions from DaVinci. Because the results of DaVinci, and its parent
DaVinciRe, are consolidated in our results of operations, these fees and profit commissions are eliminated
in our consolidated financial statements and are principally reflected in redeemable noncontrolling interest –
DaVinciRe. The net impact of all fees and profit commissions related to these joint ventures and
specialized quota share cessions within our Catastrophe Reinsurance segment was $145.9 million, $120.0
million and $64.6 million in 2013, 2012 and 2011, respectively.

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Specialty Reinsurance

Below is a summary of the underwriting results and ratios for our Specialty Reinsurance segment:

Specialty Reinsurance Segment Overview
Year ended December 31,

(in thousands, except percentages)
Specialty Reinsurance gross premiums written

Renaissance

DaVinci

2013

2012

2011

$ 256,354

$ 207,387

$ 144,192

3,135

2,500

1,699

Total Specialty Reinsurance gross premiums written

$ 259,489

$ 209,887

$ 145,891

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Underwriting income

$ 248,562

$ 201,552

$ 139,939

$ 214,306

$ 164,685

$ 135,543

67,236

41,538

31,780

76,813

23,826

29,124

13,354

20,096

30,319

73,752

34,922

71,774

Net claims and claim expenses incurred – current accident

year

Net claims and claim expenses incurred – prior accident

years

$ 101,347

$ 110,959

91,115

(34,111)

(34,146)

(77,761)

Net claims and claim expenses incurred – total

67,236

76,813

13,354

Net claims and claim expense ratio – current accident year

Net claims and claim expense ratio – prior accident years

Net claims and claim expense ratio – calendar year

Underwriting expense ratio

Combined ratio

47.3 %

(15.9)%

31.4 %

34.2 %

65.6 %

67.4 %

(20.8)%

46.6 %

32.2 %

78.8 %

67.2 %

(57.3)%

9.9 %

37.1 %

47.0 %

Specialty Reinsurance Gross Premiums Written – In 2013, our Specialty Reinsurance segment gross
premiums written increased $49.6 million, or 23.6%, to $259.5 million, compared to $209.9 million in 2012,
primarily due to the inception of a number of new contracts which met our risk-adjusted return thresholds
including additional quota share business.

In 2012, our Specialty Reinsurance segment gross premiums written increased $64.0 million, or 43.9%, to
$209.9 million, compared to $145.9 million in 2011, primarily due to the inception of a number of new
contracts during 2012 which met our risk-adjusted return thresholds.

During 2013 and 2012, we experienced growth in a number of our specialty lines of business and will
continue to seek to expand our specialty reinsurance operations through this platform, although we cannot
assure you that we will do so. Our specialty reinsurance premiums are prone to significant volatility as this
business is characterized by a relatively small number of comparably large transactions.

Our Specialty Reinsurance segment gross premiums written in force at December 31, 2013 reflected a
relatively larger proportion of quota share reinsurance compared to excess of loss reinsurance than in
comparative periods. Our relative mix of business between quota share, or proportional business, and
excess of loss business has fluctuated in the past and will vary in the future. Quota share business typically
has relatively higher premiums per unit of expected underwriting income than traditional excess of loss
reinsurance, particularly business that is heavily catastrophe exposed. In addition, quota share coverage
tends to be exposed to relatively more attritional, and frequent, losses while subject to less expected
severity. Our underwriting determination to support additional quota share capacity in 2013 reflected, in

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part, an assessment that the underlying business written by certain of our primary insurer clients had
improved on a risk-adjusted basis, making this coverage more attractive in our portfolio.

Specialty Reinsurance Underwriting Results – Our Specialty Reinsurance segment generated underwriting
income of $73.8 million in 2013, compared to $34.9 million in 2012. In 2013, our Specialty Reinsurance
segment generated a net claims and claim expense ratio of 31.4%, an underwriting expense ratio of 34.2%
and a combined ratio of 65.6%, compared to 46.6%, 32.2% and 78.8%, respectively, in 2012. The $38.8
million increase in underwriting income and 13.2 percentage point decrease in the combined ratio is
primarily due to a $49.6 million increase in net premiums earned as a result of the growth in gross
premiums written over the prior twelve months and a $9.6 million decrease in net claims and claim
expenses, partially offset by a $17.7 million increase in acquisition expenses due to higher net premiums
earned and a higher proportion of quota share reinsurance premiums which have a higher acquisition
expense ratio. Current accident year net claims and claim expenses of $101.3 million in 2013 were
principally the result of the application of our formulaic actuarial reserving methodologies for establishing
incurred but not reported reserves for net claims and claim expenses.

Our Specialty Reinsurance segment generated $34.9 million of underwriting income in 2012, compared to
$71.8 million in 2011, a decrease of $36.9 million, principally due to a $63.5 million increase in net claims
and claim expenses, partially offset by a $29.1 million increase in net premiums earned due to the increase
in gross premiums written noted above. The $63.5 million increase in net claims and claim expenses is
driven by a $43.6 million decrease in favorable development on prior accident year net claims and claim
expenses and a $19.8 million increase in current accident year net claims and claim expenses, both as
discussed below.

In 2012, our Specialty Reinsurance segment generated a net claims and claim expense ratio of 46.6%, an
underwriting expense ratio of 32.2% and a combined ratio of 78.8%, compared to 9.9%, 37.1% and 47.0%,
respectively, in 2011. The 4.9 percentage point decrease in the underwriting expense ratio was principally
driven by a $29.1 million increase in net premiums earned and partially offset by a $3.7 million increase in
acquisition expenses, both as a result of the increase in gross premiums written noted above. Operating
expenses of $29.1 million in 2012 remained relatively flat compared to $30.3 million in 2011.

Current accident year net claims and claim expenses of $111.0 million in 2012 includes $16.0 million related
to estimated ultimate losses associated with potential exposure to LIBOR related claims attributable to the
current accident year, $11.0 million related to Storm Sandy and $5.0 million related to the grounding of the
Costa Concordia cruise ship, with the remainder principally due to reported attritional losses and the
application of our formulaic reserving methodologies for establishing incurred but not reported reserves for
net claims and claim expenses.

The favorable development of $34.1 million in 2013 was primarily driven by $10.4 million associated with
actuarial assumption changes in the first quarter of 2013, principally in our casualty clash and casualty risk
lines of business, and primarily as a result of revised claim development factors based on actual loss
experience, and $23.7 million due to paid and reported claims activity coming in lower than expected on
prior accident years events, as a result of the application of our formulaic actuarial reserving methodology.

The favorable development of $34.1 million within our Specialty Reinsurance segment in 2012 included
$14.4 million associated with actuarial assumption changes, principally in our casualty and medical
malpractice lines of business, and primarily as a result of revised initial expected claims ratios and claim
development factors due to actual experience coming in better than expected, $3.0 million of favorable
development on the 2005 Hurricanes and $16.7 million of reported losses developing more favorably than
expected during 2012 on prior accident years events.

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Lloyd’s Segment

Below is a summary of the underwriting results and ratios for our Lloyd’s segment:

Lloyd’s Segment Overview
Year ended December 31,

(in thousands, except percentages)
Lloyd’s gross premiums written

Specialty

Catastrophe

Total Lloyd’s gross premiums written

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Underwriting loss

2013

2012

2011

$ 188,663

$ 123,099

37,869

36,888

$ 226,532

$ 159,987

$ 201,697

$ 135,131

$ 176,029

$ 122,968

95,693

34,823

50,540

80,242

22,864

45,680

83,641

27,943

111,584

98,617

76,386

73,259

14,031

36,732

(5,027)

$ (25,818)

(47,636)

Net claims and claim expenses incurred – current accident

year

Net claims and claim expenses incurred – prior accident

years

$ 103,949

96,444

(8,256)

(16,202)

Net claims and claim expenses incurred – total

95,693

80,242

72,781

478

73,259

Net claims and claim expense ratio – current accident year

Net claims and claim expense ratio – prior accident years

Net claims and claim expense ratio – calendar year

Underwriting expense ratio

Combined ratio

59.1 %

(4.7)%

54.4 %

48.5 %

102.9 %

78.4 %

(13.1)%

65.3 %

55.7 %

121.0 %

95.3%

0.6%

95.9%

66.5%

162.4%

Lloyd’s Gross Premiums Written – Gross premiums written in our Lloyd’s segment increased by $66.5
million, or 41.6%, to $226.5 million in 2013, compared to $160.0 million in 2012, primarily due to Syndicate
1458 continuing to organically grow its specialty book of business across several of its lines of business.

Gross premiums written in our Lloyd’s segment increased by $48.4 million, or 43.4%, to $160.0 million in
2012, compared to $111.6 million in 2011, primarily due to Syndicate 1458 growing its book of business
across the majority of its lines of business and the impact of rate increases, most notably in its casualty
lines of business.

Lloyd’s Underwriting Results – Our Lloyd’s segment incurred an underwriting loss of $5.0 million and a
combined ratio of 102.9% in 2013, compared to an underwriting loss of $25.8 million and a combined ratio
of 121.0%, respectively, in 2012. The $20.8 million improvement in the underwriting result for our Lloyd’s
segment is primarily due to an increase in net premiums earned of $53.1 million, as a result of the increase
in gross premiums written, noted above, and the relatively low level of insured catastrophe loss activity
during 2013, compared to 2012 which was negatively impacted by Storm Sandy which resulted in $17.1
million of underwriting losses and increased the combined ratio by 16.2 percentage points in 2012, and
partially offset by increased underwriting expenses and lower favorable development on prior accident
years net claims and claim expenses, each as discussed below. In addition, our Lloyd’s segment’s
underwriting expense ratio decreased to 48.5% in 2013, compared to 55.7% in 2012, driven in part by the
increase in net premiums earned, noted above, and in part by a relatively smaller increase in our Lloyd’s
segment underwriting expenses as underwriting expenses for our Lloyd’s segment are increasing at a
slower rate. Our Lloyd’s segment experienced current accident year net claims and claim expenses of

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$103.9 million during 2013, compared to $96.4 million in 2012, which includes $2.1 million and $1.0 million
related to the European Floods and May 2013 U.S. Tornadoes, respectively, with the remainder primarily
related to attritional loss activity.

Operational expenses increased $4.9 million to $50.5 million in 2013, compared to 2012, and principally
include compensation and related operating expenses. Acquisition expenses increased $12.0 million to
$34.8 million in 2013, compared to 2012, primarily due to the increase in gross premiums written in our
Lloyd’s segment, as discussed above. The decrease in the underwriting expense ratio to 48.5% in 2013,
from 55.7% in 2012, was primarily driven by the increase in net premiums earned which increased at a
higher rate than the increase in underwriting expenses.

Our Lloyd’s segment incurred an underwriting loss of $25.8 million and a combined ratio of 121.0% in 2012,
compared to $47.6 million and a combined ratio of 162.4% in 2011. Current accident year net claims and
claim expenses increased $23.7 million, while favorable development of prior accident years net claims and
claim expenses increased $16.7 million, during 2012, compared to 2011, resulting in net claims and claims
expenses increasing to $80.2 million in 2012, compared to $73.3 million in 2011. Included in current
accident year net claims and claim expenses during 2012 is $18.5 million related to Storm Sandy, $4.5
million due to the U.S. drought impacting the 2012 crop season and estimated ultimate losses of $2.5
million associated with potential exposure to LIBOR related claims attributable to the current accident year,
with the remainder due to reported attritional losses and the application of our formulaic reserving
methodologies for establishing incurred but not reported reserves for net claims and claim expenses.
Operational expenses increased $8.9 million, to $45.7 million in 2012, compared to 2011, principally driven
by an increase in compensation and related operating expenses as a result of growth in headcount as
Syndicate 1458 continues to expand its operations. The decrease in the underwriting expense ratio to
55.7% in 2012, from 66.5% in 2011, was primarily driven by the increase in net premiums earned.

The favorable development of prior accident years claims and claim expenses within our Lloyd’s segment of
$8.3 million during 2013 was principally driven by $4.7 million related to reported claims coming in lower
than expected on prior accident years events as a result of the application of our formulaic actuarial
reserving methodology and $3.8 million pertaining to a decrease in the estimated ultimate net claims and
claim expenses related to Storm Sandy, partially offset by adverse development of $0.3 million related to
assumption changes.

The favorable development of $16.2 million within our Lloyd’s segment in 2012 included $5.5 million related
to the 2011 Thailand Floods, $2.5 million related to Hurricane Irene and $1.3 million related to actuarial
assumption changes, with the remainder primarily due to reported claims coming in lower than expected on
a number of prior accident years events, as a result of the application of our formulaic actuarial reserving
methodology.

Other Underwriting Loss

Year ended December 31,
(in thousands)
Underwriting loss

2013

2012

2011

(498) $

(3,706) $

(4,686)

Included in our Other category are primarily the underwriting results related to the remnants of our
Bermuda-based insurance operations not sold pursuant to the stock purchase agreement with QBE.
Included in our Other category was an underwriting loss of $0.5 million in 2013, primarily due to $0.5 million
of net adverse development on prior accident years net claims and claim expenses.

Included in our Other category was an underwriting loss of $3.7 million in 2012, primarily due to us entering
into a loss portfolio transfer in respect of our contractor’s liability book of business within RenaissanceRe
Specialty Risks, whereby we transfered net liabilities of $29.1 million, resulting in a loss of $7.4 million
which was recorded as prior accident years net claims and claims expenses, partially offset by favorable
development related to the application of our formulaic actuarial reserving methodology with the reductions

107

being due to actual paid and reported claim activity being more favorable to date than what was originally
anticipated when setting the initial reserves.

Net Investment Income

Year ended December 31,
(in thousands)
Fixed maturity investments
Short term investments
Equity investments trading
Other investments

Hedge funds and private equity investments
Other

Cash and cash equivalents

Investment expenses

Net investment income

2013

2012

2011

95,907 $

1,698
2,295

103,330 $
1,007
1,086

116,570
1,666
471

45,810
73,692
191
219,593
(11,565)
208,028 $

36,635
35,196
277
177,531
(11,806)
165,725 $

27,541
10,585
195
157,028
(10,157)
146,871

Net investment income was $208.0 million in 2013, compared to $165.7 million in 2012. The $42.3 million
increase in net investment income was primarily driven by a $47.7 million increase related to our portfolio of
other investments principally driven by an increase in the fair value of our investment in the common shares
of Essent included in the other category of our portfolio of other investments prior to October 31, 2013 (see
below for additional details with respect to Essent), and higher returns in our private equity investments as a
result of improved equity market prices.

Low interest rates in recent years have lowered the yields at which we invest our assets relative to historical
levels, though recent interest rate increases have generated net realized and unrealized losses on
investments while increasing our portfolio yield. We expect these developments, combined with the current
composition of our investment portfolio and other factors, to constrain investment income growth for the
near term. The hedge fund, private equity and other investment portfolios are accounted for at fair value
with the change in fair value recorded in net investment income which included net unrealized gains of
$75.8 million in 2013, compared to $38.2 million of net unrealized gains in 2012.

At September 30, 2013, we had an investment of $48.0 million in the common shares of Essent, a then
private company, which we recorded in other investments on our consolidated balance sheet with fair value
adjustments recorded in net investment income on our consolidated statements of operations. On
October 31, 2013, Essent’s common shares began publicly trading on the NYSE and at that time, we
reclassified our investment in Essent as equity investments trading on our consolidated balance sheet and
subsequently recognized any realized and unrealized gains or losses related to our investment in Essent
following the initial public offering price in net realized and unrealized gains on investments in our
consolidated statements of operations in the period in which they occur. During the period from January 1,
2013 through October 30, 2013, we recorded $56.9 million of net investment income related to the
estimated increase in the fair value of our investment in Essent. From October 31, 2013 through December
31, 2013, we recorded $35.5 million of unrealized gains in net realized and unrealized gains on investments
in our consolidated statements of operations in respect of our investment in Essent. At December 31, 2013,
the fair value of our investment in Essent was $121.1 million. We have agreed, subject to certain
exceptions, not to dispose of or hedge any of the common shares of Essent we hold prior to April 28, 2014.

Net investment income was $165.7 million in 2012, compared to $146.9 million in 2011. The $18.9 million
increase in net investment income in 2012 was driven by a $29.3 million increase in the returns from our
allocation to senior secured bank loan funds and insurance-linked securities included in other in the table
above and a $9.1 million increase in the returns from our portfolio of hedge funds and private equity
investments, with the increase primarily from our private equity investments due to higher fund valuations.
These increases were offset by a $13.2 million decrease from our fixed maturity investments portfolio as a
result of lower total returns. The hedge fund, private equity and other investment portfolios are accounted
for at fair value with the change in fair value recorded in net investment income which included net
unrealized gains of $38.2 million in 2012, compared to $12.7 million of net unrealized gains in 2011.

108

Subsequently in the second quarter of 2013, we established a public equity securities mandate with a third
party investment manager, which currently comprises a majority of our investments included in equity
investments trading. It is possible our equity allocation will increase in the future, although we do not expect
it to represent a material portion of our invested assets or to have a material effect on our financial results
for the reasonably foreseeable future.

Our equity investments trading are carried at fair value with dividend income included in net investment
income, and realized and unrealized gains included in net realized and unrealized gains on investments, in
our consolidated statements of operations and generated $2.3 million of net investment income in 2013,
compared to $1.1 million in 2012 and $0.5 million million in 2011.

Net Realized and Unrealized Gains on Investments and Net Other-Than-Temporary Impairments

Year ended December 31,

(in thousands)
Gross realized gains

Gross realized losses

Net realized gains on fixed maturity investments

Net unrealized (losses) gains on fixed maturity

investments trading

Net realized and unrealized gains (losses) on

investments-related derivatives

Net realized gains on equity investments trading

Net unrealized gains on equity investments trading

2013

2012

2011

72,492 $

97,787 $

79,358

(50,206)

22,286

(16,705)

81,082

(30,659)

48,699

(87,827)

75,279

19,404

31,058

26,650

42,909

(866)

—

7,626

Net realized and unrealized gains on investments

35,076 $

163,121 $

Total other-than-temporary impairments

Portion recognized in other comprehensive income, before

taxes

—

(395)

Net other-than-temporary impairments

— $

(343) $

(26,712)

—

2,565

43,956

(630)

(552)

Our investment portfolio is structured to seek to preserve capital and provide us with a high level of liquidity.
A large majority of our investments are invested in the fixed income markets and, therefore, our realized
and unrealized holding gains and losses on investments are highly correlated to fluctuations in interest
rates. Therefore, as interest rates decline, we will tend to have realized and unrealized gains from our
investment portfolio, and as interest rates rise, we will tend to have realized and unrealized losses from our
investment portfolio.

Net realized and unrealized gains on investments were $35.1 million in 2013, compared to gains of $163.1
million in 2012, a decrease of $128.0 million. The net unrealized losses on our fixed maturity investments
trading of $87.8 million during 2013, deteriorated $163.1 million, compared to unrealized gains of $75.3
million in 2012, primarily due to a rising interest rate environment during 2013, compared to 2012 where
significant contraction in credit spreads yielded positive returns from our fixed maturity investment portfolio.
In addition, realized gains on equity investments trading of $26.7 million was principally the result of the sale
of substantially all of our portfolio of internally managed public equity investments trading during the first
quarter of 2013. Unrealized gains on equity investments trading of $42.9 million in 2013, increased $35.3
million, compared to $7.6 million in 2012, principally due to unrealized gains of $35.5 million recorded in the
fourth quarter of 2013 related to our investment in Essent (as discussed above in “Net Investment Income”),
combined with improved pricing in equity markets for 2013.

Previously, we classified the net realized and unrealized gains (losses) from investments-related derivatives
such as interest rate futures and credit derivatives in net investment income on our consolidated statement

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of operations. However, in order to align the net realized and unrealized (losses) gains of the majority of
our fixed maturity investments portfolio with the net realized and unrealized gains (losses) of the
investments-related derivatives, we reclassified the investments-related derivatives from net investment
income to net realized and unrealized (losses) gains. As a result of this reclassification, included in net
realized and unrealized gains on investments in 2013 is $31.1 million of net realized and unrealized gains
on investments-related derivatives, compared to 2012 which included $0.9 million of net realized and
unrealized losses on investments-related derivatives. The $31.9 million improvement is primarily driven by
the rising interest rate environment during 2013, compared to 2012 which experienced significant
contraction in credit spreads.

Net realized and unrealized gains on investments were $163.1 million in 2012, compared to $44.0 million in
2011, an improvement of $119.2 million. In addition to increased turnover in our fixed maturity investments
portfolio generating $81.1 million of net realized gains in 2012, unrealized gains on our fixed maturity
investments trading of $75.3 million during 2012 increased $55.9 million, compared to $19.4 million of
unrealized gains in 2011, primarily due to the net appreciation of our fixed maturity investment portfolio as a
result of tightening credit spreads during 2012. Included in net realized and unrealized gains on
investments in 2012 is $7.6 million of net unrealized gains on equity investments trading due to increases in
the share prices of our equity positions.

Equity in Earnings (Losses) of Other Ventures

Year ended December 31,
(in thousands)
Top Layer Re
Tower Hill Companies
Other

Total equity in earnings (losses) of other ventures

2013

2012

2011

13,836 $
10,270
(912)
23,194 $

20,792 $

4,965
(2,519)
23,238 $

(37,471)
2,923
(1,985)
(36,533)

Equity in earnings (losses) of other ventures primarily represents our pro-rata share of the net income (loss)
from our investments in Top Layer Re and the Tower Hill Companies, with the equity in earnings from these
entities, except Top Layer Re, recorded one quarter in arrears.

Our equity in earnings of other ventures of $23.2 million in 2013 was relatively flat when compared to 2012.

Equity in earnings of other ventures was $23.2 million in 2012, compared to losses of $36.5 million in 2011.
The $59.8 million improvement in equity in earnings of other ventures was primarily due to our equity in
earnings of Top Layer Re of $20.8 million during 2012, as a result of the absence of net claims and claim
expenses in Top Layer Re 2012, compared to 2011, which was negatively impacted by net claims and claim
expenses related to the 2011 New Zealand and Tohoku Earthquakes and resulted in a loss to us of $37.5
million.

The carrying value of these investments on our consolidated balance sheet, individually or in the aggregate,
may differ from the realized value we may ultimately attain, perhaps significantly so.

Other (Loss) Income

Year ended December 31,

2013

2012

2011

(in thousands)
Assumed and ceded reinsurance contracts accounted for

as derivatives and deposits

Gain on NBIC

Mark-to-market on Platinum warrant

Other

Total other (loss) income

(2,517) $

(4,648) $

37,414

—

158

—

2,528

4,836

2,975

(880)

(2,359) $

(2,120) $

44,345

In 2013, we incurred an other loss of $2.4 million, compared to an other loss of $2.1 million in 2012. The
$0.2 million deterioration in other loss is the result of a reduction in other income from miscellaneous other

110

items, partially offset by a loss on the fair value of assumed and ceded reinsurance contracts accounted for
as deposits.

In 2012 we incurred an other loss of $2.1 million, compared to other income of $44.3 million in 2011. The
$46.5 million deterioration in other income is primarily due to:

•

a $42.1 million decrease in other income generated by our assumed and ceded reinsurance
contracts accounted for at fair value, principally as a result of $45.0 million of net recoverables from
the Tohoku Earthquake during 2011 not reoccurring in 2012; and

the absence in 2012 of a mark-to-market adjustment on the Platinum warrant due to its sale during
the first quarter of 2011 and the sale of NBIC Holdings, Inc. (“NBIC”) in the third quarter of 2011.

Corporate Expenses

Year ended December 31,
(in thousands)

Total corporate expenses

2013

2012

2011

33,622 $

16,456 $

18,156

Corporate expenses include certain executive, director, legal and consulting expenses, costs for research
and development, impairment charges related to goodwill and other intangible assets, and other
miscellaneous costs, including those associated with operating as a publicly traded company. Corporate
expenses were $33.6 million in 2013, compared to $16.5 million in 2012, with the increase primarily driven
by the senior management transition changes announced during the second quarter of 2013 which totaled
$16.8 million. Corporate expenses were $16.5 million in 2012, compared to $18.2 million in 2011, with the
decrease driven by the absence of certain goodwill and intangible asset impairments of $5.2 million which
were incurred in 2011, and partially offset by a corporate insurance recovery of $1.7 million, recorded in
2011, which did not reoccur in 2012.

Interest Expense and Preferred Share Dividends

Year ended December 31,

(in thousands)
Interest expense

$250 million 5.75% Senior Notes

$100 million 5.875% Senior Notes

DaVinciRe revolving credit facility

Other

Total interest expense

Preferred share dividends

$125 million 6.08% Series C Preference Shares (1)

$150 million 6.60% Series D Preference Shares (1)

$275 million 5.375% Series E Preference Shares (1)

Total preferred share dividends

2013

2012

2011

14,375 $

—

3,554

17,929

11,317

4,845

8,786

24,948

5,875

—

2,847

23,097

15,200

19,695

—

34,895

14,375

5,875

474

2,644

23,368

15,200

19,800

—

35,000

58,368

Total interest expense and preferred share dividends

42,877 $

57,992 $

(1) During May 2013, we raised $275.0 million through the issuance of 11 million Series E Preference Shares, and subsequently
redeemed the remaining 6 million Series D Preference Shares for $150.0 million and 5 million Series C Preference Shares for
$125.0 million, or a total of $275.0 million. See “Capital Resources” for additional information.

Interest expense was $17.9 million in 2013, compared to $23.1 million in 2012, with the decrease driven by
the repayment of our 5.875% Senior Notes upon their scheduled maturity of February 15, 2013 using
available cash and investments. In addition, our preferred share dividends in 2013 were $24.9 million,
compared to $34.9 million in 2012, with the $9.9 million decrease driven by the redemption of our remaining
6 million Series D Preference Shares and 5 million Series C Preference Shares upon the issuance of our
Series E Preference Shares in May 2013. With the redemption of our remaining outstanding Series D

111

Preference Shares and 5.0 million Series C Preference Shares as noted in the table above, and in the
absence of issuing new preference shares, we expect our future preference share dividends to decrease in
2014 as a result of the lower coupon rate on the Series E Preference Shares, relative to the Series C and
Series D Preference Shares.

Interest expense was relatively flat at $23.1 million in 2012, compared to $23.4 million in 2011. In addition,
our preferred share dividends were also relatively flat at $34.9 million in 2012, compared to $35.0 million in
2011.

Income Tax Expense

Year ended December 31,
(in thousands)
Income tax expense

2013

2012

2011

(1,692) $

(1,413) $

(10,385)

We are subject to income taxes in certain jurisdictions in which we operate; however, since the majority of
our income is currently earned in Bermuda, which does not have a corporate income tax, the tax impact to
our operations has historically been minimal. During 2013, we incurred an income tax expense of $1.7
million, compared to income tax expense of $1.4 million and $10.4 million, in 2012 and 2011, respectively.
Income tax expense in 2011 was principally the result of establishing a full valuation allowance against our
deferred tax asset related to our U.S. tax-paying subsidiaries as described below.

Losses incurred within our U.S. tax-paying subsidiaries in the fourth quarter of 2011 were significant enough
to result in a cumulative GAAP taxable loss for the three year period ended December 31, 2011. We
reassess our valuation allowance on a quarterly basis and commencing with our reassessment effective
December 31, 2011, we determined that it was more likely than not that we would not be able to recover our
U.S. net deferred tax asset and increased our valuation allowance in the fourth quarter of 2011 to reduce
our net deferred tax asset to $Nil. At December 31, 2013, our U.S. tax-paying subsidiaries had a net
deferred tax asset of $43.9 million, for which a full valuation allowance has been provided. The remaining
valuation allowance as of December 31, 2013 relates exclusively to our operations in Ireland, the U.K. and
Singapore. Our Ireland, U.K. and Singapore operations have produced GAAP taxable losses and we
currently do not believe it is more likely than not that we will be able to recover our net deferred tax assets
from these jurisdictions. Our valuation allowance totaled $56.1 million and $35.1 million at December 31,
2013 and 2012, respectively.

Our effective income tax rate, which we calculate as income tax expense divided by income before taxes,
may fluctuate significantly from period to period depending on the geographic distribution of pre-tax income
in any given period between different jurisdictions with comparatively higher tax rates and those with
comparatively lower tax rates. The geographic distribution of pre-tax income can vary significantly between
periods due to, but not limited to, the following factors: the business mix of net premiums written and
earned; the size and nature of net claims and claim expenses incurred; the amount and geographic location
of operating expenses, net investment income, net realized and unrealized gains (losses) on investments;
outstanding debt and related interest expense; and the amount of specific adjustments to determine the
income tax basis in each of our operating jurisdictions. In addition, a significant portion of our gross and net
premiums are currently written and earned in Bermuda, which does not have a corporate income tax,
including the majority of our catastrophe business, which can result in significant volatility to our pre-tax
income (loss) in any given period. We expect our consolidated effective tax rate to increase in the future,
as our global operations outside of Bermuda expand. In addition, it is possible that we could be adversely
affected by changes in tax laws, regulation, or enforcement, any of which could increase our effective tax
rate more rapidly or steeply than we currently anticipate.

The preponderance of our revenue and pre-tax income is generated by our domestic operations (i.e.
Bermuda) in the form of underwriting income and net investment income, when compared to our foreign
operations. The geographic distribution of pre-tax income can vary significantly between periods due to, but
not limited, the following factors: the business mix of net premiums written and earned; the size and nature
of net claims and claim expenses incurred; the amount and geographic location of operating expenses, net
investment income and net realized and unrealized gains (losses) on investments; and the amount of
specific adjustments to determine the income tax basis in each of our operating jurisdictions. Pre-tax
income for our domestic operations (i.e. Bermuda) was higher compared to our foreign operations for the

112

years ended December 31, 2013, 2012 and 2011 primarily as a result of the more volatile catastrophe
business underwritten in our Bermuda operations during these periods being relatively free of catastrophe
losses and thus generating higher levels of net underwriting income than our foreign operations, which
underwrite primarily less volatile business and as a result produce lower levels of net underwriting income in
benign loss years. During the year ended December 31, 2011, our domestic operations incurred a loss
from continuing operations primarily as a result of significant catastrophe losses experienced during the
period resulting in underwriting losses.

Net (Income) Loss Attributable to Noncontrolling Interests

Year ended December 31,
(in thousands)
Net (income) loss attributable to noncontrolling interests

2013

2012

2011

(151,144) $

(148,040) $

33,157

Our net income attributable to the noncontrolling interests was $151.1 million in 2013, compared to $148.0
million in 2012. The $3.1 million change was primarily due to our noncontrolling economic ownership
percentage in DaVinciRe decreasing to 27.3% at December 31, 2013, compared to 30.8% at December 31,
2012, resulting in an increase in the portion of DaVinciRe’s net income attributable to noncontrolling
interests.

We expect our noncontrolling economic ownership in DaVinciRe to fluctuate over time.

Our net income attributable to the noncontrolling interests was $148.0 million in 2012, compared to a net
loss attributable to noncontrolling interests of $33.2 million in 2011. The $181.2 million change is primarily
due to increased profits at DaVinciRe as a result of significantly lower insured losses in respect of large
events and improved investment results, partially offset by a decrease in our noncontrolling economic
ownership percentage in DaVinciRe from 42.8% at December 31, 2011 to 30.8% at December 31, 2012.

Income (Loss) from Discontinued Operations

Year ended December 31,
(in thousands)
REAL
U.S.-based insurance operations
Income (loss) from discontinued operations

2013

2012

2011

2,422 $
—
2,422 $

(18,763) $
2,287
(16,476) $

(35,669)
(15,890)
(51,559)

Income (loss) from discontinued operations includes the financial results of REAL and substantially all of
our U.S.-based insurance operations sold to QBE. Income from discontinued operations was $2.4 million in
2013, compared to a loss from discontinued operations of $16.5 million in 2012. Included in income from
discontinued operations in 2013 is trading-related income of $10.5 million related to REAL, partially offset
by an $8.8 million loss on sale of REAL. In comparison, the loss from discontinued operations of $16.5
million in 2012 was primarily due to REAL experiencing trading losses driven by unusually warm weather
experienced in parts of the United Kingdom and the United States, principally during the first quarter of
2012.

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LIQUIDITY AND CAPITAL RESOURCES

Financial Condition

RenaissanceRe is a holding company, and we therefore rely on dividends from our subsidiaries and
investment income to make principal and interest payments on our debt and to make dividend payments to
our preference and common shareholders.

The payment of dividends by our subsidiaries is, under certain circumstances, limited under statutory
regulations and insurance law, which require our insurance subsidiaries to maintain certain measures of
solvency and liquidity. In addition, Bermuda regulations require approval from the Bermuda Monetary
Authority (“BMA”) for any reduction of capital in excess of 15% of statutory capital, as defined in the
Insurance Act. The Insurance Act also requires these Bermuda insurance subsidiaries of the Company to
maintain certain measures of solvency and liquidity. At December 31, 2013, the statutory capital and
surplus of our Bermuda insurance subsidiaries was $3.2 billion (December 31, 2012 - $3.1 billion) and the
minimum amount required to be maintained under Bermuda law, the Minimum Solvency Margin, was
$562.1 million (December 31, 2012 - $554.8 million). During 2013, Renaissance Reinsurance, DaVinciRe
and the operating subsidiaries of RenRe Insurance Holdings Ltd. returned capital to RenaissanceRe, which
included dividends declared and return of capital, net of capital contributions received, of $506.9 million,
$97.2 million and $Nil, respectively (2012 - $282.0 million, $133.3 million and $Nil, respectively).

Under the Insurance Act, RenaissanceRe Specialty Risks and RenaissanceRe Specialty U.S. are defined
as Class 3B insurers, and Renaissance Reinsurance and DaVinci are classified as Class 4 insurers, and
therefore must maintain capital at a level equal to its enhanced capital requirement (“ECR”) which is
established by reference to the Bermuda Solvency Capital Requirement (“BSCR”) model. The BSCR is a
risk-based capital model designed to give the BMA more advanced methods for determining an insurer’s
capital adequacy. Underlying the BSCR is the belief that all insurers should operate on an ongoing basis
with a view to maintaining their capital at a prudent level in excess of the Minimum Solvency Margin
otherwise prescribed under the Insurance Act. Alternatively, under the Insurance Act, insurers may, subject
to the terms of the Insurance Act and to the BMA’s oversight, elect to utilize an approved internal capital
model to determine regulatory capital. In either case, the ECR shall at all times equal or exceed the
respective Class 3B and Class 4 insurer’s Minimum Solvency Margin and may be adjusted in
circumstances where the BMA concludes that the insurer’s risk profile deviates significantly from the
assumptions underlying its ECR or the insurer’s assessment of its risk management policies and practices
used to calculate the ECR applicable to it. While not specifically referred to in the Insurance Act, the BMA
has also established a target capital level (“TCL”) for each Class 3B and Class 4 insurer equal to 120% of
its respective ECR. While a Class 3B or Class 4 insurer is not currently required to maintain its statutory
capital and surplus at this level, the TCL serves as an early warning tool for the BMA and failure to maintain
statutory capital at least equal to the TCL will likely result in increased BMA regulatory oversight. The 2013
BSCR for Renaissance Reinsurance, DaVinci, RenaissanceRe Specialty Risks and RenaissanceRe
Specialty U.S. must be filed with the BMA on or before April 30, 2014; at this time, we believe each
company will exceed its respective target level of required capital.

RenaissanceRe CCL and Syndicate 1458 are subject to oversight by the Council of Lloyd’s. RSML is
subject to regulation by the PRA and FCA, under the FSMA. Underwriting capacity of a member of Lloyd’s
must be supported by providing a deposit in the form of cash, securities or letters of credit, which are
referred to as Funds at Lloyd’s (“FAL”). This amount is determined by Lloyd’s and is based on Syndicate
1458’s solvency and capital requirement as calculated through its internal model. In addition, if the FAL are
not sufficient to cover all losses, the Lloyd’s Central Fund provides an additional level of security for
policyholders. At December 31, 2013, the FAL requirement set by Lloyd’s for Syndicate 1458 is £241.7
million based on its business plan, approved in November 2013 (2012 - £183.2 million based on its
business plan, approved November 2012) and using a foreign exchange conversion rate of 1 British Pound
= 1.52 U.S. Dollars. Actual FAL posted for Syndicate 1458 at December 31, 2013 by RenaissanceRe CCL
is $281.0 million and £60.0 million supported 100% by letters of credit (2012 - $222.0 million and £45.5
million).

114

The activities of the Singapore Branches are regulated by the Monetary Authority of Singapore pursuant to
Singapore’s Insurance Act and by the ACRA as foreign companies pursuant to Singapore’s Companies Act.
Renaissance Services of Asia Pte. Ltd. is registered with the ACRA and subject to Singapore’s Companies
Act.

For additional information with respect to our statutory requirements, refer to “Note 18. Statutory
Requirements in our Notes to Consolidated Financial Statements.”

As discussed in the “Capital Resources” section below, Renaissance Reinsurance is obligated to make a
mandatory capital contribution of up to $50.0 million in the event that a loss reduces Top Layer Re’s capital
below a specified level.

In the aggregate, our operating subsidiaries have historically produced sufficient cash flows to meet their
expected claims payments and operational expenses and to provide dividend payments to us. Our
subsidiaries also maintain a concentration of investments in high quality liquid securities, which
management believes will provide additional liquidity for extraordinary claims payments should the need
arise. See “Capital Resources” section below.

Liquidity and Cash Flows

Holding Company Liquidity

As a Bermuda-domiciled holding company, RenaissanceRe has limited operations of its own and its assets
consist primarily of investments in subsidiaries, and to a degree, cash and securities in amounts which
fluctuate over time. Accordingly, RenaissanceRe’s future cash flows largely depend on the availability of
dividends or other statutorily permissible payments from subsidiaries. The ability to pay such dividends is
limited by the applicable laws and regulations of the various countries and states in which these
subsidiaries operate, including, among others, Bermuda, the U.S., Ireland, and the U.K. Refer to “Part II,
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Liquidity
and Capital Resources, Financial Condition” for further discussion and details regarding dividend capacity
of our major operating subsidiaries.

RenaissanceRe’s principal uses of liquidity are: (1) common share related transactions including dividend
payments to holders of its common shareholders as well as common share repurchases from time to time;
(2) preference share related transactions including dividend payments to its preference shareholders as
well as preference share redemptions from time to time; (3) interest and principal payments on debt; (4)
capital investments in its subsidiaries; and (5) certain corporate and operating expenses.

We attempt to structure our organization such that it facilitates efficient capital movements between
RenaissanceRe and its operating subsidiaries and to ensure that adequate liquidity is available when
required, giving consideration to applicable laws and regulations, and the domiciliary location of sources of
liquidity and related obligations.

Sources of Liquidity

Historically, cash receipts from operations, consisting of premiums and investment income, generally have
provided sufficient funds to pay losses as well as operating expenses of our subsidiaries and to fund
dividends to RenaissanceRe. Cash receipts from operations are generally derived from the receipt of
investment income on our investment portfolio as well as the net receipt of premiums less net claims and
claims expenses and underwriting expenses related to our underwriting activities. The premiums received
by our operating subsidiaries are generally received months or even years before losses are paid under the
policies related to such premiums. Premiums and acquisition expenses are settled based on terms of trade
as stipulated by an underwriting contract, and generally are received within the first year of inception of a
policy when the premium is written, but can be longer on certain reinsurance business assumed. Operating
expenses are generally paid within a year of being incurred. Claims and claims expenses may take a much
longer time before they are reported and ultimately settled, requiring the establishment of reserves for
claims and claim expenses. Therefore, the amount of claims paid in any one year is not necessarily related
to the amount of net claims incurred in that year, as reported in the consolidated statement of operations.

As a result of the combination of current market conditions, lower investment yields, and the nature of our
business where a large portion of the coverages we provide can produce losses of high severity and low

115

frequency, it is not possible to accurately predict our future cash flows from operating activities. As a
consequence, cash flows from operating activities may fluctuate, perhaps significantly, between individual
quarters and years. Due to the magnitude and relatively recent occurrence of certain large loss events,
meaningful uncertainty remains regarding losses from these events and our actual ultimate net losses from
these events may vary from preliminary estimates, perhaps materially. As a result, our cash flows from
operations would be impacted accordingly.

We are a “well-known seasoned issuer” as defined by the rules promulgated under the Securities Act of
1933, as amended (the “Securities Act”), and we maintain a “shelf” Registration Statement on Form S-3 (the
“Shelf Registration Statement”) under the Securities Act and are eligible to file additional automatically
effective Registration Statements of Form S-3 in the future for the potential offering and sale of an unlimited
amount of debt and equity securities. The Shelf Registration Statement allows for various types of
securities to be offered, including, but not limited to the following: common shares, preference shares and
debt securities.

In addition we maintain letter of credit facilities which provide liquidity. Refer to “Part II, Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, Liquidity and
Capital Resources, Capital Resources” for details of these facilities.

Cash Flows

Year ended December 31,

2013

2012

2011

(in thousands)
Net cash provided by operating activities

Net cash (used in) provided by investing activities

Net cash used in financing activities

Effect of exchange rate changes on foreign currency cash

Net increase (decrease) in cash and cash equivalents

Net decrease in cash and cash equivalents of

discontinued operations

Cash and cash equivalents, beginning of period

795,721 $

716,929 $

165,933

(315,515)

(398,955)

1,423

82,674

21,213

304,145

(71,677)

315,031

(538,570)

(542,236)

1,692

108,374

13,946

181,825

518

(60,754)

16,441

226,138

Cash and cash equivalents, end of period

408,032 $

304,145 $

181,825

During 2013, our cash and cash equivalents increased $82.7 million, to $408.0 million at December 31,
2013, compared to $304.1 million at December 31, 2012, after excluding a decrease of $21.2 million in cash
and cash equivalents related to discontinued operations held for sale. The following discussion of our cash
flows includes the results of operations and financial position of our discontinued operations held for sale at
December 31, 2013, related to the sale of REAL.

Cash flows provided by operating activities. Cash flows provided by operating activities during 2013 were
$795.7 million, compared to $716.9 million during 2012. Cash flows provided by operating activities during
2013 were primarily the result of certain adjustments to reconcile our net income of $841.8 million to net
cash provided by operating activities, including: a reduction in reinsurance recoverable of $91.5 million
primarily due to the collection of those balances, an increase in unearned premiums of $78.4 million due to
the timing of our gross premiums written; and a decrease in premiums receivable of $17.3 million due to the
receipt of those balances; partially offset by a decrease in our reserve for claims and claim expenses of
$315.6 million driven by the payment of claims and by favorable development on prior accident years net
claims and claims expenses during 2013; and an increase in deferred acquisition costs of $29.1 million due
to the relative increase in gross premiums written during 2013 with a higher acquisition expense ratio. As
discussed under “Summary of Results of Operations”, we generated relatively higher underwriting income
and lower investment results in 2013 compared to 2012, which contributed to the net increase in cash flows
provided by operating activities. A portion of the cash provided by operating activities was used in our
financing activities, as noted below.

116

Cash flows used in investing activities. During 2013, our cash flows used in investing activities were $315.5
million, principally reflecting our net purchases of short term investments of $247.0 million, net purchases
and maturities of fixed maturity investments of $169.9 million and net purchases of $33.1 million pursuant to
a public equity securities mandate with a third party investment manager. These purchases were partially
offset by net sales of other investments of $76.2 million which principally related to the redemption of certain
senior secured bank loan funds, with the proceeds being allocated to the purchase of bank loan portfolios
included in our portfolio of fixed maturity investments and short term investments, as noted above.

Cash flows used in financing activities. Our cash flows used in financing activities in 2013 were $399.0
million, and were principally the result of the redemption of our remaining 6 million Series D Preference
Shares for $150.0 million and 5 million Series C Preference Shares for $125.0 million, or a total of $275.0
million, the settlement of $207.4 million of common share repurchases, the repayment of $100.0 million of
our 5.875% Senior Notes upon their scheduled maturity of February 15, 2013 and the payment of $49.3
million and $24.9 million in dividends to our common and preferred shareholders, respectively. Offsetting
these outflows was an inflow of $265.9 million through the issuance of 11 million Series E Preference
Shares, net of related offering expenses.

During 2012, our cash and cash equivalents increased $108.4 million, to $325.4 million at December 31,
2012, compared to $217.0 million at December 31, 2011, which excludes a decrease of $13.9 million in
cash and cash equivalents related to discontinued operations held for sale.

Cash flows provided by operating activities. Cash flows provided by operating activities during 2012 were
$716.9 million, compared to $165.9 million in 2011. Cash flows provided by operating activities during 2012
were primarily the result of certain adjustments to reconcile our net income of $748.9 million to net cash
provided by operating activities, including: a reduction in reinsurance recoverable of $211.5 million primarily
due to the collection of those balances, an increase in unearned premiums of $51.9 million due to the timing
of, and growth in, our gross premiums written, and a $33.5 million increase in reinsurance balances payable
due to the timing of, and increase in, our premiums ceded, and partially offset by an adjustment for net
realized and unrealized gains on investments of $164.0 million due to improved total returns in our portfolios
of fixed maturity and other investments, a decrease in our reserve for claims and claim expenses of $113.0
million driven by the payment of claims and by favorable development on prior accident years net claims
and claims expenses during 2012, an increase in premiums receivable of $19.5 million due to increased
gross premiums written and an increase in our prepaid reinsurance premiums of $18.6 million due to the
timing of, and increase in, our premiums ceded. As discussed under “Summary of Results of Operations”,
we generated higher underwriting income and higher investment results in 2012 compared to 2011, which
contributed to the increase in cash flows provided by operating activities.

Cash flows used in investing activities. During 2012, our cash flows used in investing activities were $71.7
million, principally reflecting our net investment in fixed maturity investments trading of $343.4 million, which
was funded primarily by cash provided by our operating activities and net sales of other investments, short
term investments and fixed maturity investments available for sale of $150.8 million, $68.8 million and $65.2
million, respectively.

Cash flows used in financing activities. Our cash flows used in financing activities in 2012 were $538.6
million, and were principally the result of the settlement of $463.3 million of our common share repurchases,
the payment of $53.4 million and $34.9 million in dividends to our common and preferred shareholders,
respectively, and the redemption of $150.0 million of our Series D preference shares during the fourth
quarter, partially offset by net inflows of $164.9 million related to additional third party equity capital raised
during 2012 in our redeemable noncontrolling interest - DaVinciRe.

Reserves for Claims and Claim Expenses

117

case reserves”) which represent our estimates for claims previously reported to us which we believe may
not be adequately reserved as of that date, and adding estimates for the anticipated cost of IBNR.

The following table summarizes our claims and claim expense reserves by line of business and split
between case reserves, additional case reserves and IBNR:

At December 31, 2013

(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

At December 31, 2012
(in thousands)
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total

Case
Reserves

Additional
Case Reserves

IBNR

Total

430,166 $
113,188
45,355
14,915

603,624 $

177,518 $

81,251
14,265
2,324
275,358 $

173,303 $
311,829
158,747
40,869

780,987
506,268
218,367
58,108
684,748 $ 1,563,730

706,264 $
111,234
29,260
17,016

863,774 $

222,208 $

80,971
10,548
8,522
322,249 $

255,786 $ 1,184,258
478,313
286,108
149,470
109,662
67,336
41,798
693,354 $ 1,879,377

Our estimates of claims and claim expense reserves are not precise in that, among other matters, they are
based on predictions of future developments and estimates of future trends and other variable factors.
Some, but not all, of our reserves are further subject to the uncertainty inherent in actuarial methodologies
and estimates. Because a reserve estimate is simply an insurer’s estimate at a point in time of its ultimate
liability, and because there are numerous factors which affect reserves and claims payments that cannot be
determined with certainty in advance, our ultimate payments will vary, perhaps materially, from our
estimates of reserves. If we determine in a subsequent period that adjustments to our previously
established reserves are appropriate, such adjustments are recorded in the period in which they are
identified. During 2013, changes to prior year estimated claims reserves increased our net income by
$144.0 million (2012 - $158.0 million), excluding the consideration of changes in reinstatement premium,
profit commissions, redeemable noncontrolling interest, equity in net claims and claim expenses of Top
Layer Re and income tax.

118

uncertainty of our estimates for certain of these large events is additionally impacted by the preliminary
nature of the information available, the magnitude and relative infrequency of the events, the expected
duration of the respective claims development period, inadequacies in the data provided to the relevant
date by industry participants and the potential for further reporting lags or insufficiencies (particularly in
respect of our current reserves arising from the Chilean, 2010 New Zealand, 2011 New Zealand and
Tohoku Earthquakes); and in the case of Storm Sandy and the Thailand Floods, significant uncertainty as to
the form of the claims and legal issues, under the relevant terms of insurance and reinsurance contracts. In
addition, a significant portion of the net claims and claim expenses associated with Storm Sandy and the
New Zealand and Tohoku Earthquakes are concentrated with a few large clients and therefore the loss
estimates for these events may vary significantly based on the claims experience of those clients. Loss
reserve estimation in respect of our retrocessional contracts poses further challenges compared to directly
assumed reinsurance. A significant portion of our reinsurance recoverable relates to the New Zealand and
Tohoku Earthquakes. There is inherent uncertainty and complexity in evaluating loss reserve levels and
reinsurance recoverable amounts, due to the nature of the losses relating to earthquake events, including
that loss development time frames tend to take longer with respect to earthquake events. The contingent
nature of business interruption and other exposures may also impact losses in a meaningful way, especially
in respect of our current reserves with regard to Storm Sandy, the Tohoku Earthquake and the Thailand
Floods, which we believe may give rise to significant complexity in respect of claims handling, claims
adjustment and other coverage issues, over time. Given the magnitude and relatively recent occurrence of
these large events, meaningful uncertainty remains regarding total covered losses for the insurance
industry and, accordingly, several of the key assumptions underlying our loss estimates. In addition, our
actual net losses from these events may increase if our reinsurers or other obligors fail to meet their
obligations.

Our reserving techniques, assumptions and processes differ between our Catastrophe Reinsurance,
Specialty Reinsurance and Lloyd’s segments. Refer to “Part II, Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations, Summary of Critical Accounting Estimates,
Claims and Claim Expense Reserves” for more information on the risks we insure and reinsure, the
reserving techniques, assumptions and processes we follow to estimate our claims and claim expense
reserves, and our current estimates versus our initial estimates of our claims reserves, for each of these
units.

Capital Resources

Our total capital resources are as follows:

At December 31,

(in thousands)
Common shareholders’ equity

Preference shares

2013

2012

Change

$ 3,504,384 $ 3,103,065 $

401,319

400,000

Total shareholders’ equity attributable to RenaissanceRe

3,904,384

3,503,065

5.875% Senior Notes

5.750% Senior Notes

RenaissanceRe revolving credit facility – borrowed

—

249,430

—

100,000

249,339

—

RenaissanceRe revolving credit facility – unborrowed

250,000

150,000

100,000

Total capital resources

$ 4,403,814 $ 4,002,404 $

401,410

During 2013, our capital resources increased by $401.4 million, principally due to an increase in
shareholders’ equity as a result of our comprehensive income attributable to RenaissanceRe of $681.1
million and, as discussed below, an increase of $100.0 million in the aggregate commitment under
RenaissanceRe’s revolving credit facility, partially offset by RenaissanceRe repaying the full $100.0 million

119

—

401,319

(100,000)

—

of its outstanding 5.875% Senior Notes upon their scheduled maturity of February 15, 2013 using available
cash and investments, $9.1 million of offering expenses related to the issuance of the Series E Preference
Shares, as discussed below, $49.3 million of dividends on our common shares and $207.9 million of
common share repurchases as discussed in more detail in “Part II, Item 5. Market for Registrant’s Common
Equity, Related Shareholder Matters and Issuer Repurchases of Equity Securities, Issuer Repurchases of
Equity Securities.”

As discussed below, during May 2013, RenaissanceRe raised $275.0 million through the issuance of 11
million Series E Preference Shares, and subsequently redeemed the remaining 6 million Series D
Preference Shares for $150.0 million and 5 million Series C Preference Shares for $125.0 million, or a total
of $275.0 million.

Preference Shares

In March 2004, RenaissanceRe raised $250.0 million through the issuance of 10 million Series C
Preference Shares at $25 per share; in December 2006, RenaissanceRe raised $300.0 million through the
issuance of 12 million Series D Preference Shares at $25 per share; and in May 2013, RenaissanceRe
raised $275.0 million through the issuance of 11 million Series E Preference Shares at $25 per share. On
December 27, 2012, RenaissanceRe redeemed 6 million Series D Preference Shares for $150.0 million
plus accrued and unpaid dividends thereon. Following the redemption, 6 million Series D Preference
Shares remained outstanding. The proceeds of the issuance of the Series E Preference Shares were used
to redeem the remaining 6 million outstanding Series D Preference Shares and 5 million of the outstanding
Series C Preference Shares, as discussed below.

The Series E Preference Shares and the remaining Series C Preference Shares may be redeemed at $25
per share plus certain dividends at RenaissanceRe’s option on or after June 1, 2018 and March 23, 2009,
respectively. Dividends on the Series C Preference Shares are cumulative from the date of original
issuance and are payable quarterly in arrears at 6.08% per annum, when, if, and as declared by the Board
of Directors. Dividends on the Series E Preference Shares will be payable from the date of original
issuance on a non-cumulative basis, only when, as and if declared by the Board of Directors, quarterly in
arrears at 5.375% per annum. Unless certain dividend payments are made on the preference shares,
RenaissanceRe will be restricted from paying any dividends on its common shares. The preference shares
have no stated maturity and are not convertible into any other securities of RenaissanceRe. Generally, the
preference shares have no voting rights. Whenever dividends payable on the preference shares are in
arrears (whether or not such dividends have been earned or declared) in an amount equivalent to dividends
for six full dividend periods (whether or not consecutive), the holders of the preference shares, voting as a
single class regardless of class or series, will have the right to elect two directors to the Board of Directors
of RenaissanceRe.

In May 2013, RenaissanceRe announced a mandatory redemption of the remaining 6 million of its
outstanding Series D Preference Shares and on June 27, 2013 RenaissanceRe redeemed the remaining 6
million Series D Preference Shares called for redemption for $150.0 million plus accrued and unpaid
dividends thereon. Following the redemption, no Series D Preference Shares remain outstanding. In
addition, in May 2013, RenaissanceRe announced a mandatory partial redemption of 5 million of its
outstanding Series C Preference Shares. The partial redemption was allocated by random lottery in
accordance with the Depository Trust Company’s rules and procedures and on June 27, 2013
RenaissanceRe redeemed the 5 million Series C Preference Shares called for redemption for $125.0 million
plus accrued and unpaid dividends thereon. Following the redemption, 5 million Series C Preference
Shares remain outstanding.

5.875% Senior Notes

In January 2003, RenaissanceRe issued $100.0 million, which represented the carrying amount on the
Company’s consolidated balance sheet, of 5.875% Senior Notes due February 15, 2013, with interest on
the notes payable on February 15 and August 15 of each year. RenaissanceRe repaid the notes in full
upon their scheduled maturity on February 15, 2013 using available cash and investments. Currently, the
Company does not plan to replace the notes with additional indebtedness.

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5.75% Senior Notes

RenaissanceRe Revolving Credit Facility

RenaissanceRe is a party to a Credit Agreement, dated as of May 17, 2012 (the “Credit Agreement”), with
various banks and financial institutions parties thereto (collectively, the “Lenders”), Wells Fargo Bank,
National Association (“Wells Fargo”), as fronting bank, letter of credit administrator and administrative agent
(the “Administrative Agent”) for the Lenders, and certain other agents. The Credit Agreement previously
provided for commitments from the Lenders in an aggregate amount of $150.0 million, including the
issuance of letters of credit for the respective accounts of RenaissanceRe and certain of RenaissanceRe’s
subsidiaries. Effective as of May 23, 2013, RenaissanceRe entered into a First Amendment and Joinder to
Credit Agreement (the “Amendment”) with the Administrative Agent and the Lenders. Among other items,
the Amendment (i) increased the aggregate commitment of the Lenders to $250.0 million, (ii) added an
additional bank as a Lender, and (iii) eliminated the commitment of the Lenders to issue letters of credit.
After giving effect to the Amendment, RenaissanceRe has the right, subject to certain conditions, to
increase the size of the facility up to $350.0 million.

Amounts borrowed under the Credit Agreement bear interest at a rate selected by RenaissanceRe equal to
the Base Rate or LIBOR (each as defined in the Credit Agreement) plus a margin, all as more fully set forth
in the Credit Agreement.

The Credit Agreement contains representations, warranties and covenants customary for bank loan facilities
of this type. In addition to customary covenants which limit RenaissanceRe and its subsidiaries’ ability to
merge, consolidate, enter into negative pledge agreements, sell a substantial amount of assets, incur liens
and declare or pay dividends under certain circumstances, the Credit Agreement also contains certain
financial covenants. These financial covenants generally provide that consolidated debt to capital shall not
exceed the ratio of 0.35:1 and that for the year ending December 31, 2014, the consolidated net worth of
RenaissanceRe and Renaissance Reinsurance shall equal or exceed approximately $2.3 billion and $1.1
billion, respectively (the “Net Worth Requirements”). The Net Worth Requirements are recalculated
effective as of the end of each fiscal year, all as more fully set forth in the Credit Agreement. The
commitments under the Credit Agreement expire on May 17, 2015.

In the event of the occurrence and continuation of certain events of default, the administrative agent shall,
at the request of the Required Lenders (as defined in the Credit Agreement), or may, with the consent of the
Required Lenders, among other things, take any or all of the following actions: terminate the Lenders’
obligations to make loans and accelerate the outstanding obligations of RenaissanceRe under the Credit
Agreement.

Syndicated Letter of Credit Facility

Effective May 17, 2012, RenaissanceRe and certain of its affiliates, Renaissance Reinsurance, ROE,
RenaissanceRe Specialty Risks and DaVinci (such affiliates, collectively, the “Account Parties”), entered
into a Fourth Amended and Restated Reimbursement Agreement with various banks and financial
institutions parties thereto (collectively, the “Banks”), Wells Fargo, as issuing bank, administrative agent and
collateral agent for the Banks, and certain other agents (the “Reimbursement Agreement”). The
Reimbursement Agreement amended and restated in its entirety the Third Amended and Restated
Reimbursement Agreement, dated as of April 22, 2010, which was terminated concurrently with the
effectiveness of the Reimbursement Agreement. The commitments under the Reimbursement Agreement
expire on May 17, 2015.

121

sources of credit enhancement. Prior to the expiration date of May 17, 2015, the commitments under the
facility may be increased from time to time up to an amount not to exceed $600.0 million in the aggregate,
subject to RenaissanceRe satisfying certain conditions. The Reimbursement Agreement contains
representations, warranties and covenants in respect of RenaissanceRe, the Account Parties and their
respective subsidiaries that are customary for facilities of this type, including customary covenants limiting
the ability to merge, consolidate and sell a substantial amount of assets. The Reimbursement Agreement
contains certain financial covenants requiring RenaissanceRe and DaVinci to maintain, for the year ending
December 31, 2014, a minimum net worth of approximately $2.0 billion and $781.2 million, respectively,
which requirements are recalculated effective as of the end of each fiscal year, all as more fully set forth in
the Reimbursement Agreement.

Under the Reimbursement Agreement, each Account Party is required to pledge eligible collateral having a
value sufficient to cover all of its obligations under the Reimbursement Agreement, including reimbursement
obligations for outstanding letters of credit issued for its account. In the case of an event of default under
the Reimbursement Agreement, and in certain other circumstances set forth in the Reimbursement
Agreement, including, among others, a decrease in the net worth of an Account Party below the level
specified therein for such Account Party, a decline in collateral value, and certain failures to maintain
specified ratings, the Banks may exercise certain remedies, including conversion of collateral into cash.

At December 31, 2013, we had $162.3 million of letters of credit with effective dates on or before
December 31, 2013 outstanding under the Reimbursement Agreement.

Bilateral Letter of Credit Facility (“Bilateral Facility”)

Effective October 1, 2013, each of ROE and RenaissanceRe Specialty U.S. became parties to the existing
Bilateral Facility provided pursuant to the facility letter, dated September 17, 2010 and amended July 14,
2011 (as so amended, the “Facility Letter”), among Citibank Europe plc (“CEP”) and the existing
participants: Renaissance Reinsurance, DaVinci and RenaissanceRe Specialty Risks (collectively, the
“Bilateral Facility Participants”). The Bilateral Facility provides a commitment from CEP to issue letters of
credit for the account of one or more of the Bilateral Facility Participants (inclusive of ROE and
RenaissanceRe Specialty U.S.) and their respective subsidiaries in multiple currencies and in an aggregate
amount of up to $300.0 million, subject to a sublimit of $50.0 million for letters of credit issued for the
account of RenaissanceRe Specialty U.S. The Bilateral Facility was to expire on December 31, 2013;
however effective October 1, 2013, the Bilateral Facility was extended to December 31, 2014. The Bilateral
Facility is evidenced by the Facility Letter and five separate master agreements between CEP and each of
the Bilateral Facility Participants, as well as certain ancillary agreements. At December 31, 2013, $258.3
million remained unused and available to the Bilateral Facility Participants under the Bilateral Facility.

Under the Bilateral Facility, each of the Bilateral Facility Participants is severally obligated to pledge to CEP
at all times during the term of the Bilateral Facility certain securities with a collateral value (as determined
as therein provided) that equals or exceeds 100% of the aggregate amount of its then-outstanding letters of
credit. In the case of an event of default under the Bilateral Facility with respect to a Bilateral Facility
Participant, CEP may exercise certain remedies with respect to such Bilateral Facility Participant, including
terminating its commitment to such Bilateral Facility Participant under the Bilateral Facility and taking certain
actions with respect to the collateral pledged by such Bilateral Facility Participant (including the sale
thereof). In the Facility Letter, each of Bilateral Facility Participant makes, as to itself, representations and
warranties that are customary for facilities of this type and severally agrees that it will comply with certain
informational and other undertakings, including those regarding the delivery of quarterly and annual
financial statements.

Funds at Lloyd’s Letter of Credit Facility

On April 26, 2010, Renaissance Reinsurance and CEP entered into an Amended and Restated Pledge
Agreement (the “Pledge Agreement”) in respect of its letter of credit facility with CEP which is evidenced by
the Master Reimbursement Agreement, dated as of April 29, 2009, which provides for the issuance and
renewal of letters of credit used to support business written by Syndicate 1458. At December 31, 2013, two
letters of credit issued by CEP under the Master Reimbursement Agreement were outstanding, in the
amount of $281.0 million and £60.0 million, respectively. Pursuant to the Pledge Agreement, Renaissance
Reinsurance has agreed to pledge to CEP at all times during the term of the Master Reimbursement

122

Agreement certain securities with a collateral value equal to 100% of the aggregate amount of the then-
outstanding letters of credit issued under the Master Reimbursement Agreement.

Letters of Credit

At December 31, 2013, we had total letters of credit outstanding under all facilities of $584.4 million.

Renaissance Reinsurance is also party to a collateralized letter of credit and reimbursement agreement in
the amount of $37.5 million that supports our Top Layer Re joint venture. Renaissance Reinsurance is
obligated to make a mandatory capital contribution of up to $50.0 million in the event that a loss reduces
Top Layer Re’s capital below a specified level.

DaVinciRe Loan Agreement

On March 30, 2011, DaVinciRe entered into a loan agreement with RenaissanceRe (the “Loan Agreement”)
under which RenaissanceRe made a loan to DaVinciRe in the principal amount of $200.0 million on April 1,
2011. The loan matures on March 31, 2021 and interest on the loan is payable at a rate of three month
LIBOR plus 3.5% and is due at the end of each March, June, September and December, commencing on
June 30, 2011. Under the terms of the Loan Agreement, DaVinciRe is required to maintain a debt to capital
ratio of no greater than 0.40:1 and a net worth of no less than $500.0 million. On December 21, 2012,
DaVinciRe repaid $100.0 million of principal under the Loan Agreement and at December 31, 2013, $100.0
million remained outstanding under the Loan Agreement. No additional amounts may be borrowed by
DaVinciRe under the Loan Agreement.

Multi-Beneficiary Reinsurance Trusts

Effective March 15, 2011, each of Renaissance Reinsurance and DaVinci was approved as a Trusteed
Reinsurer in the State of New York and established a multi-beneficiary reinsurance trust (“MBRT”) to
collateralize its respective (re)insurance liabilities associated with U.S. domiciled cedants. The MBRTs are
subject to the rules and regulations of the State of New York and the respective deed of trust, including but
not limited to certain minimum capital funding requirements, investment guidelines, capital distribution
restrictions and regulatory reporting requirements. Following the initial approval in the State of New York,
Renaissance Reinsurance and DaVinci have submitted applications to all U.S. states to become Trusteed
Reinsurers. As of December 31, 2013, Renaissance Reinsurance and DaVinci are approved in 51 and 50
U.S. states and territories, respectively. We expect, over time, to transition cedants with existing
outstanding letters of credit to the appropriate MBRT as determined by cedant state of domicile, thereby
reducing our absolute and relative reliance on letters of credit. Accordingly, it is our intention to seek to
have new business incepting with cedants domiciled in approved states collateralized using a MBRT.
Cedants collateralized with a MBRT will be eligible for automatic reinsurance credit in their respective U.S.
regulatory filings. Assets held under trust at December 31, 2013 with respect to the MBRTs totaled $505.1
million and $173.9 million for Renaissance Reinsurance and DaVinci, respectively, compared to the
minimum amount required under U.S. state regulations of $441.7 million and $135.2 million, respectively.

Multi-Beneficiary Reduced Collateral Reinsurance Trusts

Effective December 31, 2012, each of Renaissance Reinsurance and DaVinci has been approved as an
“eligible reinsurer” in the state of Florida. Therefore they are each authorized to provide reduced collateral
equal to 20% of their net outstanding insurance liabilities to Florida-domiciled insurers. Each of
Renaissance Reinsurance and DaVinci has established a multi-beneficiary reduced collateral reinsurance
trust (“RCT”) to collateralize its (re)insurance liabilities associated with Florida-domiciled cedants. Because
the RTCs were established in New York, they are subject to the rules and regulations of the state of New
York including but not limited to certain minimum capital funding requirements, investment guidelines,
capital distribution restrictions and regulatory reporting requirements. Assets held under trust at
December 31, 2013 with respect to the RCTs totaled $21.1 million and $18.6 million for Renaissance
Reinsurance and DaVinci, respectively, compared to the minimum amount required under U.S. state
regulations of $16.3 million and $10.2 million, respectively.

123

Renaissance Trading Guarantees

At December 31, 2013, RenaissanceRe had provided guarantees in the aggregate amount of $50.8 million
to certain counterparties of the weather and energy risk operations of Renaissance Trading, subsequently
renamed as Munich Re Trading LLC, one of the entities acquired by Munich in the REAL transaction.
Although the guarantees issued by RenaissanceRe to certain counterparties of Renaissance Trading
remained in effect at December 31, 2013, in conjunction with the purchase agreement of REAL, Munich has
agreed, effective October 1, 2013, to indemnify RenaissanceRe against any liabilities, losses and damages
that may arise as a result of any transaction between Renaissance Trading and a counterparty that has
been provided a guarantee by RenaissanceRe.

Redeemable Noncontrolling Interest – DaVinciRe

DaVinciRe shareholders are party to a shareholders agreement (the “Shareholders Agreement”) which
provides DaVinciRe shareholders, excluding us, with certain redemption rights that enable each
shareholder to notify DaVinciRe of such shareholder’s desire for DaVinciRe to repurchase up to half of such
shareholder’s aggregate number of shares held, subject to certain limitations, such as limiting the
aggregate of all share repurchase requests to 25% of DaVinciRe’s capital in any given year and satisfying
all applicable regulatory requirements. If total shareholder requests exceed 25% of DaVinciRe’s capital, the
number of shares repurchased will be reduced among the requesting shareholders pro-rata, based on the
amounts desired to be repurchased. Shareholders desiring to have DaVinciRe repurchase their shares
must notify DaVinciRe before March 1 of each year. The repurchase price will be based on GAAP book
value as of the end of the year in which the shareholder notice is given, and the repurchase will be effective
as of such date. Payment will be made by April 1 of the following year, following delivery of the audited
financial statements for the year in which the repurchase was effective. The repurchase price is subject to
a true-up for development on outstanding loss reserves after settlement of all claims relating to the
applicable years.

During January 2013, DaVinciRe redeemed shares from certain DaVinciRe shareholders, including the
Company, while certain other existing DaVinciRe shareholders purchased additional shares in DaVinciRe.
The net redemption as a result of these transactions was $150.0 million. In connection with the
redemptions, DaVinciRe retained a $20.5 million holdback. Our noncontrolling economic ownership in
DaVinciRe was 30.8% at December 31, 2012 and subsequent to the above transactions, our noncontrolling
economic ownership in DaVinciRe increased to 32.9% effective January 1, 2013.

Effective October 1, 2013, an existing third party shareholder sold a portion of its shares in DaVinciRe to a
new third party shareholder. In addition, effective October 1, 2013, we sold a portion of our shares in
DaVinciRe to the same new third party shareholder. We sold these shares for $77.4 million. Our
noncontrolling economic ownership in DaVinciRe was 32.9% at September 30, 2013 and subsequent to the
above transactions, our noncontrolling economic ownership interest in DaVinciRe decreased and was
27.3% at December 31, 2013.

During January 2014, DaVinciRe redeemed a portion of its outstanding shares from all existing DaVinciRe
shareholders, including the Company, while a new DaVinciRe shareholder purchased shares in DaVinciRe.
The net redemption as a result of these transactions was $300.0 million. The Company’s noncontrolling
economic ownership in DaVinciRe subsequent to these transactions is 26.5%, effective January 1, 2014.
We expect our noncontrolling economic ownership in DaVinciRe to fluctuate over time.

Ratings

124

Presented below are the ratings of our principal operating subsidiaries and joint ventures by segment and
the ERM rating of RenaissanceRe as of February 19, 2014.

Renaissance Reinsurance (1)
DaVinci (1)
RenaissanceRe Specialty Risks (1)
RenaissanceRe Specialty U.S. (1)
ROE (1)
Top Layer Re (1)

Syndicate 1458
Lloyd’s Overall Market Rating (2)

RenaissanceRe (3)

A.M. Best

A+
A
A
A
A+
A+

—
A

—

S&P

AA-
AA-
A+
—
AA-
AA

—
A+

Very Strong

Moody’s

Fitch

A1
A3
—
—
—
—

—
—

—

A+
—
—
—
—
—

—
A+

—

(1) The A.M. Best, S&P, Moody's and Fitch ratings for these companies reflect the insurer's financial strength rating and in addition,

the S&P ratings also reflect the insurer's issuer credit rating.

(2) The A.M. Best, S&P and Fitch ratings for the Lloyd’s Overall Market Rating represent its financial strength rating.

(3) The S&P rating for RenaissanceRe represents rating on its Enterprise Risk Management practices.

A.M. Best. “A+” is the second highest designation of A.M. Best’s sixteen rating levels. “A+” rated insurance
companies are defined as “Superior” companies and are considered by A.M. Best to have a very strong
ability to meet their obligations to policyholders. “A” is the third highest designation assigned by A.M. Best,
representing A.M. Best’s opinion that the insurer has an “Excellent” ability to meet its ongoing obligations to
policyholders.

On June 12, 2013, A.M. Best affirmed its issuer credit rating (“ICR”) of “a-” (Excellent) and all debt ratings of
RenaissanceRe. Concurrently, A.M. Best affirmed the financial strength rating (“FSR”) of “A+” (Superior) of
each of Renaissance Reinsurance and ROE, respectively, and the FSR of “A” (Excellent) of each of DaVinci
and RenaissanceRe Specialty Risks, respectively. In addition, A.M. Best assigned an FSR of
“A” (Excellent) to RenaissanceRe Specialty U.S. The outlook is stable for these ratings.

On June 12, 2013, A.M. Best affirmed the FSR of “A+” (Superior) of Top Layer Re. The outlook is stable for
this rating.

S&P. The “AA” range (“AA+”, “AA”, AA-“), which has been assigned by S&P to Renaissance Reinsurance,
DaVinci, ROE and Top Layer Re, is the second highest rating assigned by S&P, and indicates that S&P
believes the insurers have very strong financial security characteristics, differing only slightly from those
rated higher. S&P assigns an issuer credit rating to an entity which is an opinion on the credit worthiness of
the obligor with respect to a specific financial obligation.

On August 13, 2013, S&P upgraded the ICR and FSR on RenaissanceRe Specialty Risks to “A+” from “A”.
The outlook is stable for these ratings.

On May 23, 2013, S&P affirmed its ICR of “A” on RenaissanceRe and its “A” senior debt rating on our
senior unsecured notes. In addition, S&P affirmed its “AA-“ ICR and FSR on Renaissance Reinsurance and
ROE and upgraded its “A+” ICR and FSR to “AA-“ on DaVinci. The outlook is stable for these ratings.

On November 1, 2010, S&P revised its outlook on Top Layer Re to stable from negative and at the same
time, affirmed Top Layer Re’s ICR and FSR of “AA”.

In addition, S&P assesses companies’ ERM practices, which is an opinion on the many critical dimensions
of risk management that determine overall creditworthiness. RenaissanceRe has been assigned an ERM
rating of “Very Strong”, which is the highest rating assigned by S&P, and indicates that S&P believes
RenaissanceRe has extremely strong capabilities to consistently identify, measure, and manage risk
exposures and losses within RenaissanceRe’s predetermined tolerance guidelines.

125

Moody’s. Moody’s Insurance Financial Strength Ratings represent its opinions of the ability of insurance
companies to pay punctually policyholder claims and obligations and senior unsecured debt instruments.
Moody’s believes that insurance companies rated “A1”, such as Renaissance Reinsurance, and companies
rated “A3”, such as DaVinci, offer good financial security. However, Moody’s believes that elements may be
present which suggest a susceptibility to impairment sometime in the future.

On October 7, 2013, Moody’s affirmed its “A1” insurance FSR on Renaissance Reinsurance and its “A3”
insurance FSR on DaVinci. The outlook is stable for these ratings.

Fitch. Fitch’s Issuer Financial Strength (“IFS”) ratings provide an assessment of the financial strength of an
insurance organization. Fitch believes that insurance companies rated “A+”, such as Renaissance
Reinsurance, have “Strong” capacity to meet policyholders and contract obligations on a timely basis with a
low expectation of ceased or interrupted payments.

On May 23, 2013, Fitch affirmed the IFS of Renaissance Reinsurance at “A+”. The outlook is stable for this
rating.

Lloyd’s Overall Market Rating

A.M. Best, S&P and Fitch have each assigned an FSR to the Lloyd’s overall market. The financial risks to
policy holders of syndicates within the Lloyd’s market are partially mutualized through the Lloyd’s Central
Fund, to which all underwriting members contribute. Because of the presence of the Lloyd’s Central Fund,
and the current legal and regulatory structure of the Lloyd’s market, FSRs on individual syndicates would
not be particularly meaningful and in any event would not be lower than the FSR of the Lloyd’s overall
market.

While the ratings of our principal operating subsidiaries and joint ventures remain among the highest in our
business, adverse ratings actions could have a negative effect on our ability to fully realize current or future
market opportunities. In addition, it is common for our reinsurance contracts to contain provisions permitting
our customers to cancel coverage pro-rata if our relevant operating subsidiary is downgraded below a
certain rating level. Whether a client would exercise this right would depend, among other factors, on the
reason for such a downgrade, the extent of the downgrade, the prevailing market conditions and the pricing
and availability of replacement reinsurance coverage. Therefore, in the event of a downgrade, it is not
possible to predict in advance the extent to which this cancellation right would be exercised, if at all, or what
effect such cancellations would have on our financial condition or future operations, but such effect
potentially could be material. To date, we are not aware that we have experienced such a cancellation. Our
ratings are subject to periodic review and may be revised or revoked by the agencies which issue them.

126

Investments

The table below shows our invested assets:

At December 31,

(in thousands, except percentages)
U.S. treasuries

Agencies

Non-U.S. government (Sovereign debt)

Non-U.S. government-backed corporate

Corporate

Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed

2013

2012

$ 1,352,413

19.8% $ 1,254,547

19.8%

186,050

334,580

237,479

2.7%

4.9%

3.5%

315,154

133,198

349,514

5.0%

2.1%

5.5%

1,803,415

26.4% 1,615,207

25.4%

341,908

257,938

314,236

15,258

5.0%

3.8%

4.6%

0.2%

408,531

248,339

406,166

12,954

6.4%

3.9%

6.4%

0.2%

74.7%

12.9%

0.9%

10.1%

98.6%

1.4%

Total fixed maturity investments, at fair value

4,843,277

70.9% 4,743,610

Short term investments, at fair value

Equity investments trading, at fair value

Other investments, at fair value

Total managed investment portfolio

1,044,779

15.3%

254,776

573,264

3.7%

8.5%

821,163

58,186

644,711

6,716,096

98.4% 6,267,670

Investments in other ventures, under equity method

105,616

1.6%

87,724

Total investments

$ 6,821,712

100.0% $ 6,355,394

100.0%

At December 31, 2013, we held investments totaling $6.8 billion, compared to $6.4 billion at December 31,
2012, with net unrealized appreciation included in accumulated other comprehensive income of $4.1 million
at December 31, 2013, compared to $13.6 million at December 31, 2012. Our investment guidelines stress
preservation of capital, market liquidity, and diversification of risk. Notwithstanding the foregoing, our
investments are subject to market-wide risks and fluctuations, as well as to risks inherent in particular
securities. Refer to “Note 6. Fair Value Measurements” in our notes to the consolidated financial
statements for additional information regarding the fair value measurement of our investments.

As the reinsurance coverages we sell include substantial protection for damages resulting from natural and
man-made catastrophes, we expect from time to time to become liable for substantial claim payments on
short notice. Accordingly, our investment portfolio as a whole is structured to seek to preserve capital and
provide a high level of liquidity which means that the large majority of our investment portfolio consists of
highly rated fixed income securities, including U.S. treasuries, agencies, highly rated sovereign and
supranational securities, high-grade corporate securities and mortgage-backed and asset-backed
securities. We also have an allocation to publicly traded equities reflected on our consolidated balance
sheet as equity investments trading and an allocation to other investments (including hedge funds, private
equity partnerships, senior secured bank loan funds, catastrophe bonds and other investments). At
December 31, 2013, our portfolio of equity investments trading totaled $254.8 million, or 3.7%, of our total
investments inclusive of our investment in Essent of $121.1 million (2012 - $58.2 million or 0.9%) and our
portfolio of other investments totaled $573.3 million, or 8.5%, of our total investments (2012 – $644.7 million
or 10.1%).

127

The following table summarizes the composition of our investment portfolio, including the amortized cost and fair
value of our investment portfolio and the ratings as assigned by S&P, or Moody’s and/or other rating agencies when
S&P ratings were not available, and the respective effective yield.

Amortized
Cost

Fair Value

% of Total
Investment
Portfolio

Weighted
Average
Effective
Yield

AAA

BBB

Non-
Investment
Grade

Not Rated

Credit Rating (1)

December 31, 2013

(in thousands, except percentages)

Short term investments

$1,044,779

15.3%

0.1% $1,032,327

9,820

2,559

—

100.0%

98.8%

0.9%

0.3%

—%

Fixed maturity investments

U.S. treasuries

Agencies

1,358,094

1,352,413

19.8%

0.8%

—

1,352,413

Fannie Mae & Freddie Mac

184,405

182,738

Other agencies

Total agencies

3,410

3,312

187,815

186,050

Non-U.S. government (Sovereign
debt)

332,935

334,580

FDIC guaranteed corporate

—

Non-U.S. government-backed
corporate

Corporate

Mortgage-backed

Residential mortgage-backed

Agency securities

Non-agency securities - Alt A

Non-agency securities -
Prime

Total residential mortgage-backed

Commercial mortgage-backed

Total mortgage-backed

Asset-backed

Credit cards

Auto loans

Student loans

Other

234,531

237,479

1,783,043

1,803,415

346,740

126,803

115,541

589,084

311,681

900,765

4,270

3,008

2,918

4,606

341,908

136,734

121,204

599,846

314,236

914,082

4,385

3,109

2,947

4,817

Total asset-backed

14,802

15,258

Total securitized assets

915,567

929,340

Total fixed maturity investments

4,811,985

4,843,277

2.7%

—%

2.7%

4.9%

—%

3.5%

26.4%

5.0%

2.0%

1.8%

8.8%

4.6%

13.4%

0.1%

—%

0.1%

0.2%

13.6%

70.9%

1.3%

1.6%

1.3%

—%

1.1%

2.7%

2.9%

4.7%

3.7%

3.5%

2.1%

3.0%

2.6%

0.8%

1.4%

2.7%

2.0%

3.0%

2.0%

—%

—

182,738

3,312

186,050

—

238,764

67,555

13,572

14,689

—

152,468

80,110

3,494

—

815

—

592

39,878

265,761

772,126

338,993

361,935

24,722

—

341,908

—

2,554

6,823

18,308

12,315

81,483

15,251

10,662

22,977

6,034

29,011

77,534

159,017

—

8,431

23,682

490

159,017

24,172

11,139

13,693

177,988

191,681

4,385

3,109

2,947

4,817

15,258

5,791

354,522

108,446

462,968

—

7,647

25,955

21,278

47,233

—

206,939

462,968

47,233

29,011

638,049

2,414,857

836,425

383,508

100.0%

13.2%

49.8%

17.3%

Equity investments trading

254,776

3.7%

Other investments

Private equity partnerships

Catastrophe bonds

Senior secured bank loan funds

Non-U.S. fixed income funds

Hedge funds

Miscellaneous other investment

Total other investments

Investments in other ventures

100.0%

322,391

229,016

18,048

—

3,809

—

573,264

100.0%

4.7%

3.4%

0.3%

—%

0.1%

—%

8.5%

105,616

1.6%

100.0%

—

—%

—

—%

—

—%

—

—%

—

—%

—

—%

—

—%

—

—%

—

—%

7.9%

—

—%

—

—%

—

—%

Total investment portfolio

$6,821,712

100.0%

$1,670,376

$2,424,677

$ 838,984

$ 383,508

$ 750,560

$ 753,607

100.0%

24.5%

35.5%

12.3%

5.6%

11.0%

11.1%

(1) The credit ratings included in this table are those assigned by S&P. When ratings provided by S&P were not available, ratings from other nationally recognized

rating agencies were used. The Company has grouped short term investments with an A-1+ and A-1 short term issue credit rating as AAA, short term investments
with A-2 short term issue credit rating as AA and short term investments with an A-3 short term issue credit rating as A.

128

—

159,017

521,544

24,172

48,894

10.8%

1.0%

—

—%

254,776

100.0%

—

322,391

229,016

—

18,048

—

3,809

—

229,016

344,248

39.9%

60.1%

—

—%

105,616

100.0%

Fixed Maturity Investments and Short Term Investments

At December 31, 2013, our fixed maturity investments and short term investment portfolio had a dollar-
weighted average credit quality rating of AA (2012 – AA) and a weighted average effective yield of 1.7%
(2012 – 1.4%). At December 31, 2013, our non-investment grade and not rated fixed maturity investments
totaled $570.4 million or 11.8% of our fixed maturity investments (2012 - $471.6 million or 9.9%,
respectively). In addition, within our other investments category we have funds that invest in non-
investment grade and not rated fixed income securities and non-investment grade cat-linked securities. At
December 31, 2013, the funds that invest in non-investment grade and not rated fixed income securities
and non-investment grade cat-linked securities totaled $247.1 million (2012 – $294.2 million).

At December 31, 2013, we had $1,044.8 million of short term investments (2012 – $821.2 million). Short
term investments are managed as part of our investment portfolio and have a maturity of one year or less
when purchased. Short term investments are carried at amortized cost, which approximates fair value.

The duration of our fixed maturity investments and short term investments at December 31, 2013 was 2.1
years (2012 – 2.2 years). From time to time, we may reevaluate the duration of our portfolio in light of the
duration of our liabilities and market conditions.

As with other fixed income investments, the value of our fixed maturity investments will fluctuate with
changes in the interest rate environment and when changes occur in the overall investment market and in
overall economic conditions. Additionally, our differing asset classes expose us to other risks which could
cause a reduction in the value of our investments. Examples of some of these risks include:

• Changes in the overall interest rate environment can expose us to “prepayment risk” on our mortgage-

backed investments. When interest rates decline, consumers will generally make prepayments on their
mortgages and, as a result, our investments in mortgage-backed securities will be repaid to us more
quickly than we might have originally anticipated. When we receive these prepayments, our
opportunities to reinvest these proceeds back into the investment markets will likely be at reduced
interest rates. Conversely, when interest rates increase, consumers will generally make fewer
prepayments on their mortgages and, as a result, our investments in mortgage-backed securities will be
repaid to us less quickly than we might have originally anticipated. This will increase the duration of our
portfolio, which is disadvantageous to us in a rising interest rate environment.

• Our investments in mortgage-backed securities are also subject to default risk. This risk is due in part
to defaults on the underlying securitized mortgages, which would decrease the market value of the
investment and be disadvantageous to us. Similar risks apply to other asset-backed securities in which
we may invest from time to time.

• Our investments in debt securities of other corporations are exposed to losses from insolvencies of

these corporations, and our investment portfolio can also deteriorate based on reduced credit quality of
these corporations. We are also exposed to the impact of widening credit spreads even if specific
securities are not downgraded.

• Our investments in asset-backed securities are subject to prepayment risks, as noted above, and to the

structural risks of these securities. The structural risks primarily emanate from the priority of each
security in the issuer’s overall capital structure. We are also exposed to the impact of widening credit
spreads.

• Within our other investments category, we have funds that invest in non-investment grade fixed income
securities as well as securities denominated in foreign currencies. These investments expose us to
losses from insolvencies and other credit-related issues. We are also exposed to fluctuations in foreign
exchange rates that may result in realized losses to us if our exposures are not hedged or if our
hedging strategies are not effective and also to widening of credit spreads.

129

The following table summarizes the fair value by contractual maturity of our fixed maturity investment
portfolio at the dates indicated. Actual maturities may differ from contractual maturities because borrowers
may have the right to call or prepay obligations with or without penalty.

At December 31,
(in thousands, except percentages)
Due in less than one year
Due after one through five years
Due after five through ten years
Due after ten years
Mortgage-backed
Asset-backed

2013

2012

160,760
3,118,799
551,007
83,371
914,082
15,258

3.3% $

64.4%
11.4%
1.7%
18.9%
0.3%

427,821
2,389,856
711,844
138,099
1,063,036
12,954

9.0%
50.4%
15.0%
2.9%
22.4%
0.3%

Total fixed maturity investments, at fair

value

$ 4,843,277

100.0% $ 4,743,610

100.0%

Corporate Fixed Maturity Investments

The following table summarizes the composition of the fair value of our corporate fixed maturity investments
at the date indicated by ratings as assigned by S&P, or Moody’s and/or other rating agencies when S&P
ratings were not available.

At December 31, 2013

(in thousands)

Sector
Financials

Industrial, utilities
and energy

Communications
and technology

Consumer

Health care

Basic materials

Other

Total corporate
fixed maturity
investments, at
fair value (1)

Total

A
Not Rated
$ 734,503 $ 34,531 $ 125,558 $ 473,381 $ 53,816 $ 28,450 $ 18,767

AAA

BBB

Non-
Investment
Grade

396,530

4,175

54,926

129,732

116,606

88,644

2,447

250,685

225,580

116,731

66,646

12,740

373
—

—

799

21,582

18,962

39,254

—

5,479

63,643

59,503

26,150

15,023

4,694

61,087

53,412

18,229

34,075

1,768

101,300

2,700

93,375

33,098

17,068

—

328

—

480

—

$ 1,803,415 $ 39,878 $ 265,761 $ 772,126 $ 338,993 $ 361,935 $ 24,722

(1) Excludes non-U.S. government-backed corporate fixed maturity investments, at fair value.

130

The following table summarizes the composition of the fair value of the fixed maturity investments and short
term investments of our top ten corporate issuers at the date indicated.

At December 31, 2013

(in thousands)

Issuer
Bank of America Corp.
JP Morgan Chase & Co.
General Electric Company
Citigroup Inc.
Goldman Sachs Group Inc.
Morgan Stanley
HSBC Holdings PLC
BNP Paribas SA
Ford Motor Co.
Wells Fargo & Co.

Total (1)

Total

Short term
investments

Fixed
maturity
investments

59,439 $
57,994
56,352
54,292
51,699
35,360
34,166
28,472
27,689
26,272

431,735 $

— $
—
—
—
—
—
—
—
—
—
— $

59,439
57,994
56,352
54,292
51,699
35,360
34,166
28,472
27,689
26,272
431,735

(1) Excludes non-U.S. government-backed corporate fixed maturity investments, reverse repurchase agreements and commercial

paper, at fair value.

Equity Investments Trading

Commencing in the first quarter of 2011, we established an internal portfolio of certain publicly traded
equities which are reflected in our consolidated balance sheet as equity investments trading. During the
first quarter of 2013, we sold substantially all of the securities then held in our portfolio of internally
managed public equity investments trading, which was carried at fair value with dividend income included in
net investment income, and realized and unrealized gains included in net realized and unrealized gains on
investments, in our consolidated statements of operations. Subsequently, in the second quarter of 2013,
we established a public equity securities mandate with a third party investment manager which currently
comprises a majority of our investments included in equity investments trading, excluding our investment in
Essent. Included in the financial category of our equity investments trading at December 31, 2013 is $121.1
million related to our investment in Essent. We have agreed, subject to certain exceptions, not to dispose
of or hedge any of the common shares of Essent we hold prior to April 28, 2014. It is possible our equity
allocation will increase in the future, although we do not expect it to represent a material portion of our
invested assets or to have a material effect on our financial results for the reasonably foreseeable future.

The following table summarizes the fair value of equity investments trading:

At December 31,

(in thousands)
Financials
Consumer
Industrial, utilities and energy
Healthcare
Basic materials
Communications and technology
Total

2013

2012

Change

152,905 $

44,115
25,350
15,340
12,766
4,300
254,776 $

58,186 $
—
—
—
—
—
58,186 $

94,719
44,115
25,350
15,340
12,766
4,300
196,590

131

Other Investments

The table below shows our portfolio of other investments:

At December 31,

(in thousands)
Private equity partnerships

Catastrophe bonds

Senior secured bank loan funds

Hedge funds

Total other investments

2013

2012

Change

322,391 $

344,669 $

(22,278)

229,016

18,048

3,809

91,310

202,929

5,803

137,706

(184,881)

(1,994)

573,264 $

644,711 $

(71,447)

We account for our other investments at fair value in accordance with FASB ASC Topic Financial
Instruments. The fair value of certain of our fund investments, which principally include hedge funds,
private equity funds and senior secured bank loan funds, is recorded on our balance sheet in other
investments, and is generally established on the basis of the net valuation criteria established by the
managers of such investments, if applicable. The net valuation criteria established by the managers of
such investments is established in accordance with the governing documents of such investments. Many of
our fund investments are subject to restrictions on redemptions and sales which are determined by the
governing documents and limit our ability to liquidate these investments in the short term. Certain of our
fund managers, fund administrators, or both, are unable to provide final fund valuations as of our current
reporting date. The typical reporting lag experienced by us to receive a final net asset value report is one
month for hedge funds and senior secured bank loan funds and three months for private equity funds,
although, in the past, in respect of certain of our private equity funds, we have on occasion experienced
delays of up to six months at year end, as the private equity funds typically complete their respective year-
end audits before releasing their final net asset value statements.

In circumstances where there is a reporting lag between the current period end reporting date and the
reporting date of the latest fund valuation, we estimate the fair value of these funds by starting with the prior
month or quarter-end fund valuations, adjusting these valuations for actual capital calls, redemptions or
distributions, as well as the impact of changes in foreign currency exchange rates, and then estimating the
return for the current period. In circumstances in which we estimate the return for the current period, all
information available to us is utilized. This principally includes preliminary estimates reported to us by our
fund managers, obtaining the valuation of underlying portfolio investments where such underlying
investments are publicly traded and therefore have a readily observable price, using information that is
available to us with respect to the underlying investments, reviewing various indices for similar investments
or asset classes, as well as estimating returns based on the results of similar types of investments for which
we have obtained reported results, or other valuation methods, where possible. Actual final fund valuations
may differ, perhaps materially so, from our estimates and these differences are recorded in our statement of
operations in the period in which they are reported to us as a change in estimate. Included in net
investment income for 2013 is a loss of $3.7 million (2012 - loss of $4.7 million) representing the change in
estimate during the period related to the difference between our estimated net investment income due to
the lag in reporting discussed above and the actual amount as reported in the final net asset values
provided by our fund managers.

Our estimate of the fair value of catastrophe bonds are based on quoted market prices, or when such prices
are not available, by reference to broker or underwriter bid indications. Refer to “Note 6. Fair Value
Measurements” in our notes to the consolidated financial statements for additional information regarding the
fair value measurement of our investments.

Interest income, income distributions and realized and unrealized gains (losses) on other investments are
included in net investment income and resulted in $119.5 million of net investment income for 2013 (2012 -
$71.8 million). Of this amount, $75.8 million relates to net unrealized gains (2012 - unrealized gains of
$38.2 million).

132

We have committed capital to private equity partnerships and other investments of $662.7 million, of which
$544.6 million has been contributed at December 31, 2013. Our remaining commitments to these
investments at December 31, 2013 totaled $116.2 million. In the future, we may enter into additional
commitments in respect of private equity partnerships or individual portfolio company investment
opportunities.

Measuring the Fair Value of Other Investments Using Net Asset Valuations

The table below shows our portfolio of other investments measured using net asset valuations:

At December 31, 2013

(in thousands)
Private equity partnerships

Senior secured bank loan funds

Hedge funds

Total other investments

measured using net asset
valuations

Fair Value

Unfunded
Commitments

Redemption
Frequency

Redemption
Notice Period
(Minimum
Days)

Redemption
Notice Period
(Maximum
Days)

322,391 $

99,610

See below

18,048
3,809

16,635

See below

— See below

See below

344,248 $

116,245

Private equity partnerships – Included in the Company’s investments in private equity partnerships are
alternative asset limited partnerships (or similar corporate structures) that invest in certain private equity
asset classes including U.S. and global leveraged buyouts; mezzanine investments; distressed securities;
real estate; and oil, gas and power. The fair values of the investments in this category have been estimated
using the net asset value of the investments, as discussed in detail above. The Company generally has no
right to redeem its interest in any of these private equity partnerships in advance of dissolution of the
applicable private equity partnership. Instead, the nature of these investments is that distributions are
received by the Company in connection with the liquidation of the underlying assets of the respective
private equity partnership. It is estimated that the majority of the underlying assets of the limited
partnerships would liquidate over 7 to 10 years from inception of the respective limited partnership.

Senior secured bank loan funds – The Company has $18.0 million invested in closed end funds which
invest primarily in loans. The Company has no right to redeem its investment in these funds. The
Company’s investments in these funds are valued using estimated monthly net asset valuations received
from the investment manager, as discussed in detail above. It is estimated that the majority of the
underlying assets in the closed end funds would liquidate over 4 to 5 years from inception of the respective
fund.

Hedge funds – The Company invests in hedge funds that pursue multiple strategies. The fair values of the
investments in this category are estimated using the net asset value per share of the funds, as discussed in
detail above. The Company’s investments in hedge funds at December 31, 2013 are $3.8 million of so
called “side pocket” investments which are not redeemable at the option of the shareholder. The Company
will retain its interest in the side pocket investments, referred to above, until the underlying investments
attributable to such side pockets are liquidated, realized or deemed realized at the discretion of the fund
manager.

133

Investments in Other Ventures, under Equity Method

The table below shows our investments in other ventures, under equity method:

At December 31,

2013

2012

(in thousands, except percentages)
THIG

Investment
$ 50,000

Ownership
%
Investment
25.0% $ 25,107 $ 50,000

Carrying
Value

Ownership
%
25.0% $ 28,303

Carrying
Value

Tower Hill

Tower Hill Signature

Total Tower Hill Companies

Top Layer Re

Angus

Other

Total investments in other
ventures, under equity
method

10,000

500

60,500

65,375

10,507
3,000

29.4%

25.0%

50.0%

42.5%
22.0%

14,506

2,515

42,128

50,500

9,180
3,808

10,000

500

60,500

65,375

8,226
—

28.6%

25.0%

50.0%

38.8%
—%

13,969

896

43,168

36,664

7,892
—

$ 139,382

$ 105,616 $ 134,101

$ 87,724

Our equity in earnings of the Tower Hill Companies are reported one quarter in arrears. The carrying value
of our investments in other ventures, under equity method, individually or in the aggregate may, and likely
will, differ from the realized value we may ultimately attain, perhaps significantly so.

Effects of Inflation

The potential exists, after a catastrophe loss, for the development of inflationary pressures in a local
economy. The anticipated effects on us are considered in our catastrophe loss models. Our estimates of
the potential effects of inflation are also considered in pricing and in estimating reserves for unpaid claims
and claim expenses. In addition, it is possible that the risk of general economic inflation could increase
which, if such increase actually occurred, would, among other things, cause claims and claim expenses to
increase and also impact the performance of our investment portfolio. The actual effects of this potential
increase in inflation on our results cannot be accurately known until, among other items, claims are
ultimately settled. The onset, duration and severity of an inflationary period cannot be estimated with
precision.

Off-Balance Sheet and Special Purpose Entity Arrangements

At December 31, 2013, we have not entered into any off-balance sheet arrangements, as defined by
Item 303(a)(4) of Regulation S-K.

134

Contractual Obligations

In the normal course of its business, the Company is a party to a variety of contractual obligations and
these are considered by the Company when assessing its liquidity requirements.

The table below shows our contractual obligations:

At December 31, 2013

(in thousands)
Long term debt obligations (1)

Total

Less than 1
year

1-3 years

3-5 years

More than 5
years

5.75% Senior Notes

$ 339,164 $

14,375 $

28,750 $

28,750 $ 267,289

Private equity and investment

commitments (2)

Operating lease obligations

Capital lease obligations

Payable for investments

purchased

Reserve for claims and claim

expenses (3)
Total contractual obligations

116,245

25,499

40,064

6,040

3,017

—

10,671

6,034

193,221

—

4,453

4,834

—

4,335

26,179

—

1,563,730

386,367
$ 2,277,923 $ 871,115 $ 472,137 $ 250,501 $ 684,170

212,464

426,682

538,217

(1)

Includes contractual interest payments.

(2) The private equity and investment commitments do not have a defined contractual commitment date and we have therefore

included them in the less than one year category.

(3) We caution the reader that the information provided above related to estimated future payment dates of our reserves for claims

and claim expenses is not prepared or utilized for internal purposes and that we currently do not estimate the future payment
dates of claims and claim expenses. Because of the nature of the coverages that we provide, the amount and timing of the cash
flows associated with our policy liabilities will fluctuate, perhaps significantly, and therefore are highly uncertain. We have based
our estimates of future claim payments upon benchmark industry payment patterns, drawing upon available relevant sources of
loss and allocated loss adjustment expense development data. These benchmarks are revised periodically as new trends
emerge. We believe that it is likely that this benchmark data will not be predictive of our future claim payments and that material
fluctuations can occur due to the nature of the losses which we insure and the coverages which we provide.

In certain circumstances, many of our contractual obligations may be accelerated to dates other than those reflected in the table,
due to defaults under the agreements governing those obligations (including pursuant to cross-default provisions in such
agreements) or in connection with certain changes in control of the Company, if applicable. In addition, in connection with any
such default under the agreement governing these obligations, in certain circumstances, these obligations may bear an increased
interest rate or be subject to penalties as a result of such a default.

CURRENT OUTLOOK

Catastrophe Exposed Market Developments

Notwithstanding the severe global catastrophic losses during 2011, the advent in late 2012 of Storm Sandy,
one of the most significant insured losses on record, and the increased frequency of severe weather events
during these periods in many high-insurance-penetration regions, the global insurance and reinsurance
markets entered 2013 with near-record levels of industry wide capital held by private market insurers and
reinsurers, and diminished growth of demand for many coverages and solutions, outside of the impacted
regions and in respect of certain products and lines. During the 2013 reinsurance renewals, we believe that
supply, principally from traditional market participants and complemented by alternative capital providers,
more than offset market demand, resulting in a dampening of overall market pricing on a risk-adjusted
basis, except for, in general, loss impacted treaties and contracts. We believe these trends accelerated
during the January 2014 renewals, driven by both the availability of traditional and alternative capital, and
uncertain estimates of the potential availability of additive alternative capital; which were only partially offset
by capital return initiatives and modest new aggregate demand in the market. Moreover, we believe that
many of the positive factors that had previously impacted market conditions have now been absorbed by
the market and, we believe, are unlikely to drive further improvement in our core catastrophe-exposed
markets absent significant new industry losses or other new developments. While we believe that the
market evidences some indication that the general overall decline in pricing and the broadening in certain
cases of terms and conditions we have been experiencing in the markets we serve may be decelerating

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somewhat, for the immediate future, we do not expect risk demand to out-pace capital supply or for the
market developments we have experienced to shift more favorably.

Accordingly, although the nature of the business which renews in June and July differs from the January
renewal business, we currently anticipate increased pressure in the market on both premiums and risk-
adjusted rates to continue throughout 2014. With our continuing focus on underwriting discipline, we cannot
assure that we can continue to maintain the size and portfolio quality of our aggregate book of business. In
addition, we believe that many of the key markets we serve are increasingly characterized by large,
increasingly sophisticated cedants who are able to manage large retentions and seek to focus their
reinsurance relationships on a core group of well-capitalized, highly-rated reinsurers who can provide a
complete product suite as well as value added service. While we believe we are well positioned to compete
for this business, these dynamics may introduce or exacerbate challenges in our markets.

General Economic Conditions

While the U.S. has evidenced some signs of economic expansion in recent periods, and the Eurozone
region has reported modest growth as a whole recently, we believe that meaningful uncertainty remains
regarding the strength, duration and comprehensiveness of the economic recovery in the U.S., E.U. and our
other key markets. In particular, global economic markets, including many of the key markets which we
serve, may continue to be adversely impacted by the financial and fiscal instability of several European
jurisdictions and certain large developing economies. Accordingly, we continue to believe that meaningful
risk remains for continued uncertainty or disruptions in general economic and financial market conditions.
Moreover, future economic growth may be only at a comparably suppressed rate for a relatively extended
period of time. Declining or weak economic conditions could reduce demand for the products sold by us or
our customers, or could weaken our overall ability to write business at risk-adequate rates. In addition,
persistent low levels of economic activity could adversely impact other areas of our financial performance,
such as by contributing to unforeseen premium adjustments, mid-term policy cancellations or
commutations, or asset devaluation. Any of the foregoing or other outcomes of a prolonged period of
relative economic weakness could adversely impact our financial position or results of operations. In
addition, during a period of extended economic weakness, we believe our consolidated credit risk, reflecting
our counterparty dealings with customers, agents, brokers, retrocessionaires, capital providers and parties
associated with our investment portfolio, among others, is likely to be increased. Several of these risks
could materialize, and our financial results could be negatively impacted, even after the end of any period of
economic weakness.

Moreover, we continue to monitor the risk that our principal markets will experience increased inflationary
conditions, which would, among other things, cause costs related to our claims and claim expenses to
increase, and impact the performance of our investment portfolio. The onset, duration and severity of an
inflationary period cannot be estimated with precision. The continued uncertainty with respect of large
developing jurisdictions and the related financial restructuring efforts, among other factors, make it more
difficult to predict the inflationary environment.

Our catastrophe-exposed operations are subject to the ever-present potential for significant volatility in
capital due primarily to our exposure to severe catastrophic events. Our specialty reinsurance portfolio is
also exposed to emerging risks arising from the ongoing relative economic weakness, including with respect
to a potential increase of claims in directors and officers, errors and omissions, surety, casualty clash and
other lines of business.

The sustained and continuing environment of low interest rates, as compared to past periods, has lowered
the yields at which we invest our assets. We expect these developments, combined with the current
composition of our investment portfolio and other factors, to continue to constrain investment income growth
for the near term. In addition to impacting our reported net income, potential future losses on our
investment portfolio, including potential future mark-to-market results, would adversely impact our equity
capital. Moreover, as we invest cash from new premiums written or reinvest the proceeds of invested
assets that mature or that we choose to sell, the yield on our portfolio is impacted by the prevailing
environment of comparably low yields. While it is possible yields will improve in future periods, we currently
expect the challenging economic conditions to generally persist and we are unable to predict with certainty
when conditions will substantially improve, or the pace of any such improvement.

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Market Conditions and Competition

Leading global intermediaries and other sources have generally reported that the U.S. casualty reinsurance
market continues to reflect a relatively soft pricing environment. However, we believe that pockets of niche
or specialty casualty lines may provide more attractive opportunities for stronger or well-positioned
reinsurers, and that this trend may be gaining a degree of momentum in certain lines. We anticipate that
persistent low investment returns and, to a degree, balance sheet issues in the broader market may
favorably impact demand for coverages on terms that we find attractive. However, we cannot assure you
that any increased demand will indeed materialize or that we will be successful in consummating new or
expanded transactions.

As noted above, we currently anticipate a continued level of slowly growing demand for our catastrophe
coverages as a whole over coming periods, with select pockets of more rapidly growing demand, offset by
ample and likely increasing supplies of private market capital. Renewal terms vary widely by insured
account and our ability to shape our portfolio to improve its risk and return characteristics as estimated by
us is subject to a range of competitive and commercial factors. While we believe that our strong
relationships, and track record of superior claims paying ability and other client services will enable us to
compete for the business we find attractive, we may not succeed in doing so; moreover, our relationships in
emerging markets are not as developed as they are in our current core markets.

The market for our catastrophe reinsurance products is generally dynamic and volatile. The market
dynamics noted above, increased or decreased catastrophe loss activity, and changes in the amount of
capital in the industry can result in significant changes to the pricing, policy terms and demand for our
catastrophe reinsurance products over a relatively short period of time. In addition, changes in state-
sponsored catastrophe funds, or residual markets, which have generally grown dramatically in recent years,
or the implementation of new government-subsidized or sponsored programs, can dramatically alter market
conditions. We believe that the overall trend of increased frequency and severity of tropical cyclones
experienced in recent years may continue for the foreseeable future. Increased understanding of the
potential increase in frequency and severity of storms may contribute to increased demand for protection in
respect of coastal risks which could impact pricing and terms and conditions in coastal areas over time.
Overall, we expect higher property loss cost trends, driven by increased severity and by the potential for
increased frequency, to continue in the future. At the same time, certain markets we target continue to be
impacted by fundamental weakness experienced by primary insurers, due to ongoing economic weakness
and, in many cases, inadequate primary insurance rate levels, including without limitation insurers operating
on an admitted basis in Florida. These conditions, which occurred in a period characterized by relatively
low insured catastrophic losses for these respective regions, have contributed to certain publicly announced
instances of insolvency, regulatory supervision and other regulatory actions, and have weakened the ability
of certain carriers to invest in reinsurance and other protections for coming periods, and in some cases to
meet their existing premium obligations. It is possible that these dynamics will continue in future periods.

In addition, we continue to explore potential strategic transactions or investments, and other opportunities,
from time to time that are presented to us or that we originate. In evaluating these potential investments
and opportunities, we seek to improve the portfolio optimization of our business as a whole, to enhance our
strategy, to achieve an attractive estimated return on equity in respect of investments, to develop or
capitalize on a competitive advantage, and to source business opportunities that will not detract from our
core operations. Our efforts to explore strategic transactions may not result in positive gains, or may not
yield material contributions to our financial results or book value growth over time. Alternatively, strategic
investments in which we engage to improve the optimization of our business, focus our operations on core
or scalable business, or position us for future opportunities, may fail to be successfully executed, pose more
operational risk than we estimate or otherwise not yield the financial or strategic benefits we seek. Should
we pursue or consummate a strategic transaction, we may mis-value the acquired company or operations,
fail to integrate the acquired operation appropriately into our own franchise, expend unforeseen costs during
the acquisition or integration process, or encounter unanticipated risks or challenges.

Legislative and Regulatory Update

In January 2013, Congresswoman Frederica Wilson introduced the Homeowners’ Defense Act which would,
if enacted, provide for the creation of (i) a federal reinsurance catastrophe fund; (ii) a federal consortium to
facilitate qualifying state residual markets and catastrophe funds in securing reinsurance; and (iii) a federal

137

bond guarantee program for state catastrophe funds in qualifying state residual markets. In January 2013,
Congressman Dennis Ross introduced the Homeowners’ Insurance Protection Act (HR 240). The bill would
create a federal catastrophe reinsurance program to back up state insurance or reinsurance programs.
Other analogous bills have been introduced in the past and may be introduced in the future.

If enacted, any of these bills, or legislation similar to these proposals, would, we believe, likely contribute to
the growth of state entities offering below market priced insurance and reinsurance in a manner adverse to
us and market participants more generally. While none of this legislation has been enacted to date, and
although we believe such legislation will continue to be vigorously opposed, if adopted these bills would
likely diminish the role of private market catastrophe reinsurers and could adversely impact our financial
results, perhaps materially.

In June 2012, Congress passed the Biggert-Waters Bill, which provided for a five-year renewal of the NFIP
and effected substantial reforms in the program. Among other things, pursuant to this statute, the FEMA is
explicitly authorized to carry out initiatives to determine the capacity of private insurers, reinsurers, and
financial markets to assume a greater portion of the flood risk exposure in the U.S., and to assess the
capacity of the private reinsurance market to assume some of the program’s risk. The bill required FEMA to
submit a report on this assessment within six months of enactment. The bill also increased the annual
limitation on program premium increases from 10% to 20% of the average of the risk premium rates for
certain properties concerned; established a four-year phase-in, after the first year, in annual 20%
increments, of full actuarial rates for a newly mapped risk premium rate area; instructed FEMA to establish
new flood insurance rate maps; allowed multi-family properties to purchase NFIP policies; and introduced
minimum deductibles for flood claims. We believe that these reforms could increase the role of private risk-
bearing capital in respect of U.S. flood perils, perhaps significantly. In February 2014, legislation was
passed in the U.S. Senate, entitled the “Homeowner Flood Insurance Affordability Act of 2014”, which
would, if enacted into law, impose a four-year delay in most rate reforms required by the enacted version of
the Biggert-Waters Bill, and would require FEMA, which administers the flood program, to complete an
affordability study and propose regulations that address affordability issues. Subsequently, House Majority
Leader Eric Cantor announced that the House of Representatives will consider a modified version of the
Homeowner Flood Insurance Affordability Act the week of February 24. While it is possible that a House bill
would maintain more of the reforms currently incorporated in the Biggert-Waters Bill than the Senate
legislation at this date, specific legislative language has not been promulgated and it is possible that the
House bill, as proposed or as it may develop, may have a substantially similar impact as the Senate
legislation, and potentially could be more adverse than the Senate bill. It is likely that a version of this
legislation, or broader alternatives, will be adopted by Congress and adversely impact prospects for
increased U.S. private flood insurance demand, as well as the stability of the NFIP, the primary insurers that
produce policies for the NFIP or offer private coverages, or the communities they serve. Accordingly, we
cannot assure you that the Biggert-Waters Bill will be implemented or that, if implemented, it will materially
benefit private carriers, or that we will succeed in participating in any positive market developments that
may transpire.

In 2007, the State of Florida enacted legislation to expand the Florida Hurricane Catastrophe Fund’s (the
“FHCF”) provision of below-market rate reinsurance to up to $28.0 billion per season (the “2007 Florida
Bill”). In May of 2009, the Florida legislature enacted Bill No. CS/HB 1495 (the “2009 Bill”), which will
gradually phase out $12.0 billion in optional reinsurance coverage under the FHCF over the succeeding five
years. The 2009 Bill similarly allows the state-sponsored property insurer, Citizens Property Insurance
Corporation (“Citizens”), to raise its rates by up to 10% starting in 2010 and every year thereafter, until such
time that it has sufficient funds to pay its claims and expenses. The rate increases and cut back on
coverage by the FHCF and Citizens have supported, over this period, a relatively increased role of the
private insurers in Florida, a market in which we have established substantial market share.

In May 2011, the Florida legislature passed Florida Senate bill 408 (“SB 408”), relating principally to
property insurance. Among other things, SB 408 requires an increase in minimum capital and surplus for
newly licensed Florida domestic insurers from $5.0 million to $15.0 million; institutes a three-year claims
filing deadline for new and reopened claims from the date of a hurricane or windstorm; allows an insurer to
offer coverage where replacement cost value is paid, but initial payment is limited to actual cash value;
allows admitted insurers to seek rate increases up to 15% to adjust for third party reinsurance costs; and
institutes a range of reforms relating to various matters that have increased the costs of insuring sinkholes

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in Florida. We believe SB 408 and other reform initiatives have contributed to stabilization of the Florida
market and have increased both private and market demand and affordability in the Florida market.

We believe the 2007 Florida Bill caused a substantial decline at that time in the private reinsurance and
insurance markets in and relating to Florida, and contributed to instability in the Florida primary insurance
market, where many insurers have reported substantial and continuing losses from 2009 through 2012,
despite the period being an unusually low period for catastrophe losses in the state. Because of our
position as one of the largest providers of catastrophe-exposed coverage, both on a global basis and in
respect of the Florida market, adverse changes in the Florida market or to Florida primary insurance
companies, may have a disproportionate adverse impact on us compared to other reinsurance market
participants. Moreover, the advent of a large windstorm, or of multiple smaller storms, could challenge the
assessment-based claims paying capacity of Citizens and the FHCF. For example, in several recent years,
the FHCF Advisory Council approved official bonding capacity estimates that reflected a shortfall in respect
of even an initial season or event. Any inability, or delay, in the claims paying ability of these entities or of
private market participants could further weaken or destabilize the Florida market, potentially giving rise to
an unpredictable range of adverse impacts. The FHCF and the Florida Office of Insurance Regulation (the
“OIR”) have each estimated that even partial failure, or deferral, of the FHCF’s ability to pay claims in full
could substantially weaken numerous private insurers, with the OIR having estimated that a 25% shortfall in
the FHCF’s claims-paying capacity could cause as many as 24 of the top 50 insurers in the state to have
less than the statutory minimum surplus of $5.0 million, with such insurers representing approximately 35%
of the market based on premium volume, or approximately 2.2 million policies. Adverse market, regulatory
or legislative changes impacting Florida could affect our ability to sell certain of our products, to collect
premiums we may be owed on policies we have already written, to renew business with our customers for
future periods, or have other adverse impacts, some of which may be difficult to foresee, and could
therefore have a material adverse effect on our operations.

In May 2013, the Florida Legislature adopted legislation comprising some modest reforms of Citizens.
Among other things, the legislation, if enacted, would empower Citizens to create a so-called
“clearinghouse” mechanism with the intent of facilitating the transfer to admitted private market carriers of
residential policies that might otherwise be bound by or remain in Citizens. In addition the legislation
provides for a reduction in the current structure value cap on eligibility for Citizens from $1.0 million to $0.7
million over three years; and prohibits Citizens from insuring new structures located seaward of the coastal
construction control line and in the broader federal Coastal Barrier Resources system. While incremental,
we believe these reforms, if enacted, would marginally strengthen the fiscal position of Citizens and
increase private market demand moderately over time. However, we cannot assure you that this legislation
will indeed be fully enacted into law, that the measures contemplated thereby will be acted on, that any
market improvements will accrue, or that we will benefit from the reforms.

The “clearinghouse” mechanism contemplated by the May 2013 legislation commenced operation in
January 2014. With the clearinghouse operational, existing customers of Citizens may be renewed by a
private insurance carrier approved by the state if that company offers comparable coverage at equal or less
cost than the Citizens renewal rate. Proposed new customers of Citizens may be directed via the
mechanism of the clearinghouse to an eligible private carrier if that company’s estimate for comparable
coverage is within 15% of a quote for a Citizens policy. If successful, it is possible that the “clearinghouse”
mechanism will contribute incrementally to increased private market demand over time. However, it is
possible the “clearinghouse” mechanism will not operate successfully; that participating carriers may not
choose to cede risk to reinsurers in general or to the Company in particular; or that any growth attributable
to the “clearinghouse” mechanism will be offset by other changes returning risk to the state public sector.

In October 2013, Florida Senator Jeremy Ring filed a prospective bill for the 2014 legislative session, S.B.
228, which would reduce the retention of the FHCF from its current $7.2 billion level to $5 billion; mandate a
perpetual overall per event capacity level of $17 billion, the current level, obviating the possibility of future
capacity reductions; and delete current statutory provisions which limit the obligation of the FHCF to
amounts it can afford to pay. The bill also would require the FHCF to obtain a line of credit to cover
projected receipts from a minimum of three years of post-event bonding without providing for a funding
source for the line of credit. If enacted, S.B. 228 could destabilize private carriers participating in the
market, lead to a range of market dislocations, and reduce private market demand.

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Internationally, in the wake of the large natural catastrophes in 2011 a number of proposals have been
introduced to alter the financing of natural catastrophes in several of the markets in which we operate. For
example, the Thailand government has announced it is studying proposals for a natural catastrophe fund,
under which the government would provide coverage for natural disasters in excess of an industry retention
and below a certain limit, after which private reinsurers would continue to participate. The government of
the Philippines has announced that it is considering similar proposals. A range of proposals from varying
stakeholders have been reported to have been made to alter the current regimes for insuring flood risk in
the U.K. and Australia and earthquake risk in New Zealand. If these proposals are enacted and reduce
market opportunities for our clients or for the reinsurance industry, we could be adversely impacted.

Over the past few years the U.S. Congress has considered legislation which, if passed, would deny U.S.
insurers and reinsurers the deduction for reinsurance placed with non-U.S. affiliates. In early 2013, as well
as the immediate few prior years, the Obama administration included a formal proposal for such a provision
in its budget proposal. As described in the administration’s 2013 budget request, the proposal would deny
an insurance company a deduction for premiums and other amounts paid to affiliated foreign companies
with respect to reinsurance of property and casualty risks to the extent that the foreign reinsurer (or its
parent company) is not subject to U.S. income tax with respect to the premiums received; and would
exclude from the insurance company’s income (in the same proportion in which the premium deduction was
denied) any return premiums, ceding commissions, reinsurance recovered, or other amounts received with
respect to reinsurance policies for which a premium deduction is wholly or partially denied. We believe that
the passage of such legislation could adversely affect the reinsurance market broadly and potentially impact
our own current or future operations in particular.

On February 11, 2013, U.S. Senators Carl Levin and Sheldon Whitehouse introduced legislation in the U.S.
Senate entitled the “Cut Unjustified Tax Loopholes Act”. Similar legislation was also proposed earlier in
2013 as well as in 2012, 2011 and 2010. If enacted, this legislation would, among other things, cause to be
treated as a U.S. corporation for U.S. tax purposes generally, certain corporate entities if the “management
and control” of such a corporation is, directly or indirectly, treated as occurring primarily within the U.S. The
proposed legislation provides that a corporation will be so treated if substantially all of the executive officers
and senior management of the corporation who exercise day-to-day responsibility for making decisions
involving strategic, financial, and operational policies of the corporation are located primarily within the U.S.
To date, this legislation has not been approved by either the House of Representatives or the Senate.
However, we can provide no assurance that this legislation or similar legislation will not ultimately be
adopted. While we do not believe that the legislation would negatively impact us, it is possible that an
adopted bill would include additional or expanded provisions which could negatively impact us, or that the
interpretation or enforcement of the current proposal, if enacted, would be more expansive or adverse than
we currently estimate.

In November 2013, former Senate Finance Committee Chairman Max Baucus (D-MT) released a tax reform
discussion draft on international tax issues that included two proposals that would change the definitions of
controlled foreign corporation and passive foreign investment company. We do not believe these proposals
would, if enacted, directly apply to us, but it is possible that they might apply to shareholders of certain of
our joint ventures, possibly discouraging those shareholders from continuing to participate in the joint
venture or impeding our ability to attract or retain other investors. We are not aware of any corresponding
current legislation in the House of Representatives. Senator Baucus recently retired from the Senate and it
is uncertain whether this proposal will formally be proposed as legislation or ever enacted.

On July 24, 2013, the New York State Department of Financial Services (the “DFS”) issued an Insurance
Circular Letter No. 6 (2013) (the “Circular”) to all Accredited Reinsurers writing business in New York State.
Renaissance Reinsurance and DaVinci are Accredited Reinsurers in New York. As described in the
Circular, the DFS is seeking information concerning Accredited Reinsurers’ compliance with the Iran
Freedom and Counter-Proliferation Act of 2012 (the “IFCPA”), which was passed by the U.S. Congress in
2012 and which became effective on July 1, 2013. The Accredited Reinsurers to whom the Circular applies
do business in New York and are all based outside the United States. The DFS is responsible for the
regulation of insurers doing business in New York State. We intend to cooperate with the DFS in their
request for information in this regard. We believe our existing risk-based compliance program is responsive
to the IFCPA and we are not aware of any non-compliance with the IFCPA. While we believe that this
request for information by the DFS will not have a material adverse impact on our operations, it is possible
that our industry could see increased scrutiny and perhaps additional enforcement of sanction laws and

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regulations. We cannot assure you that increased enforcement of sanction laws and regulations will not
impact our business more adversely than we currently estimate.

In 2008, the IRS issued a revenue ruling (the “2008 Revenue Ruling”) expressing that position that
premiums covering U.S. risks paid by a foreign insurer or reinsurer to another foreign reinsurer are subject
to a 1% insurance federal excise tax (“FET”). In essence, pursuant to the views expressed in the 2008
Revenue Ruling, FET should be imposed on a “cascading” basis, including to these reinsurance
arrangements which are referred to in the industry as “retrocessions”, as the IRS took the view that all
payments of premiums to foreign insurers or reinsurers in respect of the ultimate underlying risks are also
subject to FET. In February 2014, the U.S. District Court for the District of Columbia held that FET does
not apply to secondary reinsurance transactions covering U.S. risks between two foreign reinsurance
companies. The decision, if unappealed or upheld, effectively countermands the 2008 Revenue Ruling.
Accordingly, it is possible that foreign reinsurance companies such as certain of our operating subsidiaries
that have paid the “cascading” FET on retrocessions may in the future be eligible to file and receive refund
claims. At this time, it is not clear if the IRS will appeal the decision or whether an appeal would be
successful. The amount of “cascading” FET we have paid is not material to us and we are evaluating our
position. It is also possible that in the future Congress may adversely amend the existing legislation or
adopt new statutory language which would adversely affect us, the industry generally or our ceding clients
in respect of excise tax liabilities.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following risk management discussion and the estimated amounts generated from sensitivity presented
are forward-looking statements of market risk assuming certain market conditions occur. Actual results in
the future may differ materially from these estimated results due to, among other things, actual
developments in the global financial markets and changes in the composition of our investment portfolio,
derivatives and product offerings. The results of analysis used by us to assess and mitigate risk should not
be considered projections of future events or losses. See “Note On Forward-Looking Statements” for
additional discussion regarding forward-looking statements included herein.

We are principally exposed to four types of market risk: interest rate risk; foreign currency risk; credit risk;
and equity price risk. Our policies to address these risks in 2013 were not materially different than those
used in 2012, and we do not currently anticipate significant changes in our market risk exposures or in how
those exposures are managed in future reporting periods based upon what is known or expected to be in
effect in future reporting periods. The Company’s guidelines permit investments in derivative instruments
such as futures, forward contracts, options, swap agreements and other derivative contracts which may be
used to assume risk or for hedging purposes. Refer to “Note 19. Derivative Instruments in our Notes to
Consolidated Financial Statements” for additional information related to derivatives entered into by us.

Interest Rate Risk

Interest rate risk is the price sensitivity of a security to changes in interest rates. Our investment portfolio
includes fixed maturity investments and short term investments, whose fair values will fluctuate with
changes in interest rates. We attempt to maintain adequate liquidity in our fixed maturity investments
portfolio to fund operations, pay reinsurance and insurance liabilities and claims and provide funding for
unexpected events. We seek to manage our interest rate risk in part by monitoring the duration and
structure of our investment portfolio.

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The following tables summarize the aggregate hypothetical increase (decrease) in fair value from an
immediate parallel shift in the treasury yield curve, assuming credit spreads remain constant, reflecting the
use of an immediate time horizon since this presents the worst-case scenario, in our fixed maturity
investment and short term investments portfolio for the years indicated:

At December 31, 2013

(in thousands, except
percentages)

Fair value of fixed maturity

and short term
investments

Net increase (decrease) in

fair value

Percentage change in fair

value

At December 31, 2012

(in thousands, except
percentages)

Fair value of fixed maturity

and short term
investments

Net increase (decrease) in

fair value

Percentage change in fair

value

-100

-50

Base

100

Interest Rate Shift in Basis Points

$ 6,043,858

$ 5,965,533

$ 5,888,056

$5,811,425

$5,735,642

155,802

77,477

— $ (76,631)

$ (152,414)

2.6%

1.3%

—%

(1.3)%

(2.6)%

Interest Rate Shift in Basis Points

-100

-50

Base

100

$ 5,709,140

$ 5,637,183

$ 5,564,773

$5,491,911

$5,418,596

144,367

72,410

— $ (72,862)

$ (146,177)

2.6%

1.3%

—%

(1.3)%

(2.6)%

We use interest rate futures within our portfolio of fixed maturity investments to manage our exposure to
interest rate risk, which can include increasing or decreasing our exposure to this risk. At December 31,
2013, we had $1,169.3 million of notional long positions and $356.6 million of notional short positions of
primarily U.S. Treasury and non-U.S. dollar futures contracts (2012 - $377.8 million and $310.7 million,
respectively). Refer to “Note 19. Derivative Instruments in our Notes to Consolidated Financial
Statements” for additional information related to interest rate futures entered into by us. The aggregate
hypothetical loss generated from an immediate upward parallel shift in the treasury yield curve of 100 basis
points would cause an increase in market value of our net position in these derivatives of approximately
$22.7 million at December 31, 2013. The foregoing reflects the use of an immediate time horizon, since this
presents the worst-case scenario. Credit spreads are assumed to remain constant in these hypothetical
examples.

Foreign Currency Risk

Our functional currency is the U.S. dollar. We routinely write a portion of our business in currencies other
than U.S. dollars and may, from time to time, experience foreign exchange gains and losses in our
consolidated financial statements. All changes in exchange rates, with the exception of non-U.S. dollar
denominated investments classified as available for sale, are recognized currently in our consolidated
statements of operations. We are primarily impacted by the foreign currency risk exposures noted below,
and may, from time to time, enter into foreign currency forward and option contracts to minimize the effect of
fluctuating foreign currencies on the value of non-U.S. denominated assets and liabilities. Refer to “Note
19. Derivative Instruments in our Notes to Consolidated Financial Statements” for additional information
related to foreign currency forward and option contracts entered into by us. We may determine to not
match a portion of our projected liabilities in foreign currencies with investments in the same currencies,
which would increase our exposure to foreign currency fluctuations and increase the volatility of our results
of operations.

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Underwriting Operations

Our foreign currency policy with regard to our underwriting operations is generally to hold foreign currency
assets, including cash, investments and receivables that approximate the foreign currency liabilities,
including claims and claim expense reserves and reinsurance balances payable. When necessary, we may
use foreign currency forward and option contracts to minimize the effect of fluctuating foreign currencies on
the value of non-U.S. dollar denominated assets and liabilities associated with our underwriting operations.

Investment Portfolio

Our investment operations are exposed to currency fluctuations through our investments in non-U.S. dollar
fixed maturity investments, short term investments and other investments. The principal currencies creating
foreign exchange risk for us are the British pound sterling, the euro, the yen and the Canadian dollar. To
economically hedge our exposure to currency fluctuations from these investments, we have entered into
foreign currency forward contracts. In certain instances, we may assume foreign exchange risk as part of
our investment strategy. Unrealized foreign exchange gains or losses arising from non-U.S. dollar
investments classified as available for sale are recorded in accumulated other comprehensive income.
Realized foreign exchange gains or losses from the sale of our non-U.S. dollar fixed maturity investments
available for sale, realized and unrealized foreign exchange gains or losses from the sale of our non-U.S.
dollar fixed maturity investments trading and other investments, and foreign exchange gains or losses
associated with our hedging of these non-U.S. dollar investments are recorded in net foreign exchange
gains (losses) in our consolidated statements of operations. In the future, we may choose to increase our
exposure to non-U.S. dollar investments.

The following tables summarize our net foreign currency exposures and the impact of a hypothetical 10%
change in our net foreign currency exposure, keeping all other variables constant, as of the dates indicated:

At December 31,
2013

(in thousands, except
for percentages)

Net assets

denominated in
foreign currencies

Net foreign currency

derivatives notional
amounts

Total net foreign

currency exposure

Net foreign currency
exposure as a
percentage of total
shareholders’ equity
attributable to
RenaissanceRe

Impact of a

hypothetical 10%
change in total net
foreign currency
exposure

AUD

CAD

EUR

GBP

JPY

NZD

Other

Total

$ 29,472

$ 13,374

$ (13,983)

$ 76,362

$ (97,448)

$ 2,651

10,445

(38,210)

(10,134)

20,276

(61,368)

(3,742)

99,885

(2,287)

4,420

$ (8,738)

$ 3,240

$ 6,293

$ 14,994

$ (3,725)

2,437

364

14,865

(0.2)%

0.1%

0.2%

0.4%

(0.1)%

0.1%

—%

0.4%

874

(324)

(629)

$ (1,499)

373

(244)

(36)

(1,487)

143

At December 31,
2012

(in thousands, except
for percentages)

Net assets

denominated in
foreign currencies

Net foreign currency

derivatives notional
amounts

Total net foreign

currency exposure

Net foreign currency
exposure as a
percentage of total
shareholders’ equity
attributable to
RenaissanceRe

Impact of a

hypothetical 10%
change in total net
foreign currency
exposure

Credit Risk

AUD

CAD

EUR

GBP

JPY

NZD

Other

Total

$ 5,335

$ 24,750

$ (85,004)

$ 45,994

$(42,037)

$(217,506)

$ 14,548

$ (253,920)

(11,283)

(17,151)

110,197

(49,933)

33,714

211,981

8,523

286,048

$ (5,948)

$ 7,599

$ 25,193

$ (3,939)

$ (8,323)

$ (5,525)

$ 23,071

32,128

(0.2)%

0.2%

0.7%

(0.1)%

(0.2)%

0.7%

0.9%

595

(760)

$ (2,519)

394

832

553

$ (2,307)

(3,213)

Credit risk relates to the uncertainty of a counterparty’s ability to make timely payments in accordance with
contractual terms of the instrument or contract. We are exposed to direct credit risk within our portfolios of
fixed maturity and short term investments, and through customers and reinsurers in the form of premiums
receivable and reinsurance recoverables, respectively, as discussed below.

Fixed Maturity Investments and Short Term Investments

Credit risk related to our fixed maturity investments and short term investments is the exposure to adverse
changes in the creditworthiness of individual investment holdings, issuers, groups of issuers, industries and
countries. We manage credit risk in our fixed maturity investments and short term investments through the
credit research performed primarily by the investment management service providers and our evaluation of
these investment managers adherence to investment mandates provided to them. The management of
credit risk in the investment portfolio is integrated in our credit risk management governance framework and
the management of credit exposures and concentrations within the investment portfolio are carried out in
accordance with our risk policies, limits and risk concentrations as overseen by our Investment Risk
Management Committee of the Board of Directors. In the investment portfolio, we review on a regular basis
our asset concentration, credit quality and adherence to credit limit guidelines. At December 31, 2013, our
invested asset portfolio had a dollar weighted average rating of AA (2012 - AA). In addition, we limit the
amount of credit exposure to any one financial institution and, except for U.S. Government securities, none
of our investments exceeded 10% of shareholders’ equity at December 31, 2013.

144

The following table summarizes our fixed maturity investments and short term investments as indicated by
ratings assigned by S&P, or Moody’s and/or other rating agencies when S&P ratings were not available as a
percentage of total fixed maturity investments and short term investments as of the dates indicated:

At December 31,

2013

2012

AAA

BBB

Non-investment grade

Not rated

Total

28.4%

41.2%

14.2%

6.5%

8.9%

0.8%

25.8%

44.7%

15.2%

5.8%

8.2%

0.3%

100.0%

We consider the impact of credit spread movements on the fair value of our fixed maturity and short term
investments portfolio. As credit spreads widen, the fair value of our fixed maturity and short term
investments decreases, and vice versa.

The following tables summarize the aggregate hypothetical increase (decrease) in fair value from an
immediate parallel shift in credit spreads, assuming the treasury yield curve remains constant, reflecting the
use of an immediate time horizon since this presents the worst-case scenario, in our fixed maturity
investment and short term investments portfolio for the years indicated:

At December 31, 2013

(in thousands, except
percentages)

Fair value of fixed income

and short term
investments

Net increase (decrease) in

fair value

Percentage change in fair

value

At December 31, 2012

(in thousands, except
percentages)

Fair value of fixed income

and short term
investments

Net increase (decrease) in

fair value

Percentage change in fair

value

-100

-50

Base

100

Credit Spread Shift in Basis Points

$ 6,013,968

$ 5,951,010

$ 5,888,056

$5,825,099

$5,762,144

125,912

62,954

— $ (62,957)

$ (125,912)

2.1%

1.1%

—%

(1.1)%

(2.1)%

-100

-50

Base

100

Credit Spread Shift in Basis Points

$ 5,691,346

$ 5,630,687

$ 5,564,773

$5,509,367

$5,448,707

121,320

60,661

— $ (60,659)

$ (121,319)

2.2%

1.1%

—%

(1.1)%

(2.2)%

We also employ credit derivatives in our investment portfolio to either assume credit risk or hedge our credit
exposure. At December 31, 2013, we had outstanding credit derivatives of $7.1 million in notional long
positions and $18.4 million in notional short positions, denominated in U.S. dollars (2012 - $46.1 million and
$24.0 million, respectively). Refer to “Note 19. Derivative Instruments in our Notes to Consolidated
Financial Statements” for additional information related to credit derivatives entered into by us.

145

Premiums Receivable and Reinsurance Recoverable

Premiums receivable from ceding companies are subject to credit risk. To mitigate credit risk related to
reinsurance premiums receivable, we have established standards for ceding companies and, in most cases,
have a contractual right of offset thereby allowing us to settle claims net of any such reinsurance premiums
receivable. We also have reinsurance recoverable amounts from our reinsurers. To mitigate credit risk
related to our reinsurance recoverable amounts, we consider the financial strength of our reinsurers when
determining whether to purchase coverage from them. We generally obtain reinsurance coverage from
companies rated “A-“ or better by S&P unless the obligations are collateralized. We routinely monitor
the financial performance and rating status of all material reinsurers. Refer to “Part II, Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations, Summary of
Critical Accounting Estimates, Reinsurance Recoverables” for additional information with respect to
reinsurance recoverable.

Equity Price Risk

Equity price risk is the potential loss arising from changes in the market value of equities. As detailed in the
table below, we are directly exposed to this risk through our investment in equity investments trading which
are traded on nationally recognized stock exchanges; and indirectly exposed to this risk through our
investments in: private equity partnerships whose exit strategies often depend on the equity markets;
certain hedge funds that have net long equity positions; and other ventures, under equity method. The
following table summarizes a hypothetical 10% increase and decline in the carrying value of our equity
investments trading, private equity partnerships, hedge funds and investments in other ventures, holding all
other factors constant, at the dates indicated:

At December 31,
(in thousands, except for percentages)
Equity investments trading, at fair value

Private equity investments, at fair value

Hedge funds, at fair value
Investments in other ventures, under equity method

Total carrying value of investments exposed to equity price risk

Impact of a hypothetical 10% increase in the carrying value of investments

exposed to equity price risk

Impact of a hypothetical 10% decrease in the carrying value of

investments exposed to equity price risk

2013

2012

254,776 $

322,391
3,809

105,616

58,186
344,669

5,803

87,724

686,592 $

496,382

68,659 $

49,638

(68,659) $

(49,638)

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Reference is made to Item 15(a) of this Report for the Consolidated Financial Statements of
RenaissanceRe and the Notes thereto, as well as the Schedules to the Consolidated Financial Statements.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None.

146

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Internal Controls: We have designed various disclosure controls and procedures
(as defined in Rules 13a-15(e) and Rule 15d-15(e) under the Exchange Act), to help ensure that information
required to be disclosed in our periodic Exchange Act reports, such as this annual report, is recorded,
processed, summarized and reported on a timely and accurate basis. Our disclosure controls and
procedures are also designed with the objective of ensuring that such information is accumulated and
communicated to our senior management, including our Chief Executive Officer and Chief Financial Officer,
as appropriate to allow timely decisions regarding required disclosure. Our internal control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles and includes those policies and procedures that: (1) pertain to the
maintenance of records that in reasonable detail accurately and fairly reflect the transactions and
dispositions of the assets of the issuer; (2) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the issuer are being made only in accordance with
authorizations of management and directors of the issuer; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that
could have a material effect on the financial statements.
Limitations on the Effectiveness of Controls: Our Board of Directors and management, including our Chief
Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures or
internal control over financial reporting will prevent all errors and all fraud. Controls, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the
controls are met. Further, we believe that the design of prudent controls must reflect appropriate resource
constraints, such that the benefits of controls must be considered relative to their costs. Because of the
inherent limitations in all controls, there can be no absolute assurance that all control issues and instances
of fraud, if any, applicable to us have been or will be detected. These inherent limitations include the
realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple
errors or mistakes. Additionally, controls can be circumvented by the individual acts of some individuals, by
collusion of more than one person, or by management override of the control. The design of any system of
controls also is based in part upon certain assumptions about the likelihood of future events, and there can
be no assurance that any design will succeed in achieving its stated goals under all potential future
conditions; over time, controls may become inadequate because of changes in conditions, or the degree of
compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-
effective control system, misstatements due to error or fraud may occur and not be detected.

Evaluation: An evaluation was performed under the supervision and with the participation of the Company’s
management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of the Company’s disclosure controls and procedures as required by Rules 13a-15(b)
and 15d-15(b) of the Exchange Act. Based upon that evaluation, the Company’s management, including
our Chief Executive Officer and Chief Financial Officer, concluded that, at December 31, 2013, the
Company’s disclosure controls and procedures were effective at the reasonable assurance level in ensuring
that information required to be disclosed in Company reports filed under the Exchange Act is (i) recorded,
processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii)
accumulated and communicated to management, including the Company’s Chief Executive Officer and
Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. There has
been no change in the Company’s internal control over financial reporting during the three months ended
December 31, 2013 that has materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

147

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

This item is omitted because a definitive proxy statement that involves the election of directors will be filed
with the Securities and Exchange Commission not later than 120 days after the close of the fiscal year
pursuant to Regulation 14A, which proxy statement is incorporated by reference.

RenaissanceRe has adopted a Code of Ethics that applies to its directors and executive officers. The Code
of Ethics is available free of charge on our website http://www.renre.com. We will also provide a printed
version of the Code of Ethics to any shareholder who requests it. We intend to disclose any amendments
to our Code of Ethics by posting such information on our website. As outlined in the Code of Ethics, any
waivers of our Code of Ethics applicable to our directors, principal executive officer, principal financial
officer, principal accounting officer or controller and other executive officers who perform similar functions
will be disclosed by filing a Form 8-K.

ITEM 11. EXECUTIVE COMPENSATION

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED SHAREHOLDER MATTERS

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)

Financial Statements, Financial Statement Schedules and Exhibits.

Financial Statements

The Consolidated Financial Statements of RenaissanceRe Holdings Ltd. and related Notes thereto are
listed in the accompanying Index to Consolidated Financial Statements and are filed as part of this Form
10-K.

Financial Statement Schedules

The Schedules to the Consolidated Financial Statements of RenaissanceRe Holdings Ltd. are listed in the
accompanying Index to Schedules to Consolidated Financial Statements and are filed as a part of this Form
10-K.

3.1

3.2

Exhibits

Memorandum of Association. (1)

Amended and Restated Bye-Laws. (2)

148

3.3

3.4

4.1

4.2

Memorandum of Increase in Share Capital of RenaissanceRe Holdings Ltd. (3)

Specimen Common Share certificate. (1)

Certificate of Designation, Preferences and Rights of 6.08% Series C Preference Shares. (4)

Certificate of Designation, Preferences and Rights of 5.375% Series E Preference Shares. (5)

4.2(a)

Form of Stock Certificate Evidencing the 5.375% Series E Preference Shares. (5)

4.3

4.3(a)

4.3(b)

4.3(c)

4.4

4.4(a)

4.5

4.5(a)

4.6

4.7

4.7(a)

4.7(b)

10.1

10.2

10.3

10.4

Senior Indenture, dated as of March 17, 2010, among RenRe North America Holdings Inc., as
Issuer, RenaissanceRe Holdings Ltd., as Guarantor, and Deutsche Bank Trust Companies
America, as Trustee. (6)

First Supplemental Indenture, dated as of March 17, 2010, among RenRe North America
Holdings Inc., as Insurer, RenaissanceRe Holdings Ltd., as Guarantor, and Deutsche Bank
Trust Companies America, as Trustee. (6)

Senior Debt Securities Guarantee Agreement, dated as of March 17, 2010, between
RenaissanceRe Holdings Ltd., as Guarantor, and Deutsche Bank Trust Companies America, as
Guarantee Trustee. (6)

Waiver Agreement, dated as of January 21, 2011, by and among RenRe North America
Holdings Inc., RenaissanceRe Holdings Ltd. and Deutsche Bank Trust Company Americas, as
Trustee. (7)

Credit Agreement, dated as of May 17, 2012, by and among RenaissanceRe Holdings Ltd.,
various banks and financial institutions parties thereto, Wells Fargo Bank, National Association,
as Fronting Bank, LC Administrator and Administrative Agent for the Lenders, Citibank, N.A., as
Syndication Agent, and Wells Fargo Securities, LLC and Citigroup Global Markets Inc., as Joint
Lead Arrangers and Joint Lead Bookrunners (8).

First Amendment and Joinder to Credit Agreement, dated as of May 23, 2013, by and among
RenaissanceRe Holdings Ltd., Wells Fargo Bank, National Association, as Fronting Bank, LC
Administrator and Administrative Agent for the Lenders, and various banks and financial
institutions parties thereto. (9)

Master Reimbursement Agreement, dated as of April 29, 2009, by and between Renaissance
Reinsurance Ltd. and Citibank Europe PLC. (10)

Pledge Agreement, dated as of April 29, 2009, by and between Renaissance Reinsurance Ltd.
and Citibank Europe PLC. (10)

Fourth Amended and Restated Reimbursement Agreement, dated as of May 17, 2012, by and
among RenaissanceRe Holdings Ltd., Renaissance Reinsurance Ltd., Renaissance
Reinsurance of Europe, Glencoe Insurance Ltd., DaVinci Reinsurance Ltd., the banks and
financial institutions parties thereto, Wells Fargo Bank, National Association, as issuing bank,
administrative agent and collateral agent for the lenders, and certain other agents (8).

Facility Letter, dated September 17, 2010, from Citibank Europe plc to Renaissance
Reinsurance Ltd., DaVinci Reinsurance Ltd. and Glencoe Insurance Ltd. (11)

Amendment to Facility Letter, dated October 1, 2013, by and among Citibank Europe plc,
Renaissance Reinsurance Ltd., DaVinci Reinsurance Ltd., RenaissanceRe Specialty Risks
Ltd., Renaissance Reinsurance of Europe and RenaissanceRe Specialty U.S. Ltd. (12)

Insurance Letters of Credit - Master Agreement, dated September 17, 2010, between
Renaissance Reinsurance Ltd. and Citibank Europe plc. DaVinci Reinsurance Ltd. and Glencoe
Insurance Ltd. have each entered into an agreement with Citibank Europe plc that is identical to
the foregoing agreement, except with respect to party names. (11)

Further Amended and Restated Employment Agreement, dated as of May 15, 2013, by and
between RenaissanceRe Holdings Ltd. and Kevin J. O'Donnell (13)

Form of the Amended and Restated Employment Agreement for Named Executive Officers
(other than our Chief Executive Officer). (14)

Further Amended and Restated Employment Agreement, dated as of October 23, 2013, by and
between RenaissanceRe Holdings Ltd. and Jeffrey D. Kelly. (15)

Transition and Services Agreement, dated as of May 15, 2013, between RenaissanceRe
Holdings Ltd. and Neill A. Currie. (13)

149

10.5

10.5(a)

10.5(b)

10.5(c)

10.6

10.7

10.8

10.8(a)

10.8(b)

10.8(c)

10.8(d)

10.8(e)

10.8(f)

10.8(g)

10.8(h)

10.8(i)

10.8(j)

10.9

10.9(a)

10.9(b)

Further Amended and Restated Employment Agreement, dated as of February 19, 2009,
between RenaissanceRe Holdings Ltd. and Neill A. Currie. (16)

Amendment No. 1 to the Further Amended and Restated Employment Agreement, dated
January 8, 2010, by and among RenaissanceRe Holdings Ltd. and Neill A. Currie. (17)

Amendment No. 2 to Further Amended and Restated Employment Agreement by and between
RenaissanceRe Holdings Ltd. and Neill A. Currie, dated February 19, 2013. (18)

Amendment No. 3 to Further Amended and Restated Employment Agreement by and between
RenaissanceRe Holdings Ltd. and Neill A. Currie, dated April 5, 2013. (14)

Memorandum of Agreement by and between the Company and Neill A. Currie, dated February
21, 2012 (20).

Agreement Regarding Use of Aircraft Interest, dated as of November 17, 2009, by and between
RenaissanceRe Holdings Ltd. and Neill A. Currie. (21)

RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (22)

Amendment No. 1 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (23)

Amendment No. 2 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (23)

Amendment No. 3 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (10)

Amendment No. 4 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (19)

Amendment No. 5 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (24)

Amendment No. 6 to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (15)

UK Schedule to the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (10)

UK Sub-Plan to the RenaissanceRe Holdings 2001 Stock Incentive Plan. (10)

Form of Option Grant Notice and Agreement pursuant to which option grants are made under
the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (26)

Form of Restricted Stock Grant Notice and Agreement pursuant to which Restricted Stock
grants are made under the RenaissanceRe Holdings Ltd. 2001 Stock Incentive Plan. (26)

RenaissanceRe Holdings Ltd. 2004 Stock Option Incentive Plan. (27)

Amendment No. 1 to the RenaissanceRe Holdings Ltd. 2004 Stock Option Incentive Plan. (28)

Form of Option Agreement pursuant to which option grants are made under the
RenaissanceRe Holdings 2004 Stock Option Incentive Plan to executive officers. (27)

10.10

RenaissanceRe Holdings Ltd. 2010 Restricted Stock Unit Plan. (21)

10.10(a)

Form of Restricted Stock Unit Agreement, pursuant to which restricted stock unit grants are
made under the RenaissanceRe Holdings Ltd. 2010 Restricted Stock Unit Plan. (21)

10.11

RenaissanceRe Holdings Ltd. 2010 Performance-Based Equity Incentive Plan. (19)

10.11(a)

Form of Letter Agreement with the Named Executive Officers Regarding Performance Share
Awards. (25)

10.11(b)

Form of Letter Agreement with Neill A. Currie Regarding Performance Share Awards. (25)

10.11(c)

10.11(d)

10.12

10.13

10.15

Form of Performance-Based Restricted Stock Grant Notice and Agreement pursuant to which
performance-based restricted stock awards are made under the RenaissanceRe Holdings Ltd.
2010 Performance-Based Equity Incentive Plan. (29)

Performance-Based Restricted Stock Grant Notice and Agreement under the RenaissanceRe
Holdings Ltd. 2010 Performance-Based Equity Incentive Plan, dated June 9, 2010, between
RenaissanceRe Holdings Ltd. and Neill A. Currie. (29)

Form of Tax Reimbursement Waiver Letter with the Named Executive Officers. (30)

Form of Agreement Regarding Use of Aircraft Interest by and between RenaissanceRe
Holdings Ltd. and Certain Executive Officers of RenaissanceRe Holdings Ltd. (18)

Form of Director Retention Agreement, dated as of November 8, 2002, entered into by each of
the non-employee directors of RenaissanceRe Holdings Ltd. (31)

10.16

Amended and Restated RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan. (32)

150

10.16(a)

10.16(b)

10.16(c)

10.16(d)

10.16(e)

10.17

Amendment No. 1 to the RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan.
(33)

Amendment No. 2 to the RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan.
(34)

Amendment No. 3 to the RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan.
(35)

Form of Restricted Stock Grant Agreement pursuant to which option grants are made under the
RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan. (36)

Form of Option Grant Agreement pursuant to which option grants are made under the
RenaissanceRe Holdings Ltd. Non-Employee Director Stock Plan. (36)

Stock Purchase Agreement, dated as of November 18, 2010, by and between RenRe North
America Holdings Inc., and QBE Holdings Inc. (37)

21.1

23.1

31.1

31.2

32.1

32.2

List of Subsidiaries of the Registrant.

Consent of Ernst & Young Ltd.

Certification of Kevin J. O’Donnell, Chief Executive Officer of RenaissanceRe Holdings Ltd.,
pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as
amended.

Certification of Jeffrey D. Kelly, Chief Financial Officer of RenaissanceRe Holdings Ltd.,
pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as
amended.

Certification of Kevin J. O’Donnell, Chief Executive Officer of RenaissanceRe Holdings Ltd.,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002.

Certification of Jeffrey D. Kelly, Chief Financial Officer of RenaissanceRe Holdings Ltd.,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002.

101.INS

XBRL Instance Document

101.SCH XBRL Taxonomy Extension Schema Document

101.CAL XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB XBRL Taxonomy Extension Label Linkbase Document

101.PRE XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF XBRL Taxonomy Extension Definition Linkbase Document

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

Incorporated by reference to the Registration Statement on Form S-1 of RenaissanceRe Holdings
Ltd. (Registration No. 33-70008) which was declared effective by the SEC on July 26, 1995.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended June 30, 2002, filed with the SEC on August 14, 2002.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended March 31, 1998, filed with the SEC on May 14, 1998 (SEC File Number 000-26512)

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on March 18, 2004.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on May 28, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on March 18, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on January 24, 2011.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on May 22, 2012.

151

(9)

(10)

(11)

(12)

(13)

(14)

(15)

(16)

(17)

(18)

(19)

(20)

(21)

(22)

(23)

(24)

(25)

(26)

(27)

(28)

(29)

(30)

(31)

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on May 24, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended March 31, 2009, filed with the SEC on May 1, 2009.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K , filed
with the SEC on September 23, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on October 4, 2013

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on May 16, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on April 11, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended September 30, 2013, filed with the SEC on November 6, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on February 25, 2009.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on January 14, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2012, filed with the SEC on February 22, 2013.

Incorporated by reference to RenaissanceRe Holdings Ltd.'s Definitive Proxy Statement filed with
the Commission on April 8, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on February 27, 2012.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2009, filed with the SEC on February 19, 2010.

Incorporated by reference to Exhibit 99.2 to the Registration Statement on Form S-8 (Registration
No. 333-90758) dated June 19, 2002.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended March 31, 2007, filed with the SEC on May 2, 2007.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on August 13, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q, filed
with the SEC on April 29, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended September 30, 2004, filed with the SEC on November 9, 2004.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on September 2, 2004.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2004, filed with the SEC on March 31, 2005 (SEC File Number
001-14428).

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on June 11, 2010.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2011, filed with the SEC on February 23, 2012.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2002, filed with the SEC on March 31, 2003 (SEC File Number
001-14428).

(32)

Incorporated by reference to Exhibit 99.1 to the Registration Statement on Form S-8 (Registration
No. 333-90758) dated June 19, 2002.

152

(33)

(34)

(35)

(36)

(37)

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended March 31, 2007, filed with the SEC on May 2, 2007.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Quarterly Report on Form 10-Q for the
period ended September 30, 2008, filed with the SEC on October 30, 2008.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Annual Report on Form 10-K for the
year ended December 31, 2008, filed with the SEC on February 20, 2009.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on February 27, 2006.

Incorporated by reference to RenaissanceRe Holdings Ltd.’s Current Report on Form 8-K, filed with
the SEC on November 18, 2010.

153

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in
Hamilton, Bermuda on February 20, 2014.

RENAISSANCERE HOLDINGS LTD.

/s/ Kevin J. O’Donnell
Kevin J. O’Donnell
President, Chief Executive Officer and

Director

Signature

Title

Date

/s/ Kevin J. O’Donnell

Kevin J. O’Donnell

President, Chief Executive Officer and

February 20, 2014

Director

/s/ Jeffrey D. Kelly

Jeffrey D. Kelly

/s/ Mark A. Wilcox

Mark A. Wilcox

/s/ Ralph B. Levy

Ralph B. Levy

/s/ David C. Bushnell

David C. Bushnell

/s/ James L. Gibbons

James L. Gibbons

/s/ Brian G. J. Gray

Brian G. J. Gray

/s/ Jean D. Hamilton

Jean D. Hamilton

/s/ Henry Klehm, III
Henry Klehm, III

Executive Vice President, Chief

Financial Officer

Senior Vice President, Corporate
Controller and Chief Accounting
Officer

Chairman of the Board of

Directors

Director

/s/ W. James MacGinnitie

Director

W. James MacGinnitie

/s/ Anthony M. Santomero

Director

Anthony M. Santomero

/s/ Nicholas L. Trivisonno

Director

Nicholas L. Trivisonno

February 20, 2014

/s/ Edward J. Zore

Edward J. Zore

Director

February 20, 2014

154

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Management’s Report on Internal Control Over Financial Reporting . . . . . . . . . . . . . . . . . . . . . . . .

Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Balance Sheets at December 31, 2013 and 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Operations for the Years Ended December 31, 2013, 2012 and 2011.

Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31,

2013, 2012 and 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended December 31,
2013, 2012 and 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Statements of Cash Flows for the Years Ended December 31, 2013, 2012 and 2011

Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

F-2

F-3

F-4

F-5

F-6

F-7

F-8

F-9

F-10

F-1

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management at RenaissanceRe Holdings Ltd. (“RenaissanceRe”) is responsible for establishing and
maintaining effective internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f)
under the Securities Exchange Act of 1934, as amended. RenaissanceRe’s internal control over financial
reporting was designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with U.S. generally accepted
accounting principles and to reflect management’s judgments and estimates concerning effects of events
and transactions that are accounted for or disclosed. There are inherent limitations to the effectiveness of
any controls. Controls, no matter how well conceived and operated, can provide only reasonable assurance
that its objectives are met. No evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, within RenaissanceRe have been detected.

Management, with the participation of the Chief Executive Officer and Chief Financial Officer, assessed its
internal control over financial reporting as of December 31, 2013. In making this assessment, management
used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO) in Internal Control-Integrated Framework (1992 Framework). Based on this assessment,
management believes that RenaissanceRe maintained effective internal control over financial reporting as
of December 31, 2013.

RenaissanceRe’s effectiveness of internal control over financial reporting as of December 31, 2013, has
been audited by Ernst & Young Ltd., the Independent Registered Public Accountants who also audited
RenaissanceRe’s consolidated financial statements. Ernst & Young Ltd.’s attestation report on the
effectiveness of RenaissanceRe’s internal control over financial reporting appears on page F-4.

F-2

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF RENAISSANCERE HOLDINGS LTD.

We have audited the accompanying consolidated balance sheets of RenaissanceRe Holdings Ltd. and
Subsidiaries as of December 31, 2013 and 2012, and the related consolidated statements of operations,
comprehensive income (loss), changes in shareholders’ equity and cash flows for each of the three years in
the period ended December 31, 2013. These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the
consolidated financial position of RenaissanceRe Holdings Ltd. and Subsidiaries at December 31, 2013 and
2012, and the consolidated results of their operations and their cash flows for each of the three years in the
period ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), RenaissanceRe Holdings Ltd.’s internal control over financial reporting as of
December 31, 2013, based on criteria established in Internal Control-Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (1992 Framework) and our report
dated February 20, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young Ltd.

Hamilton, Bermuda
February 20, 2014

F-3

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF RENAISSANCERE HOLDINGS LTD.

We have audited RenaissanceRe Holdings Ltd. and Subsidiaries’ internal control over financial reporting as
of December 31, 2013, based on criteria established in Internal Control – Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission (1992 Framework) (the COSO
criteria). RenaissanceRe Holdings Ltd. and Subsidiaries’ management is responsible for maintaining
effective internal control over financial reporting, and for its assessment of the effectiveness of internal
control over financial reporting included in the accompanying Management’s Report on Internal Control over
Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over
financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk, and performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our
opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. A company’s internal control over
financial reporting includes those policies and procedures that (1) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that
receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a
material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

In our opinion, RenaissanceRe Holdings Ltd. and Subsidiaries maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2013, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States), the consolidated balance sheets of RenaissanceRe Holdings Ltd. and Subsidiaries
as of December 31, 2013 and 2012, and the related consolidated statements of operations, comprehensive
income (loss), changes in shareholders’ equity, and cash flows for each of the three years in the period
ended December 31, 2013 of RenaissanceRe Holdings Ltd. and Subsidiaries and our report dated
February 20, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young Ltd.

Hamilton, Bermuda
February 20, 2014

F-4

RenaissanceRe Holdings Ltd. and Subsidiaries
Consolidated Balance Sheets
(in thousands of United States Dollars, except per share amounts)

Assets
Fixed maturity investments trading, at fair value

(Amortized cost $4,781,712 and $4,549,112 at December 31, 2013 and

December 31, 2012, respectively) (Notes 5 and 6)
Fixed maturity investments available for sale, at fair value

(Amortized cost $30,273 and $71,445 at December 31, 2013 and

December 31, 2012, respectively) (Notes 5 and 6)
Short term investments, at fair value (Notes 5 and 6)
Equity investments trading, at fair value (Notes 5 and 6)
Other investments, at fair value (Notes 5 and 6)
Investments in other ventures, under equity method (Note 5)

Total investments

Cash and cash equivalents
Premiums receivable
Prepaid reinsurance premiums (Note 7)
Reinsurance recoverable (Notes 7 and 8)
Accrued investment income
Deferred acquisition costs
Receivable for investments sold
Other assets
Goodwill and other intangible assets (Note 4)
Assets of discontinued operations held for sale (Note 3)

Total assets

Liabilities, Noncontrolling Interests and Shareholders’ Equity
Liabilities
Reserve for claims and claim expenses (Note 8)
Unearned premiums
Debt (Note 9)
Reinsurance balances payable
Payable for investments purchased
Other liabilities
Liabilities of discontinued operations held for sale (Note 3)

Total liabilities

Commitments and Contingencies (Note 20)
Redeemable noncontrolling interests (Note 10)
Shareholders’ Equity (Note 12)
Preference shares: $1.00 par value – 16,000,000 shares issued and

December 31,
2013

December 31,
2012

4,809,036 $

4,660,168

34,241
1,044,779
254,776
573,264
105,616
6,821,712
408,032
474,087
66,132
101,025
34,065
81,684
75,845
108,438
8,111
—

8,179,131 $

1,563,730 $
477,888
249,430
293,022
193,221
397,596
—
3,174,887

83,442
821,163
58,186
644,711
87,724
6,355,394
304,145
491,365
77,082
192,512
33,478
52,622
168,673
110,777
8,486
134,094
7,928,628

1,879,377
399,517
349,339
290,419
278,787
198,434
57,440
3,453,313

1,099,860

968,259

outstanding at December 31, 2013 (December 31, 2012 – 16,000,000)

400,000

Common shares: $1.00 par value – 43,646,436 shares issued and

outstanding at December 31, 2013 (December 31, 2012 – 45,542,203)

Accumulated other comprehensive income
Retained earnings

Total shareholders’ equity attributable to RenaissanceRe

Noncontrolling interest (Note 10)
Total shareholders’ equity
Total liabilities, noncontrolling interests and shareholders’ equity

43,646
4,131
3,456,607
3,904,384
—
3,904,384
8,179,131 $

45,542
13,622
3,043,901
3,503,065
3,991
3,507,056
7,928,628

See accompanying notes to the consolidated financial statements

F-5

RenaissanceRe Holdings Ltd. and Subsidiaries
Consolidated Statements of Operations
For the years ended December 31, 2013, 2012, and 2011
(in thousands of United States Dollars, except per share amounts)

2013

2012

2011

Revenues
Gross premiums written
Net premiums written (Note 7)
Increase in unearned premiums
Net premiums earned (Note 7)
Net investment income (Note 5)
Net foreign exchange gains (losses)
Equity in earnings (losses) of other ventures (Note 5)
Other (loss) income
Net realized and unrealized gains on investments (Note 5)
Total other-than-temporary impairments
Portion recognized in other comprehensive income (loss), before

taxes

Net other-than-temporary impairments (Note 5)

Total revenues

Expenses

Net claims and claim expenses incurred (Notes 7 and 8)
Acquisition expenses
Operational expenses
Corporate expenses
Interest expense (Note 9)
Total expenses

Income (loss) from continuing operations before taxes
Income tax expense (Note 15)

Income (loss) from continuing operations

Income (loss) from discontinued operations (Note 3)

Net income (loss)

Net (income) loss attributable to noncontrolling interests (Note 10)

Net income (loss) attributable to RenaissanceRe

Dividends on preference shares (Note 12)

Net income (loss) available (attributable) to RenaissanceRe

common shareholders

$ 1,605,412 $ 1,551,591 $ 1,434,976
$ 1,203,947 $ 1,102,657 $ 1,012,773
(61,724)
951,049
146,871
(7,844)
(36,533)
44,345
43,956
(630)

(89,321)
1,114,626
208,028
1,917
23,194
(2,359)
35,076
—

(33,302)
1,069,355
165,725
5,319
23,238
(2,120)
163,121
(395)

—
—
1,380,482

52
(343)
1,424,295

171,287
125,501
191,105
33,622
17,929
539,444
841,038
(1,692)
839,346
2,422
841,768
(151,144)
690,624
(24,948)

325,211
113,542
179,151
16,456
23,097
657,457
766,838
(1,413)
765,425
(16,476)
748,949
(148,040)
600,909
(34,895)

78
(552)
1,141,292

861,179
97,376
169,661
18,156
23,368
1,169,740
(28,448)
(10,385)
(38,833)
(51,559)
(90,392)
33,157
(57,235)
(35,000)

665,676 $

566,014 $

(92,235)

Income (loss) from continuing operations available (attributable) to

RenaissanceRe common shareholders per common share – basic $

Income (loss) from discontinued operations available (attributable) to
RenaissanceRe common shareholders per common share – basic

Net income (loss) available (attributable) to RenaissanceRe
common shareholders per common share – basic (Note 13)

Income (loss) from continuing operations available (attributable) to
RenaissanceRe common shareholders per common share –
diluted

Income (loss) from discontinued operations available (attributable) to

RenaissanceRe common shareholders per common share –
diluted

Net income (loss) available (attributable) to RenaissanceRe

common shareholders per common share – diluted (Note 13)

Dividends per common share (Note 12)

$
$

15.08 $

11.74 $

(0.82)

0.06

(0.34)

(1.02)

15.14 $

11.40 $

(1.84)

14.82 $

11.56 $

(0.82)

0.05

(0.33)

14.87 $
1.12 $

11.23 $
1.08 $

(1.02)

(1.84)
1.04

See accompanying notes to the consolidated financial statements

F-6

RenaissanceRe Holdings Ltd. and Subsidiaries
Consolidated Statements of Comprehensive Income (Loss)
For the years ended December 31, 2013, 2012 and 2011
(in thousands of United States Dollars)

Comprehensive income (loss)

Net income (loss)

Change in net unrealized gains on investments

Portion of other-than-temporary impairments recognized in

other comprehensive income (loss), before taxes

Comprehensive income (loss)

Net (income) loss attributable to noncontrolling interests

Change in net unrealized gains on fixed maturity investments
available for sale attributable to noncontrolling interests

Comprehensive (income) loss attributable to noncontrolling

interests

2013

2012

2011

841,768 $
(9,491)

748,949 $
1,914

(90,392)

(7,991)

—

(52)

832,277

750,811

(151,144)

(148,040)

(78)

(98,461)

33,157

—

(151,144)

(148,040)

33,163

Comprehensive income (loss) attributable to RenaissanceRe $

681,133 $

602,771 $

(65,298)

Disclosure regarding net unrealized gains

Total net realized and unrealized holding (losses) gains on
investments and net other-than-temporary impairments

Net realized gains on fixed maturity investments available for

sale

Net other-than-temporary impairments recognized in earnings

(1,943) $

5,100 $

(2,426)

(7,548)

—

(3,529)

343

(6,111)

552

Change in net unrealized gains on investments

(9,491) $

1,914 $

(7,985)

See accompanying notes to the consolidated financial statements

F-7

RenaissanceRe Holdings Ltd. and Subsidiaries
Consolidated Statements of Changes in Shareholders’ Equity
For the years ended December 31, 2013, 2012 and 2011
(in thousands of United States Dollars)

Preference shares

Balance – January 1
Issuance of shares
Repurchase of shares
Balance – December 31

Common shares

Balance – January 1
Repurchase of shares
Exercise of options and issuance of restricted stock awards

(Notes 12 and 17)

Balance – December 31
Additional paid-in capital

Balance – January 1
Repurchase of shares
Offering expenses
Change in redeemable noncontrolling interest
Exercise of options and issuance of restricted stock awards

(Notes 12 and 17)

Balance – December 31

Accumulated other comprehensive income

Balance – January 1
Change in net unrealized gains on investments

Portion of other-than-temporary impairments recognized in

other comprehensive income (loss)

Balance – December 31

Retained earnings

Balance – January 1
Net income (loss)
Net (income) loss attributable to noncontrolling interests

(Note 10)

Repurchase of shares
Dividends on common shares
Dividends on preference shares
Balance – December 31

Noncontrolling interest (Note 10)

Total shareholders’ equity

2013

2012

2011

400,000 $
275,000
(275,000)
400,000

550,000 $

—
(150,000)
400,000

550,000
—
—
550,000

45,542
(2,451)

555
43,646

—
(1,702)
(9,144)
318

10,528
—

13,622
(9,491)

—
4,131

51,543
(6,399)

398
45,542

—
(27,376)
—
9,091

18,285
—

11,760
1,914

(52)
13,622

54,110
(2,889)

322
51,543

—
(13,923)
—
(473)

14,396
—

19,823
(7,985)

(78)
11,760

3,043,901
841,768

2,991,890
748,949

3,312,392
(90,392)

(151,144)
(203,703)
(49,267)
(24,948)
3,456,607
—

(148,040)
(460,647)
(53,356)
(34,895)
3,043,901
3,991

33,157
(174,807)
(53,460)
(35,000)
2,991,890
3,340

$ 3,904,384 $ 3,507,056 $ 3,608,533

See accompanying notes to the consolidated financial statements

F-8

RenaissanceRe Holdings Ltd. and Subsidiaries
Consolidated Statements of Cash Flows
For the years ended December 31, 2013, 2012 and 2011
(in thousands of United States Dollars)

Cash flows provided by operating activities

Net income (loss)
Adjustments to reconcile net income (loss) to net cash

provided by operating activities
Amortization, accretion and depreciation
Equity in undistributed (earnings) losses of other ventures
Net realized and unrealized gains on investments
Net other-than-temporary impairments
Net unrealized gains included in net investment income
Net unrealized losses (gains) included in other (loss)

income
Change in:

Premiums receivable
Prepaid reinsurance premiums
Reinsurance recoverable
Deferred acquisition costs
Reserve for claims and claim expenses
Unearned premiums
Reinsurance balances payable
Other
Net cash provided by operating activities
Cash flows (used in) provided by investing activities
Proceeds from sales and maturities of fixed maturity

investments trading

Purchases of fixed maturity investments trading
Proceeds from sales and maturities of fixed maturity

investments available for sale

Purchases of fixed maturity investments available for sale
Net purchases of equity investments trading
Net (purchases) sales of short term investments
Net sales of other investments
Net purchases of investments in other ventures
Net sales (purchases) of other assets
Net proceeds (payments) related to sale of discontinued

operations

Net cash (used in) provided by investing activities

Cash flows used in financing activities

Dividends paid – RenaissanceRe common shares
Dividends paid – preference shares
RenaissanceRe common share repurchases
Net repayment of debt
Redemption of 6.08% Series C preference shares
Redemption of 6.60% Series D preference shares
Issuance of 5.375% Series E preference shares, net of

expenses

Net third party redeemable noncontrolling interest share

transactions

Net cash used in financing activities

Effect of exchange rate changes on foreign currency cash

Net increase (decrease) in cash and cash equivalents
Net decrease in cash and cash equivalents of

discontinued operations

Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year

2013

2012

2011

841,768 $

748,949 $

(90,392)

51,596
(15,450)
(35,058)
—
(75,789)

12,782

17,278
10,950
91,487
(29,062)
(315,647)
78,371
2,603
159,892
795,721

59,695
(19,316)
(163,121)
343
(38,207)

42,298
39,581
(43,956)
552
(12,706)

(330)

1,553

(19,487)
(18,560)
211,517
(8,901)
(112,977)
51,862
33,536
(8,074)
716,929

(149,798)
2,121
(302,318)
(8,073)
734,511
61,472
(61,141)
(47,771)
165,933

8,251,405
(8,466,467)

8,192,867
(8,536,238)

6,089,468
(6,271,623)

45,178
—
(33,055)
(246,971)
76,214
(4,000)
2,181

60,000
(315,515)

(49,267)
(24,948)
(207,410)
(102,436)
(125,000)
(150,000)

265,856

(5,750)
(398,955)
1,423
82,674

65,168
—
—
68,777
150,828
—
(4,079)

(9,000)
(71,677)

(53,356)
(34,895)
(463,309)
(1,937)
—
(150,000)

106,362
(4,107)
(47,995)
103,148
50,940
(39,000)
58,318

269,520
315,031

(53,460)
(35,000)
(191,619)
(200,000)
—
—

—

164,927
(538,570)
1,692
108,374

(62,157)
(542,236)
518
(60,754)

16,441
226,138
181,825

21,213
304,145
408,032 $

13,946
181,825
304,145 $

See accompanying notes to the consolidated financial statements

F-9

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2013

(unless otherwise noted, amounts in tables expressed in thousands of United States (“U.S.”) dollars, except per share
amounts and percentages)

NOTE 1. ORGANIZATION

RenaissanceRe Holdings Ltd. (“RenaissanceRe”) was formed under the laws of Bermuda on June 7, 1993.
Together with its wholly owned and majority-owned subsidiaries and DaVinciRe (as defined below), which
are collectively referred to herein as the “Company”, RenaissanceRe provides reinsurance and insurance
coverages and related services to a broad range of customers.

• Renaissance Reinsurance Ltd. (“Renaissance Reinsurance”), the Company’s principal reinsurance

subsidiary, provides property catastrophe and specialty reinsurance coverages to insurers and
reinsurers on a worldwide basis.

• The Company also manages property catastrophe and specialty reinsurance business written on
behalf of joint ventures, which principally include Top Layer Reinsurance Ltd. (“Top Layer Re”),
recorded under the equity method of accounting, and DaVinci Reinsurance Ltd. (“DaVinci”). Because
the Company owns a noncontrolling equity interest in, but controls a majority of the outstanding voting
power of DaVinci’s parent, DaVinciRe Holdings Ltd. (“DaVinciRe”), the results of DaVinci and
DaVinciRe are consolidated in the Company’s financial statements. Redeemable noncontrolling
interest – DaVinciRe represents the interests of external parties with respect to the net income and
shareholders’ equity of DaVinciRe. Renaissance Underwriting Managers, Ltd. (“RUM”), a wholly
owned subsidiary, acts as exclusive underwriting manager for these joint ventures in return for fee-
based income and profit participation.

• RenaissanceRe Syndicate 1458 (“Syndicate 1458”) is the Company’s Lloyd’s syndicate.

RenaissanceRe Corporate Capital (UK) Limited (“RenaissanceRe CCL”), a wholly owned subsidiary
of RenaissanceRe, is Syndicate 1458’s sole corporate member and RenaissanceRe Syndicate
Management Ltd. (“RSML”), a wholly owned subsidiary of RenaissanceRe, is the managing agent for
Syndicate 1458.

• RenaissanceRe Specialty Risks Ltd., formerly known as Glencoe Insurance Ltd. (“RenaissanceRe

Specialty Risks”), is a Bermuda-domiciled excess and surplus lines insurance company that is listed
on the National Association of Insurance Commissioners’ International Insurance Department’s
Quarterly List of Alien Insurers as an eligible surplus lines insurer. RenaissanceRe Underwriting
Managers U.S. LLC, a specialty reinsurance agency domiciled in Connecticut, provides specialty
treaty reinsurance solutions on both a quota share and excess of loss basis; and writes business on
behalf of RenaissanceRe Specialty U.S. Ltd. (“RenaissanceRe Specialty U.S.”), a Bermuda-domiciled
reinsurer launched in June 2013 which operates subject to U.S. federal income tax, and Syndicate
1458.

• Effective January 1, 2013, the Company formed and launched a managed joint venture, Upsilon

Reinsurance II Ltd. (“Upsilon Re II”), a Bermuda domiciled special purpose insurer (“SPI”), to provide
additional capacity to the worldwide aggregate and per-occurrence primary and retrocessional
property catastrophe excess of loss market. Effective December 11, 2013, Upsilon Re II was
renamed Upsilon Reinsurance Fund Opportunities Ltd. (“Upsilon RFO”). Upsilon RFO is considered
a variable interest entity (“VIE”) and the Company is considered the primary beneficiary. As a result,
Upsilon RFO is consolidated by the Company and all significant inter-company transactions have
been eliminated.

• RenaissanceRe Medici Fund Ltd. (“Medici”) is an exempted fund, incorporated under the laws of

Bermuda. Medici’s objective is to seek to invest substantially all of its assets in various insurance-
based investment instruments that have returns primarily tied to property catastrophe risk. During
2013, third-party investors subscribed for a portion of the participating, non-voting common shares of
Medici. Because the Company owns a noncontrolling equity interest in, but controls a majority of the
outstanding voting power of Medici’s parent, RenaissanceRe Fund Holdings Ltd. (“Fund Holdings”),
the results of Medici and Fund Holdings are consolidated in the Company’s financial statements.

F-10

Redeemable noncontrolling interest - Medici represents the interests of external parties with respect
to the net income and shareholders’ equity of Medici.

• On August 30, 2013, the Company entered into a purchase agreement with a subsidiary of Munich-
American Holding Corporation (together with applicable affiliates, “Munich”) to sell its U.S.-based
weather and weather-related energy risk management unit, which included RenRe Commodity
Advisors LLC (“RRCA”), Renaissance Trading Ltd. (“Renaissance Trading”) and RenRe Energy
Advisors Ltd. (collectively referred to as “REAL”). REAL offered certain derivative-based risk
management products primarily to address weather and energy risk and engaged in hedging and
trading activities related to those transactions. On October 1, 2013, the Company closed the sale of
REAL to Munich. The Company has classified the assets and liabilities associated with this
transaction as held for sale. The financial results for these operations have been presented in the
Company’s consolidated financial statements as “discontinued operations” for all periods presented.
Refer to “Note 3. Discontinued Operations”, for more information.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

These consolidated financial statements have been prepared on the basis of accounting principles
generally accepted in the United States (“GAAP”). All significant intercompany accounts and transactions
have been eliminated from these statements. Except as discussed in “Note 3. Discontinued Operations,”
and unless otherwise noted, the notes to the consolidated financial statements reflect the Company’s
continuing operations.

Certain comparative information has been reclassified to conform to the current presentation.

USE OF ESTIMATES IN FINANCIAL STATEMENTS

The preparation of financial statements in conformity with GAAP requires management to make estimates
and assumptions that affect the reported and disclosed amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ materially from those
estimates. The major estimates reflected in the Company’s consolidated financial statements include, but
are not limited to, the reserve for claims and claim expenses; reinsurance recoverables, including
allowances for reinsurance recoverables deemed uncollectible; estimates of written and earned premiums;
fair value, including the fair value of investments, financial instruments and derivatives; impairment charges;
and the Company’s deferred tax valuation allowance.

DISCONTINUED OPERATIONS

The results of operations of substantially all of the Company’s U.S.-based insurance operations and REAL,
its U.S.-based weather and weather-related energy risk management unit, each of which has been sold to a
separate unaffiliated third party, are classified as held for sale and are reported as discontinued operations
in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification
(“ASC”) Topic Discontinued Operations. The consolidated financial statements and notes thereto are
presented excluding the operations and cash flows of the discontinued operations from the continuing
operations of the Company since the Company will not have any significant continuing involvement in the
operations after the sale. The financial position and results of operations of discontinued operations are
presented as single line items on the consolidated balance sheets and statements of operations,
respectively.

PREMIUMS AND RELATED EXPENSES

Premiums are recognized as income, net of any applicable reinsurance or retrocessional coverage
purchased, over the terms of the related contracts and policies. Premiums written are based on contract
and policy terms and include estimates based on information received from both insureds and ceding
companies. Subsequent differences arising on such estimates are recorded in the period in which they are
determined. Unearned premiums represents the portion of premiums written that relate to the unexpired
terms of contracts and policies in force. Amounts are computed by pro-rata methods based on statistical

F-11

data or reports received from ceding companies. Reinstatement premiums are estimated after the
occurrence of a significant loss and are recorded in accordance with the contract terms based upon paid
losses and case reserves. Reinstatement premiums are earned when written.

Acquisition costs are shown net of commissions and profit commissions earned on ceded reinsurance, and
consist principally of commissions, brokerage and premium tax expenses incurred at the time a contract or
policy is issued and are deferred and amortized over the period in which the related premiums are earned.
Deferred policy acquisition costs are limited to their estimated realizable value based on the related
unearned premiums. Anticipated claims and claim expenses, based on historical and current experience,
and anticipated investment income related to those premiums are considered in determining the
recoverability of deferred acquisition costs.

CLAIMS AND CLAIM EXPENSES

The reserve for claims and claim expenses includes estimates for unpaid claims and claim expenses on
reported losses as well as an estimate of losses incurred but not reported. The reserve is based on
individual claims, case reserves and other reserve estimates reported by insureds and ceding companies
as well as management estimates of ultimate losses. Inherent in the estimates of ultimate losses are
expected trends in claim severity and frequency and other factors which could vary significantly as claims
are settled. Also, during the past few years, the Company has increased its specialty reinsurance business,
but does not have the benefit of a significant amount of its own historical experience in certain of these lines
of business. Accordingly, the setting and reserving for incurred losses in these lines of business could be
subject to greater variability.

Ultimate losses may vary materially from the amounts provided in the consolidated financial statements.
These estimates are reviewed regularly and, as experience develops and new information becomes known,
the reserves are adjusted as necessary. Such adjustments, if any, are reflected in the consolidated
statements of operations in the period in which they become known and are accounted for as changes in
estimates.

REINSURANCE

Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability
associated with the reinsured policies. For multi-year retrospectively rated contracts, the Company accrues
amounts (either assets or liabilities) that are due to or from assuming companies based on estimated
contract experience. If the Company determines that adjustments to earlier estimates are appropriate, such
adjustments are recorded in the period in which they are determined. Reinsurance recoverables on dual
trigger reinsurance contracts require the Company to estimate its ultimate losses applicable to these
contracts as well as estimate the ultimate amount of insured industry losses that will be reported by the
applicable statistical reporting agency, as per the contract terms. Amounts recoverable from reinsurers are
recorded net of a valuation allowance for estimated uncollectible recoveries.

Assumed and ceded reinsurance contracts that lack a significant transfer of risk are treated as deposits.

INVESTMENTS, CASH AND CASH EQUIVALENTS

Fixed Maturity Investments

Investments in fixed maturities are classified as available for sale or trading and are reported at fair value.
Investment transactions are recorded on the trade date with balances pending settlement reflected in the
balance sheet as a receivable for investments sold or a payable for investments purchased. Net investment
income includes interest and dividend income together with amortization of market premiums and discounts
and is net of investment management and custody fees. The amortization of premium and accretion of
discount for fixed maturity securities is computed using the effective yield method. For mortgage-backed
securities and other holdings for which there is prepayment risk, prepayment assumptions are evaluated
quarterly and revised as necessary. Any adjustments required due to the change in effective yields and
maturities are recognized on a prospective basis through yield adjustments. Fair values of investments are
based on quoted market prices, or when such prices are not available, by reference to broker or underwriter
bid indications and/or internal pricing valuation techniques. The net unrealized appreciation or depreciation
on fixed maturity investments available for sale is included in accumulated other comprehensive income.

F-12

The net unrealized appreciation or depreciation on fixed maturity investments trading is included in net
realized and unrealized gains on investments in the consolidated statements of operations. Realized gains
or losses on the sale of investments are determined on the basis of the first in first out cost method and, for
fixed maturity investments available for sale, include adjustments to the cost basis of investments for
declines in value that are considered to be other-than-temporary.

Other-Than-Temporary Impairments

The Company recognizes other-than-temporary impairments in earnings for its impaired fixed maturity
securities available for sale (i) for which the Company has the intent to sell the security or (ii) it is more likely
than not that the Company will be required to sell the debt security before its anticipated recovery and
(iii) for those securities which have a credit loss. In assessing whether a credit loss exists, the Company
compares the present value of the cash flows expected to be collected from the security with the amortized
cost basis of the security. In instances in which a determination is made that an impairment exists but the
Company does not intend to sell the security and it is not more likely than not that the Company will be
required to sell the security before the anticipated recovery of its remaining amortized cost basis, the
impairment is separated into (i) the amount of the total impairment related to the credit loss and (ii) the
amount of the total impairment related to all other factors. The amount of the total other-than-temporary
impairment related to the credit loss is recognized in earnings. The amount of the total other-than-temporary
impairment related to all other factors is recognized in other comprehensive income. In periods after the
recognition of other-than-temporary impairments on the Company’s fixed maturity securities available for
sale, the Company accounts for such securities as if they had been purchased on the measurement date of
the other-than-temporary impairment at an amortized cost basis equal to the previous amortized cost basis
less the other-than-temporary impairment recognized in earnings. For debt securities in which other-than-
temporary impairments were recognized in earnings, the difference between the new amortized cost basis
and the cash flows expected to be collected will be amortized into net investment income.

Equity Investments, Classified as Trading

Equity investments are accounted for at fair value in accordance with FASB ASC Topic Financial
Instruments. Fair values are primarily priced by pricing services, reflecting the closing price quoted for the
final trading day of the period. Net investment income includes dividend income and the net realized and
unrealized appreciation or depreciation on equity investments is included in net realized and unrealized
gains on investments in the consolidated statements of operations.

Short Term Investments and Cash and Cash Equivalents

Short term investments, which are managed as part of the Company’s investment portfolio and have a
maturity of one year or less when purchased, are carried at amortized cost, which approximates fair value.
The net unrealized appreciation or depreciation on short term investments is included in net realized and
unrealized gains on investments in the consolidated statements of operations. Cash equivalents include
money market instruments with a maturity of ninety days or less when purchased.

Other Investments

The Company accounts for its other investments at fair value in accordance with FASB ASC Topic Financial
Instruments. The fair value of certain of the Company’s fund investments, which principally include private
equity funds, senior secured bank loan funds and hedge funds, is recorded on its balance sheet in other
investments, and is generally established on the basis of the net valuation criteria established by the
managers of such investments, if applicable. The net valuation criteria established by the managers of
such investments is established in accordance with the governing documents of such investments. Certain
of the Company’s fund managers, fund administrators, or both, are unable to provide final fund valuations
as of the Company’s current reporting date. The typical reporting lag experienced by the Company to
receive a final net asset value report is one month for hedge funds and senior secured bank loan funds and
three months for private equity funds, although, in the past, in respect of certain of the Company’s private
equity funds, the Company has on occasion experienced delays of up to six months at year end, as the
private equity funds typically complete their respective year-end audits before releasing their final net asset
value statements.

F-13

In circumstances where there is a reporting lag between the current period end reporting date and the
reporting date of the latest fund valuation, the Company estimates the fair value of these funds by starting
with the prior month or quarter-end fund valuations, adjusting these valuations for actual capital calls,
redemptions or distributions, as well as the impact of changes in foreign currency exchange rates, and then
estimating the return for the current period. In circumstances in which the Company estimates the return for
the current period, all information available to the Company is utilized. This principally includes preliminary
estimates reported to the Company by its fund managers, obtaining the valuation of underlying portfolio
investments where such underlying investments are publicly traded and therefore have a readily observable
price, using information that is available to the Company with respect to the underlying investments,
reviewing various indices for similar investments or asset classes, as well as estimating returns based on
the results of similar types of investments for which the Company has obtained reported results, or other
valuation methods, where possible. Actual final fund valuations may differ, perhaps materially so, from the
Company’s estimates and these differences are recorded in the Company’s statement of operations in the
period in which they are reported to the Company as a change in estimate.

The Company’s other investments also include investments in catastrophe bonds which are recorded at fair
value and based on broker or underwriter bid indications.

Investments in Other Ventures

Investments in which the Company has significant influence over the operating and financial policies of the
investee are classified as investments in other ventures, under equity method, and are accounted for under
the equity method of accounting. Under this method, the Company records its proportionate share of
income or loss from such investments in its results for the period. Any decline in value of investments in
other ventures, under equity method considered by management to be other-than-temporary is charged to
income in the period in which it is determined.

STOCK INCENTIVE COMPENSATION

The Company is authorized to issue restricted stock awards and units, performance shares, stock options
and other equity-based awards to its employees and directors. The fair value of the compensation cost is
measured at the grant date and expensed over the period for which the employee is required to provide
services in exchange for the award.

In addition, the Company is authorized to issue cash settled restricted stock units (“CSRSU”) to its
employees. The fair value of CSRSUs is determined at each reporting date using observable exchange
traded prices for the Company’s common shares and is expensed over the period for which the employee is
required to provide service in exchange for the award. In addition, the fair value of the award is recorded on
the Company’s consolidated balance sheet as a liability as it is expensed and until the point payment is
made to the employee.

Forfeiture benefits are estimated on a quarterly basis and incorporated in the determination of stock-based
compensation.

DERIVATIVES

The Company enters into derivative instruments such as futures, options, swaps, forward contracts and
other derivative contracts in order to manage its foreign currency exposure, obtain exposure to a particular
financial market, for yield enhancement, or for trading and speculation. The Company accounts for its
derivatives in accordance with FASB ASC Topic Derivatives and Hedging, which requires all derivatives to
be recorded at fair value on the Company’s balance sheet as either assets or liabilities, depending on their
rights or obligations, with changes in fair value reflected in current earnings. The Company does not
currently apply hedge accounting. The fair value of the Company’s derivatives is estimated by reference to
quoted prices or broker quotes, where available, or in the absence of quoted prices or broker quotes, the
use of industry or internal valuation models.

F-14

FAIR VALUE

The Company accounts for certain of its assets and liabilities at fair value in accordance with FASB ASC
Topic Fair Value Measurements and Disclosures. The Company recognizes the change in unrealized gains
and losses arising from changes in fair value in its statements of operations, with the exception of changes
in unrealized gains and losses on its fixed maturity investments available for sale, which are recognized as
a component of accumulated other comprehensive income (loss) in shareholders’ equity.

BUSINESS COMBINATIONS, GOODWILL AND OTHER INTANGIBLE ASSETS

The Company accounts for business combinations in accordance with FASB ASC Topic Business
Combinations, and goodwill and other intangible assets that arise from business combinations in
accordance with FASB ASC Topic Intangibles – Goodwill and Other. A purchase price that is in excess of
the fair value of the net assets acquired arising from a business combination is recorded as goodwill, and is
not amortized. Other intangible assets with a finite life are amortized over the estimated useful life of the
asset. Other intangible assets with an indefinite useful life are not amortized.

Goodwill and other indefinite life intangible assets are tested for impairment on an annual basis or more
frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable.
Definite life intangible assets are reviewed for indicators of impairment on an annual basis or more
frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable,
and tested for impairment if appropriate. For purposes of the annual impairment evaluation, goodwill is
assigned to the applicable reporting unit of the acquired entities giving rise to the goodwill. Goodwill and
other intangible assets recorded in connection with investments accounted for under the equity method, are
recorded as “Investments in other ventures, under equity method” on the Company’s consolidated balance
sheets.

The Company has established the beginning of the fourth quarter as the date for performing its annual
impairment tests. The Company has the option to first assess qualitative factors to determine whether it is
necessary to perform the quantitative goodwill impairment test. Under this option, the Company would not
be required to calculate the fair value of a reporting unit unless the Company determines, based on its
qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying
amount. If goodwill or other intangible assets are impaired, they are written down to their estimated fair
value with a corresponding expense reflected in the Company’s consolidated statements of operations.

NONCONTROLLING INTERESTS

The Company accounts for noncontrolling interests in the shareholders’ equity section of the Company’s
consolidated balance sheet in accordance with FASB ASC Topic Consolidations, and presents such
noncontrolling shareholders’ interest in the net assets of the subsidiary. Net (income) loss attributable to
noncontrolling interests is presented separately in the Company’s consolidated statements of operations.

In addition, the Company accounts for redeemable noncontrolling interest in DaVinciRe in the mezzanine
section of the Company’s consolidated balance sheet in accordance with United States Securities and
Exchange Commission (“SEC”) guidance which is applicable to SEC registrants. The SEC guidance
requires shares, not required to be accounted for in accordance with FASB ASC Topic Distinguishing
Liabilities from Equity, and having redemption features that are not solely within the control of the issuer, to
be classified outside of permanent equity in the mezzanine section of the balance sheet. Because the
share classes related to the redeemable noncontrolling interest portion of DaVinciRe are not considered
liabilities in accordance with FASB ASC Topic Distinguishing Liabilities from Equity and have redemption
features that are not solely within the control of DaVinciRe, the redeemable noncontrolling interest in
DaVinciRe is presented in the mezzanine section on the Company’s consolidated balance sheet in
accordance with the SEC guidance noted above. The SEC guidance does not impact the accounting for
redeemable noncontrolling interest on the consolidated statements of operations; therefore, the provisions
of FASB ASC Topic Consolidation with respect to the consolidated statements of operations still apply.

F-15

VARIABLE INTEREST ENTITIES

The Company accounts for VIEs in accordance with FASB ASC Topic Consolidation, which requires the
consolidation of all VIEs by the primary beneficiary, that being the investor that has the power to direct the
activities of the VIE and will absorb a majority of the VIE’s expected losses or residual returns. The
Company determines whether it is the primary beneficiary of a VIE by performing an analysis that principally
considers: (i) the VIE’s purpose and design, including the risks the VIE was designed to create and pass
through to its variable interest holders; (ii) the VIE’s capital structure; (iii) the terms between the VIE and its
variable interest holders and other parties involved with the VIE; (iv) which variable interest holders have
the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance;
(v) which variable interest holders have the obligation to absorb losses or the right to receive benefits from
the VIE that could potentially be significant to the VIE; and (vi) related party relationships. The Company
reassesses its initial determination of whether the Company is the primary beneficiary of a VIE upon
changes in facts and circumstances that could potentially alter the Company’s assessment.

EARNINGS PER SHARE

The Company calculates earnings per share in accordance with FASB ASC Topic Earnings per Share.
Basic earnings per share are based on weighted average common shares and exclude any dilutive effects
of options and restricted stock. Diluted earnings per share assumes the exercise of all dilutive stock options
and restricted stock grants.

The two-class method is used to determine earnings per share based on dividends declared on common
shares and participating securities (i.e. distributed earnings) and participation rights of participating
securities in any undistributed earnings. Each unvested restricted share granted by the Company to its
employees is considered a participating security and the Company uses the two-class method to calculate
its net income (loss) available (attributable) to RenaissanceRe common shareholders per common share –
basic and diluted.

FOREIGN EXCHANGE

The Company’s functional currency is the U.S. dollar. Revenues and expenses denominated in foreign
currencies are translated at the prevailing exchange rate at the transaction date. Monetary assets and
liabilities denominated in foreign currencies are remeasured at exchange rates in effect at the balance
sheet date, which may result in the recognition of exchange gains or losses which are included in the
determination of net income (loss).

TAXATION

Income taxes have been provided in accordance with the provisions of FASB ASC Topic Income Taxes.
Deferred tax assets and liabilities result from temporary differences between the amounts recorded in the
consolidated financial statements and the tax basis of the Company’s assets and liabilities. Such temporary
differences are primarily due to net operating loss carryforwards and GAAP versus tax basis accounting
differences relating to interest expense, underwriting results, accrued expenses and investments. The
effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period
that includes the enactment date. A valuation allowance against deferred tax assets is recorded if it is more
likely than not that all, or some portion, of the benefits related to deferred tax assets will not be realized.

Uncertain tax positions are also accounted for in accordance with FASB ASC Topic Income Taxes.
Uncertain tax positions must meet a more likely than not recognition threshold to be recognized.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Disclosures About Offsetting Assets and Liabilities

In December 2011, the FASB issued Accounting Standard Update (“ASU”) No. 2011-11, Disclosures about
Offsetting Assets and Liabilities (“ASU 2011-11”). The objective of ASU 2011-11 is to enhance disclosures
by requiring improved information about financial instruments and derivative instruments in relation to
netting arrangements. ASU 2011-11 became effective for interim and annual periods beginning on or after
January 1, 2013, with retrospective presentation of the new disclosure required. The Company adopted

F-16

ASU 2011-11 effective January 1, 2013; since this update is disclosure-related only, the adoption of this
guidance did not have a material impact on the Company’s consolidated statements of operations and
financial position.

In January 2013, the FASB issued ASU No. 2013-01, Clarifying the Scope of Disclosures about Offsetting
Assets and Liabilities (“ASU 2013-01”). The guidance clarified that the disclosures in ASU 2011-11 would
apply only to derivatives, repurchase and reverse repurchase agreements, and securities borrowing and
securities lending transactions, each to the extent that they met specific conditions provided in the initial
accounting standard. ASU 2013-01 became effective for interim and annual periods beginning on or after
January 1, 2013, with retrospective presentation of the new disclosure required. As this guidance is
disclosure-related only, the adoption of this guidance did not have a material impact on the Company’s
consolidated statements of operations and financial position.

Testing Indefinite-Lived Intangible Assets for Impairment

In July 2012, the FASB issued ASU No. 2012-02, Intangibles - Goodwill and Other (Topic 350): Testing
Indefinite-Lived Intangible Assets for Impairment (“ASU 2012-02”). ASU 2012-02 simplifies the guidance for
testing the decline in the realizable value of indefinite-lived intangible assets other than goodwill. ASU
2012-02 allows an organization the option to first assess the qualitative factors to determine whether it is
necessary to perform the quantitative impairment test. An organization electing to perform a qualitative
assessment is no longer required to calculate the fair value of an indefinite-lived intangible asset unless the
organization determines, based on a qualitative assessment, that it is “more likely than not” that the asset is
impaired. ASU 2012-02 became effective for annual and interim impairment tests performed for fiscal years
beginning after September 15, 2012. The Company adopted ASU 2012-02 effective January 1, 2013 and
the adoption of this guidance did not have a material impact on the Company’s consolidated statements of
operations and financial position.

Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income

In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of
Accumulated Other Comprehensive Income (“ASU 2013-02”). The objective of ASU 2013-02 is to improve
the reporting of classifications out of accumulated other comprehensive income by requiring an entity to
report the effect of significant reclassifications out of accumulated other comprehensive income on the
respective line items in net income if the amount being reclassified is required under GAAP to be
reclassified in its entirety. For other amounts that are not required under GAAP to be reclassified in their
entirety to net income in the same reporting period, an entity is required to cross-reference other
disclosures required under GAAP that provide additional details about those amounts. ASU 2013-02
became effective for interim and annual reporting periods beginning after December 15, 2012. The
Company prospectively adopted ASU 2013-02 effective January 1, 2013; since this update is disclosure-
related only, the adoption of this guidance did not have a material impact on the Company’s consolidated
statements of operations and financial position.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss,
or a Tax Credit Carryforward Exists

In July 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”). The
objective of ASU 2013-11 is to improve the financial statement presentation of an unrecognized tax benefit
when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU 2013-11
seeks to reduce the diversity in practice by providing guidance on the presentation of unrecognized tax
benefits to better reflect the manner in which an entity would settle at the reporting date any additional
income taxes that would result from the disallowance of a tax position when net operating loss
carryforwards, similar tax losses, or tax credit carryforwards exist. ASU 2013-11 is effective for annual and
interim reporting periods beginning after December 15, 2013, with both early adoption and retrospective
application permitted. The Company is currently evaluating the impact of this guidance; however, it is not
expected to have a material impact on the Company’s consolidated statements of operations and financial
position.

F-17

NOTE 3. DISCONTINUED OPERATIONS

REAL

On August 30, 2013, the Company entered into a purchase agreement with Munich to sell REAL and, on
October 1, 2013, the Company closed the sale of REAL to Munich. The Company has classified the assets
and liabilities associated with this transaction as held for sale and the financial results are reflected in the
Company’s consolidated financial statements as “discontinued operations.”

Consideration for the transaction was $60.0 million, paid in cash at closing, subject to post-closing
adjustments for certain tax and other items. The Company recorded a loss on sale of $8.8 million in
conjunction with the sale, including related direct expenses to date.

See “Note 9. Debt” for additional information related to guarantees provided by RenaissanceRe with
respect to certain counterparties of REAL.

U.S.-Based Insurance Operations

On November 18, 2010, RenaissanceRe entered into a Stock Purchase Agreement with QBE Holdings, Inc.
(“QBE”) to sell substantially all of its U.S.-based insurance operations, including its U.S. property and
casualty business underwritten through managing general agents, its crop insurance business underwritten
through Agro National, its commercial property insurance operations and its claims operations. At
December 31, 2010, the Company classified the assets and liabilities associated with this transaction as
held for sale and the assets and liabilities were recorded at the lower of the carrying value or fair value less
costs to sell. The financial results for these operations have been presented as discontinued operations in
the Company’s consolidated statements of operations for all periods presented.

Consideration for the transaction was book value at December 31, 2010, for the aforementioned
businesses, payable in cash at closing and subject to adjustment for certain tax and other items.
The transaction closed on March 4, 2011 and net consideration of $269.5 million was received by
RenaissanceRe.

Pursuant to the stock purchase agreement, RenaissanceRe’s U.S.-based insurance operations were
subject to a post-closing review following December 31, 2011 of the net reserve for claims and claim
expenses for loss events occurring on or prior to December 31, 2010 (the “Reserve Collar”). Effective May
23, 2012, RenaissanceRe and QBE reached an agreement in respect of the Reserve Collar, and
RenaissanceRe paid QBE the sum of $9.0 million on June 1, 2012, representing full and final settlement of
the Reserve Collar.

Except as explicitly described as held for sale or as discontinued operations, and unless otherwise noted,
all discussions and amounts presented herein relate to the Company’s continuing operations. All prior
periods presented have been reclassified to conform to this form of presentation.

F-18

The Company has reclassified the assets and liabilities of the discontinued operations to assets of
discontinued operations held for sale and liabilities of discontinued operations held for sale, respectively, on
its consolidated balance sheets. Details of the assets, liabilities and shareholder’s equity of discontinued
operations held for sale at at December 31, 2013 and 2012, are as follows and relate entirely to REAL.

At December 31,
Assets of Discontinued Operations Held for Sale
Fixed maturity investments trading, at fair value (Amortized cost $Nil and

$5,250 at December 31, 2013 and 2012, respectively)

Cash and cash equivalents

Other assets

Total assets of discontinued operations held for sale

Liabilities of Discontinued Operations Held for Sale
Debt

Other liabilities

Total liabilities of discontinued operations held for sale

Shareholder’s Equity of Discontinued Operations Held for Sale

Total shareholder’s equity of discontinued operations held for sale

Total liabilities and shareholder’s equity of discontinued operations

held for sale

2013

2012

— $

—

5,253

21,213

107,628

— $ 134,094

— $

—

— $

2,436

55,004

57,440

—

76,654

— $ 134,094

The Company has reclassified the results of operations of the discontinued operations to income (loss) from
discontinued operations in its consolidated statements of operations. Details of the income (loss) from
discontinued operations for the years ended December 31, 2013, 2012 and 2011 are as follows:

Year ended December 31, 2013
Revenues

Net investment income

Net foreign exchanges gains

Other income

Net realized and unrealized losses on investments

Total revenues

Expenses

Operational expenses

Corporate expenses

Total expenses
Income before taxes

Income tax expense

REAL

1,150

849

701

(18)

2,682

104

193

2,489

(67)

Income from discontinued operations

2,422

F-19

Year ended December 31, 2012
Revenues

Net investment income

Net foreign exchange losses

Other (loss) income

Net realized and unrealized gains on investments

Total revenues

Expenses

Operational expenses

Corporate expenses

Total expenses

(Loss) income before taxes

Income tax expense

REAL

U.S.-based
insurance
operations

Total

2,517 $

— $

2,517

(96)

(20,785)

(18,361)

150

236

386

—

2,730

—

2,730

436

—

436

(96)

(18,055)

(15,631)

586

236

822

(18,747)

2,294

(16,453)

(16)

(7)

(23)

(Loss) income from discontinued operations

(18,763) $

2,287 $

(16,476)

Year ended December 31, 2011
Revenues

Gross premiums written

Net premiums written

Decrease in unearned premiums

Net premiums earned

Net investment (loss) income

Net foreign exchange gains

Other loss

Net realized and unrealized gains on investments

Total revenues

Expenses

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Corporate expenses

Total expenses
Loss before taxes

Income tax benefit (expense)

REAL

U.S.-based
insurance
operations

Total

— $

—

21,546 $

21,546

(44,935) $

(44,935)

66,137

— $

21,202 $

(2,159)

933

339

—

66,137

21,202

(1,820)

933

(45,030)

(9,904)

(54,934)

—

(46,256)

11,679

(34,577)

—

108

113

(46,369)

10,700

8,430

6,059

7,272

770

22,531

(10,852)

(5,038)

8,430

6,059

7,277

878

22,644

(57,221)

5,662

Loss from discontinued operations

(35,669) $

(15,890) $

(51,559)

F-20

NOTE 4. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table shows an analysis of goodwill and other intangible assets:

Balance as of December 31, 2011

Gross amount

Accumulated impairment losses and amortization

Amortization

Balance as of December 31, 2012

Gross amount

Accumulated impairment losses and amortization

Amortization

Balance as of December 31, 2013

Gross amount

Accumulated impairment losses and amortization

Goodwill and other intangible assets

Goodwill

Other
intangible
assets

Total

8,160 $

12,999 $

21,159

(2,299)

5,861

—

8,160

(2,299)

5,861

—

8,160

(2,299)

(9,966)

3,033

(408)

12,999

(10,374)

2,625

(375)

(12,265)

8,894

(408)

21,159

(12,673)

8,486

(375)

12,999

(10,749)

21,159

(13,048)

5,861 $

2,250 $

8,111

The following table shows an analysis of goodwill and other intangible assets included in investments in
other ventures, under equity method:

Goodwill and other intangible assets included
in investments in other
ventures, under equity method

Goodwill

Other
intangible
assets

Total

9,021 $

44,323 $

53,344

—

9,021

1,819

—

10,840

—

10,840

1,705

—

12,545

—

(19,820)

24,503

—

(4,949)

44,323

(24,769)

19,554

1,155

(4,042)

(19,820)

33,524

1,819

(4,949)

55,163

(24,769)

30,394

2,860

(4,042)

45,478

(28,811)

58,023

(28,811)

12,545 $

16,667 $

29,212

Balance as of December 31, 2011

Gross amount

Accumulated impairment losses and amortization

Acquired during the year

Amortization

Balance as of December 31, 2012

Gross amount

Accumulated impairment losses and amortization

Acquired during the year

Amortization

Balance as of December 31, 2013

Gross amount

Accumulated impairment losses and amortization

F-21

The gross carrying value and accumulated amortization by major category of other intangible assets is
shown below:

At December 31, 2013
Customer relationships and customer lists
Lloyd’s managing agency license
Trademarks and trade names
Covenants not-to-compete
Software
Patents and intellectual property

At December 31, 2012
Customer relationships and customer lists
Lloyd’s managing agency license
Covenants not-to-compete
Trademarks and trade names
Software
Patents and intellectual property

Other intangible assets

Gross
carrying
value

Accumulated
amortization
and
impairment
losses

40,640 $

1,867
610
2,130
8,730
4,500

58,477 $

(24,522) $
—
(134)
(1,674)
(8,730)
(4,500)
(39,560) $

Other intangible assets

Gross
carrying
value

Accumulated
amortization
and
impairment
losses

39,485 $

1,867
2,130
610
8,730
4,500

57,322 $

(20,936) $
—
(1,369)
(110)
(8,395)
(4,333)
(35,143) $

Total

16,118
1,867
476
456
—
—
18,917

Total

18,549
1,867
761
500
335
167
22,179

The useful life of intangible assets with finite lives ranges from one to 25 years, with a weighted-average
amortization period of 11 years. Expected amortization of the other intangible assets, including other
intangible assets recorded in investments in other ventures, under equity method, is shown below:

Other
intangible
assets
included
in
investments
in other
ventures,
under
equity
method

Other
intangibles

209 $
174
—
—
—
—
383 $

1,867
2,250 $

3,669 $
3,008
2,309
1,931
1,497
4,253

16,667 $
—
16,667 $

Total

3,878
3,182
2,309
1,931
1,497
4,253
17,050
1,867
18,917

2014
2015
2016
2017
2018
2019 and thereafter
Total remaining amortization expense
Indefinite lived
Total

F-22

NOTE 5. INVESTMENTS

Fixed Maturity Investments Trading

The following table summarizes the fair value of fixed maturity investments trading:

U.S. treasuries
Agencies
Non-U.S. government (Sovereign debt)
Non-U.S. government-backed corporate
Corporate
Agency mortgage-backed
Non-agency mortgage-backed
Commercial mortgage-backed
Asset-backed

Total fixed maturity investments trading

December 31,
2013

December 31,
2012

$ 1,352,413 $ 1,254,547
315,154
133,198
349,514
1,607,233
399,619
230,747
361,645
8,511
$ 4,809,036 $ 4,660,168

186,050
334,580
237,479
1,803,415
336,661
243,795
303,214
11,429

Fixed Maturity Investments Available For Sale

The following table summarizes the amortized cost, fair value and related unrealized gains and losses and
non-credit other-than-temporary impairments of fixed maturity investments available for sale:

Included in Accumulated
Other Comprehensive Income

Amortized
Cost

Gross

Unrealized

Gains

Losses

Fair Value

Non-Credit
Other-Than-
Temporary
Impairments
(1)

4,880 $

378 $

(11) $

5,247 $

11,735

10,052
3,606

2,414

970

223

(6)

—

14,143

11,022

3,829

—

(742)

—

30,273 $

3,985 $

(17) $

34,241 $

(742)

At December 31, 2013
Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed

Total fixed maturity investments

available for sale

Included in Accumulated
Other Comprehensive Income

Gross

Unrealized

Gains

Losses

Fair Value

Non-Credit
Other-Than-
Temporary
Impairments
(1)

1,002 $

(93) $

7,974 $

632

2,989

7,229

248

—

(10)

—

8,912

17,592

44,521

4,443

(85)

—

(835)

—

Amortized
Cost

7,065 $
8,280

14,613

37,292
4,195

71,445 $

12,100 $

(103) $

83,442 $

(920)

At December 31, 2012
Corporate

Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed

Total fixed maturity investments

available for sale

(1) Represents the non-credit component of other-than-temporary impairments recognized in accumulated other comprehensive
income adjusted for subsequent sales of securities. It does not include the change in fair value subsequent to the impairment
measurement date.

F-23

Contractual maturities of fixed maturity investments are described in the following table. Expected
maturities will differ from contractual maturities because borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.

Trading

Available for Sale

Total Fixed Maturity
Investments

Amortized
Cost

Fair Value

Amortized
Cost

Fair Value

Amortized
Cost

Fair Value

$ 160,345 $ 160,760 $

— $

— $ 160,345 $ 160,760

At December 31, 2013
Due in less than

one year

Due after one

through five years

3,109,181

3,118,799

—

— 3,109,181

3,118,799

Due after five

through ten years
Due after ten years
Mortgage-backed
Asset-backed
Total

550,269
76,623
874,099
11,195

551,007

83,371
883,670

11,429

—
—
26,667

3,606

—
—
30,412
3,829

550,269
76,623
900,766
14,801

551,007
83,371
914,082
15,258

$ 4,781,712 $ 4,809,036 $

30,273 $

34,241 $ 4,811,985 $ 4,843,277

Equity Investments Trading

The following table summarizes the fair value of equity investments trading:

Financials
Consumer
Industrial, utilities and energy
Healthcare
Basic materials
Communications and technology
Total

Pledged Investments

December 31,
2013

December 31,
2012

152,905 $

44,115
25,350
15,340
12,766
4,300
254,776 $

58,186
—
—
—
—
—
58,186

At December 31, 2013, $2,081.1 million of cash and investments at fair value were on deposit with, or in
trust accounts for the benefit of, various counterparties, including with respect to the Company’s syndicated
letter of credit facility and bilateral letter of credit facility (2012 - $1,490.9 million). Of this amount, $652.8
million is on deposit with, or in trust accounts for the benefit of, U.S. state regulatory authorities (2012 -
$581.2 million).

Reverse Repurchase Agreements

At December 31, 2013, the Company held $37.3 million (2012 - $74.8 million) of reverse repurchase
agreements. These loans are fully collateralized, are generally outstanding for a short period of time and
are presented on a gross basis as part of short term investments on the Company’s consolidated balance
sheets. The required collateral for these loans typically include high-quality, readily marketable instruments
at a minimum amount of 102% of the loan principal. Upon maturity, the Company receives principal and
interest income.

F-24

Net Investment Income, Net Realized and Unrealized Gains on Investments and Net Other-Than-
Temporary Impairments

The components of net investment income are as follows:

Year ended December 31,
Fixed maturity investments

Short term investments

Equity investments

Other investments

Hedge funds and private equity investments

Other

Cash and cash equivalents

Investment expenses

Net investment income

2013
95,907 $

2012
103,330 $

2011
116,570

1,698

2,295

1,007

1,086

1,666

471

45,810

73,692

191

219,593

(11,565)

36,635

35,196

277

177,531

(11,806)

27,541

10,585

195

157,028

(10,157)

208,028 $

165,725 $

146,871

Net realized and unrealized gains on investments and net other-than-temporary impairments are as follows:

2013
72,492 $

2012
97,787 $

2011
79,358

(50,206)

22,286

(16,705)

81,082

(30,659)

48,699

(87,827)

75,279

19,404

31,058

26,650

42,909

(866)

—

7,626

(26,712)

—

2,565

35,076 $

163,121 $

43,956

— $

(395) $

(630)

—

— $

(343) $

(552)

Year ended December 31,
Gross realized gains

Gross realized losses

Net realized gains on fixed maturity investments

Net unrealized (losses) gains on fixed maturity investments

trading

Net realized and unrealized gains (losses) on investments-

related derivatives

Net realized gains on equity investments trading

Net unrealized gains on equity investments trading

Net realized and unrealized gains on investments

Total other-than-temporary impairments

Portion recognized in other comprehensive income, before

taxes

Net other-than-temporary impairments

F-25

The following table provides an analysis of the components of other comprehensive income and
reclassifications out of accumulated other comprehensive income.

Twelve months ended December 31, 2013

Beginning balance

1,625 $

Investments
in other
ventures

Fixed
maturity
investments
available for
sale
11,997 $

Total
13,622

Other comprehensive loss before reclassifications

(1,462)

(481)

(1,943)

Amounts reclassified from accumulated other comprehensive

income by statement of operations line item:

Realized gains reclassified from accumulated other

comprehensive income to net realized and unrealized gains
(losses) on investments

Net current-period other comprehensive loss

Ending balance

—

(1,462)

(7,548)

(8,029)

(7,548)

(9,491)

163 $

3,968 $

4,131

The following tables provide an analysis of the length of time the Company’s fixed maturity investments
available for sale in an unrealized loss have been in a continual unrealized loss position.

Less than 12 Months

12 Months or Greater

Total

At December 31, 2013
Agency mortgage-backed

Non-agency mortgage-backed

Fair Value
$

726 $
—

Commercial mortgage-backed

Total

765 $

Unrealized
Losses

Fair Value

Unrealized
Losses

Fair Value

Unrealized
Losses

(11) $
—

—
(11) $

— $

726 $

—

(6)

—

89 $

(6) $

854 $

(11)

(6)

—

(17)

Less than 12 Months

12 Months or Greater

Total

At December 31, 2012
Corporate

Non-agency mortgage-backed

Fair Value
$

598 $
—

Total

598 $

Unrealized
Losses

Fair Value

Unrealized
Losses

Fair Value

Unrealized
Losses

(30) $
—
(30) $

440 $

(63) $

1,038 $

101

(10)

101

(93)

(10)

541 $

(73) $

1,139 $

(103)

At December 31, 2013, the Company held four fixed maturity investments available for sale securities that
were in an unrealized loss position (2012 - 28), including two fixed maturity investments available for sale
securities that were in an unrealized loss position for twelve months or greater (2012 - 11). The Company
does not intend to sell these securities and it is not more likely than not that the Company will be required to
sell these securities before the anticipated recovery of the remaining amortized cost basis. The Company
performed reviews of its fixed maturity investments available for sale for the year ended December 31, 2013
and 2012, respectively, in order to determine whether declines in the fair value below the amortized cost
basis were considered other-than-temporary in accordance with the applicable guidance, as discussed
below.

F-26

Other-Than-Temporary Impairment Process

The Company’s process for assessing whether declines in the fair value of its fixed maturity investments
available for sale represent impairments that are other-than-temporary includes reviewing each fixed
maturity investment available for sale that is impaired and determining: (i) if the Company has the intent to
sell the debt security or (ii) if it is more likely than not that the Company will be required to sell the debt
security before its anticipated recovery; and (iii) whether a credit loss exists, that is, where the Company
expects that the present value of the cash flows expected to be collected from the security is less than the
amortized cost basis of the security.

In assessing the Company’s intent to sell securities, the Company’s procedures may include actions such
as discussing planned sales with its third party investment managers, reviewing sales that have occurred
shortly after the balance sheet date, and consideration of other qualitative factors that may be indicative of
the Company’s intent to sell or hold the relevant securities. For the year ended December 31, 2013, the
Company recognized $Nil other-than-temporary impairments due to the Company’s intent to sell these
securities as of December 31, 2013 (2012 – $Nil, 2011 - $Nil).

In assessing whether it is more likely than not that the Company will be required to sell a security before its
anticipated recovery, the Company considers various factors including its future cash flow forecasts and
requirements, legal and regulatory requirements, the level of its cash, cash equivalents, short term
investments, fixed maturity investments trading and fixed maturity investments available for sale in an
unrealized gain position, and other relevant factors. For the year ended December 31, 2013, the Company
recognized $Nil of other-than-temporary impairments due to required sales (2012 – $Nil, 2011 - $Nil).

In evaluating credit losses, the Company considers a variety of factors in the assessment of a security
including: (i) the time period during which there has been a significant decline below cost; (ii) the extent of
the decline below cost and par; (iii) the potential for the security to recover in value; (iv) an analysis of the
financial condition of the issuer; (v) the rating of the issuer; (vi) the implied rating of the issuer based on an
analysis of option adjusted spreads; (vii) the absolute level of the option adjusted spread for the issuer; and
(viii) an analysis of the collateral structure and credit support of the security, if applicable.

Once the Company determines that it is possible that a credit loss may exist for a security, the Company
performs a detailed review of the cash flows expected to be collected from the issuer. The Company
estimates expected cash flows by applying estimated default probabilities and recovery rates to the
contractual cash flows of the issuer, with such default and recovery rates reflecting long-term historical
averages adjusted to reflect current credit, economic and market conditions, giving due consideration to
collateral and credit support, if applicable, and discounting the expected cash flows at the purchase yield on
the security. In instances in which a determination is made that an impairment exists but the Company
does not intend to sell the security and it is not more likely than not that the Company will be required to sell
the security before the anticipated recovery of its remaining amortized cost basis, the impairment is
separated into: (i) the amount of the total other-than-temporary impairment related to the credit loss; and
(ii) the amount of the total other-than-temporary impairment related to all other factors. The amount of the
other-than-temporary impairment related to the credit loss is recognized in earnings. The amount of the
other-than-temporary impairment related to all other factors is recognized in other comprehensive income.
For the year ended December 31, 2013, the Company recognized $Nil of other-than-temporary impairments
which were recognized in earnings and $Nil related to other factors which were recognized in other
comprehensive income (2012 – $0.3 million and $52 thousand, respectively, 2011 - $0.6 million and $78
thousand, respectively).

F-27

The following table provides a rollforward of the amount of other-than-temporary impairments related to
credit losses recognized in earnings for which a portion of an other-than-temporary impairment was
recognized in accumulated other comprehensive income:

Balance – January 1

Additions:

Amount related to credit loss for which an other-than-temporary

impairment was not previously recognized

Amount related to credit loss for which an other-than-temporary

impairment was previously recognized

Reductions:

Securities sold during the period

Securities for which the amount previously recognized in other

comprehensive income was recognized in earnings, because the
Company intends to sell the security or is more likely than not the
Company will be required to sell the security

Increases in cash flows expected to be collected that are recognized

over the remaining life of the security

Balance – December 31

Other Investments

2013

2012

838 $

2,370

—

110

(277)

(1,650)

—

561 $

838

The table below shows the fair value of the Company’s portfolio of other investments:

At December 31,
Private equity partnerships

Catastrophe bonds

Senior secured bank loan funds

Hedge funds

Total other investments

2013
322,391 $

229,016

18,048

3,809

2012
344,669

91,310

202,929

5,803

573,264 $

644,711

Interest income, income distributions and net realized and unrealized gains on other investments are
included in net investment income and totaled $119.5 million (2012 – $71.8 million, 2011 – $38.1 million) of
which $75.8 million was related to net unrealized gains (2012 – $38.2 million, 2011 – $12.7 million).
Included in net investment income for the year ended December 31, 2013 is a loss of $3.7 million (2012 -
loss of $4.7 million, 2011 - loss of $1.4 million) representing the change in estimate during the period related
to the difference between the Company’s estimated net investment income due to the lag in reporting, as
discussed in “Note 2. Significant Accounting Policies”, and the actual amount as reported in the final net
asset values provided by the Company’s fund managers.

The Company has committed capital to private equity partnerships and other entities of $662.7 million, of
which $544.6 million has been contributed at December 31, 2013. The Company’s remaining commitments
to these funds at December 31, 2013 totaled $116.2 million. In the future, the Company may enter into
additional commitments in respect of private equity partnerships or individual portfolio company investment
opportunities.

F-28

Investments in Other Ventures, under Equity Method

The table below shows the Company’s portfolio of investments in other ventures, under equity method:

At December 31,
THIG

Tower Hill

Tower Hill Signature

Total Tower Hill Companies

Top Layer Re

Angus

Other

Total investments in other
ventures, under equity
method

2013

2012

Investment
$ 50,000

Ownership
%
Investment
25.0% $ 25,107 $ 50,000

Carrying
Value

Ownership
%
25.0% $ 28,303

Carrying
Value

10,000

500

60,500

65,375

10,507
3,000

29.4%

25.0%

50.0%

42.5%
22.0%

14,506

2,515

42,128

50,500

9,180
3,808

10,000

500

60,500

65,375

8,226
—

28.6%

25.0%

50.0%

38.8%
—%

13,969

896

43,168

36,664

7,892
—

$ 139,382

$ 105,616 $ 134,101

$ 87,724

Included in the table above is the Company’s investment in Angus Partners LLC (“Angus”). On December
1, 2013, the Company increased its investment in Angus through the transactions described in “Note 10.
Noncontrolling Interests”. As a result of these transactions, the Company has cumulatively invested $10.5
million in Angus, representing a 42.5% ownership.

On July 1, 2008, the Company invested $50.0 million in Tower Hill Insurance Group, LLC. (“THIG”)
representing a 25.0% equity ownership. Included in the purchase price was $40.0 million of other
intangibles and $7.8 million of goodwill, which, in accordance with generally accepted accounting principles,
are recorded as “Investments in other ventures, under equity method” rather than “Goodwill and other
intangibles” on the Company’s consolidated balance sheet.

The Company originally invested $13.1 million in Top Layer Re, representing a 50.0% ownership. In
December 2010, March 2011 and December 2011, primarily as a result of net claims and claim expenses
incurred by Top Layer Re with respect to the September 2010, February 2011 New Zealand and Tohoku
Earthquakes, respectively, the Company invested an additional $13.8 million, $20.5 million and $18.0
million, respectively, in Top Layer Re, maintaining the Company’s 50% ownership interest.

The table below shows the Company’s equity in earnings (losses) of other ventures, under equity method:

Year ended December 31,
Top Layer Re

Tower Hill Companies

Angus

Other

2013
13,836 $

2012
20,792 $

2011
(37,471)

10,270

(858)

(54)

4,965

(2,519)

—

2,923

808

(2,793)

Total equity in earnings (losses) of other ventures

23,194 $

23,238 $

(36,533)

Undistributed earnings in the Company’s investments in other ventures, under equity method were $15.5
million at December 31, 2013 (2012 - $19.3 million). During 2013, the Company received $9.9 million of
dividends from its investments in other ventures, under equity method (2012 – $9.9 million, 2011 – $9.5
million). During the third quarter of 2011, the Company sold its entire ownership interest in NBIC Holdings,
Inc. (“NBIC”), a holding company for a specialty underwriter of homeowners’ insurance products and
services, for $12.0 million. Included in Other in the table above for the year ended December 31, 2011 is
equity in losses of NBIC of $2.8 million, which was accounted for under the equity method of accounting
prior to its sale. As a result of the sale, the Company recorded a $4.8 million gain, included in other income
for the year ended December 31, 2011. Except for Top Layer Re, the equity in earnings of Tower Hill
Insurance Group, LLC., Tower Hill Holdings, Inc. and Tower Hill Signature Insurance Holdings, Inc.
(collectively, the “Tower Hill Companies”), Angus and the Company’s other category of investments in other
ventures are reported one quarter in arrears.

F-29

NOTE 6. FAIR VALUE MEASUREMENTS

The use of fair value to measure certain assets and liabilities with resulting unrealized gains or losses is
pervasive within the Company’s financial statements. Fair value is defined under accounting guidance
currently applicable to the Company to be the price that would be received upon the sale of an asset or paid
to transfer a liability in an orderly transaction between open market participants at the measurement date.
The Company recognizes the change in unrealized gains and losses arising from changes in fair value in its
consolidated statements of operations, with the exception of changes in unrealized gains and losses on its
fixed maturity investments available for sale, which are recognized as a component of accumulated other
comprehensive income in shareholders’ equity.

• Fair values determined by Level 1 inputs utilize unadjusted quoted prices obtained from active
markets for identical assets or liabilities for which the Company has access. The fair value is
determined by multiplying the quoted price by the quantity held by the Company;

• Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its
entirety falls has been determined based on the lowest level input that is significant to the fair value
measurement of the asset or liability. The Company’s assessment of the significance of a particular input to
the fair value measurement in its entirety requires judgment, and the Company considers factors specific to
the asset or liability.

In order to determine if a market is active or inactive for a security, the Company considers a number of factors,
including, but not limited to, the spread between what a seller is asking for a security and what a buyer is
bidding for the same security, the volume of trading activity for the security in question, the price of the security
compared to its par value (for fixed maturity investments), and other factors that may be indicative of market
activity.

Other than the transaction noted below, there have been no material changes in the Company’s valuation
techniques, nor have there been any transfers between Level 1 and Level 2, or Level 2 and 3 during the
period represented by these consolidated financial statements. As discussed in greater detail below, the
Company transferred its investment in the common shares of Essent Group Ltd. (“Essent”), a U.S.
mortgage guaranty insurance company, from Level 3 to Level 1, effective October 31, 2013, the date which
Essent became a publicly traded company on the New York Stock Exchange (the “NYSE”). The fair value
transferred from Level 3 to Level 1 was $85.6 million.

F-30

Below is a summary of the assets and liabilities that are measured at fair value on a recurring basis and
also represents the carrying amount on the Company’s consolidated balance sheet:

At December 31, 2013
Fixed maturity investments

U.S. treasuries

Agencies

Non-U.S. government (Sovereign debt)

Non-U.S. government-backed corporate

Corporate

Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed
Total fixed maturity investments

Short term investments

Equity investments trading

Other investments

Private equity partnerships

Catastrophe bonds

Senior secured bank loan funds

Hedge funds

Total other investments

Other assets and (liabilities)

Derivatives (1)

Other

Total other assets and (liabilities)

Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)

Total

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

$ 1,352,413 $ 1,352,413 $

— $

186,050

334,580

237,479

—

186,050

334,580

237,479

—

1,803,415

— 1,775,835

27,580

341,908

257,938

314,236
15,258

—

—
—

341,908

257,938

314,236
15,258

—

—
—

4,843,277

1,352,413

3,463,284

27,580

1,044,779

— 1,044,779

254,776

322,391

229,016
18,048

3,809

573,264

4,758

(12,991)

(8,233)

—

823

—

823

—

229,016

—

322,391

—

18,048

3,809

229,016

344,248

6,425

(12,991)

(6,566)

(2,490)

—

(2,490)

(1) See “Note 19. Derivative Instruments” for additional information related to the fair value by type of contract, of derivatives entered

into by the Company.

$ 6,707,863 $ 1,608,012 $ 4,730,513 $

369,338

F-31

At December 31, 2012
Fixed maturity investments

U.S. treasuries

Agencies

Non-U.S. government (Sovereign debt)

Non-U.S. government-backed corporate

Corporate

Agency mortgage-backed

Non-agency mortgage-backed

Commercial mortgage-backed

Asset-backed
Total fixed maturity investments

Short term investments

Equity investments trading
Other investments

Private equity partnerships

Senior secured bank loan funds

Catastrophe bonds

Hedge funds

Total other investments

Other assets and (liabilities)

Assumed and ceded (re)insurance contracts

Derivatives (1)

Other

Total other assets and (liabilities)

Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)

Total

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

$ 1,254,547 $ 1,254,547 $

— $

315,154

133,198

349,514

—

315,154

133,198

349,514

—

1,615,207

— 1,587,415

27,792

408,531

248,339

406,166
12,954

—

—
—

408,531

248,339

406,166
12,954

—

—
—

4,743,610

1,254,547

3,461,271

27,792

821,163
58,186

344,669

202,929
91,310

5,803

644,711

2,647

4,107

7,315
14,069

—
58,186

821,163
—

—
—

—

402

—

402

—

172,334

91,310

—

344,669

30,595

—

5,803

263,644

381,067

—

3,705

(11,551)

(7,846)

2,647

—

18,866

21,513

$ 6,281,739 $ 1,313,135 $ 4,538,232 $

430,372

(1) See “Note 19. Derivative Instruments” for additional information related to the fair value by type of contract, of derivatives entered

into by the Company.

Level 1 and Level 2 Assets and Liabilities Measured at Fair Value

Fixed Maturity Investments

Fixed maturity investments included in Level 1 consist of the Company’s investments in U.S. treasuries.
Fixed maturity investments included in Level 2 are agencies, non-U.S. government, non-U.S. government-
backed corporate, corporate, agency mortgage-backed, non-agency mortgage-backed, commercial
mortgage-backed and asset-backed.

The Company’s fixed maturity investments are primarily priced using pricing services, such as index
providers and pricing vendors, as well as broker quotations. In general, the pricing vendors provide pricing
for a high volume of liquid securities that are actively traded. For securities that do not trade on an
exchange, the pricing services generally utilize market data and other observable inputs in matrix pricing
models to determine month end prices. Observable inputs include benchmark yields, reported trades,
broker-dealer quotes, issuer spreads, bids, offers, reference data and industry and economic events. Index
pricing generally relies on market traders as the primary source for pricing, however models are also utilized
to provide prices for all index eligible securities. The models use a variety of observable inputs such as

F-32

benchmark yields, transactional data, dealer runs, broker-dealer quotes and corporate actions. Prices are
generally verified using third party data. Securities which are priced by an index provider are generally
included in the index.

In general, broker-dealers value securities through their trading desks based on observable inputs. The
methodologies include mapping securities based on trade data, bids or offers, observed spreads, and
performance on newly issued securities. Broker-dealers also determine valuations by observing secondary
trading of similar securities. Prices obtained from broker quotations are considered non-binding, however
they are based on observable inputs and by observing secondary trading of similar securities obtained from
active, non-distressed markets.

The Company considers these Level 2 inputs as they are corroborated with other market observable inputs.
The techniques generally used to determine the fair value of the Company’s fixed maturity investments are
detailed below by asset class.

U.S. treasuries

Level 1 - At December 31, 2013, the Company’s U.S. treasuries fixed maturity investments are primarily
priced by pricing services and had a weighted average effective yield of 0.8% and a weighted average
credit quality of AA (2012 - 0.4% and AA, respectively). When pricing these securities, the pricing services
utilize daily data from many real time market sources, including active broker dealers. Certain data sources
are regularly reviewed for accuracy to attempt to ensure the most reliable price source is used for each
issue and maturity date.

Agencies

Level 2 - At December 31, 2013, the Company’s agency fixed maturity investments had a weighted average
effective yield of 1.3% and a weighted average credit quality of AA (2012 - 0.7% and AA, respectively). The
issuers of the Company’s agency fixed maturity investments primarily consist of the Federal National
Mortgage Association, the Federal Home Loan Mortgage Corporation and other agencies. Fixed maturity
investments included in agencies are primarily priced by pricing services. When evaluating these
securities, the pricing services gather information from market sources and integrate other observations
from markets and sector news. Evaluations are updated by obtaining broker dealer quotes and other
market information including actual trade volumes, when available. The fair value of each security is
individually computed using analytical models which incorporate option adjusted spreads and other daily
interest rate data.

Non-U.S. government (Sovereign debt)

Level 2 - Non-U.S. government fixed maturity investments held by the Company at December 31, 2013,
had a weighted average effective yield of 1.3% and a weighted average credit quality of AA (2012 - 1.9%
and AA, respectively). The issuers of securities in this sector are non-U.S. governments and their
respective agencies as well as supranational organizations. Securities held in these sectors are primarily
priced by pricing services who employ proprietary discounted cash flow models to value the securities. Key
quantitative inputs for these models are daily observed benchmark curves for treasury, swap and high
issuance credits. The pricing services then apply a credit spread for each security which is developed by
in-depth and real time market analysis. For securities in which trade volume is low, the pricing services
utilize data from more frequently traded securities with similar attributes. These models may also be
supplemented by daily market and credit research for international markets.

Non-U.S. government-backed corporate

Level 2 - Non-U.S. government-backed corporate fixed maturity investments had a weighted average
effective yield of 1.1% and a weighted average credit quality of AAA at December 31, 2013 (2012 - 0.7%
and AAA, respectively). Non-U.S. government-backed fixed maturity investments are primarily priced by
pricing services who employ proprietary discounted cash flow models to value the securities. Key
quantitative inputs for these models are daily observed benchmark curves for treasury, swap and high
issuance credits. The pricing services then apply a credit spread to the respective curve for each security
which is developed by in-depth and real time market analysis. For securities in which trade volume is low,

F-33

the pricing services utilize data from more frequently traded securities with similar attributes. These models
may also be supplemented by daily market and credit research for international markets.

Corporate

Level 2 - At December 31, 2013, the Company’s corporate fixed maturity investments principally consist of
U.S. and international corporations and had a weighted average effective yield of 2.7% and a weighted
average credit quality of BBB (2012 - 2.6% and A, respectively). The Company’s corporate fixed maturity
investments are primarily priced by pricing services. When evaluating these securities, the pricing services
gather information from market sources regarding the issuer of the security and obtain credit data, as well
as other observations, from markets and sector news. Evaluations are updated by obtaining broker dealer
quotes and other market information including actual trade volumes, when available. The pricing services
also consider the specific terms and conditions of the securities, including any specific features which may
influence risk. In certain instances, securities are individually evaluated using a spread which is added to
the U.S. treasury curve or a security specific swap curve as appropriate.

Agency mortgage-backed

Level 2 - At December 31, 2013, the Company’s agency mortgage-backed fixed maturity investments
included agency residential mortgage-backed securities with a weighted average effective yield of 2.9%, a
weighted average credit quality of AA and a weighted average life of 6.2 years (2012 - 1.3%, AA and 3.3
years, respectively). The Company’s agency mortgage-backed fixed maturity investments are primarily
priced by pricing services using a mortgage pool specific model which utilizes daily inputs from the active to
be announced market which is very liquid, as well as the U.S. treasury market. The model also utilizes
additional information, such as the weighted average maturity, weighted average coupon and other
available pool level data which is provided by the sponsoring agency. Valuations are also corroborated with
daily active market quotes.

Non-agency mortgage-backed

Level 2 - The Company’s non-agency mortgage-backed fixed maturity investments include non-agency
prime residential mortgage-backed and non-agency Alt-A fixed maturity investments. The Company has no
fixed maturity investments classified as sub-prime held in its fixed maturity investments portfolio. At
December 31, 2013, the Company’s non-agency prime residential mortgage-backed fixed maturity
investments have a weighted average effective yield of 3.7%, a weighted average credit quality of BBB, and
a weighted average life of 4.4 years (2012 - 3.6%, BBB and 4.5 years, respectively). The Company’s non-
agency Alt-A fixed maturity investments held at December 31, 2013 have a weighted average effective yield
of 4.7%, a weighted average credit quality of non-investment grade and a weighted average life of 4.0 years
(2012 - 5.2%, non-investment grade and 4.7 years, respectively) . Securities held in these sectors are
primarily priced by pricing services using an option adjusted spread (“OAS”) model or other relevant
models, which principally utilize inputs including benchmark yields, available trade information or broker
quotes, and issuer spreads. The pricing services also review collateral prepayment speeds, loss severity
and delinquencies among other collateral performance indicators for the securities valuation, when
applicable.

Commercial mortgage-backed

Level 2 - The Company’s commercial mortgage-backed fixed maturity investments held at December 31,
2013 have a weighted average effective yield of 2.1%, a weighted average credit quality of AA, and a
weighted average life of 3.3 years (2012 - 1.7%, AA and 3.7 years, respectively). Securities held in these
sectors are primarily priced by pricing services. The pricing services apply dealer quotes and other
available trade information such as bid and offers, prepayment speeds which may be adjusted for the
underlying collateral or current price data, the U.S. treasury curve and swap curve as well as cash
settlement. The pricing services discount the expected cash flows for each security held in this sector using
a spread adjusted benchmark yield based on the characteristics of the security.

F-34

Asset-backed

Level 2 - At December 31, 2013, the Company’s asset-backed fixed maturity investments had a weighted
average effective yield of 2.0%, a weighted average credit quality of AAA and a weighted average life of 3.5
years (2012 - 1.8%, AAA and 3.5 years, respectively). The underlying collateral for the Company’s asset-
backed fixed maturity investments primarily consists of student loans, credit card receivables, auto loans
and other receivables. Securities held in these sectors are primarily priced by pricing services. The pricing
services apply dealer quotes and other available trade information such as bids and offers, prepayment
speeds which may be adjusted for the underlying collateral or current price data, the U.S. treasury curve
and swap curve as well as cash settlement. The pricing services determine the expected cash flows for
each security held in this sector using historical prepayment and default projections for the underlying
collateral and current market data. In addition, a spread is applied to the relevant benchmark and used to
discount the cash flows noted above to determine the fair value of the securities held in this sector.

Short Term Investments

Level 2 - The fair value of the Company’s portfolio of short term investments is generally determined using
amortized cost which approximates fair value and, in certain cases, in a manner similar to the Company’s
fixed maturity investments noted above.

Equity Investments, Classified as Trading

Level 1 - The fair value of the Company’s portfolio of equity investments, classified as trading is primarily
priced by pricing services, reflecting the closing price quoted for the final trading day of the period. When
pricing these securities, the pricing services utilize daily data from many real time market sources, including
applicable securities exchanges. All data sources are regularly reviewed for accuracy to attempt to ensure
the most reliable price source was used for each security.

At September 30, 2013, the Company had an investment of $48.0 million in the common shares of Essent,
a then private U.S. mortgage guaranty insurance company which provides capital to lenders and investors
that support financing for homeowner mortgages. On October 31, 2013, Essent common shares began
publicly trading on the NYSE at a share price of $17.00, resulting in a fair value of $85.6 million. Following
the initial public offering, the Company transferred its investment in Essent from other investments to its
portfolio of equity investments trading on its consolidated balance sheet and any realized and unrealized
gains or losses related to Essent from the initial public offering price are included in net realized and
unrealized gains (losses) on investments on the Company’s consolidated statements of operations. The
Company has agreed, subject to certain exceptions, not to dispose of or hedge any of the common shares
of Essent it holds prior to April 28, 2014.

Other investments

Catastrophe bonds

Level 2 - The Company’s other investments include investments in catastrophe bonds which are recorded
at fair value based on broker or underwriter bid indications.

Other assets and liabilities

Derivatives

Level 1 and Level 2 - Other assets and liabilities include certain other derivatives entered into by the
Company. The fair value of these transactions includes certain exchange traded foreign currency forward
contracts which are considered Level 1, and certain credit derivatives, determined using standard industry
valuation models and considered Level 2, as the inputs to the valuation model are based on observable
market inputs, including credit spreads, credit ratings of the underlying referenced security, the risk free rate
and the contract term.

F-35

Other

Level 2 - The liabilities measured at fair value and included in Level 2 at December 31, 2013 of $13.0
million are principally CSRSUs that form part of the Company’s compensation program. The fair value of
the Company’s CSRSUs is determined using observable exchange traded prices for the Company’s
common shares.

Level 3 Assets and Liabilities Measured at Fair Value

Below is a summary of quantitative information regarding the significant observable and unobservable
inputs (Level 3) used in determining the fair value of assets and liabilities measured at fair value on a
recurring basis:

December 31, 2013

Fixed maturity investments

Fair Value
(Level 3)

Valuation
Technique

Unobservable (U)
and Observable (O)
Inputs

Low

High

Weighted
Average
or Actual

Corporate

15,726

Discounted cash
flow (“DCF”)

Credit spread (U)

Liquidity discount (U)

Risk-free rate (O)

Dividend rate (O)

Internal
valuation model

Private transaction
(U)

n/a

2.3%

1.0%

0.6%

6.2%

See below

Net asset
valuation

Estimated
performance (U)

(100.0)%

71.8%

0.5 %

0.0 %

0.6%

0.0%

4.8%

0.5%

0.0%

Internal
valuation model

See below

n/a

See below

Corporate

Total fixed maturity
investments

Other investments

11,854

27,580

Private equity partnerships

322,391

Senior secured bank loan

funds

Hedge funds

Total other investments

Other assets and (liabilities)

Weather contract

Total other assets and

(liabilities)

18,048

3,809

344,248

(2,490)

$ 369,338

Fixed Maturity Investments

Corporate

Level 3 - Included in the Company’s corporate fixed maturity investments is an investment in the preferred
equity of a company with a fair value of $15.7 million. The Company measures the fair value of this
investment using a DCF model and seeks to incorporate all relevant information reasonably available. The
Company considers the contractual agreement which stipulates the methodology for calculating a dividend
rate to be paid upon liquidation, conversion or redemption. At December 31, 2013, the dividend rate was
6.2%. In addition, the Company has estimated a liquidity discount of 1.0%, a risk-free rate of 0.6% and a
credit spread of 2.3%. To ensure the estimate for fair value determined using the DCF model is reasonable,
the Company reviews private market comparables of similar investments, if available, and in particular,
credit ratings of other private market comparables for similar investments to determine the appropriateness
of its estimate of fair value using a DCF model. The fair value of the Company’s investment in corporate
fixed maturity investments determined by a DCF model is positively correlated to the dividend rate, and
inversely correlated to the credit spread, liquidity discount and the risk-free rate.

The Company’s corporate fixed maturity investments also include an investment in the preferred equity of
another company with a fair value of $11.9 million at December 31, 2013. The Company measures the fair

F-36

value of this investment using an internal valuation model and uses a combination of quantitative and
qualitative factors, with a focus on third party valuations, which factors may also include, but are not limited
to, discounted cash flow analysis, financial statement analysis, budgets and forecasts, and capital
transactions. In circumstances where a private market transaction has recently occurred, the Company will
evaluate the comparability of that transaction and incorporate it into its internal valuation model accordingly.
Recent private market transactions of investments similar to that held by the Company have been used to
determine the fair value of $11.9 million at December 31, 2013, as the Company believes the recent market
transactions represent the price that would be received upon the sale of the Company’s investment in an
orderly transaction among market participants. Consequently, should future relevant private market
transactions occur, the Company will re-evaluate the information used to determine fair value of this
investment and record any adjustments to fair value in its consolidated statements of operations.

Other investments

Private equity partnerships

Level 3 - Included in the Company’s $322.4 million of investments in private equity partnerships at
December 31, 2013 are alternative asset limited partnerships (or similar corporate structures) that invest in
certain private equity asset classes including U.S. and global leveraged buyouts; mezzanine investments;
distressed securities; real estate; and oil, gas and power. The fair value of private equity partnership
investments is based on current estimated net asset values established in accordance with the governing
documents of such investments and is obtained from the investment manager or general partner of the
respective entity. The type of underlying investments held by the investee which form the basis of the net
asset valuation include assets such as private business ventures, for which the Company does not have
access to financial information. As a result, the Company is unable to corroborate the fair value
measurement of the underlying investments of the private equity partnership and therefore requires
significant management judgment to determine the fair value of the private equity partnership. In
circumstances where there is a reporting lag between the current period end reporting date and the
reporting date of the latest fund valuation, the Company estimates the fair value of these funds by starting
with the prior quarter-end fund valuations, adjusting these valuations for actual capital calls, redemptions or
distributions, as well as the impact of changes in foreign currency exchange rates, and then estimating the
return for the current period. In circumstances in which the Company estimates the return for the current
period, all relevant information reasonably available to the Company is utilized. This principally includes
preliminary estimates reported to the Company by its fund managers, obtaining the valuation of underlying
portfolio investments where such underlying investments are publicly traded and therefore have a readily
observable price, using information that is available to the Company with respect to the underlying
investments, reviewing various indices for similar investments or asset classes, as well as estimating
returns based on the results of similar types of investments for which the Company has obtained reported
results, or other valuation methods, where possible. The range of such current estimated periodic returns
for the three months ended December 31, 2013 was negative 100.0% to positive 71.8% with a weighted
average of positive 4.8%. The fair value of the Company’s investment in private equity partnerships is
positively correlated to the estimated periodic rate of return. The Company also considers factors such as
recent financial information, the value of capital transactions with the partnership and management’s
judgment regarding whether any adjustments should be made to the net asset value. For each respective
private equity partnership, the Company obtains and reviews the valuation methodology used by the
investment manager or general partner and the latest annual audited financial statements to attempt to
ensure that the investment partnership is following fair value principles consistent with GAAP in determining
the net asset value of each limited partner’s interest.

Senior secured bank loan funds

Level 3 - The Company has $18.0 million invested in closed end funds which invest primarily in loans. The
Company has no right to redeem its investment in these funds. The Company’s investments in these funds
are valued using estimated monthly net asset valuations received from the investment manager. The lock
up provisions in these funds result in a lack of current observable market transactions between the fund
participants and the funds, and therefore, the Company considers the fair value of its investment in these
funds to be determined using Level 3 inputs. The Company obtains and reviews the latest annual audited
financial statements to attempt to ensure that these funds are following fair value principles consistent with

F-37

GAAP in determining the net asset value. The fair value of the Company’s investment in senior secured
bank loan funds is positively correlated to the estimated monthly net asset valuations received from the
investment manager.

Hedge funds

Level 3 - The Company has $3.8 million of hedge fund investments that are invested in so called “side
pockets” or illiquid investments. In these instances, the Company generally does not have the right to
redeem its interest, and as such, the Company classifies this portion of its investment as Level 3. The fair
value of these illiquid investments is determined by adjusting the previous periods’ reported net asset value
(generally one month in arrears) for an estimated periodic rate of return obtained from the respective
investment manager.

For each respective hedge fund investment, the Company obtains and reviews the valuation methodology
used by the investment manager and the latest annual audited financial statements to attempt to ensure
that the hedge fund investment is following fair value principles consistent with GAAP in determining the net
asset value.

Other assets and liabilities

Weather Contract

Level 3 - The Company has a $2.5 million liability related to a weather contract with the fair value
determined through the use of an internal valuation model with the inputs to the internal valuation model
based on proprietary data as observable market inputs are not available. The most significant
unobservable input is the potential payment that would become due to a counterparty following the
occurrence of a triggering event as reported by an external agency. Generally, an increase (decrease) in
the potential payment would result in an increase (decrease) to the fair value of the Company’s weather
contract liability.

Below is a reconciliation of the beginning and ending balances, for the periods shown, of assets and
liabilities measured at fair value on a recurring basis using Level 3 inputs. Interest and dividend income are
included in net investment income and are excluded from the reconciliation.

Balance - January 1, 2012

Total unrealized gains (losses)

Included in net investment income
Included in other (loss) income

Total realized (losses) gains

Included in net investment income
Included in other (loss) income

Total foreign exchange losses
Purchases
Sales
Settlements

Balance - December 31, 2012
Change in unrealized gains for the period

included in earnings for assets held at the
end of the period included in net investment
income

Change in unrealized losses for the period

included in earnings for assets held at the
end of the period included in other (loss)
income

Fair Value Measurements Using Significant Unobservable Inputs
(Level 3)

Fixed maturity
investments
trading

Other
investments

Other assets
and
(liabilities)

27,761 $

396,526 $

19,628 $

Total
443,915

31
—

24,947
—

—
(3,225)

24,978
(3,225)

—
—
—
—
—
—
27,792 $

—
—
699
48,631
(2,842)
(86,894)
381,067 $

—
(12,177)
—
17,287
—
—
21,513 $

—
(12,177)
699
65,918
(2,842)
(86,894)
430,372

31 $

24,947 $

— $

24,978

— $

(3,225) $

(3,225)

F-38

Balance - January 1, 2013

Total unrealized gains (losses)

Included in net investment income
Included in other (loss) income

Total realized losses

Included in net investment income
Included in other (loss) income

Total foreign exchange gains
Purchases
Sales
Settlements
Reclassified from other assets to other

investments

Fair Value Measurements Using Significant Unobservable Inputs
(Level 3)

Fixed maturity
investments
trading

Other
investments

Other assets
and
(liabilities)

27,792 $

381,067 $

21,513 $

2,288
—

—
—
—
—
—
(2,500)

80,113
—

(4,114)
—
1,352
48,287
—
(95,144)

(1,331)
(625)

—
(2,083)
—
(1,722)
—
—

Total
430,372

81,070
(625)

(4,114)
(2,083)
1,352
46,565
—
(97,644)

Net transfers out of Level 3
Balance - December 31, 2013
Change in unrealized gains for the period

included in earnings for assets held at the
end of the period included in net investment
income

Change in unrealized gains for the period

included in earnings for assets held at the
end of the period included in other (loss)
income

—
—
27,580 $

18,242
(85,555)
344,248 $

(18,242)
—
(2,490) $

—
(85,555)
369,338

2,288 $

78,903 $

(1,331) $

79,860

— $

—

Financial Instruments Disclosed, But Not Carried, at Fair Value

The Company uses various financial instruments in the normal course of its business. The Company’s
insurance contracts are excluded from fair value of financial instruments accounting guidance, unless the
Company elects the fair value option, and therefore, are not included in the amounts discussed herein. The
carrying values of cash, accrued interest, receivables for investments sold, certain other assets, payables
for investments purchased, certain other liabilities, and other financial instruments not included herein
approximated their fair values.

Senior Notes

In March 2010, RenRe North America Holdings Inc. (“RRNAH”) issued $250.0 million of 5.75% Senior
Notes due March 15, 2020, with interest on the notes payable on March 15 and September 15 of each year.
At December 31, 2013, the fair value of the 5.75% Senior Notes was $273.9 million (2012 - $281.2 million).

The fair value of RRNAH’s 5.75% Senior Notes is determined using indicative market pricing obtained from
third-party service providers, which the Company considers Level 2 in the fair value hierarchy. There have
been no changes during the period in the Company’s valuation technique used to determine the fair value
of the Senior Notes.

F-39

The Fair Value Option for Financial Assets and Financial Liabilities

The Company has elected to account for certain financial assets and financial liabilities at fair value using
the guidance under FASB ASC Topic Financial Instruments as the Company believes it represents the most
meaningful measurement basis for these assets and liabilities. Below is a summary of the balances the
Company has elected to account for at fair value:

Other investments
Other assets

2013
573,264 $
— $

2012
644,711
21,513

$
$

Included in net investment income for the year ended December 31, 2013 was net unrealized gains of
$75.8 million related to the changes in fair value of other investments (2012 – $38.2 million, 2011 – $12.7
million). Net unrealized losses related to the changes in the fair value of other assets and liabilities
recorded in other (loss) income was $Nil for the year ended December 31, 2013 (2012 – $3.2 million, 2011
– $2.8 million).

Measuring the Fair Value of Other Investments Using Net Asset Valuations

The table below shows the Company’s portfolio of other investments measured using net asset valuations:

Fair Value

322,391 $

Unfunded
Commitments
99,610

Redemption
Frequency
See below

Redemption
Notice Period
(Minimum
Days)
See below

Redemption
Notice Period
(Maximum
Days)
See below

18,048
3,809

16,635

See below

— See below

See below

At December 31, 2013
Private equity partnerships

Senior secured bank loan funds

Hedge funds

Total other investments

measured using net asset
valuations

344,248 $

116,245

Private equity partnerships – Included in the Company’s investments in private equity partnerships are
alternative asset limited partnerships (or similar corporate structures) that invest in certain private equity
asset classes including U.S. and global leveraged buyouts; mezzanine investments; distressed securities;
real estate; and oil, gas and power. The fair values of the investments in this category have been estimated
using the net asset value of the investments, as discussed in detail above. The Company generally has no
right to redeem its interest in any of these private equity partnerships in advance of dissolution of the
applicable partnership. Instead, the nature of these investments is that distributions are received by the
Company in connection with the liquidation of the underlying assets of the respective private equity
partnership. It is estimated that the majority of the underlying assets of the limited partnerships would
liquidate over 7 to 10 years from inception of the respective limited partnership.

Hedge funds – The Company invests in hedge funds that pursue multiple strategies. The fair values of the
investments in this category are estimated using the net asset value per share of the funds, as discussed in
detail above. The Company’s investments in hedge funds at December 31, 2013 are $3.8 million of so
called “side pocket” investments which are not redeemable at the option of the shareholder. The Company
fully redeemed the remaining non-side pocket investments in hedge funds during June 2012. The
Company will retain its interest in the side pocket investments, referred to above, until the underlying
investments attributable to such side pockets are liquidated, realized or deemed realized at the discretion of
the fund manager.

F-40

NOTE 7. REINSURANCE

The Company purchases reinsurance and other protection to manage its risk portfolio and to reduce its
exposure to large losses. The Company currently has in place contracts that provide for recovery of a
portion of certain claims and claim expenses, generally in excess of various retentions or on a proportional
basis. In addition to loss recoveries, certain of the Company’s ceded reinsurance contracts provide for
recoveries of additional premiums, reinstatement premiums and for lost no-claims bonuses, which are
incurred when losses are ceded to other reinsurance contracts. The Company remains liable to the extent
that any reinsurance company fails to meet its obligations.

The following table sets forth the effect of reinsurance and retrocessional activity on premiums written and
earned and on net claims and claim expenses incurred:

Year ended December 31,
Premiums written

Direct

Assumed

Ceded

Net premiums written

Premiums earned

Direct

Assumed

Ceded

Net premiums earned

Claims and claim expenses

Gross claims and claim expenses incurred

Claims and claim expenses recovered

Net claims and claim expenses incurred

2013

2012

2011

54,334 $

36,367 $

29,725

1,551,078

1,515,224

1,405,251

(401,465)

(448,934)

(422,203)

$ 1,203,947 $ 1,102,657 $ 1,012,773

44,530 $

34,028 $

17,794

1,482,511

1,465,701

1,356,205

(412,415)

(430,374)

(422,950)

$ 1,114,626 $ 1,069,355 $

951,049

185,139 $

403,491 $ 1,270,487

(13,852)

(78,280)

(409,308)

171,287 $

325,211 $

861,179

The reinsurers with the three largest balances accounted for 28.2%, 19.9% and 11.0%, respectively, of the
Company’s reinsurance recoverable balance at December 31, 2013 (2012 - 14.3%, 14.3% and 12.6%,
respectively). The valuation allowance recorded against reinsurance recoverable was $1.7 million at
December 31, 2013 (2012 - $4.5 million). The three largest company-specific components of the valuation
allowance represented 14.2%, 12.5% and 3.1%, respectively, of the Company’s total valuation allowance at
December 31, 2013 (2012 - 44.1%, 26.7% and 6.1%, respectively).

NOTE 8. RESERVE FOR CLAIMS AND CLAIM EXPENSES

The Company uses statistical and actuarial methods to estimate ultimate expected claims and claim
expenses. The period of time from the reporting of a claim to the Company and the settlement of the
Company’s liability may be many years. During this period, additional facts and trends will be revealed. As
these factors become apparent, case reserves will be adjusted, sometimes requiring an increase or
decrease in the overall reserve for claims and claim expenses of the Company, and at other times requiring
a reallocation of incurred but not reported (“IBNR”) reserves to specific case reserves or additional case
reserves. These estimates are reviewed regularly, and such adjustments, if any, are reflected in the results
of operations in the period in which they become known and are accounted for as changes in estimates.
Adjustments to the Company’s reserve for claims and claim expenses can impact current year net income
(loss) by increasing net income or decreasing net loss if the estimates of prior years claims and claim
expense reserves prove to be overstated or by decreasing net income or increasing net loss if the estimates
of prior years claims and claim expense reserves prove to be insufficient.

The Company’s estimates of claims and claim expenses are also based in part upon the estimation of
claims resulting from natural and man-made disasters such as hurricanes, earthquakes, tsunamis,
tornadoes, floods, winter storms, terrorist attacks and other catastrophic events. Estimation by the
Company of claims resulting from catastrophic events is inherently difficult because of the potential severity

F-41

of property catastrophe claims. Additionally, the Company has recently increased its specialty reinsurance
business but does not have the benefit of a significant amount of its own historical experience in certain of
these lines. Therefore, the Company uses both proprietary and commercially available models, as well as
historical (re)insurance industry claims experience, for purposes of evaluating future trends and providing
an estimate of ultimate claims costs.

Activity in the liability for unpaid claims and claim expenses is summarized as follows:

Year ended December 31,
Net reserves as of January 1
Net incurred related to:

Current year
Prior years

Total net incurred
Net paid related to:

Current year
Prior years
Total net paid
Net reserves as of December 31
Reinsurance recoverable as of December 31
Gross reserves as of December 31

2013

2012
$ 1,686,865 $ 1,588,325 $ 1,156,132

2011

315,241
(143,954)
171,287

483,180
(157,969)
325,211

993,168
(131,989)
861,179

32,212
363,235
395,447
1,462,705
101,025

299,299
129,687
428,986
1,588,325
404,029
$ 1,563,730 $ 1,879,377 $ 1,992,354

84,056
142,615
226,671
1,686,865
192,512

The following table details the Company’s prior year development by segment of its liability for unpaid
claims and claim expenses:

Year ended December 31,
Catastrophe Reinsurance
Specialty Reinsurance
Lloyd’s
Other
Total favorable development of prior accident years net claims

and claim expenses

2013

2012

$ (102,037) $ (110,568) $

(34,111)
(8,256)
450

(34,146)
(16,202)
2,947

2011
(59,137)
(77,761)
478
4,431

$ (143,954) $ (157,969) $ (131,989)

Catastrophe Reinsurance Segment

The Company reviews substantially all of its catastrophe reinsurance claims and claim expense reserves
quarterly. The Company’s quarterly review procedures include identifying events that have occurred up to
the latest balance sheet date, determining the Company’s best estimate of the ultimate expected cost to
settle all claims and administrative costs associated with those new events which have arisen during the
reporting period, reviewing the ultimate expected cost to settle claims and administrative costs associated
with those events which occurred during previous periods, and considering new estimation techniques,
such as additional actuarial methods or other statistical techniques, that can assist the Company in
developing its best estimate. This process is judgmental in that it involves reviewing changes in paid and
reported claims each period and adjusting the Company’s estimates of the ultimate expected claims for
each event where there are developments that are different from the Company’s previous expectations. If
the Company determines that adjustments to an earlier estimate are appropriate, such adjustments are
recorded in the period in which they are identified. The level of the Company’s claims associated with
certain catastrophes can be very large. For example, within the Company’s Catastrophe Reinsurance
segment, initial estimated ultimate claims associated with the 2005 Hurricanes, Katrina, Rita and Wilma,
were over $1.3 billion, the 2008 Hurricanes, Gustav and Ike, were over $530 million and the large losses of
2011 (including the 2011 New Zealand Earthquake, the Tohoku Earthquake, the large U.S. tornadoes,
flooding in Australia, certain aggregate losses, Hurricane Irene and the Thailand Floods) were over $1.1
billion. As a result, small percentage changes in the estimated ultimate claims of large catastrophic events
can significantly impact the Company’s reserves for claims and claim expenses in subsequent periods.

F-42

Specialty Reinsurance Segment

When initially developing reserving techniques for the Company’s specialty reinsurance coverages, the
Company considered estimating reserves utilizing several actuarial techniques such as paid and reported
claims development methods. The Company elected to use the Bornhuetter-Ferguson actuarial method
because this method is appropriate for lines of business, such as its specialty reinsurance business, where
there is a lack of historical claims experience. This method allows for greater weight to be applied to
expected results in periods where little or no actual experience is available, and, hence, is less susceptible
to the potential pitfall of being excessively impacted by one particular year or quarter of actual paid and/or
reported claims data. This method uses initial expected claims ratio expectations to the extent that claims
are not paid or reported, and it assumes that past experience is not fully representative of the future. As the
Company’s reserves for claims and claim expenses age, and actual claims experience becomes available,
this method places less weight on expected experience and places more weight on actual experience. This
experience, which represents the difference between expected reported claims and actual reported claims
is reflected in the respective reporting period as a change in estimate. The Company reevaluates its
actuarial reserving techniques on a periodic basis.

The Company reviews substantially all of its specialty reinsurance claims and claim expense reserves
quarterly. Typically, the quarterly review procedures include reviewing paid and reported claims in the most
recent reporting period, reviewing the development of paid and reported claims from prior periods, and
reviewing the Company’s overall experience by underwriting year and in the aggregate. The Company
monitors its expected ultimate claims and claim expense ratios and expected claims reporting assumptions
on a quarterly basis and compares them to its actual experience. These actuarial assumptions are
generally reviewed annually, based on input from the Company’s actuaries, underwriters, claims personnel
and finance professionals, although adjustments may be made more frequently if needed. Assumption
changes are made to adjust for changes in the pricing and terms of coverage the Company provides,
changes in industry results for similar business, as well as its actual experience, to the extent the Company
has enough data to rely on its own experience. If the Company determines that adjustments to an earlier
estimate are appropriate, such adjustments are recorded in the period in which they are identified.

Lloyd’s Segment

The Company uses the Bornhuetter-Ferguson actuarial method to estimate claims and claim expenses
within its Lloyd’s segment for its property and casualty (re)insurance contracts and quota share reinsurance
business. The comments discussed above relating to the Company’s reserving techniques and processes
for the Company’s Specialty Reinsurance segment also apply to the Company’s Lloyd’s segment. In
addition, certain of the Company’s coverages may be impacted by natural and man-made catastrophes.
The Company estimates claim reserves for these claims after the event giving rise to these claims occurs,
following a process that is similar to the Company’s Catastrophe Reinsurance segment discussed above.

Other Category

The Company uses the Bornhuetter-Ferguson actuarial method to estimate claims and claim expenses
within its Other category for its property and casualty insurance contracts and quota share reinsurance
business. The comments discussed above relating to the Company’s reserving techniques and processes
for its Specialty Reinsurance and Lloyd’s segments also apply to the Company’s Other category. In
addition, certain of the Company’s coverages may be impacted by natural and man-made catastrophes.
The Company estimates claim reserves for these claims after the event giving rise to these claims occurs,
following a process that is similar to the Company’s Catastrophe Reinsurance segment discussed above.

F-43

Development of Liability for Unpaid Claims and Claim Expenses

The following table details the development of the Company’s liability for unpaid claims and claim expenses
for each of its Catastrophe Reinsurance, Specialty Reinsurance and Lloyd’s segments and Other category,
for the year ended December 31, 2013 split between catastrophe net claims and claim expenses and
attritional net claims and claim expenses:

Year ended December 31, 2013

Catastrophe net claims and claim
expenses

Large catastrophe events
Storm Sandy (2012)

Tohoku Earthquake and Tsunami

(2011)

Hurricanes Gustav & Ike (2008)

New Zealand Earthquake (2011)

Windstorm Kyrill (2007)

Hurricane Isaac (2012)

New Zealand Earthquake (2010)

Other

Total large catastrophe events

Small catastrophe events
U.S. PCS 83 Wind and
Thunderstorm (2012)

U.S. PCS 76 Wind and
Thunderstorm (2012)

U.S. PCS 70 Wind and
Thunderstorm (2012)

Other

Total small catastrophe events

Total catastrophe net claims and

claim expenses

Attritional net claims and claim
expenses

Bornhuetter-Ferguson actuarial

method - actual reported claims
less than expected claims

Actuarial assumption changes

Total attritional net claims and
claim expenses

Total favorable development of

prior accident years net claims
and claim expenses

Catastrophe
Reinsurance
Segment

Specialty
Reinsurance
Segment

Lloyd's
Segment

Other

Total

44,460 $

— $

3,825 $

— $

48,285

18,033

16,261

10,944
8,244
(2,610)
(11,040)

776

85,068

3,500

300

(8,225)
21,394

16,969

1,000

—

—
(300)
1,763

2,463

—

1,442

5,267

—

404

—

1,325

1,729

—

19,033

16,665

10,944

8,244

(2,610)

(11,340)

5,306

94,527

3,500

300

(8,225)

21,394

16,969

$ 102,037 $

2,463 $

5,267 $

1,729 $ 111,496

—

21,216

10,432

3,263

(274)

(2,179)

—

22,300

10,158

— $

31,648 $

2,989 $

(2,179) $

32,458

$ 102,037 $

34,111 $

8,256 $

(450) $ 143,954

F-44

Catastrophe Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Catastrophe Reinsurance segment in 2013 of $102.0 million was primarily due to $44.5 million, $18.0
million, $16.3 million and $10.9 million of favorable development related to reductions in the expected
ultimate net loss for Storm Sandy, the Tohoku Earthquake, the 2008 Hurricanes and the 2011 New Zealand
Earthquake, respectively, as reported claims came in better than expected, and $34.2 million of net
favorable development related to a number of other catastrophes principally the result of reported claims
coming in less than expected, resulting in decreases to the ultimate claims for these events through the
application of the Company’s formulaic actuarial reserving methodology. Partially offsetting the reductions
noted above was adverse development on the 2010 New Zealand Earthquake, U.S. PSC 70 and Hurricane
Isaac of $11.0 million, $8.2 million and $2.6 million, respectively, associated with an increase in reported
gross ultimate losses.

Specialty Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Specialty Reinsurance segment in 2013 of $34.1 million was primarily driven by $10.4 million associated
with actuarial assumption changes, principally in the Company’s casualty clash and casualty risk lines of
business, and primarily as a result of revised claim development factors based on actual loss experience,
and $23.7 million due to reported claims coming in lower than expected on prior accident years events, as a
result of the application of the Company’s formulaic actuarial reserving methodology.

Lloyd’s Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Lloyd’s segment of $8.3 million during 2013 was principally driven by a $5.3 million decrease in the
estimated ultimate net claims and claim expenses related to large catastrophes, including $3.8 million
related to Storm Sandy, and $3.3 million related to reported claims coming in lower than expected on prior
accident years events as a result of the application of the Company’s formulaic actuarial reserving
methodology and partially offset by adverse development of $0.3 million related to assumption changes.

Other Category

The net adverse development on prior accident years of $0.5 million for 2013 within the Company’s Other
category was principally the result of $2.2 million related to the application of the Company’s formulaic
actuarial reserving methodology with the increases being due to actual paid and reported claim activity
coming in higher than what was originally anticipated when setting the initial reserves; partially offset by
favorable development of $1.7 million related to large catastrophe events.

F-45

The following table details the development of the Company’s liability for unpaid claims and claim expenses
for each of its Catastrophe Reinsurance, Specialty Reinsurance and Lloyd’s segments and Other category,
for the year ended December 31, 2012 split between catastrophe net claims and claim expenses and
attritional net claims and claim expenses:

Year ended December 31, 2012

Catastrophe net claims and claim
expenses

Large catastrophe events
Chile Earthquake (2010)

Hurricanes Gustav & Ike (2008)

U.K. Floods (2007)

Hurricanes Katrina, Rita and

Wilma (2005)

Hurricane Irene (2011)

Thailand Floods (2011)

Tohoku Earthquake and Tsunami

(2011)

Windstorm Kyrill (2007)

New Zealand Earthquake (2010)

New Zealand Earthquake (2011)

Other

Total large catastrophe events

Small catastrophe events
Danish Floods (2011)

U.S. PCS 63 Winter Storm (2011)

U.S. PCS 42 Winter Storm (2011)

U.S. PCS 53 Winter Storm (2011)

Other

Total small catastrophe events

Total catastrophe net claims and

claim expenses

Attritional net claims and claim
expenses

Bornhuetter-Ferguson actuarial

method - actual reported claims
less than expected claims

Actuarial assumption changes

Total attritional net claims and
claim expenses

Total favorable development of

prior accident years net claims
and claim expenses

Catastrophe
Reinsurance
Segment

Specialty
Reinsurance
Segment

Lloyd’s
Segment

Other

Total

24,575 $

— $

24,575

17,541

17,271

6,420

4,630

3,933

3,896
3,417
(3,570)
(17,912)
2,542

62,743

5,000

2,560

2,558

32,707

47,825

—

3,000

—

2,500

5,500

—

2,926

—

(1,690)

—

—
3,000

1,476

9,476

(65)

1,171

—

20,467

17,271

7,730

7,130

9,433

3,896

3,417

(3,570)

(17,912)

3,953

76,390

5,000

2,560

2,558

32,707

47,825

$ 110,568 $

3,000 $

9,476 $

1,171 $ 124,215

— $
—

16,747 $
14,399

8,011 $

(4,118) $

20,640

(1,285)

—

13,114

— $

31,146 $

6,726 $

(4,118) $

33,754

$ 110,568 $

34,146 $

16,202 $

(2,947) $ 157,969

F-46

Catastrophe Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Catastrophe Reinsurance segment in 2012 of $110.6 million was primarily due to net reductions of $84.2
million arising from the estimated ultimate claims of large catastrophe events, including the 2010 Chilean
Earthquake, the 2008 Hurricanes, the 2007 U.K. Flooding, the 2005 Hurricanes, Hurricane Irene of 2011,
the 2011 Thailand Floods and the Tohoku Earthquake, as reported claims came in better than expected.
The remainder of the favorable development of prior accident years net claims and claim expenses of $47.8
million was due to a reduction in ultimate claims on a number of relatively small catastrophes, all principally
the result of reported claims coming in less than expected, principally resulting in formulaic decreases to the
ultimate claims for these events. Partially offsetting the reductions noted above was a $17.9 million and
$3.6 million increase in net claims and claim expenses from the 2011 and 2010 New Zealand Earthquake,
respectively, primarily as a result of increased cedant gross ultimate loss estimates.

Specialty Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Specialty Reinsurance segment in 2012 of $34.1 million includes $14.4 million associated with actuarial
assumption changes, principally in the Company’s casualty and medical malpractice lines of business, and
primarily as a result of revised initial expected claims ratios and claim development factors due to actual
experience coming in better than expected, and $16.7 million due to reported claims coming in lower than
expected on prior accident years events, as a result of the application of the Company’s formulaic actuarial
reserving methodology, and $3.0 million related to reductions in the estimated ultimate losses from the 2005
Hurricanes.

Lloyd’s Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Lloyd’s segment of $16.2 million during 2012 was principally due to favorable development of $8.0 million
due to reported claims coming in lower than expected on a number of prior accident years events, as a
result of the application of the Company’s formulaic actuarial reserving methodology, $5.5 million related to
the 2011 Thailand Floods, $2.5 million related to Hurricane Irene, and $1.5 million due to lower than
expected reported claims for catastrophe losses within the Lloyd’s segment’s property catastrophe
reinsurance book of business, partially offset by $1.3 million of adverse development related to actuarial
assumption changes.

Other Category

The net adverse development on prior accident years of $2.9 million for 2012 within the Company’s Other
category was principally the result of a loss portfolio transfer entered into by the Company on October 1,
2012, in respect of its contractor’s liability book of business within RenaissanceRe Specialty Risks, whereby
the Company paid consideration of $36.5 million to transfer net liabilities of $29.1 million, resulting in a loss
of $7.4 million which is recorded above as prior accident years attritional net claims and claims expenses in
the Company’s Other category, partially offset by reductions in reported losses on certain attritional loss
contracts and favorable development related to catastrophe events, primarily the 2008 Hurricanes.

F-47

The following table details the development of the Company’s liability for unpaid claims and claim expenses
for each of its Catastrophe Reinsurance, Specialty Reinsurance and Lloyd’s segments and Other category,
for the year ended December 31, 2011 split between catastrophe net claims and claim expenses and
attritional net claims and claim expenses:

Year ended December 31, 2011

Catastrophe net claims and claim
expenses

Large catastrophe events

Catastrophe
Reinsurance
Segment

Specialty
Reinsurance
Segment

Lloyd’s
Segment

Other

Total

Tropical Cyclone Tasha (2010)

13,922 $

3,000 $

— $

16,922

—

—
—

—

4,633

—

476
—

—

(866)

20,856

13,143

4,701

4,552
3,635

2,494

(866)

—

(15,179)

4,243

50,258

—

4,554

3,125

3,039

2,288

14,019

27,025

Hurricanes Katrina, Rita and

Wilma (2005)

Chilean Earthquake (2010)

World Trade Center (2001)

Hurricanes Charley, Francis, Ivan

and Jeanne (2004)

U.K. Floods (2007)

Windstorm Kyrill (2007)

Hurricanes Gustav & Ike (2008)

New Zealand Earthquake (2010)

Total large catastrophe events

Small catastrophe events

10,008
8,455

4,701

4,076
3,635

2,494
—

6,215

4,688

—

—
—

—

(15,179)

32,112

—
13,903

U.S. PCS 21 Wildland Fire (2007)

4,554

3,125

3,039

2,288

14,019

27,025

—

U.S. PCS 33 Great Midwest Storm

(2010)

U.S. PCS 31 Wind and
Thunderstorm (2010)

U.S. PCS 96 Wind and
Thunderstorm (2010)

Other

Total small catastrophe events

Total catastrophe net claims and

claim expenses

Attritional net claims and claim
expenses

Bornhuetter-Ferguson actuarial

method - actual reported claims
less than expected claims

Actuarial assumption changes

Total attritional net claims and
claim expenses

Total favorable development of

prior accident years net claims
and claim expenses

59,137 $

13,903 $

— $

4,243 $

77,283

— $
—

37,058 $
26,800

(478) $

1,389 $

37,969

—

(10,063)

16,737

— $

63,858 $

(478) $

(8,674) $

54,706

59,137 $

77,761 $

(478) $

(4,431) $ 131,989

F-48

Catastrophe Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Catastrophe Reinsurance segment in 2011 of $59.1 million was due to net reductions of $47.3 million
arising from the estimated ultimate claims of large catastrophe events, including the 2005 Hurricanes and
the World Trade Center, for which the claims are principally paid and the amount of additional reported
claims has slowed considerably and therefore the ultimate claims were reduced, and Tropical Cyclone
Tasha and the Chilean Earthquake, as reported claims came in better than expected in 2011. Partially
offsetting the above reductions in estimated ultimate claims during 2011, the Company increased its
estimated ultimate claims for the 2010 New Zealand Earthquake by $15.2 million due to additional claims
reporting information being available to the Company. The remainder of the favorable development of prior
accident years net claims and claim expenses of $27.0 million was due to a reduction in ultimate claims on
a large number of relatively small catastrophes, all principally the result of reported claims coming in less
than expected, resulting in formulaic decreases to the ultimate claims and claim expenses for these events.

Specialty Reinsurance Segment

The favorable development of prior accident years net claims and claim expenses within the Company’s
Specialty Reinsurance segment in 2011 of $77.8 million includes: $26.8 million associated with actuarial
assumption changes, principally in the Company’s workers’ compensation quota share and per risk and
property risk and energy lines of business, and primarily as a result of revised initial expected claims ratios
and claim development factors due to actual experience coming in better than expected; $13.9 million due
to reductions in case reserves and additional case reserves for certain large catastrophe events; and the
remainder of $37.1 million due to reported claims coming in better than expected in 2011 on prior accident
years events, as a result of the application of the Company’s formulaic actuarial reserving methodology.

Lloyd’s Segment

The Company commenced its Lloyd’s operations in mid-2009 and the net adverse development on prior
accident years net claims and claim expenses in this segment for the year ended December 31, 2011
amounted to $0.5 million which principally related to the 2010 New Zealand Earthquake.

Other Category

The net adverse development on prior accident years of $4.4 million in 2011 within the Company’s Other
category was principally due to the contractor’s liability book of business, which experienced higher than
expected reported losses, and was subsequently subject to a comprehensive actuarial review during the
fourth quarter of 2011, which review resulted in an increase of $10.1 million to the estimated ultimate claims
and claim expenses related to this book of business due to changes in the actuarial assumptions. The total
gross reserve for claims and claim expenses for the construction defect book of business at December 31,
2011 was $58.8 million. Partially offsetting the adverse development on prior accident years within the
construction defect book of business, noted above, was favorable development of $4.2 million related to
large catastrophe events, principally the 2005 Hurricanes, and $1.4 million related to the application of the
Company’s formulaic actuarial reserving methodology with the reductions being due to actual paid and
reported claim activity being more favorable to date than what was originally anticipated when setting the
initial reserves.

Assumed Reinsurance Contracts Classified As Deposit Contracts

Net claims and claim expenses incurred were reduced by $0.4 million during 2013 (2012 – $0.1 million,
2011 – $0.2 million) related to income earned on assumed reinsurance contracts that were classified as
deposit contracts with underwriting risk only. Other loss was decreased by $0.1 million during 2013 (2012 –
other loss decreased by $7.5 million, 2011 – other loss increased by $0.1 million) related to premiums and
losses incurred on assumed reinsurance contracts that were classified as deposit contracts with timing risk
only. Aggregate deposit liabilities of $39.7 million are included in reinsurance balances payable at
December 31, 2013 (2012 – $41.2 million) and aggregate deposit assets of $Nil are included in other assets
at December 31, 2013 (2012 – $Nil) associated with these contracts.

F-49

NOTE 9. DEBT

5.75% Senior Notes

On March 17, 2010, RRNAH issued $250.0 million of 5.75% Senior Notes due March 15, 2020, with interest
on the notes payable on March 15 and September 15 of each year. The notes, which are senior
obligations, are guaranteed by RenaissanceRe and can be redeemed by RRNAH prior to maturity, subject
to the payment of a “make-whole” premium. The notes were issued pursuant to an Indenture, dated as of
March 17, 2010, by and among RenaissanceRe, RRNAH, and Deutsche Bank Trust Company Americas, as
trustee (the “Trustee”), as supplemented by the First Supplemental Indenture, dated as of March 17, 2010.
The notes, which are senior obligations, contain various covenants, including limitations on mergers and
consolidations, restrictions as to the disposition of the stock of designated subsidiaries and limitations on
liens of the stock of designated subsidiaries.

5.875% Senior Notes

In January 2003, RenaissanceRe issued $100.0 million, which represented the carrying amount on the
Company’s consolidated balance sheet, of 5.875% Senior Notes due February 15, 2013, with interest on
the notes payable on February 15 and August 15 of each year. RenaissanceRe repaid the full $100.0
million of its outstanding 5.875% Senior Notes upon their scheduled maturity of February 15, 2013 using
available cash and investments.

RenaissanceRe Revolving Credit Facility

RenaissanceRe is a party to a credit agreement, dated as of May 17, 2012 (the “Credit Agreement”), with
various banks and financial institutions parties thereto (collectively, the “Lenders”), Wells Fargo Bank,
National Association (“Wells Fargo”), as fronting bank, letter of credit administrator and administrative agent
(the “Administrative Agent”) for the Lenders, and certain other agents. The Credit Agreement previously
provided for commitments from the Lenders in an aggregate amount of $150.0 million, including the
issuance of letters of credit for the respective accounts of RenaissanceRe and certain of RenaissanceRe’s
subsidiaries. Effective as of May 23, 2013, RenaissanceRe entered into a First Amendment and Joinder to
Credit Agreement (the “Amendment”) with the Administrative Agent and the Lenders. Among other items,
the Amendment (i) increased the aggregate commitment of the Lenders to $250.0 million, (ii) added an
additional bank as a Lender, and (iii) eliminated the commitment of the Lenders to issue letters of credit.
After giving effect to the Amendment, RenaissanceRe has the right, subject to certain conditions, to
increase the size of the facility up to $350.0 million.

F-50

Syndicated Letter of Credit Facility

Effective May 17, 2012, RenaissanceRe and certain of its affiliates, Renaissance Reinsurance,
Renaissance Reinsurance of Europe (“ROE”), RenaissanceRe Specialty Risks and DaVinci (such affiliates,
collectively, the “Account Parties”), entered into a Fourth Amended and Restated Reimbursement
Agreement with various banks and financial institutions parties thereto (collectively, the “Banks”), Wells
Fargo, as issuing bank, administrative agent and collateral agent for the Banks, and certain other agents
(the “Reimbursement Agreement”). The Reimbursement Agreement amended and restated in its entirety
the Third Amended and Restated Reimbursement Agreement, dated as of April 22, 2010, which was
terminated concurrently with the effectiveness of the Reimbursement Agreement. The commitments under
the Reimbursement Agreement expire on May 17, 2015.

Effective March 28, 2013, RenaissanceRe reduced the commitments under the facility from $450.0 million
to $250.0 million. The reductions were implemented in connection with a reassessment of the future
collateral needs of RenaissanceRe, taking into account, among other things, its access to alternative
sources of credit enhancement. Prior to the expiration date of May 17, 2015, the commitments under the
facility may be increased from time to time up to an amount not to exceed $600.0 million in the aggregate,
subject to RenaissanceRe satisfying certain conditions.

The Reimbursement Agreement contains representations, warranties and covenants in respect of
RenaissanceRe, the Account Parties and their respective subsidiaries that are customary for facilities of this
type, including customary covenants limiting the ability to merge, consolidate and sell a substantial amount
of assets. The Reimbursement Agreement contains certain financial covenants requiring RenaissanceRe
and DaVinci to maintain for the year ending December 31, 2014, a minimum net worth of approximately
$2.0 billion and $781.2 million, respectively, which requirements are recalculated effective as of the end of
each fiscal year, all as more fully set forth in the Reimbursement Agreement.

At December 31, 2013, the Company had $162.3 million of letters of credit with effective dates on or before
December 31, 2013 outstanding under the Reimbursement Agreement.

Bilateral Letter of Credit Facility (“Bilateral Facility”)

The Bilateral Facility provides a commitment from CEP to issue letters of credit for the account of one or
more of the Bilateral Facility Participants (inclusive of ROE and RenaissanceRe Specialty U.S.) and their
respective subsidiaries in multiple currencies and in an aggregate amount of up to $300.0 million, subject to
a sublimit of $50.0 million for letters of credit issued for the account of RenaissanceRe Specialty U.S. The
Bilateral Facility was to expire on December 31, 2013; however effective October 1, 2013, the Bilateral
Facility was extended to December 31, 2014. The Bilateral Facility is evidenced by the Facility Letter and
five separate master agreements between CEP and each of the Bilateral Facility Participants, as well as
certain ancillary agreements. At December 31, 2013, the Bilateral Facility of $258.3 million remained
unused and available to the Bilateral Facility Participants.

F-51

terminating its commitment to such Bilateral Facility Participant under the Bilateral Facility and taking certain
actions with respect to the collateral pledged by such Bilateral Facility Participant (including the sale
thereof). In the Facility Letter, each Bilateral Facility Participant makes, as to itself, representations and
warranties that are customary for facilities of this type and severally agrees that it will comply with certain
informational and other undertakings, including those regarding the delivery of quarterly and annual
financial statements.

Funds at Lloyd’s Letter of Credit Facility

On April 26, 2010, Renaissance Reinsurance and CEP entered into an Amended and Restated Pledge
Agreement (the “Pledge Agreement”) in respect of its letter of credit facility with CEP which is evidenced by
the Master Reimbursement Agreement, dated as of April 29, 2009, which provides for the issuance and
renewal of letters of credit which are used to support business written by Syndicate 1458. At December 31,
2013, letters of credit issued by CEP under the Master Reimbursement Agreement were outstanding in the
amount of $281.0 million and £60.0 million, respectively. Pursuant to the Pledge Agreement, Renaissance
Reinsurance has agreed to pledge to CEP at all times during the term of the Master Reimbursement
Agreement certain securities with a collateral value equal to 100% of the aggregate amount of the then-
outstanding letters of credit issued under the Master Reimbursement Agreement.

Letters of Credit

At December 31, 2013, the Company had total letters of credit outstanding under all facilities of $584.4
million.

Renaissance Reinsurance is also party to a collateralized letter of credit and reimbursement agreement in
the amount of $37.5 million that supports the Company’s Top Layer Re joint venture. Renaissance
Reinsurance is obligated to make a mandatory capital contribution of up to $50.0 million in the event that a
loss reduces Top Layer Re’s capital below a specified level.

DaVinciRe Loan Agreement

Renaissance Trading Guarantees

F-52

Interest Paid and Scheduled Debt Maturity

Interest paid on the Company’s debt totaled $20.1 million for the year ended December 31, 2013 (2012 –
$23.1 million, 2011 – $23.8 million).

The following table sets forth the scheduled maturity of the Company’s aggregate amount of its debt
obligation reflected on its consolidated balance sheet at December 31, 2013:

2014
2015
2016
2017
2018
After 2018
Unamortized debt issuance expenses

—
—
—
—
—
250,000
(570)
249,430

NOTE 10. NONCONTROLLING INTERESTS

A summary of the Company’s noncontrolling interests on its consolidated balance sheets are detailed
below:

Redeemable noncontrolling interest - DaVinciRe

Redeemable noncontrolling interest - Medici

Redeemable noncontrolling interest

2013

$ 1,063,368 $

36,492

2012
968,259

—

$ 1,099,860 $

968,259

Noncontrolling interest - Angus Fund

— $

3,991

A summary of the Company’s noncontrolling interests on its consolidated statements of operations are
detailed below:

Redeemable noncontrolling interest - DaVinciRe

Redeemable noncontrolling interest - Medici
Noncontrolling interest - Angus Fund

2013
150,581 $

2012
147,499 $

2011
(33,697)

617

(54)

—

541

—

540

Net income (loss) attributable to noncontrolling interests

151,144 $

148,040 $

(33,157)

Redeemable Noncontrolling Interest – DaVinciRe

In October 2001, the Company formed DaVinciRe and DaVinci with other equity investors. RenaissanceRe
owns a noncontrolling economic interest in DaVinciRe; however, because RenaissanceRe controls a
majority of DaVinciRe’s outstanding voting rights, the consolidated financial statements of DaVinciRe are
included in the consolidated financial statements of the Company. The portion of DaVinciRe’s earnings
owned by third parties is recorded in the consolidated statements of operations as net (income) loss
attributable to noncontrolling interests. The Company’s noncontrolling economic ownership in DaVinciRe
was 27.3% at December 31, 2013 (2012 - 30.8%).

DaVinciRe shareholders are party to a shareholders agreement (the “Shareholders Agreement”) which
provides DaVinciRe shareholders, excluding RenaissanceRe, with certain redemption rights that enable
each shareholder to notify DaVinciRe of such shareholder’s desire for DaVinciRe to repurchase up to half of
such shareholder’s initial aggregate number of shares held, subject to certain limitations, such as limiting
the aggregate of all share repurchase requests to 25% of DaVinciRe’s capital in any given year and
satisfying all applicable regulatory requirements. If total shareholder requests exceed 25% of DaVinciRe’s

F-53

capital, the number of shares repurchased will be reduced among the requesting shareholders pro-rata,
based on the amounts desired to be repurchased. Shareholders desiring to have DaVinci repurchase their
shares must notify DaVinciRe before March 1 of each year. The repurchase price will be based on GAAP
book value as of the end of the year in which the shareholder notice is given, and the repurchase will be
effective as of such date. Payment will be made by April 1 of the following year, following delivery of the
audited financial statements for the year in which the repurchase was effective. The repurchase price is
subject to a true-up for development on outstanding loss reserves after settlement of all claims relating to
the applicable years.

Certain third party shareholders of DaVinciRe submitted repurchase notices on or before the required
annual redemption notice date of March 1, 2011, in accordance with the Shareholders Agreement. The
repurchase notices submitted on or before March 1, 2011, were for shares of DaVinciRe with a GAAP book
value of $9.2 million at December 31, 2011. Effective January 1, 2012, DaVinciRe redeemed the shares for
$9.2 million, less a $1.8 million reserve holdback.

Effective January 1, 2012, an existing third party shareholder sold a portion of its shares in DaVinciRe to a
new third party shareholder. In connection with the sale by the existing third party shareholder, DaVinciRe
retained a $4.9 million holdback. In addition, effective January 1, 2012, the Company sold a portion of its
shares of DaVinciRe to a separate new third party shareholder. The Company sold these shares for $98.9
million, net of a $10.0 million reserve holdback due from DaVinciRe. The Company’s noncontrolling
economic ownership in DaVinciRe was 42.8% at December 31, 2011 and subsequent to the above
transactions, its noncontrolling economic ownership interest in DaVinciRe decreased to 34.7% effective
January 1, 2012.

Certain third party shareholders of DaVinciRe submitted repurchase notices on or before the required
annual redemption notice date of March 1, 2012, in accordance with the Shareholders Agreement. The
repurchase notices submitted on or before March 1, 2012, were for shares of DaVinciRe with a GAAP book
value of $53.2 million at December 31, 2012.

On June 1, 2012, DaVinciRe completed an equity raise of $49.3 million from a new third party investor. In
addition, the Company and an existing third party investor each sold $24.7 million in common shares of
DaVinciRe to another existing third party investor, for a total of $49.4 million. In connection with the sale by
the Company and the existing third party investor, DaVinciRe retained a $5.0 million holdback. As a result
of the above transactions, the Company’s noncontrolling economic ownership in DaVinciRe decreased to
31.5% effective January 1, 2012.

On October 1, 2012, the Company sold a portion of its shares of DaVinciRe to a new third party shareholder
for $9.8 million. The Company’s noncontrolling economic ownership in DaVinciRe decreased to 30.8%
effective January 1, 2012 as a result of this sale.

During January 2013, DaVinciRe redeemed shares from certain DaVinciRe shareholders (including those
who submitted redemption notices in advance of the March 1, 2012 annual redemption notice date, as
discussed above) while certain other DaVinciRe shareholders purchased additional shares in DaVinciRe.
The net redemption as a result of these transactions was $150.0 million. In connection with the
redemptions, DaVinciRe retained a $20.5 million holdback. The Company’s noncontrolling economic
ownership in DaVinciRe was 30.8% at December 31, 2012 and subsequent to the above transactions, the
Company’s noncontrolling economic ownership in DaVinciRe increased to 32.9% effective January 1, 2013.

Effective October 1, 2013, an existing third party shareholder sold a portion of its shares in DaVinciRe to a
new third party shareholder. In addition, effective October 1, 2013, the Company sold a portion of its shares
of DaVinciRe to the same new third party shareholder. The Company sold these shares for $77.4 million
and subsequent to the above transactions, the Company’s noncontrolling economic ownership interest in
DaVinciRe decreased, and was 27.3% at December 31, 2013.

See “Note 23. Subsequent Events” for additional information related to DaVinciRe shareholder transactions
which occurred during January 2014.

The Company expects its noncontrolling economic ownership in DaVinciRe to fluctuate over time.

F-54

The activity in redeemable noncontrolling interest – DaVinciRe is detailed in the table below:

Balance – January 1

Redemption of shares from redeemable noncontrolling interest

Sale of shares to redeemable noncontrolling interest

Comprehensive income:

Net income attributable to redeemable noncontrolling interest

Balance – December 31

2013
968,259 $

2012
657,727

(209,356)

—

153,884

163,033

150,581

147,499

$ 1,063,368 $

968,259

Redeemable Noncontrolling Interest - Medici

Medici is an exempted fund incorporated under the laws of Bermuda and its objective is to seek to invest
substantially all of its assets in various insurance-based investment instruments that have returns primarily
tied to property catastrophe risk. Prior to June 1, 2013, Medici was a wholly owned subsidiary of Fund
Holdings, which in turn is a wholly owned subsidiary of RenaissanceRe.

Subsequent to June 1, 2013, third-party investors subscribed for, and redeemed, an aggregate of $37.2
million and $1.3 million, respectively, of the participating, non-voting common shares of Medici. As a result
of the third-party investments during the period from June 1, 2013 through December 31, 2013, the
Company’s ownership in Medici was 73.9% at December 31, 2013. The portion of Medici’s earnings owned
by third parties is recorded in the consolidated statements of operations as net (income) loss attributable to
noncontrolling interests. Any shareholder may redeem all or any portion of its shares as of the last day of
any calendar month, upon at least 30 calendar days’ prior irrevocable written notice to Medici. As the
participating, non-voting common shares of Medici have redemption features which are outside the control
of the issuer, the portion related to the redeemable noncontrolling interest in Medici is recorded in the
mezzanine section of the consolidated balance sheets of the Company.

See “Note 23. Subsequent Events” for additional information related to Medici transactions which occurred
subsequent to December 31, 2013.

The Company expects its ownership in Medici to fluctuate over time.

The activity in redeemable noncontrolling interest – Medici is detailed in the table below:

Balance – January 1

Redemption of shares from redeemable noncontrolling interest

Sale of shares to redeemable noncontrolling interest

Net income attributable to redeemable noncontrolling interest

Balance – December 31

2013

—

(1,325)

37,200

617

36,492

Noncontrolling Interest - Angus Fund L.P. (the “Angus Fund”)

In December 2010, REAL and RRCA, both formerly wholly owned subsidiaries of the Company, formed the
Angus Fund with other equity investors. The Angus Fund was formed to provide capital to and make
investments in companies primarily in the heating oil and propane distribution industries and Angus was
formed to provide commodity related risk management products to third party customers.

As part of the agreement to sell REAL to Munich (see “Note 3. Discontinued Operations” for additional
information), the former general partner of the Angus Fund, REAL, transferred its general partner ownership
interest to RRV U.S. Holdings LLC (“RRV U.S.”), a wholly owned subsidiary of the Company, representing a
$55 thousand investment in the Angus Fund, or a 1.1% ownership interest at December 1, 2013
(December 31, 2012 - $55 thousand and 1.1%, respectively), and RRCA, the former limited partner,
transferred its limited partner ownership interest to RenTech U.S. Holdings LLC (“RenTech”), a wholly
owned subsidiary of the Company, representing a $2.0 million investment in the Angus Fund, or a 35.0%

F-55

ownership interest at December 1, 2013 (December 31, 2012 - $2.0 million and 35.1%, respectively).
There was no gain or loss recognized on the above transactions.

Effective December 1, 2013, both RRV U.S. and RenTech contributed their ownership interests in the
Angus Fund to Angus for $2.3 million, in return for equity interests in Angus. The Company previously had
an equity interest of 38.8% in Angus, and as a result of these transactions, its equity interest in Angus has
increased to 42.5%. In addition, these transactions resulted in $1.7 million of additional goodwill related to
the Company’s additional investment in Angus.

Prior to December 1, 2013, the Angus Fund met the definition of a VIE, therefore the Company evaluated its
ownership in the Angus Fund to determine if it was the primary beneficiary. The Company had concluded it
was the primary beneficiary of the Angus Fund as it had the power to direct, and had more than insignificant
economic interest in, the activities of the Angus Fund and as such, the financial position and results of
operations of the Angus Fund were consolidated. The portion of the Angus Fund’s earnings owned by third
parties was recorded in the consolidated statements of operations as net (income) loss attributable to
noncontrolling interest. Effective December 1, 2013, the Company concluded that it no longer had the
power to direct the activities, nor was it the primary beneficiary, of the Angus Fund and as a result, it was
deconsolidated. The Company’s equity investment in Angus is recorded under investments in other
ventures, under equity method on its consolidated balance sheet. See “Note. 5 Investments” for additional
information related to the Company’s investments in other ventures, under equity method.

The activity in noncontrolling interest is detailed in the table below:

Balance – January 1

Sale of shares to noncontrolling interest
Adjustment of ownership interest
Net (loss) income attributable to noncontrolling interest
Dividends on common shares

Balance – December 31

NOTE 11. VARIABLE INTEREST ENTITIES

Upsilon Reinsurance Ltd. (“Upsilon Re”)

2013

2012

3,991 $
—
(3,709)
(54)
(228)

— $

3,340
300
—
541
(190)
3,991

Effective January 1, 2012, the Company formed and launched a managed joint venture, Upsilon Re, a
Bermuda domiciled SPI, to provide additional capacity to the worldwide aggregate and per-occurrence
retrocessional property catastrophe excess of loss market for the 2012 underwriting year. The original
business was written by Renaissance Reinsurance of Europe (“ROE”), a wholly owned subsidiary of
RenaissanceRe, and included $37.4 million of gross premiums written incepting between January 1, 2012
and June 1, 2012. A portion of this business was in turn ceded to Upsilon Re under a fully-collateralized
retrocessional reinsurance contract, effective January 1, 2012. In conjunction with the formation and launch
of Upsilon Re, $16.8 million of non-voting Class B shares were sold to external investors, and the Company
invested $48.8 million in Upsilon Re’s non-voting Class B shares, representing a 74.5% ownership interest
in Upsilon Re. The Class B shareholders participate in substantially all of the profits or losses of Upsilon Re
while the Class B shares remain outstanding. The holders of Class B shares indemnify Upsilon Re against
losses relating to insurance risk and therefore these shares have been accounted for as prospective
reinsurance under FASB ASC Topic Financial Services - Insurance. In addition, another third party investor
supplied $17.6 million of capital through a reinsurance participation (a third party quota share agreement)
with ROE alongside Upsilon Re. Inclusive of the reinsurance participation, the Company had a 61.4%
participation in the original risks assumed by ROE. Both Upsilon Re and the reinsurance participation were
managed by RUM in return for an expense override. Through RUM, the Company was eligible to receive a
potential underwriting profit commission in respect of Upsilon Re. Upsilon Re is considered a VIE and the
Company is considered the primary beneficiary. As a result, Upsilon Re is consolidated by the Company
and all significant inter-company transactions have been eliminated.

During 2013, Upsilon Re redeemed all of its outstanding third party non-voting Class B shares for $23.0
million as a result of the scheduled expiration of certain risks underwritten by Upsilon Re. Following these

F-56

redemptions, no third-party non-voting Class B Shares remained outstanding. In addition, the Company
has authorized the release of all collateral provided to a third party investor who participated in risks
underwritten by ROE related to Upsilon Re through the reinsurance participation. At December 31, 2013,
the Company’s consolidated balance sheet included total assets and total liabilities of $Nil and $Nil,
respectively, related to Upsilon (2012 - $93.5 million and $93.5 million, respectively).

Timicuan Reinsurance III Limited (“Tim Re III”)

Effective June 1, 2012, the Company formed and launched a managed joint venture, Tim Re III, a Bermuda
domiciled SPI, to provide collateralized reinsurance in respect of a portfolio of Florida reinstatement
premium protection (“RPP”) contracts. The original business was written by Renaissance Reinsurance and
DaVinci, and included $41.1 million of gross premiums written incepting June 1, 2012 and Renaissance
Reinsurance and DaVinci ceded $37.7 million to Tim Re III under a fully-collateralized reinsurance contract.
In conjunction with the formation and launch of Tim Re III, $44.8 million of non-voting Class B shares were
sold to external investors. Additionally, $10.3 million of the non-voting Class B shares were acquired by the
Company, representing an 18.6% ownership interest in Tim Re III. The Class B shareholders participate in
substantially all of the profits or losses of Tim Re III while the Class B shares remain outstanding. The
holders of Class B shares indemnify Tim Re III against losses relating to insurance risk and therefore these
shares have been accounted for as prospective reinsurance under FASB ASC Topic Financial Services -
Insurance. In addition, another third party investor supplied $5.2 million of capital through a reinsurance
participation with Renaissance Reinsurance and DaVinci, alongside Tim Re III. Inclusive of the reinsurance
participation, the Company had a 17.1% participation in the original risks assumed by Renaissance
Reinsurance and DaVinci related to Tim Re III. Both Tim Re III and the reinsurance participation were
managed by RUM. Through RUM, the Company was eligible to receive a potential underwriting profit
commission in respect of Tim Re III. Tim Re III is considered a VIE and the Company is considered the
primary beneficiary. As a result, Tim Re III is consolidated by the Company and all significant inter-
company transactions have been eliminated.

During 2013, Tim Re III redeemed all of its outstanding third party non-voting Class B shares for $66.5
million as a result of the scheduled expiration of the risks underwritten by Tim Re III. Following these
redemptions, no third-party non-voting Class B Shares remained outstanding. In addition, the Company
has authorized the release of all the collateral provided to a third party investor who participated in risks
underwritten by Renaissance Reinsurance and DaVinci related to Tim Re III through the reinsurance
participation. At December 31, 2013, the Company’s consolidated balance sheet included total assets and
total liabilities of $Nil and $Nil, respectively, related to Tim Re III (2012 - $90.5 million and $90.5 million,
respectively).

Upsilon RFO Re Ltd. (“Upsilon RFO”)

Effective January 1, 2013, the Company formed and launched Upsilon RFO (formerly known as Upsilon
Reinsurance II Ltd.), a managed joint venture and a Bermuda domiciled SPI, to provide additional capacity
to the worldwide aggregate and per-occurrence retrocessional property catastrophe excess of loss market.
Original business was written directly by Upsilon RFO and includes $53.5 million of gross premiums written
incepting January 1, 2013 under fully-collateralized reinsurance contracts. In conjunction with the formation
and launch of Upsilon RFO, $61.0 million of Upsilon RFO non-voting Class B shares were sold to
unaffiliated third party investors. Additionally, $76.4 million of the non-voting Class B shares were acquired
by the Company, representing a 55.6% participation in the original risks assumed by Upsilon RFO effective
January 1, 2013. In addition, another third party investor supplied $17.5 million of capital through an
insurance contract with the Company related to Upsilon RFO’s reinsurance portfolio. Inclusive of the
insurance contract, the Company had a 42.9% participation in the original risks assumed by Upsilon RFO
effective January 1, 2013.

On July 1, 2013, the Company sold a portion of its shares of Upsilon RFO to a new unaffiliated third party
shareholder for $25.0 million. The Company’s participation in the original risks assumed by Upsilon RFO
prior to January 1, 2014 was 25.8%, inclusive of the related insurance contract, effective December 31,
2013.

In conjunction with risks incepting on or after January 1, 2014, $172.4 million of Upsilon RFO non-voting
preference shares were sold to unaffiliated third-party investors. Additionally, $109.7 million of the non-

F-57

voting preference shares were acquired by the Company, representing a 38.9% participation in the risks
assumed by Upsilon RFO incepting on or after January 1, 2014. In addition, another third party investor
supplied $15.0 million of capital through an insurance contract with the Company related to Upsilon RFO’s
reinsurance portfolio. Inclusive of the insurance contract, the Company has a 33.6% participation in the
original risks assumed by Upsilon RFO in conjunction with risks incepting on or after January 1, 2014. At
December 31, 2013, the Company’s consolidated balance sheet included total assets and total liabilities of
$474.2 million and $474.2 million, respectively, related to Upsilon RFO, including $156.3 million of capital
raised from third party investors and received by Upsilon RFO prior to December 31, 2013, which is
reflected on the Company’s consolidated balance sheet in other liabilities. The final amount raised by
Upsilon RFO, and the amount attributable to third party investors, will be determined during the first quarter
of 2014, following the completion of the underwriting portfolio and calculation of the total capital
requirements for Upsilon RFO, for risks incepting on or after January 1, 2014.

The shareholders (other than the Class A shareholder) participate in substantially all of the profits or losses
of Upsilon RFO while their shares remain outstanding. The shareholders (other than the Class A
shareholder) indemnify Upsilon RFO against losses relating to insurance risk and therefore these shares
have been accounted for as prospective reinsurance under FASB ASC Topic Financial Services -
Insurance. Both Upsilon RFO and the insurance participation are managed by RUM in return for an
expense override. Through RUM, the Company is eligible to receive a potential underwriting profit
commission in respect of Upsilon RFO. Upsilon RFO is considered a VIE and the Company is considered
the primary beneficiary. As a result, Upsilon RFO is consolidated by the Company and all significant inter-
company transactions have been eliminated.

Upsilon Re, Tim Re III and Upsilon RFO are each considered VIEs as they each have insufficient equity
capital to finance their activities without additional financial support. The Company is the primary
beneficiary of each of Upsilon Re, Tim Re III and Upsilon RFO as it: (i) has the power over the activities
that most significantly impact the economic performance of each of Upsilon Re, Tim Re III and Upsilon RFO
and (ii) has the obligation to absorb the losses, and right to receive the benefits, in accordance with the
accounting guidance, that could be significant to Upsilon Re, Tim Re III and Upsilon RFO, respectively. As
a result, the Company consolidates Upsilon Re, Tim Re III and Upsilon RFO and all significant inter-
company transactions have been eliminated. The Company has not provided financial or other support to
any of Upsilon Re, Tim Re III and Upsilon RFO that was not contractually required to be provided.

Mona Lisa Re Ltd. (“Mona Lisa Re”)

On March 14, 2013, Mona Lisa Re was licensed as a Bermuda domiciled SPI to provide reinsurance
capacity to subsidiaries of RenaissanceRe, namely Renaissance Reinsurance and DaVinci, through
reinsurance agreements which will be collateralized and funded by Mona Lisa Re through the issuance of
one or more series of principal-at-risk variable rate notes (“Notes”) to third-party investors.

Upon issuance of a series of Notes by Mona Lisa Re, all of the proceeds from the issuance are expected to
be deposited into collateral accounts, separated by series, to fund any potential obligation under the
reinsurance agreements entered into with Renaissance Reinsurance and/or DaVinci underlying such series
of Notes. The outstanding principal amount of each series of Notes generally will be returned to holders of
such Notes upon the expiration of the risk period underlying such Notes, unless an event occurs which
causes a loss under the applicable series of Notes, in which case the amount returned will be reduced by
such noteholder’s pro rata share of such loss, as specified in the applicable governing documents of such
Notes. In addition, holders of Notes are generally entitled to interest payments, payable quarterly, as
determined by the applicable governing documents of each series of Notes.

The Company concluded that Mona Lisa Re meets the definition of a VIE as it does not have sufficient
equity capital to finance its activities. Therefore, the Company evaluated its relationship with Mona Lisa Re
and concluded it does not have a variable interest in Mona Lisa Re. As a result, the financial position and
results of operations of Mona Lisa Re are not consolidated by the Company. At December 31, 2013, the
total assets and total liabilities of Mona Lisa Re were $209.6 million and $209.6 million, respectively.

F-58

The only transactions related to Mona Lisa Re that are recorded in the Company’s consolidated financial
statements are the ceded reinsurance agreements entered into by Renaissance Reinsurance and DaVinci
which are accounted for as prospective reinsurance under FASB ASC Topic Financial Services - Insurance.
During 2013, Renaissance Reinsurance and DaVinci have together entered into ceded reinsurance
contracts with Mona Lisa Re with gross premiums ceded of $9.2 million and $6.5 million, respectively.

NOTE 12. SHAREHOLDERS’ EQUITY

The aggregate authorized capital of RenaissanceRe is 325 million shares consisting of 225 million common
shares and 100 million preference shares. The following table is a summary of changes in common shares
issued and outstanding:

Year ended December 31,
(thousands of shares)
Issued and outstanding shares – January 1

Repurchase of shares
Exercise of options and issuance of restricted stock awards

Issued and outstanding shares – December 31

2013

2012

2011

45,542

(2,451)
555

43,646

51,543
(6,399)

398

45,542

54,110
(2,889)

322

51,543

The Board of Directors of RenaissanceRe declared, and RenaissanceRe paid, a dividend of $0.28 per
common share to shareholders of record on March 15, June 14, September 13 and December 13, 2013,
respectively. Dividends declared and paid on common shares amounted to $1.12 per common share for
the year ended December 31, 2013 (2012 - $1.08, 2011 - $1.04), or $49.3 million on all common shares
outstanding (2012 - $53.4 million, 2011 - $53.5 million).

The Company’s share repurchase program may be effected from time to time, depending on market
conditions and other factors, through open market purchases and privately negotiated transactions. Unless
terminated earlier by resolution of RenaissanceRe’s Board of Directors, the program will expire when the
Company has repurchased the full value of the shares authorized. The Company’s decision to repurchase
common shares will depend on, among other matters, the market price of the common shares and the
capital requirements of the Company. During the year ended December 31, 2013, the Company
repurchased an aggregate of 2.5 million shares in open market transactions and a privately negotiated
transaction at an aggregate cost of $207.9 million, and at an average share price of $84.80. On November
14, 2013, RenaissanceRe’s Board of Directors approved a renewal of the authorized share repurchase
program to an aggregate amount of $500.0 million. At December 31, 2013, $433.1 million remained
available for repurchase under the Board authorized share repurchase program. See “Note 23.
Subsequent Events” for additional information related to share repurchases subsequent to December 31,
2013 and an increase in the Company’s authorized share repurchase program.

In March 2004, RenaissanceRe raised $250.0 million through the issuance of 10 million Series C
Preference Shares at $25 per share; in December 2006, RenaissanceRe raised $300.0 million through the
issuance of 12 million Series D Preference Shares at $25 per share; and in May 2013, RenaissanceRe
raised $275.0 million through the issuance of 11 million Series E Preference Shares at $25 per share.
Offering expenses of $9.1 million related to the issuance of the Series E Preference Shares have been
included in additional paid in capital on the Company’s consolidated statements of changes in shareholders’
equity. On December 27, 2012, the Company redeemed 6 million Series D Preference Shares for $150.0
million plus accrued and unpaid dividends thereon. Following the redemption, 6 million Series D Preference
Shares remained outstanding. The proceeds of the issuance of the Series E Preference Shares were used
to redeem the remaining 6 million outstanding Series D Preference Shares and 5 million of the outstanding
Series C Preference Shares, as discussed below.

F-59

RenaissanceRe will be restricted from paying any dividends on its common shares. The preference shares
have no stated maturity and are not convertible into any other securities of RenaissanceRe. Generally, the
preference shares have no voting rights. Whenever dividends payable on the preference shares are in
arrears (whether or not such dividends have been earned or declared) in an amount equivalent to dividends
for six full dividend periods (whether or not consecutive), the holders of the preference shares, voting as a
single class regardless of class or series, will have the right to elect two directors to the Board of Directors
of RenaissanceRe.

In May 2013, RenaissanceRe announced a mandatory redemption of the remaining 6 million of its
outstanding Series D Preference Shares and on June 27, 2013 RenaissanceRe redeemed the remaining 6
million Series D Preference Shares called for redemption for $150.0 million million plus accrued and unpaid
dividends thereon. Following the redemption, no Series D Preference Shares remain outstanding. In
addition, in May 2013, RenaissanceRe announced a mandatory partial redemption of 5 million of its
outstanding Series C Preference Shares. The partial redemption was allocated by random lottery in
accordance with the Depository Trust Company’s rules and procedures and on June 27, 2013
RenaissanceRe redeemed the 5 million Series C Preference Shares called for redemption for $125.0 million
plus accrued and unpaid dividends thereon. Following the redemption, 5 million Series C Preference
Shares remain outstanding.

During the year ended December 31, 2013, RenaissanceRe declared and paid $24.9 million in preference
share dividends (2012 - $34.9 million, 2011 - $35.0 million).

NOTE 13. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per common share:

Year ended December 31,

(thousands of shares)
Numerator:

2013

2012

2011

Net income (loss) available (attributable) to RenaissanceRe

common shareholders

$ 665,676 $ 566,014 $

(92,235)

Amount allocated to participating common shareholders (1)

(9,520)

(8,973)

(990)

Net income (loss) allocated to RenaissanceRe common

shareholders

Denominator:

$ 656,156 $ 557,041 $

(93,225)

Denominator for basic income (loss) per RenaissanceRe
common share - weighted average common shares

Per common share equivalents of employee stock options

and restricted shares

Denominator for diluted income (loss) per RenaissanceRe
common share - adjusted weighted average common
shares and assumed conversions

Basic income (loss) per RenaissanceRe common share

Diluted income (loss) per RenaissanceRe common share

43,349

48,873

50,747

779

730

—

44,128

49,603

50,747

15.14 $

14.87 $

11.40 $

11.23 $

(1.84)

(1) Represents earnings attributable to holders of unvested restricted shares issued under the Company’s 2001 Stock Incentive Plan

and the Non-Employee Director Stock Incentive Plan.

F-60

NOTE 14. RELATED PARTY TRANSACTIONS AND MAJOR CUSTOMERS

During 2010, the Company issued a $5.0 million promissory note to THIG. Interest was due quarterly and
was accrued on the unpaid principal balance at LIBOR plus 6.0%. THIG could voluntarily prepay the loan in
whole, or in part, plus accrued interest, without premium or penalty at any time. During 2013, THIG repaid
the promissory note in full, and accordingly, the principal balance included in other assets on the
Company’s consolidated balance sheet at December 31, 2013 was $Nil (2012 - $4.0 million). Interest
income earned on the promissory note of $0.2 million (2012 - $0.3 million) is included in other income on
the Company’s consolidated statements of operations.

The Company has entered into reinsurance agreements with certain subsidiaries and affiliates of Tower Hill
and has also entered into reinsurance agreements with respect to business produced by the Tower Hill
Companies. For the year ended December 31, 2013, the Company recorded $46.7 million (2012 - $41.1
million, 2011 - $29.8 million) of gross premium written assumed from Tower Hill and its subsidiaries and
affiliates. Gross premiums earned totaled $44.9 million (2012 - $36.1 million, 2011 - $28.9 million) and
expenses incurred were $5.3 million (2012 - $3.9 million, 2011 - $3.3 million) for the year ended
December 31, 2013. The Company had a net related outstanding payable balance of $0.1 million as of
December 31, 2013 (2012 - receivable balance of $8.6 million). During 2013, the Company assumed net
claims and claims expenses of $4.1 million (2012 - assumed $4.0 million, 2011 - recovered $8.0 million)
and, as of December 31, 2013, had a net reserve for claims and claim expenses of $34.1 million (2012 -
$33.9 million). In addition, the Company received distributions of $9.8 million from THIG during 2013 (2012
- $9.5 million).

As a result of the transactions described in “Note 10. Noncontrolling Interests”, the Company has
cumulatively invested $10.5 million in Angus, representing a 42.5% equity interest, which is accounted for
under the equity method of accounting. Angus primarily provides commodity related risk management
products to third party customers. The Company had an outstanding net asset position of $Nil at
December 31, 2013 (2012 - net asset position of $1.6 million) related to certain derivative trades between
Angus and REAL, prior to the sale of REAL to Munich. For the year ended December 31, 2013, the
Company generated other income of $5.0 million (2012 - $7.9 million, 2011 - $3.4 million) associated with
Angus related transactions which is reflected in the Company’s discontinued operations with respect to
REAL.

During 2013, the Company received distributions from Top Layer Re of $Nil (2012 - $Nil, 2011 - $Nil), and a
management fee of $3.8 million (2012 - $4.1 million, 2011 - $3.7 million). The management fee reimburses
the Company for services it provides to Top Layer Re.

During 2013, the Company received 88.2% of its aggregate Catastrophe Reinsurance and Specialty
Reinsurance segments’ gross premiums written (2012 - 84.6%, 2011 - 90.7%) from three brokers.
Subsidiaries and affiliates of AON Benfield, Marsh Inc., and the Willis Group accounted for approximately
48.6%, 22.7% and 16.9%, respectively, of gross premiums written for the aggregate of the Catastrophe
Reinsurance and Specialty Reinsurance segments in 2013 (2012 - 51.5%, 21.4% and 11.7%, respectively,
2011 - 56.1%, 21.9% and 12.7%, respectively).

NOTE 15. TAXATION

Under current Bermuda law, RenaissanceRe and its Bermuda subsidiaries are not subject to any income or
capital gains taxes. In the event that such taxes are imposed, RenaissanceRe and its Bermuda
subsidiaries would be exempted from any such tax until March 2035 pursuant to the Bermuda Exempted
Undertakings Tax Protection Act 1966, and Amended Acts of 1987 and 2011, respectively.

RenRe North America Holdings Inc. (“RenRe North America”) and its subsidiaries are subject to income
taxes imposed by U.S. federal and state authorities and file a consolidated U.S. federal income tax return.
Should the U.S. subsidiaries pay a dividend to RenaissanceRe, withholding taxes would apply to the extent
of current year or accumulated earnings and profits. The Company also has operations in Ireland, the U.K.,
and Singapore which are subject to income taxes imposed by the respective jurisdictions in which they
operate.

The Company is not subject to income taxation other than as stated above. There can be no assurance
that there will not be changes in applicable laws, regulations or treaties, which might require the Company
to change the way it operates or become subject to taxation.

F-61

The following is a summary of the Company’s income (loss) from continuing operations before taxes
allocated between domestic and foreign operations:

Year ended December 31,
Domestic

Bermuda

Foreign

United Kingdom

U.S.

Ireland

Singapore

2013

2012

2011

873,103 $

795,378 $

18,308

(12,678)

(20,019)

1,855

(1,223)

(15,404)

(16,467)

3,318

(22,895)

(23,837)

(24)

—

Income (loss) from continuing operations before taxes

841,038 $

766,838 $

(28,448)

Income tax (expense) benefit is comprised as follows:

Year ended December 31, 2013

Total income tax (expense) benefit

Year ended December 31, 2012

Total income tax (expense) benefit

Year ended December 31, 2011

Total income tax benefit (expense)

Current

Deferred

Total

(2,005) $

313 $

(1,692)

(1,667) $

254 $

(1,413)

2,529 $

(12,914) $

(10,385)

The Company’s expected income tax provision computed on pre-tax income at the weighted average tax
rate has been calculated as the sum of the pre-tax income in each jurisdiction multiplied by that
jurisdiction’s applicable statutory tax rate. Statutory tax rates of 0.0%, 35.0%, 12.5%, 23.2% and 17.0%
have been used for Bermuda, the U.S., Ireland, the U.K. and Singapore, respectively.

The Company’s effective income tax rate, which it calculates as income tax expense divided by net income
before taxes, may fluctuate significantly from period to period depending on the geographic distribution of
pre-tax net income in any given period between different jurisdictions with comparatively higher tax rates
and those with comparatively lower tax rates. The geographic distribution of pre-tax income (loss) can vary
significantly between periods due to, but not limited to, the following factors: the business mix of net
premiums written and earned; the geographic location, the size and the nature of net claims and claim
expenses incurred; the amount and geographic location of operating expenses, net investment income, net
realized and unrealized gains (losses) on investments; outstanding debt and related interest expense; and
the amount of specific adjustments to determine the income tax basis in each of the Company’s operating
jurisdictions. In addition, a significant portion of the Company’s gross and net premiums are currently
written and earned in Bermuda, which does not have a corporate income tax, including the majority of the
Company’s catastrophe business, which can result in significant volatility to its pre-tax income (loss) in any
given period.

A reconciliation of the difference between the provision for income taxes and the expected tax provision at
the weighted average tax rate is as follows:

Year ended December 31,
Expected income tax benefit
Change in valuation allowance
Other

Income tax expense

2013

2012

9,930 $
(8,574)
(3,048)
(1,692) $

8,889 $
(6,212)
(4,090)
(1,413) $

2011
14,188
(21,976)
(2,597)
(10,385)

F-62

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and
deferred tax liabilities are presented below:

At December 31,
Deferred tax assets

Tax loss and credit carryforwards
Deferred interest expense
Investments
Deferred underwriting results
Amortization and depreciation
Accrued expenses

Deferred tax liabilities

Amortization and depreciation

Net deferred tax asset before valuation allowance
Valuation allowance
Net deferred tax asset (liability)

2013

2012

34,429 $
12,608
4,694
1,873
1,730
1,096
56,430

(155)
(155)
56,275
(56,106)

169 $

16,548
8,448
3,278
4,366
1,597
1,062
35,299

(369)
(369)
34,930
(35,074)
(144)

During 2013, the Company recorded a net increase to the valuation allowance of $21.0 million (2012 –
increase of $6.2 million, 2011 – increase of $25.3 million). The Company’s net deferred tax asset primarily
relates to net operating loss carryforwards and GAAP versus tax basis accounting differences relating to
interest expense, underwriting results, accrued expenses and investments. The Company’s U.S.
operations generated a cumulative GAAP taxable loss for the three year periods ended December 31, 2013
and 2012. Accordingly, the Company believes that it is more likely than not that the U.S. net deferred tax
asset will not be realized and as a result has provided a full valuation allowance against its U.S. net
deferred tax asset. In addition, a valuation allowance has been provided against deferred tax assets in
Ireland, the U.K., and Singapore. These deferred tax assets relate primarily to net operating loss
carryforwards and deferred underwriting results.

In the U.S., the Company has net operating loss carryforwards of $59.8 million. Under applicable law, the
U.S. net operating loss carryforwards will begin to expire in 2031. In Ireland, the Company has net
operating loss carryforwards of $11.5 million. In the U.K., the Company has net operating loss
carryforwards of $41.7 million. In Singapore, the Company has net operating loss carryforwards of $1.3
million. Under applicable law, the Irish, U.K. and Singapore net operating losses can be carried forward for
an indefinite period.

The Company had a net payment for U.S. federal, Irish, U.K. and Singapore income taxes of $1.2 million for
the year ended 2013 (2012 – net refund of $13.2 million, 2011 – net payment of $11.0 million).

The Company has unrecognized tax benefits of $Nil as of December 31, 2013 (2012 – $Nil). Interest and
penalties related to unrecognized tax benefits would be recognized in income tax expense. At
December 31, 2013, interest and penalties accrued on unrecognized tax benefits were $Nil. Income tax
returns filed for tax years 2009 through 2012, 2009 through 2012, 2012 and 2012, are open for examination
by the Internal Revenue Service, Irish tax authorities, U.K. tax authorities, and Singapore tax authorities,
respectively. The Company does not expect the resolution of these open years to have a significant impact
on its results from operations and financial condition.

NOTE 16. SEGMENT REPORTING

In conjunction with changes in the Company’s management structure during 2013, including the
appointment of a new Chief Executive Officer, and with changes in the mix of the Company’s reinsurance
business, the Company revised its reportable segments to: (1) Catastrophe Reinsurance, which includes
catastrophe reinsurance and certain property catastrophe joint ventures managed by the Company’s
ventures unit; (2) Specialty Reinsurance, which includes specialty reinsurance and certain specialty joint
ventures managed by the Company’s ventures unit; and (3) Lloyd’s, which includes reinsurance and

F-63

insurance business written through Syndicate 1458. RenaissanceRe CCL, an indirect wholly owned
subsidiary of RenaissanceRe, is the sole corporate member of Syndicate 1458. Previously, the Company
disclosed Reinsurance and Lloyd’s as its reportable segments. All prior periods presented have been
reclassified to conform to this presentation.

The financial results of the Company’s strategic investments, former Insurance segment, discontinued
operations related to REAL and current noncontrolling interests are included in the Other category of the
Company’s segment results. Also included in the Other category of the Company’s segment results are the
Company’s investments in other ventures, investments unit, corporate expenses and capital servicing costs.

The Company does not manage its assets by segment; accordingly, net investment income and total assets
are not allocated to the segments.

A summary of the significant components of the Company’s revenues and expenses is as follows:

Year ended December 31, 2013

Catastrophe
Reinsurance

Specialty
Reinsurance

Lloyd’s

Other

Total

Gross premiums written (1)

$ 1,120,379

$ 259,489

$ 226,532

$ 753,078

$ 248,562

$ 201,697

$ 723,705

$ 214,306

$ 176,029

7,908

49,161

108,130

67,236

41,538

31,780

95,693

34,823

50,540

$ 558,506

73,752

(5,027)

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Underwriting income (loss)

Net investment income

Net foreign exchange gains

Equity in earnings of other ventures

Other loss

Net realized and unrealized gains on investments

Corporate expenses

Interest expense

Income from continuing operations before taxes

Income tax expense

Income from discontinued operations

Net income attributable to noncontrolling interests

Dividends on preference shares

Net income available to RenaissanceRe

common shareholders

(988)

$1,605,412

610

586

450

(21)

655

(498)

208,028

1,917

23,194

(2,359)

35,076

(33,622)

(17,929)

(1,692)

2,422

$1,203,947

$1,114,626

171,287

125,501

191,105

626,733

208,028

1,917

23,194

(2,359)

35,076

(33,622)

(17,929)

841,038

(1,692)

2,422

(151,144)

(24,948)

$ 665,676

Net claims and claim expenses incurred – current

accident year

$ 109,945

$ 101,347

$ 103,949

Net claims and claim expenses incurred – prior

accident years

(102,037)

(34,111)

(8,256)

Net claims and claim expenses incurred – total

7,908

67,236

95,693

— $ 315,241

450

(143,954)

$ 171,287

Net claims and claim expense ratio – current

accident year

Net claims and claim expense ratio – prior

accident years

Net claims and claim expense ratio – calendar

year

Underwriting expense ratio

Combined ratio

15.2 %

47.3 %

59.1 %

—%

28.3 %

(14.1)%

(15.9)%

(4.7)%

76.8%

(12.9)%

1.1 %

21.7 %

22.8 %

31.4 %

34.2 %

65.6 %

54.4 %

48.5 %

102.9 %

76.8%

108.2%

185.0%

15.4 %

28.4 %

43.8 %

(1) Included in gross premiums written in the Other category is inter-segment gross premiums written of $1.0 million.

F-64

Year ended December 31, 2012

Catastrophe
Reinsurance

Specialty
Reinsurance

Lloyd’s

Other

Total

Gross premiums written (1)

$ 1,182,207

$ 209,887

$ 159,987

(490)

$1,551,591

(61)

(36)

$1,102,657

$1,069,355

$ 766,035

$ 201,552

$ 135,131

$ 781,738

$ 164,685

$ 122,968

165,209

66,665

103,811

76,813

23,826

29,124

80,242

22,864

45,680

2,947

187

536

$ 446,053

34,922

$ (25,818)

(3,706)

165,725

5,319

23,238

(2,120)

325,211

113,542

179,151

451,451

165,725

5,319

23,238

(2,120)

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Underwriting income (loss)

Net investment income

Net foreign exchange gains

Equity in earnings of other ventures

Other loss

Net realized and unrealized gains on investments

Net other-than-temporary impairments

Corporate expenses

Interest expense

Income from continuing operations before taxes

Income tax expense

Loss from discontinued operations

Net income attributable to noncontrolling interests

Dividends on preference shares

Net income attributable to RenaissanceRe

common shareholders

163,121

(343)

(16,456)

(23,097)

(1,413)

(16,476)

(343)

(16,456)

(23,097)

766,838

(1,413)

(16,476)

(148,040)

(34,895)

$ 566,014

Net claims and claim expenses incurred – current

accident year

$ 275,777

$ 110,959

96,444

Net claims and claim expenses incurred – prior

accident years

(110,568)

(34,146)

(16,202)

Net claims and claim expenses incurred – total

$ 165,209

76,813

80,242

—

$ 483,180

2,947

(157,969)

$ 325,211

Net claims and claim expense ratio – current

accident year

Net claims and claim expense ratio – prior

accident years

Net claims and claim expense ratio – calendar

year

Underwriting expense ratio

Combined ratio

35.3 %

67.4 %

78.4 %

— %

45.2 %

(14.2)%

(20.8)%

(13.1)%

(8,186.1)%

(14.8)%

21.1 %

21.8 %

42.9 %

46.6 %

32.2 %

78.8 %

65.3 %

55.7 %

(8,186.1)%

(2,008.3)%

121.0 % (10,194.4)%

30.4 %

27.4 %

57.8 %

(1) Included in gross premiums written in the Other category is inter-segment gross premiums written of $0.5 million.

F-65

Year ended December 31, 2011

Gross premiums written (1)

Net premiums written

Net premiums earned

Net claims and claim expenses incurred

Acquisition expenses

Operational expenses

Underwriting (loss) income

Net investment income

Net foreign exchange losses

Equity in losses of other ventures

Other income

Net realized and unrealized gains on investments

Net other-than-temporary impairments

Corporate expenses

Interest expense

Loss from continuing operations before taxes

Income tax expense

Loss from discontinued operations

Loss attributable to redeemable noncontrolling

interest – DaVinciRe

Dividends on preference shares

Net loss attributable to RenaissanceRe common

shareholders

Catastrophe
Reinsurance

Specialty
Reinsurance

$ 1,177,296

$ 145,891

$ 773,560

$ 139,939

$ 737,545

$ 135,543

770,350

62,882

100,932

13,354

20,096

30,319

Lloyd’s

111,584

98,617

76,386

73,259

14,031

36,732

Other

Total

205

657

1,575

4,216

367

1,678

$1,434,976

$1,012,773

$ 951,049

861,179

97,376

169,661

$ (196,619)

71,774

(47,636)

(4,686)

(177,167)

146,871

(7,844)

(36,533)

44,345

43,956

(552)

(18,156)

(23,368)

(10,385)

(51,559)

33,157

(35,000)

146,871

(7,844)

(36,533)

44,345

43,956

(552)

(18,156)

(23,368)

(28,448)

(10,385)

(51,559)

33,157

(35,000)

$ (92,235)

Net claims and claim expenses incurred – current

accident year

$ 829,487

91,115

72,781

(215)

$ 993,168

Net claims and claim expenses incurred – prior

accident years

(59,137)

(77,761)

478

Net claims and claim expenses incurred – total

$ 770,350

13,354

73,259

4,431

4,216

(131,989)

$ 861,179

Net claims and claim expense ratio – current

accident year

Net claims and claim expense ratio – prior

accident years

Net claims and claim expense ratio – calendar

year

Underwriting expense ratio

Combined ratio

112.5 %

67.2 %

95.3%

(13.7)%

104.4 %

(8.1)%

(57.3)%

0.6%

281.4 %

(13.8)%

104.4 %

22.3 %

126.7 %

9.9 %

37.1 %

47.0 %

95.9%

66.5%

162.4%

267.7 %

130.1 %

397.8 %

90.6 %

28.0 %

118.6 %

(1) Included in gross premiums written in the Other category is inter-segment gross premiums written of $0.1 million.

F-66

The following is a summary of the Company’s gross premiums written allocated to the territory of coverage
exposure:

Year ended December 31,
Catastrophe Reinsurance
U.S. and Caribbean
Worldwide (excluding U.S.) (1)
Worldwide
Japan
Europe
Australia and New Zealand
Other

Total Catastrophe Reinsurance
Specialty Reinsurance

Worldwide
U.S. and Caribbean
Australia and New Zealand
Europe
Worldwide (excluding U.S.) (1)
Other

Total Specialty Reinsurance
Lloyd’s

Worldwide
U.S. and Caribbean
Europe
Worldwide (excluding U.S.) (1)
Australia and New Zealand
Other
Total Lloyd’s
Other category (2)

Total gross premiums written

2013

2012

2011

782,211 $
146,048
99,179
39,060
25,659
22,460
5,762
1,120,379

857,740 $
139,265
81,595
43,238
37,113
18,578
4,678
1,182,207

786,721
164,112
124,797
49,021
31,888
16,818
3,939
1,177,296

151,879
91,203
12,068
2,612
1,661
66
259,489

96,081
69,070
28,307
16,429
—
—
209,887

91,032
49,832
792
3,595
—
640
145,891

104,249
88,535
14,763
8,071
2,948
7,966
226,532
(988)

47,605
48,435
8,044
238
2,060
5,202
111,584
205
$ 1,605,412 $ 1,551,591 $ 1,434,976

75,132
57,332
14,456
6,064
2,152
4,851
159,987
(490)

(1) The category “Worldwide (excluding U.S.)” consists of contracts that cover more than one geographic region (other than the

U.S.). The exposure in this category for gross premiums written to date is predominantly from Europe and Japan.

(2) The Other category consists of contracts that are primarily exposed to U.S. risks and includes inter-segment gross premiums

written of $1.0 million for the year ended December 31, 2013 (2012 - $0.5 million, 2011 - $0.1 million).

NOTE 17. STOCK INCENTIVE COMPENSATION AND EMPLOYEE BENEFIT PLANS

2001 Stock Incentive Plan and Non-Employee Director Stock Incentive Plan

The Company has a stock incentive plan (the “2001 Stock Incentive Plan”) under which employees of
RenaissanceRe and its subsidiaries may be granted stock options and restricted stock awards. A stock
option award under the Company’s 2001 Stock Incentive Plan allows for the purchase of RenaissanceRe’s
common shares at a price that is equal to the fair market value of RenaissanceRe’s common shares as of
the grant effective date. Options to purchase common shares are granted periodically by the Board of
Directors, generally vest over four years and generally expire 10 years from the date of grant. Restricted
common shares are granted periodically by the Board of Directors and generally vest ratably over a four
year period. The Company has also established a Non-Employee Director Stock Incentive Plan to issue
stock options and shares of restricted stock to RenaissanceRe’s non-employee directors. The Company’s
2001 Stock Incentive Plan also allows for the issuance of share-based awards, the issuance of restricted
common shares and the issuance of shares tendered in connection with option exercises. For purposes of
determining the number of shares reserved for issuance under the 2001 Stock Plan, shares tendered to or

F-67

withheld by the Company in connection with certain option exercises will again be available for issuance.
The 2001 Stock Incentive Plan expires on February 6, 2016.

Premium Option Plan

In August 2004, RenaissanceRe’s shareholders approved the 2004 Stock Option Incentive Plan (the
“Premium Option Plan”) under which 6.0 million common shares were reserved for issuance upon the
exercise of options granted under the Premium Option Plan. On August 15, 2007, the Company terminated
the Premium Option Plan, such that no further option grants will be made thereunder. However, options
outstanding at the time of the termination will, unless otherwise subsequently amended pursuant to the
terms of the Premium Option Plan, remain outstanding and unmodified until they expire, subject to the
terms of the Premium Option Plan and any applicable award agreement. The Premium Option Plan
provides for, among other things, mandatory premium pricing such that options can generally only be issued
thereunder with a strike price at a minimum of 150% of the fair market value on the date of grant, minimum
five year cliff vesting (subject to waiver by the compensation committee of the Board of Directors), and no
discretionary repricing. The Premium Option Plan includes a dividend protection feature that reduces the
strike price for extraordinary dividends and a change in control feature that reduces the strike price based
on a pre-established formula in the event of a change in control. Other terms are substantially similar to the
2001 Stock Incentive Plan. The Premium Option Plan expires on May 20, 2014.

2010 Cash Settled Restricted Stock Unit Plan

In 2010, the Company instituted a restricted stock unit plan (the “2010 Cash Settled Restricted Stock Unit
Plan”) allowing for the issuance of equity awards in the form of restricted stock units which will, subject to
vesting requirements consistent with those utilized by the Company in respect of restricted shares, be
settled in cash. Restricted stock units are liability awards with fair value measurement based on the market
price of RenaissanceRe common shares at the end of each reporting period. Restricted share units are
granted periodically by the Board of Directors and generally vest ratably over a four year period. During
2010, there were 900,000 restricted stock units reserved under the 2010 Cash Settled Restricted Stock Unit
Plan.

2010 Performance-Based Equity Incentive Plan

In May 2010, RenaissanceRe’s shareholders approved the 2010 Performance-Based Equity Incentive Plan
(“2010 Performance Plan”) under which 750,000 shares have been reserved (the “Performance Shares”).
The Compensation Committee determined that, beginning in 2010 with the Company’s annual target-level
incentive award grant cycle, 25% of the annual equity incentive award grants to each member of
RenaissanceRe’s Executive Committee, which includes the Company’s Named Executive Officers
excluding the Chief Executive Officer (“CEO”), will be subject to vesting conditions based on both continued
service and the attainment of pre-established performance goals. If performance goals are achieved, the
Performance Shares will vest up to a maximum of 250% of target. The 2010 grants vest over a period of
three years and are based on annual performance periods. All subsequent grants cliff vest at the end of a
three year vesting period. The Performance Shares have a market condition which is the Company’s total
shareholder return relative to its peer group. Total shareholder return is based on the average closing share
price over the 20 trading days preceding and including the start and end of the performance period.

The former CEO, who will retire on February 22, 2014, received 100% of a special retention award in the
form of Performance Shares in 2010. If performance goals are achieved, the Performance Shares for the
former CEO will vest up to a maximum of 175% of target. This grant vests ratably over a period of four
years ending December 31, 2013 and is based on annual performance periods with the final tranche
pending approval by the Company’s Compensation Committee. Although the former CEO retires February
22, 2014, the vesting of his other outstanding performance shares will continue under the original terms of
the awards with the exception of vesting at the end of each applicable performance period, which had been
provided in accordance with his employment agreement, as amended and restated April 5, 2013.

The current CEO received a special performance award on his promotion to CEO effective July 1, 2013.
The special equity award was issued in the form restricted stock and performance shares. The conditions
attached to the restricted stock awards are identical to the conditions under the 2001 Stock Incentive Plan
and the Non-Employee Director Stock Incentive Plan. If performance goals are achieved, the Performance

F-68

Shares for the current CEO will vest up to a maximum of 250% of target. This grant vests over a period of
four years, ending December 2016, and is based on annual performance periods.

Valuation Assumptions

Performance Shares

The fair value of the Performance Shares is measured on the date of grant using a Monte Carlo simulation
model which requires certain of the same inputs underlying the Black-Scholes methodology, that being:
share price; expected volatility; expected term; expected dividend yield; and risk-free interest rates. The
following are the weighted average-assumptions used to estimate the fair value for all Performance Shares
issued in each respective year.

Year ended December 31,
Expected volatility (1)

Expected term (in years)

Expected dividend yield

Risk-free interest rate (1)

Performance Shares

2013

2012

19.0% - 19.6% 19.8% - 24.4%

n/a

0.09% - 1.39% 0.16% - 0.64%

(1) The expected volatility and risk-free interest rate applied are specific to each tranche of Performance Shares.

Expected volatility: The expected volatility is estimated by the Company based on RenaissanceRe’s
historical stock volatility.

Expected term: The expected term is not applicable as the length of the performance periods are fixed and
not subject to future employee behavior. Each tranche of the Performance Shares has a one year period
during which performance is measured.

Expected dividend yield: The expected dividend yield is not applicable to Performance Shares as dividends
are paid at the end of the vesting period and do not affect the value of the Performance Shares.

Risk-free interest rate: The risk free rate is estimated based on the yield on a U.S. treasury zero-coupon
issued with a remaining term equal to the vesting period of the Performance Shares.

The total cost of the Performance Shares is determined on the grant date based on the fair value calculated
by the Monte Carlo simulation model. The Company recognizes cost equal to fair value per Performance
Share multiplied by the target number of Performance Shares on the grant date. The cost is then
recognized over the requisite service period net of estimated service-based forfeitures. When estimating
forfeitures, the Company considers its historical forfeitures as well as expectations about employee
behavior. For the year ended December 31, 2013, the Company used a 0% forfeiture rate for performance
shares (2012 - 0%).

Restricted Shares

The fair value of restricted shares is determined based on the market value of the Company’s shares on the
grant date. The estimated fair value of restricted shares, net of estimated forfeitures, is amortized as an
expense over the requisite service period. When estimating forfeitures, the Company considers its
historical forfeitures as well as expectations about employee behavior. For the year ended December 31,
2013, the Company used a 2% forfeiture rate for restricted shares (2012 - 8%).

CSRSUs

CSRSUs are revalued at the end of each quarterly reporting period based on the then value of
RenaissanceRe’s stock price. The total cost is adjusted each quarter for unvested CSRSUs to reflect the
current share price, and this total cost is amortized as an expense over the requisite service period, net of
estimated forfeitures. When estimating forfeitures, the Company considers its historical forfeitures as well
as expectations about employee behavior. For the year ended December 31, 2013, the Company used a
13% forfeiture rate for its CSRSUs (2012 - 8%).

F-69

Summary of Stock Compensation Activity

The following is a summary of activity under the Company’s existing stock compensation plans.

2001 Stock Incentive and Non-Employee Director Stock Incentive Plans

Weighted
options
outstanding

Weighted
average
exercise
price

Weighted
average
remaining
contractual
life

Aggregate
intrinsic
value

Range of
exercise prices

Balance, December 31, 2010

2,841,335

$ 47.28

4.8

$ 46,616

$33.85 – $59.66

Options granted
Options forfeited
Options expired
Options exercised

—

(40,010)

(4,404)

(823,614)

—

52.68

53.86

46.88

$ 18,155

—

Balance, December 31, 2011

1,973,307

$ 47.33

4.6

$ 53,363

$37.51 - $59.66

Options granted
Options forfeited
Options expired
Options exercised

—

(240,668)

45.30

7,910

—

Balance, December 31, 2012

1,732,639

$ 47.61

3.7

$ 58,305

$37.51 - $59.66

Options granted
Options forfeited
Options expired
Options exercised

Balance, December 31, 2013
Total options exercisable at

December 31, 2013

Premium Option Plan

—

(904,547) $ 46.55

$ 36,800

828,092

$ 48.77

2.9

$ 40,221

$37.51 - $59.66

828,092

$ 48.77

2.9

$ 40,221

$37.51 - $59.66

Balance, December 31, 2010

1,192,000

$ 73.94

— $73.06 – $74.24

Weighted
options
outstanding

Weighted
average
exercise
price

Weighted
average
remaining
contractual
life

Aggregate
intrinsic
value

Range of
exercise
prices

Options granted
Options forfeited
Options expired
Options exercised

—

Balance, December 31, 2011

1,192,000

$ 73.94

— $73.06 - $74.24

Options granted
Options forfeited
Options expired
Options exercised

Balance, December 31, 2012

Options granted
Options forfeited
Options expired
Options exercised

Balance, December 31, 2013
Total options exercisable at

December 31, 2013

—

(350,000)

74.24

842,000

$ 73.82

—

1,250

6,265

$73.06 - $74.24

(270,000)

74.24

4,921

572,000

$ 73.62

1.1

$ 13,567

$73.06 - $74.24

572,000

$ 73.62

1.1

$ 13,567

$73.06 - $74.24

F-70

The Premium Option Plan was terminated, as to new issuances, at the August 2007 Board of Directors
meeting and consequently, the shares available for grant under the plan are zero.

2010 Cash Settled Restricted Stock Unit Plan and 2010 Performance-Based Equity Incentive Plan

Nonvested at December 31, 2010

Awards granted
Awards vested
Awards forfeited

Nonvested at December 31, 2011

Awards granted
Awards vested
Awards forfeited

Nonvested at December 31, 2012

Awards granted
Awards vested
Awards forfeited

Nonvested at December 31, 2013

Cash Settled
Restricted
Stock
Unit Plan

Number of
shares
371,788
215,711
(98,676)
(65,850)
422,973
225,105
(128,401)
(26,121)
493,556
149,760
(176,265)
(72,906)
394,145

Performance Shares (1)

Weighted
average
grant-dated
fair value

Number of
shares
275,813 $
89,037 $
(63,562)
(11,421)
289,867 $
144,635 $
(70,843)
(4,139)
359,520 $
134,358 $
(24,606)
(109,729)
359,543 $

56.76
79.83

63.24
70.43

67.31
83.64

73.23

(1) For Performance Shares, the number of shares is stated at the maximum number that can be attained if the performance
conditions are fully met. Forfeitures represent shares forfeited due to vesting below the maximum attainable as a result of the
Company not fully meeting the performance conditions.

Restricted Stock

Nonvested at December 31,

2010
Awards granted
Awards vested
Awards forfeited

Nonvested at December 31,

2011
Awards granted
Awards vested
Awards forfeited

Nonvested at December 31,

2012
Awards granted
Awards vested
Awards forfeited

Nonvested at December 31,

2013

Employee
restricted stock

Non-employee director
restricted stock

Total
restricted stock

Weighted
average
grant-
dated fair
value

Number of
shares

Weighted
average
grant-
dated fair
value

Number of
shares

Weighted
average
grant-
dated fair
value

Number of
shares

1,004,426 $ 48.93
66.21
48.74
47.71

200,745
(362,234)
(78,176)

42,808 $ 51.38
66.21
18,272
50.66
(21,495)
—
—

1,047,234 $ 49.03
66.21
48.84
47.71

219,017
(383,729)
(78,176)

764,761 $ 53.68
72.46
226,827
51.06
(337,683)
53.90
(7,157)

646,748 $ 61.63
87.85
241,071
55.63
(311,334)
58.14
(6,993)

39,585 $ 58.43
71.69
16,874
54.62
(20,536)
—
—

35,923 $ 66.83
87.40
17,162
66.06
(21,599)
—
—

804,346 $ 53.91
72.40
243,701
51.26
(358,219)
53.90
(7,157)

682,671 $ 61.90
87.82
258,233
56.31
(332,933)
58.14
(6,993)

569,492 $ 76.11

31,486 $ 78.57

600,978 $ 76.24

F-71

Shares available for issuance under the Company’s 2001 Stock Incentive Plan, Non-Employee Director
Stock Incentive Plan and 2010 Performance Share Plan totaled 3.0 million in the aggregate at
December 31, 2013. The total fair value of shares and share units vested during the year ended
December 31, 2013 was $47.0 million (2012 – $43.3 million, 2011 – $36.5 million). Cash in the amount of
$1.6 million was received from employees as a result of employee stock option exercises during the year
ended December 31, 2013 (2012 – $0.9 million, 2011 – $0.1 million). In connection with share vestings and
option exercises, there was no excess windfall tax benefit realized by the Company due to its net operating
loss position in the taxable jurisdictions in which it operates. RenaissanceRe issues new shares upon the
exercise of an option.

The total stock compensation expense recognized in the Company’s consolidated statements of operations
for the year ended December 31, 2013 was $43.4 million (2012 – $38.4 million, 2011 – $33.1 million). As of
December 31, 2013, there was $26.4 million of total unrecognized compensation cost related to restricted
stock awards, $25.2 million related to restricted stock units and $4.8 million related to performance shares
expense, which will be recognized, on a weighted average, during the next 1.8, 1.6 and 1.9 years,
respectively.

All of the Company’s employees are eligible for defined contribution pension plans. Contributions are
primarily based upon a percentage of eligible compensation. The Company contributed $3.5 million to its
defined contribution pension plans in 2013 (2012 – $3.4 million, 2011 – $3.2 million).

NOTE 18. STATUTORY REQUIREMENTS

The Company’s insurance operations are subject to insurance laws and regulations in the jurisdictions in
which they operate, the most significant of which currently include Bermuda and the U.K. These regulations
include certain restrictions on the amount of dividends or other distributions, such as loans or cash
advances, available to shareholders without prior approval of the respective regulatory authorities.

The actual statutory capital and surplus, required statutory capital and surplus and restricted net assets of
the Company’s regulated insurance operations in its most significant regulatory jurisdictions are detailed
below:

At December 31,
Actual statutory capital and surplus

Required statutory capital and surplus

Restricted net assets

Bermuda

U.K. (1) (2)

2013

2012

$ 3,194,446 $ 3,061,736 $

562,126

887,083

554,809

784,693

2013
380,336 $

380,336

—

2012
293,519

293,519

—

(1) With respect to actual and required statutory capital and surplus, and as described below, underwriting capacity of a member of

Lloyd’s must be supported by providing a deposit in the form of cash, securities or letters of credit, which are referred to as Funds
at Lloyd’s (“FAL”). FAL is determined by Lloyd’s and is based on Syndicate 1458’s solvency and capital requirements as
calculated through its internal model.

(2) Syndicate 1458 is capitalized by its FAL, with the related assets not held on its balance sheet. As such, restricted net assets is

not applicable to Syndicate 1458; however, the Company can make an application to obtain approval from Lloyd’s to have funds
released to RenaissanceRe from Syndicate 1458, subject to passing a Lloyd’s release test.

Statutory net income (loss) of the Company’s regulated insurance operations in its most significant
regulatory jurisdictions are detailed below:

Year ended December 31, 2013

Year ended December 31, 2012

Year ended December 31, 2011

Statutory Net Income (Loss)

Bermuda

U.K.

712,820 $

7,745

693,887

(44,327)

(10,967)

(33,442)

The difference between statutory financial statements and statements prepared in accordance with GAAP
vary by jurisdiction; however, the primary difference is that for the Company’s regulated entities the
statutory financial statements do not reflect deferred acquisition costs.

F-72

The Company does not currently have any U.S. based insurance subsidiaries that would be subject to
statutory accounting practices as defined by the National Association of Insurance Commissioners. In
addition, none of the Company’s insurance subsidiaries used permitted practices that prevented the trigger
of a regulatory event during the years ended December 31, 2013 and 2012.

Bermuda-Based Insurance Entities

Under the Insurance Act 1978, amendments thereto and related regulations of Bermuda (collectively, the
“Insurance Act”), certain subsidiaries of RenaissanceRe are required to prepare statutory financial
statements and to file in Bermuda a statutory financial return. The Insurance Act also requires these
Bermuda insurance subsidiaries of RenaissanceRe to maintain certain measures of solvency and liquidity.

Class 3B and Class 4 Insurers

Under the Insurance Act, RenaissanceRe Specialty Risks and RenaissanceRe Specialty U.S. are defined
as Class 3B insurers, and Renaissance Reinsurance and DaVinci are classified as Class 4 insurers, and
therefore must maintain capital at a level equal to its enhanced capital requirement (“ECR”) which is
established by reference to the Bermuda Solvency Capital Requirement (the “BSCR”) model. The BSCR is
a mathematical model designed to give the Bermuda Monetary Authority (“BMA”) robust methods for
determining an insurer’s capital adequacy. Underlying the BSCR is the belief that all insurers should
operate on an ongoing basis with a view to maintaining their capital at a prudent level in excess of the
minimum solvency margin otherwise prescribed under the Insurance Act. Alternatively, under the Insurance
Act, insurers may, subject to the terms of the Insurance Act and to the BMA’s oversight, elect to utilize an
approved internal capital model to determine regulatory capital. In either case, ECR shall at all times equal
or exceed the respective Class 3B and Class 4 insurer’s minimum solvency margin and may be adjusted in
circumstances where the BMA concludes that the insurer’s risk profile deviates significantly from the
assumptions underlying its ECR or the insurer’s assessment of its risk management policies and practices
used to calculate ECR applicable to it. While not specifically referred to in the Insurance Act, the BMA has
also established a target capital level (“TCL”) for each Class 3B and Class 4 insurer equal to 120% of its
respective ECR. While a Class 3B and Class 4 insurer is not currently required to maintain its statutory
capital and surplus at this level, the TCL serves as an early warning tool for the BMA and failure to maintain
statutory capital at least equal to the TCL will likely result in increased BMA regulatory oversight.

Class 3B and Class 4 insurers are prohibited from declaring or paying any dividends if in breach of the
required minimum solvency margin or minimum liquidity ratio (the “Relevant Margins”) or if the declaration
or payment of such dividend would cause the insurer to fail to meet the Relevant Margins. Where an insurer
fails to meet its Relevant Margins on the last day of any financial year, it is prohibited from declaring or
paying any dividends during the next financial year without the prior approval of the BMA. Further, Class 3B
and Class 4 insurers are prohibited from declaring or paying in any financial year dividends of more than
25% of its total statutory capital and surplus (as shown on its previous financial year’s statutory balance
sheet) unless it files (at least seven days before payment of such dividends) with the BMA an affidavit
stating that it will continue to meet its Relevant Margins. Class 3B and Class 4 insurers must obtain the
BMA’s prior approval for a reduction by 15% or more of the total statutory capital as set forth in its previous
year’s financial statements. These restrictions on declaring or paying dividends and distributions under the
Insurance Act are in addition to the solvency requirements under the Bermuda Companies Act 1981 which
apply to all Bermuda companies.

The Company is currently completing its 2013 Bermuda-based statutory filings for Renaissance
Reinsurance, DaVinci, RenaissanceRe Specialty Risks and RenaissanceRe Specialty U.S., which must be
filed with the BMA on or before April 30, 2014, and at this time, the Company believes each of Renaissance
Reinsurance, DaVinci, RenaissanceRe Specialty Risks and RenaissanceRe Specialty U.S. will exceed the
target level of required statutory capital.

For the years ended December 31, 2013 and 2012, Renaissance Reinsurance submitted applications to the
BMA, and received approval, to exempt it from recording and recognizing certain third party guarantees as
statutory liabilities and corresponding reductions of statutory capital and surplus for purposes of filing its
statutory financial statements. The maximum monetary impact of including the third party guarantees in
Renaissance Reinsurance’s statutory financial statements at December 31, 2013 would be an increase to
statutory liabilities of $168.0 million (2012 - $113.0 million), and a corresponding decrease to statutory
capital and surplus. If these amounts were to be included in Renaissance Reinsurance’s statutory financial

F-73

statements, Renaissance Reinsurance would still exceed the required measures of solvency and liquidity,
and the target level of required statutory capital, as discussed above.

In addition, RenaissanceRe Specialty Risks is also eligible as an excess and surplus lines insurer in a
number of states in the U.S. and under the various capital and surplus requirements in these states is
required to maintain a minimum amount of capital and surplus. In this regard, the declaration of dividends
from retained earnings and distributions from additional paid-in capital may be limited to the extent that the
applicable above requirements are not met. The Company does not consider these requirements to be
material.

SPIs

Under the Insurance Act, Upsilon Re, Tim Re III and Upsilon RFO are considered SPIs. See “Note 11.
Variable Interest Entities” for additional information related to these entities. Unlike other (re)insurers, such
as the Class 3B and Class 4 insurers discussed above, SPIs are fully funded to meet their (re)insurance
obligations and are not exposed to insolvency, therefore the application and supervision processes are
streamlined to facilitate the transparent structure. Further, SPIs are currently not required to file annual loss
reserve specialist opinions and the BMA has the discretion to modify such insurer’s reporting requirements
under the Insurance Act. Like other (re)insurers, the principal representative of an SPI has a duty to inform
the BMA in relation to solvency matters, where applicable. In December 2013, the BMA issued a notice in
which it proposed to amend the reporting requirements for SPIs. Under this notice, the BMA will likely
require SPI’s to submit additional schedules together with the existing statutory financial return. These
enhancements are likely to be effective for the 2013 statutory financial return, to be filed on or before
April 30, 2014. The Company currently has in place directions from the BMA that would exempt each of
Upsilon Re, Tim Re III and Upsilon RFO from the proposed enhanced filing requirements.

U.K.-Based Syndicate 1458

RenaissanceRe CCL and Syndicate 1458 are subject to oversight by the Council of Lloyd’s. RSML is
authorized by the U.K.’s Prudential Regulation Authority and regulated by the Financial Conduct Authority
under the Financial Services and Markets Act 2000. Underwriting capacity of a member of Lloyd’s must be
supported by providing a deposit in the form of cash, securities or letters of credit, which are referred to as
FAL. This amount is determined by Lloyd’s and is based on Syndicate 1458’s solvency and capital
requirement as calculated through its internal model. In addition, if the FAL are not sufficient to cover all
losses, the Lloyd’s Central Fund provides an additional level of security for policyholders.

Singapore-Based Entities

A branch of Renaissance Reinsurance based in the Republic of Singapore (the “Singapore Branch”)
received a license to carry on insurance business as a general reinsurer on October 28, 2013. The
activities of the Singapore Branch are primarily regulated by the Monetary Authority of Singapore pursuant
to Singapore’s Insurance Act. Additionally, the Singapore Branch is regulated by the Accounting and
Corporate Regulatory Authority as a foreign company pursuant to Singapore’s Companies Act. Prior to the
establishment of the Singapore Branch, Renaissance Reinsurance had maintained a representative office
in Singapore since April 2012. The activities and regulatory requirements of the Singapore Branches are
not considered to be material to the Company.

Dividend Restrictions of RenaissanceRe

As a Bermuda-domiciled holding company, RenaissanceRe has limited operations of its own and its assets
consist primarily of investments in subsidiaries, and to a degree, cash and securities. Accordingly,
RenaissanceRe’s future cash flows largely depend on the availability of dividends or other statutorily
permissible payments from subsidiaries. The ability to pay such dividends is limited by the applicable laws
and regulations of the various countries and states in which these subsidiaries operate, including, among
others, Bermuda, the U.S., the U.K. and Ireland. RenaissanceRe’s ability to pay dividends and distribute
capital to shareholders is limited by the Bermuda Companies Act 1981, insofar as after the payment,
RenaissanceRe must still be able to pay its liabilities as they come due and the realizable value of its assets
must be greater than its liabilities. At December 31, 2013, $2.6 billion of RenaissanceRe’s retained
earnings would be unrestricted and available for payment of dividends or distribution to shareholders of
RenaissanceRe (2012 - $2.3 billion).

F-74

Multi-Beneficiary Reinsurance Trusts

Effective March 15, 2011, each of Renaissance Reinsurance and DaVinci was approved as a Trusteed
Reinsurer in the state of New York and established a multi-beneficiary reinsurance trust (“MBRT”) to
collateralize its (re)insurance liabilities associated with U.S. domiciled cedants. The MBRTs are subject to
the rules and regulations of the state of New York and the respective deed of trust, including but not limited
to certain minimum capital funding requirements, investment guidelines, capital distribution restrictions and
regulatory reporting requirements. Assets held under trust at December 31, 2013 with respect to the
MBRTs totaled $505.1 million and $173.9 million for Renaissance Reinsurance and DaVinci, respectively
(2012 – $508.7 million and $180.1 million, respectively), compared to the minimum amount required under
U.S. state regulations of $441.7 million and $135.2 million, respectively (2012 – $494.9 million and $169.1
million, respectively).

Multi-Beneficiary Reduced Collateral Reinsurance Trusts

Effective December 31, 2012, each of Renaissance Reinsurance and DaVinci has been approved as an
“eligible reinsurer” in the state of Florida. Therefore they are each authorized to provide reduced collateral
equal to 20% of their net outstanding insurance liabilities to Florida-domiciled insurers. Each of
Renaissance Reinsurance and DaVinci has established a multi-beneficiary reduced collateral reinsurance
trust (“RCT”) to collateralize its (re)insurance liabilities associated with Florida-domiciled cedants. Because
the RTCs were established in New York, they are subject to the rules and regulations of the state of New
York including but not limited to certain minimum capital funding requirements, investment guidelines,
capital distribution restrictions and regulatory reporting requirements. Assets held under trust at
December 31, 2013 with respect to the RCTs totaled $21.1 million and $18.6 million for Renaissance
Reinsurance and DaVinci, respectively (2012 - $11.0 million and $11.0 million, respectively), compared to
the minimum amount required under U.S. state regulations of $16.3 million and $10.2 million, respectively
(2012 - $10.0 million and $10.0 million, respectively).

NOTE 19. DERIVATIVE INSTRUMENTS

The Company enters into derivative instruments such as futures, options, swaps, forward contracts and
other derivative contracts primarily to manage its foreign currency exposure, obtain exposure to a particular
financial market, for yield enhancement, or for trading and speculation. The Company accounts for its
derivatives in accordance with FASB ASC Topic Derivatives and Hedging, which requires all derivatives to
be recorded at fair value on the Company’s balance sheet as either assets or liabilities, depending on the
rights or obligations of the derivatives, with changes in fair value reflected in current earnings. The
Company does not currently apply hedge accounting in respect of any positions reflected in its consolidated
financial statements. The Company’s derivative instruments are generally traded under International
Swaps and Derivatives Association master agreements, which establish the terms of the transactions
entered into with the Company’s derivative counterparties. In the event one party becomes insolvent or
otherwise defaults on its obligations, a master agreement generally permits the non-defaulting party to
accelerate and terminate all outstanding transactions and net the transactions’ marked-to-market values so
that a single sum in a single currency will be owed by, or owed to, the non-defaulting party. Effectively, this
contractual close-out netting reduces credit exposure from gross to net exposure. Where the Company has
entered into master netting agreements with counterparties, or the Company has the legal and contractual
right to offset positions, the derivative positions are generally netted by counterparty and are reported
accordingly in other assets and other liabilities.

F-75

The tables below show the gross and net amounts of recognized derivative assets and liabilities, including
the location on the consolidated balance sheets and fair value of the Company’s principal derivative
instruments:

Derivative Assets

At December 31, 2013

Gross
Amounts of
Recognized
Assets

Gross
Amounts
Offset in the
Balance
Sheet

Net
Amounts of
Assets
Presented in
the Balance
Sheet

Interest rate futures

897

62 $

835

Foreign currency forward

contracts (1)

Foreign currency forward

contracts (2)

9,612

1,179

8,433

1,013

338

675

Credit default swaps

806

Total

12,328 $

82
1,661 $

724
10,667

Balance
Sheet
Location
Other
assets

Other
assets

Collateral

Net Amount

— $

835

—

310

8,433

675

414

310 $

10,357

Derivative Liabilities

At December 31, 2013

Gross
Amounts of
Recognized
Liabilities

Gross
Amounts
Offset in the
Balance
Sheet

Net
Amounts of
Liabilities
Presented in
the Balance
Sheet

Interest rate futures

62 $

Foreign currency forward

contracts (1)

Foreign currency forward
contracts (2)

Credit default swaps

2,204

1,557

Weather contract

Total

2,490
6,419 $

338

—

510 $

2,176

1,219

2,490

5,909

Balance
Sheet
Location
Other
liabilities

Other
liabilities

Collateral

Net Amount

12 $

—

12 $

2,176

1,219

2,490

5,897

(1) Contracts used to manage foreign currency risks in underwriting and non-investment operations.
(2) Contracts used to manage foreign currency risks in investment operations.

F-76

Derivative Assets

At December 31, 2012

Gross
Amounts of
Recognized
Assets

Gross
Amounts
Offset in the
Balance
Sheet

Net
Amounts of
Assets
Presented in
the Balance
Sheet

Interest rate futures

441

— $

441

Foreign currency forward

contracts (1)

Foreign currency forward

contracts (2)

7,191

—

7,191

2,534

2,296

238

Credit default swaps

784

Total

10,950 $

333
2,629 $

451
8,321

Balance
Sheet
Location
Other
assets

Other
assets

Collateral

Net Amount

— $

441

—

310

7,191

238

141

310 $

8,011

Derivative Liabilities

At December 31, 2012

Gross
Amounts of
Recognized
Liabilities

Gross
Amounts
Offset in the
Balance
Sheet

Net
Amounts of
Liabilities
Presented in
the Balance
Sheet

Interest rate futures

Foreign currency forward

contracts (1)

Total

— $

4,173
4,214 $

—
— $

4,173

4,214

Balance
Sheet
Location
Other
liabilities

Other
liabilities

Collateral
Pledged

Net Amount

41 $

—

41 $

4,173

(1) Contracts used to manage foreign currency risks in underwriting and non-investment operations.
(2) Contracts used to manage foreign currency risks in investment operations.

Refer to “Note 5. Investments” for information on reverse repurchase agreements.

The location and amount of the gain (loss) recognized in the Company’s consolidated statements of
operations related to its principal derivative instruments is shown in the following table:

Year ended December 31,

Interest rate futures

Foreign currency forward contracts (1)

Foreign currency forward contracts (2)

Credit default swaps

Weather contract

Platinum warrant

Total

Location of gain (loss)
recognized on derivatives

Amount of gain (loss) recognized on
derivatives

Net realized and unrealized
gains on investments

Net foreign exchange gains
(losses)

Net realized and unrealized
gains on investments

Other (loss) income

2013

2012

2011

$ 29,695 $ (1,746) $ (25,256)

889

13,804

(5,443)

(3,015)

(3,445)

(4,335)

1,363

1,074

(1,467)

(1,331)

—

2,975

$ 27,601 $

9,687 $ (33,526)

(1) Contracts used to manage foreign currency risks in underwriting and non-investment operations.

(2) Contracts used to manage foreign currency risks in investment operations.

The Company is not aware of the existence of any credit-risk related contingent features that it believes
would be triggered in its derivative instruments that are in a net liability position at December 31, 2013.

F-77

Interest Rate Futures

The Company uses interest rate futures within its portfolio of fixed maturity investments to manage its
exposure to interest rate risk, which can include increasing or decreasing its exposure to this risk. At
December 31, 2013, the Company had $1,169.3 million of notional long positions and $356.6 million of
notional short positions of primarily Eurodollar, U.S. treasury and non-U.S. dollar futures contracts (2012 –
$377.8 million and $310.7 million, respectively). The fair value of these derivatives is determined using
exchange traded prices.

Foreign Currency Derivatives

The Company’s functional currency is the U.S. dollar. The Company writes a portion of its business in
currencies other than U.S. dollars and may, from time to time, experience foreign exchange gains and
losses in the Company’s consolidated financial statements. All changes in exchange rates, with the
exception of non-monetary assets and liabilities, are recognized currently in the Company’s consolidated
statements of operations.

Underwriting Operations Related Foreign Currency Contracts

The Company’s foreign currency policy with regard to its underwriting operations is generally to hold foreign
currency assets, including cash, investments and receivables that approximate the foreign currency
liabilities, including claims and claim expense reserves and reinsurance balances payable. When
necessary, the Company may use foreign currency forward and option contracts to minimize the effect of
fluctuating foreign currencies on the value of non-U.S. dollar denominated assets and liabilities associated
with its underwriting operations. The fair value of the Company’s underwriting operations related foreign
currency contracts is determined using indicative pricing obtained from counterparties or broker quotes. At
December 31, 2013, the Company had outstanding underwriting related foreign currency contracts of
$263.6 million in notional long positions and $139.8 million in notional short positions, denominated in U.S.
dollars (2012 – $446.2 million and $119.5 million, respectively).

Investment Portfolio Related Foreign Currency Forward Contracts

The Company’s investment operations are exposed to currency fluctuations through its investments in non-
U.S. dollar fixed maturity investments, short term investments and other investments. To economically
hedge its exposure to currency fluctuations from these investments, the Company has entered into foreign
currency forward contracts. Foreign exchange gains (losses) associated with the Company’s hedging of
these non-U.S. dollar investments are recorded in net foreign exchange gains (losses) in its consolidated
statements of operations. The fair value of the Company’s investment portfolio related foreign currency
forward contracts is determined using an interpolated rate based on closing forward market rates. At
December 31, 2013, the Company had outstanding investment portfolio related foreign currency contracts
of $39.6 million in notional long positions and $159.1 million in notional short positions, denominated in U.S.
dollars (2012 – $176.7 million and $217.4 million, respectively).

Credit Derivatives

The Company’s exposure to credit risk is primarily due to its fixed maturity investments, short term
investments, premiums receivable and reinsurance recoverable. From time to time, the Company
purchases credit derivatives to hedge its exposures in the insurance industry, and to assist in managing the
credit risk associated with ceded reinsurance. The Company also employs credit derivatives in its
investment portfolio to either assume credit risk or hedge its credit exposure. The fair value of the credit
derivatives is determined using industry valuation models, broker bid indications or internal pricing valuation
techniques. The fair value of these credit derivatives can change based on a variety of factors including
changes in credit spreads, default rates and recovery rates, the correlation of credit risk between the
referenced credit and the counterparty, and market rate inputs such as interest rates. At December 31,
2013, the Company had outstanding credit derivatives of $7.1 million in notional long positions and $18.4
million in notional short positions, denominated in U.S. dollars (2012 – $46.1 million and $24.0 million,
respectively).

F-78

Weather Contract

The Company, from time to time, transacts in certain derivative-based risk management products that
address weather-related risks. The fair value of these contracts is determined through the use of an
internal valuation model with the inputs to the internal valuation model based on proprietary data as
observable market inputs are not available. The most significant unobservable input is the potential
payment that would become due to a counterparty following the occurrence of a triggering event as
reported by an external agency. Generally, the Company’s portfolio of such derivatives is relatively small
and are frequently seasonal in nature. At December 31, 2013, the Company had an outstanding weather
contract of $6.4 million in a notional short position.

Platinum Warrant

The Company held a warrant to purchase up to 2.5 million common shares of Platinum Underwriters
Holdings Ltd. (“Platinum”) for $27.00 per share. The Company recorded its investment in the Platinum
warrant at fair value. The fair value of the warrant was estimated using either the Black-Scholes option
pricing model or the in-the-money value, the greater of which the Company considered the best estimate of
the exit value of the warrant. On January 20, 2011, the Company sold its warrant to Platinum for an
aggregate of $47.9 million, and recognized a $3.0 million gain on the sale, which is included in other income
during 2011.

NOTE 20. COMMITMENTS, CONTINGENCIES AND OTHER ITEMS

CONCENTRATION OF CREDIT RISK

Instruments which potentially subject the Company to concentration of credit risk consist principally of
investments, including the Company’s equity method investments, cash, premiums receivable and
reinsurance balances. The Company limits the amount of credit exposure to any one financial institution
and, except for U.S. Government securities, none of the Company’s investments exceeded 10% of
shareholders’ equity at December 31, 2013. See “Note 7. Reinsurance”, for information with respect to
reinsurance recoverable.

EMPLOYMENT AGREEMENTS

The Board of Directors has authorized the execution of employment agreements between the Company
and certain officers. These agreements provide for, among other things, severance payments under certain
circumstances, as well as accelerated vesting of options and restricted stock grants, upon a change in
control, as defined therein and under the terms of the Company’s 2001 Stock Incentive Plan, Premium
Option Plan and 2010 Performance-Based Equity Incentive Plan.

LETTERS OF CREDIT AND OTHER COMMITMENTS

At December 31, 2013, the Company’s banks have issued letters of credit of approximately $584.4 million
in favor of certain ceding companies. In connection with the Company’s Top Layer Re joint venture,
Renaissance Reinsurance has committed $37.5 million of collateral to support a letter of credit and is
obligated to make a mandatory capital contribution of up to $50.0 million in the event that a loss reduces
Top Layer Re’s capital and surplus below a specified level. The letters of credit are secured by cash and
investments of similar amounts. The Company’s syndicated letter of credit facility contains certain financial
covenants.

F-79

On April 26, 2010, Renaissance Reinsurance and CEP entered into a Pledge Agreement in respect of its
letter of credit facility with CEP which is evidenced by the Master Reimbursement Agreement, dated as of
April 29, 2009, and provides for the issuance and renewal of letters of credit which are used to support
business written by Syndicate 1458. Letter of credit fees will be payable pursuant to the terms of the
Reimbursement Agreement. At December 31, 2013, these letters of credit amounted to $281.0 million and
£60.0 million, respectively. Pursuant to the Pledge Agreement, Renaissance Reinsurance has agreed to
pledge and maintain certain securities with a collateral value equal to 75% of the aggregate amount of the
then outstanding letters of credit. In respect of the 25% unsecured portion, Renaissance Reinsurance is
required to comply with certain financial covenants, including maintaining a certain minimum financial
strength rating, minimum net worth, and a maximum consolidated debt to capital ratio for the consolidated
group. In the event Renaissance Reinsurance is unable to satisfy any of these financial covenants, it will be
required to pledge additional collateral in respect of the unsecured portion.

PRIVATE EQUITY AND INVESTMENT COMMITMENTS

The Company has committed capital to private equity partnerships and other entities of $662.7 million, of
which $544.6 million has been contributed at December 31, 2013. The Company’s remaining commitments
to these funds at December 31, 2013 totaled $116.2 million. These commitments do not have a defined
contractual commitment date.

INDEMNIFICATIONS AND WARRANTIES

In the ordinary course of its business, the Company may enter into contracts or agreements that contain
indemnifications or warranties. Future events could occur that lead to the execution of these provisions
against the Company. Based on past experience, management currently believes that the likelihood of
such an event is remote.

OPERATING AND CAPITAL LEASES

The Company leases office space under operating leases which expire at various dates through 2023.
Future minimum lease payments under existing operating leases are expected to be as follows:

2014
2015
2016
2017
2018
After 2018
Future minimum lease payments under existing operating leases

Minimum
lease
payments

6,040
5,804
4,867
2,258
2,195
4,335
25,499

The Company’s capital leases primarily relate to office space in Bermuda with an initial lease term of 20
years, ending in 2028, and a bargain renewal option for an additional 30 years. The future minimum lease
payments of the Company’s capital leases are detailed below, and relate principally to the transaction noted
above, excluding the bargain renewal option.

2014
2015
2016
2017
2018
After 2018
Future minimum lease payments under existing capital leases

F-80

Minimum
lease
payments

3,017
3,017
3,017
2,417
2,417
26,179
40,064

LITIGATION

The Company and its subsidiaries are subject to lawsuits and regulatory actions in the normal course of
business that do not arise from or directly relate to claims on reinsurance treaties or contracts or direct
surplus lines insurance policies. This category of business litigation may involve allegations of underwriting
or claims-handling errors or misconduct, employment claims, regulatory actions or disputes arising from the
Company’s business ventures. The Company’s operating subsidiaries are subject to claims litigation
involving, among other things, disputed interpretations of policy coverages. Generally, the Company’s
direct surplus lines insurance operations are subject to greater frequency and diversity of claims and
claims-related litigation than its reinsurance operations and, in some jurisdictions, may be subject to direct
actions by allegedly injured persons or entities seeking damages from policyholders. These lawsuits,
involving claims on policies issued by the Company’s subsidiaries which are typical to the insurance
industry in general and in the normal course of business, are considered in its loss and loss expense
reserves which are discussed in its loss reserves discussion. In addition, the Company may from time to
time engage in litigation or arbitration related to its claims for payment in respect of ceded reinsurance,
including disputes that challenge the Company’s ability to enforce its underwriting intent. Such matters
could result, directly or indirectly, in providers of protection not meeting their obligations to the Company or
not doing so on a timely basis. The Company may also be subject to other disputes from time to time,
relating to operational or other matters distinct from insurance or reinsurance claims. Any litigation or
arbitration, or regulatory process, contains an element of uncertainty, and the value of an exposure or a
gain contingency related to a dispute is difficult to estimate accordingly. Currently, the Company believes
that no individual litigation or arbitration to which it is presently a party is likely to have a material adverse
effect on its financial condition, business or operations.

OTHER ITEMS

On May 15, 2013, RenaissanceRe announced that effective July 1, 2013, Mr. Currie, its Chief Executive
Officer, would retire and Mr. Currie’s responsibilities would be assumed by Mr. O’Donnell, RenaissanceRe’s
President and Global Chief Underwriting Officer. As part of this transition, Mr. Currie ceased to serve as an
officer and director of RenaissanceRe on July 1, 2013. Mr. Currie will remain an employee of
RenaissanceRe through February 22, 2014 (the “Separation Date”), the remaining term of Mr. Currie’s
amended and restated employment agreement. Until the Separation Date, Mr. Currie will continue to
receive all payments and benefits set forth in his employment agreement. At the Separation Date, Mr.
Currie will be entitled to the separation payments and benefits as provided in his employment agreement.
In conjunction therewith, in the second quarter of 2013, the Company expensed $16.8 million in total
compensation, benefits and other related expenses including the unamortized balance of stock-based
compensation Mr. Currie is expected to receive under the terms of his employment agreement and the
transition agreement entered into between the Company and Mr. Currie in connection with Mr. Currie’s
retirement, subject to Mr. Currie’s continued compliance with the non-competition and non-interference
covenants set forth therein.

F-81

NOTE 21. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Revenues

Gross premiums written
Net premiums written
(Increase) decrease in unearned

premiums

Net premiums earned
Net investment income (loss)
Net foreign exchange gains

(losses)

Equity in earnings (losses) of other

ventures

Other (loss) income
Net realized and unrealized gains

(losses) on investments
Total other-than-temporary

impairments

Portion recognized in other

comprehensive income, before
taxes
Net other-than-temporary

impairments

Total revenues

Expenses

Net claims and claim expenses

incurred

Acquisition costs
Operational expenses
Corporate expenses
Interest expense
Total expenses
Income (loss) from continuing
operations before taxes
Income tax (expense) benefit
Income from continuing

operations

Income (loss) from discontinued

operations

Net income
Net income attributable to
noncontrolling interests

Net income available to

RenaissanceRe

Dividends on preference shares
Net income available to

RenaissanceRe common
shareholders

Income from continuing operations
available to RenaissanceRe
common shareholders per
common share – basic

Income (loss) from discontinued

operations available (attributable)
to RenaissanceRe common
shareholders per common share –
basic

Net income available to

RenaissanceRe common
shareholders per common share –
basic

Income from continuing operations
available to RenaissanceRe
common shareholders per
common share – diluted
Income (loss) from discontinued

operations available (attributable)
to RenaissanceRe common
shareholders per common share –
diluted

Net income available to

RenaissanceRe common
shareholders per common share –
diluted

Quarter Ended
March 31,

Quarter Ended
June 30,

Quarter Ended
September 30,

Quarter Ended
December 31,

2013

2012

2013

2012

2013

2012

2013

2012

$ 635,418
$ 436,813

$ 664,151
$ 492,575

$703,223
$559,109

$ 667,336
$ 427,630

$ 182,649
$ 127,241

$136,359
$105,035

$ 84,122
$ 80,784

$ 83,745
$ 77,417

(165,558)

(213,910)

(267,220)

(183,214)

167,476

271,255
43,202

278,665
62,942

291,889
26,163

244,416
17,648

294,717
59,931

157,588

262,623
46,135

175,981

256,765
78,732

206,234

283,651
39,000

614

(1,306)

(932)

5,835

(1,709)

5,470

(3,632)

3,772

(1,128)

1,587

6,846

5,414

488

3,187

1,747

1,851

7,313

651

4,310

(1,052)

6,274

(173)

6,612

(2,850)

14,269

47,614

(69,529)

28,071

28,472

75,297

61,864

12,139

—

(161)

(134)

—

(234)

(209)

—

333,466

389,619

250,235

303,773

391,572

390,500

405,209

340,403

27,251

25,009
45,986
4,482
5,034
107,762

15,552

24,111
42,323
4,757
5,718
92,461

103,962

31,767
42,789
21,529
4,300
204,347

49,551

25,608
41,375
4,014
5,716
126,264

60,928

37,699
44,672
4,307
4,298
151,904

73,215

(20,854)

186,893

24,438
42,357
3,796
5,891
149,697

31,026
57,658
3,304
4,297
75,431

39,385
53,096
3,889
5,772
289,035

225,704

297,158

45,888

177,509

239,668

240,803

329,778

51,368

(122)

(11)

(899)

(223)

(144)

(1,336)

(405)

225,582

297,194

45,877

176,610

239,445

240,659

328,442

50,963

9,774

(33,374)

235,356

263,820

2,427

48,304

8,034

(9,779)

(166)

—

184,644

229,666

240,493

328,442

9,029

59,992

(38,607)

(53,641)

(14,015)

(33,624)

(44,331)

(51,083)

(54,191)

(9,692)

196,749

210,179

(6,275)

(8,750)

34,289

(7,483)

151,020

185,335

189,410

274,251

(8,750)

(5,595)

(8,750)

(5,595)

50,300

(8,645)

$ 190,474

$ 201,429

$ 26,806

$ 142,270

$ 179,740

$180,660

$ 268,656

$ 41,655

4.10

4.59

0.55

2.62

4.32

3.67

6.14

0.69

0.22

(0.66)

0.06

0.16

(0.23)

—

0.19

4.32

4.01

3.93

0.61

4.53

0.55

2.78

2.59

4.09

3.67

4.23

3.62

6.14

0.88

6.05

0.68

0.22

(0.65)

0.05

0.16

(0.22)

—

0.19

4.23

3.88

0.60

2.75

4.01

3.62

6.05

0.87

Average shares outstanding – basic
Average shares outstanding – diluted

43,461
44,290

50,377
50,981

43,372
44,243

50,278
51,012

43,330
44,135

48,394
49,119

43,160
43,769

46,442
47,297

F-82

NOTE 22. CONDENSED CONSOLIDATING FINANCIAL INFORMATION PROVIDED IN CONNECTION
WITH OUTSTANDING DEBT OF SUBSIDIARIES

The following tables present condensed consolidating balance sheets at December 31, 2013 and 2012,
condensed consolidating statements of operations and condensed consolidating statements of
comprehensive income (loss) for the years ended December 31, 2013, 2012 and 2011, and condensed
consolidating statements of cash flows for the years ended December 31, 2013, 2012 and 2011,
respectively, for RenaissanceRe, RRNAH and RenaissanceRe’s other subsidiaries. RRNAH is a 100%
owned subsidiary of RenaissanceRe.

On March 17, 2010, RRNAH issued, and RenaissanceRe guaranteed, $250.0 million of 5.75% Senior
Notes due March 15, 2020, with interest on the notes payable on March 15 and September 15 of each year.
The notes can be redeemed by RRNAH prior to maturity, subject to payment of a “make-whole” premium.
The notes, which are senior obligations, contain various covenants, including limitations on mergers and
consolidations, restrictions as to the disposition of the stock of designated subsidiaries and limitations on
liens of the stock of designated subsidiaries.

F-83

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

210,719 $
8,796
3,294,729

98,784 $ 6,512,209 $

4,027
74,718

395,209
—

— $ 6,821,712
408,032
—
—
(3,369,447)

296,752

—

14
112,234

—

110

—

(296,752)

474,087

66,132

101,025

33,955

81,684

75,831

—

474,087

66,132

101,025

34,065

81,684

75,845

116,549
$ 3,923,244 $ 179,120 $ 7,842,966 $ (3,766,199) $ 8,179,131

(100,000)

102,834

1,481

— $

— $ 1,563,730 $

— $ 1,563,730

—

18,860

—

477,888

249,430

3,173

—

6,953

—

293,022

193,221

371,783

—

477,888

249,430

(3,173)

—

293,022

193,221

397,596

259,556

2,899,644

(3,173)

3,174,887

—

1,099,860

—

1,099,860

Condensed Consolidating Balance
Sheet at December 31, 2013
Assets
Total investments

Cash and cash equivalents
Investments in subsidiaries
Due from subsidiaries and

affiliates

Premiums receivable

Prepaid reinsurance

premiums

Reinsurance recoverable

Accrued investment income

Deferred acquisition costs

Receivable for investments

sold

Other assets

Total assets

Liabilities, Noncontrolling

Interests and
Shareholders’ Equity

Liabilities
Reserve for claims and claim

expenses

Unearned premiums

Debt

Amounts due to subsidiaries

and affiliates

Reinsurance balances

payable

Payable for investments

purchased

Other liabilities

Total liabilities

Redeemable noncontrolling

interests

Shareholders’ Equity

Total shareholders’ equity

3,904,384

(80,436)

3,843,462

(3,763,026)

3,904,384

Total liabilities,

noncontrolling interests
and shareholders’ equity $ 3,923,244 $ 179,120 $ 7,842,966 $ (3,766,199) $ 8,179,131
Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

(1)
(2)

F-84

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

572,139 $
6,298
2,864,793

49,618 $ 5,733,637 $

1,528
37,202

296,319
—

— $ 6,355,394
304,145
—
—
(2,901,995)

53,296

—

—
2,535

—

117

—

—
69

—

60,149
114,956

—
15,754

—

(53,413)

491,365

77,082

192,512
30,874

52,622

108,524

104,046

—

—
—

—

(115,493)

—

491,365

77,082

192,512
33,478

52,622

168,673

119,263

134,094
$ 3,674,166 $ 238,382 $ 7,086,981 $ (3,070,901) $ 7,928,628

134,094

—

— $

— $ 1,879,377 $

— $ 1,879,377

—
100,000

249,339

—

399,517

11,371

5,593

—

9,694

50,036

—

4,572

—

290,419

269,093

145,284

—

399,517

349,339

(16,964)

—

(1,458)

290,419

278,787

198,434

—
171,101

57,440

316,944

—

57,440

2,983,690

(18,422)

3,453,313

—

968,259

—

968,259

Condensed Consolidating Balance
Sheet at December 31, 2012
Assets
Total investments

Cash and cash equivalents
Investments in subsidiaries
Due from subsidiaries and

affiliates

Premiums receivable

Prepaid reinsurance

premiums

Reinsurance recoverable

Accrued investment income
Deferred acquisition costs

Receivable for investments

sold

Other assets

Assets of discontinued

operations held for sale

Total assets

Liabilities, Redeemable

Noncontrolling Interest
and Shareholders’ Equity

Liabilities
Reserve for claims and claim

expenses

Unearned premiums

Debt

Amounts due to subsidiaries

and affiliates

Reinsurance balances

payable

Payable for investments

purchased

Other liabilities

Liabilities of discontinued
operations held for sale

Total liabilities

Redeemable noncontrolling

interest

Shareholders’ Equity

Total shareholders’ equity

3,503,065

(78,562)

3,135,032

(3,052,479)

3,507,056

Total liabilities,
redeemable
noncontrolling interest
and shareholders’ equity $ 3,674,166 $ 238,382 $ 7,086,981 $ (3,070,901) $ 7,928,628
Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

(1)
(2)

F-85

Condensed Consolidating
Statement of Operations for
the year ended December 31, 2013
Revenues

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

Net premiums earned

— $

— $ 1,114,626 $

Net investment income
Net foreign exchange (losses)

gains

Equity in earnings of other

ventures

Other income (loss)

Net realized and unrealized

(losses) gains on
investments
Total revenues

Expenses

Net claims and claim
expenses incurred
Acquisition expenses

Operational expenses

Corporate expenses

Interest expense

Total expenses

(Loss) income before equity in
net income of subsidiaries
and taxes

Equity in net income of

subsidiaries

Income (loss) from continuing
operations before taxes

Income tax expense

Income (loss) from

continuing operations

Income from discontinued

operations
Net income (loss)

Net income attributable to
noncontrolling interests
Net income (loss)
attributable to
RenaissanceRe
Dividends on preference

shares
Net income (loss)
attributable to
RenaissanceRe common
shareholders

4,213

488

209,105

(7)

—

106

(2)

1,926

—

125

23,194

(2,590)

— $ 1,114,626
208,028

(5,778)

—

1,917

23,194

(2,359)

(483)
3,829

1,196
1,807

34,363
1,380,624

—
(5,778)

35,076
1,380,482

—

—
(4,962)
31,264

734

27,036

—

7,566

338
14,467

22,371

171,287

125,501

189,117

2,020

2,728

—

(616)

—

171,287

125,501

191,105

33,622

17,929

490,653

(616)

539,444

(23,207)

(20,564)

889,971

(5,162)

841,038

713,831

2,142

—

(715,973)

—

690,624

—

(18,422)

(1,558)

889,971

(721,135)

841,038

(134)

—

(1,692)

690,624

(19,980)

889,837

(721,135)

839,346

—
690,624

2,422

—

(17,558)

889,837

(721,135)

2,422

841,768

—

(151,144)

—

(151,144)

690,624

(17,558)

738,693

(721,135)

690,624

(24,948)

—

(24,948)

665,676 $

(17,558) $

738,693 $ (721,135) $

665,676

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-86

Condensed Consolidating
Statement of Comprehensive
Income (Loss) for the year ended
December 31, 2013

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

Comprehensive income

(loss)
Net income (loss)

Change in net unrealized
gains on investments

Comprehensive income

(loss)

Net income attributable to
noncontrolling interests

Comprehensive income

attributable to
noncontrolling interests

Comprehensive income (loss)

attributable to
RenaissanceRe

690,624 $

(17,558) $

889,837 $ (721,135) $

841,768

—

(9,491)

—

(9,491)

690,624

(17,558)

880,346

(721,135)

832,277

—

(151,144)

—

(151,144)

690,624 $

(17,558) $

729,202 $ (721,135) $

681,133

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-87

Condensed Consolidating
Statement of Operations
for the year ended December 31,
2012
Revenues

Net premiums earned

Net investment income

Net foreign exchange gains
Equity in earnings of other

ventures

Other income (loss)
Net realized and unrealized
gains on investments

Net other-than-temporary

impairments
Total revenues

Expenses

Net claims and claim
expenses incurred
Acquisition expenses

Operational expenses

Corporate expenses

Interest expense

Total expenses

Income (loss) before equity in
net loss of subsidiaries and
taxes

Equity in net income of

subsidiaries

Income (loss) from continuing
operations before taxes

Income tax expense

Income (loss) from

continuing operations

Loss from discontinued

operations
Net income (loss)

Net income attributable to
noncontrolling interest
Net income (loss)
attributable to
RenaissanceRe
Dividends on preference

shares
Net income (loss) available

(attributable) to
RenaissanceRe common
shareholders

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

— $

— $ 1,069,355 $

— $ 1,069,355

14,195
33

—
2,822

619
—

—
—

150,911
5,286

23,238
(4,942)

14,862

1,556

146,703

—

31,912

—

(343)

2,175

1,390,208

—

—
(5,103)
14,282
5,875

15,054

—

7,013

273
14,467

21,753

325,211

113,542

177,241

1,901

2,755

620,650

16,858

(19,578)

769,558

—
—

—

165,725
5,319

23,238
(2,120)

163,121

(343)

1,424,295

325,211

113,542

179,151

16,456

23,097

657,457

766,838

584,051

1,860

—

(585,911)

—

600,909

(17,718)

769,558

(585,911)

766,838

—

(499)

(914)

—

(1,413)

600,909

(18,217)

768,644

(585,911)

765,425

—
600,909

(16,476)

(34,693)

—

768,644

(585,911)

(16,476)

748,949

—

(148,040)

—

(148,040)

600,909

(34,693)

620,604

(585,911)

600,909

(34,895)

—

(34,895)

566,014 $

(34,693) $

620,604 $ (585,911) $

566,014

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-88

Condensed Consolidating
Statement of Comprehensive
Income (Loss) for the year ended
December 31, 2012

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

Comprehensive income

(loss)
Net income (loss)

Change in net unrealized
gains on investments

Portion of other-than-

temporary impairments
recognized in other
comprehensive loss

Comprehensive income

(loss)

Net income attributable to
noncontrolling interests

Comprehensive income

attributable to
noncontrolling interests

Comprehensive income (loss)
available (attributable) to
RenaissanceRe

600,909 $

(34,693) $

768,644 $ (585,911) $

748,949

—

1,914

(52)

—

1,914

(52)

600,909

(34,693)

770,506

(585,911)

750,811

—

(148,040)

—

(148,040)

600,909 $

(34,693) $

622,466 $ (585,911) $

602,771

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-89

Condensed Consolidating
Statement of Operations
for the year ended December 31,
2011
Revenues

Net premiums earned

Net investment income

Net foreign exchange gains

(losses)

Equity in losses of other

ventures
Other loss

Net realized and unrealized
gains on investments

Net other-than-temporary

impairments
Total revenues

Expenses

Net claims and claim
expenses incurred
Acquisition expenses

Operational expenses

Corporate expenses

Interest expense

Total expenses

Income (loss) before equity in
net loss of subsidiaries and
taxes

Equity in net loss of

subsidiaries

Loss from continuing

operations before taxes
Income tax benefit (expense)

Loss from continuing

operations

Loss from discontinued

operations
Net loss

Net loss attributable to

noncontrolling interest
Net loss attributable to

RenaissanceRe
Dividends on preference

shares
Net loss attributable to

RenaissanceRe common
shareholders

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

— $

951,049 $

— $

951,049

20,182

944

131,557

(5,812)

146,871

112

—

(11)

—

(7,956)

(36,533)

44,356

12,040

1,217

30,699

—

(7,844)

(36,533)

44,345

43,956

(552)

—

32,323

—

—
(4,842)
11,486

10,472

17,116

—

(552)

2,161

1,112,620

(5,812)

1,141,292

—

7,910

229
14,568

22,707

861,179

97,376

166,593

6,441

3,026

1,134,615

—

(4,698)

861,179

97,376

169,661

18,156

23,368

1,169,740

15,207

(20,546)

(21,995)

(1,114)

(28,448)

(73,066)

(16,689)

—

89,755

—

(57,859)

(37,235)

624

1,677

(21,995)

(12,686)

88,641

—

(28,448)

(10,385)

(57,235)

(35,558)

(34,681)

88,641

(38,833)

—

(57,235)

(51,559)

(87,117)

—

(34,681)

88,641

(51,559)

(90,392)

—

33,157

—

33,157

(57,235)

(87,117)

(1,524)

88,641

(57,235)

(35,000)

—

(35,000)

(92,235) $

(87,117) $

(1,524) $

88,641 $

(92,235)

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-90

Condensed Consolidating
Statement of Comprehensive Loss
for the year ended December 31,
2011

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Comprehensive loss

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

Consolidating
Adjustments
(2)

RenaissanceRe
Consolidated

Net loss

(57,235) $

(87,117) $

(34,681) $

88,641 $

(90,392)

Change in net unrealized
gains on investments

Portion of other-than-

temporary impairments
recognized in other
comprehensive loss

—

(7,991)

(78)

—

(7,991)

(78)

Comprehensive loss

(57,235)

(87,117)

(42,750)

88,641

(98,461)

Net loss attributable to

noncontrolling interests

Change in net unrealized
gains on fixed maturity
investments available for
sale attributable to
noncontrolling interests

Comprehensive loss

attributable to
noncontrolling interests

Comprehensive loss

attributable to
RenaissanceRe

—

33,157

—

33,157

—

33,163

—

33,163

(57,235) $

(87,117) $

(9,587) $

88,641 $

(65,298)

(1)
(2)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.
Includes Parent Guarantor and Subsidiary Issuer consolidating adjustments.

F-91

Condensed Consolidating Statement of Cash Flows
for the year ended December 31, 2013
Cash flows (used in) provided by

operating activities

Net cash (used in) provided by

operating activities

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

RenaissanceRe
Consolidated

(37,966) $

(7,583) $

841,270 $

795,721

Cash flows provided by (used in)

investing activities
Proceeds from sales and maturities of fixed

maturity investments trading

Purchases of fixed maturity investments

trading

Proceeds from sales and maturities of fixed
maturity investments available for sale
Net (purchases) sales of equity investments

trading

Net sales (purchases) of short term

investments

Net sales of other investments
Net purchases of investments in other

ventures

Net sales of other assets
Dividends and return of capital from

subsidiaries

Contributions to subsidiaries
Due (from) to subsidiary
Net proceeds related to sale of discontinued

operations
Net cash provided by (used in)

investing activities

Cash flows (used in) provided by

financing activities
Dividends paid – RenaissanceRe common

Dividends paid – preference shares
RenaissanceRe common share

repurchases

Net repayment of debt
Redemption of 6.08% Series C preference

Redemption of 6.60% Series D preference

Issuance of 5.375% Series E preference

shares, net of expenses

Contribution of capital from parent
Net third party redeemable noncontrolling

interest share transactions
Net cash (used in) provided by

financing activities

Effect of exchange rate changes on foreign

currency cash

Net increase in cash and cash equivalents
Net decrease in cash and cash

equivalents of discontinued operations
Cash and cash equivalents, beginning of

period

Cash and cash equivalents, end of period $

880,749

185,143

7,185,513

8,251,405

(491,768)

(160,422)

(7,814,277)

(8,466,467)

—

(81,437)

45,178

48,382

45,178

(33,055)

21,217
—

—
—

9,399
—

—
—

504,241
(500,652)
17,446

83,593
(38,117)
(3,761)

(277,587)
76,214

(246,971)
76,214

(4,000)
2,181

(587,834)
538,769
(13,685)

(4,000)
2,181

—
—
—

—

60,000

431,233

(5,602)

(741,146)

(315,515)

(49,267)
(24,948)

(207,410)
(100,000)

(125,000)

(150,000)

265,856
—

—
—

—

—
—

—
(2,436)

—

—
15,684

—
(15,684)

(49,267)
(24,948)

(207,410)
(102,436)

(125,000)

(150,000)

265,856
—

—

(5,750)

(390,769)

15,684

(23,870)

(398,955)

—
2,498

—

—
2,499

—

1,423
77,677

21,213

6,298
8,796 $

1,528
4,027 $

296,319
395,209 $

1,423
82,674

21,213

304,145
408,032

(1)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.

F-92

Condensed Consolidating Statement of Cash Flows
for the year ended December 31, 2012
Cash flows provided by (used in)

operating activities

Net cash provided by (used in)

operating activities

Cash flows provided by (used in)

investing activities
Proceeds from sales and maturities of fixed

maturity investments trading

Purchases of fixed maturity investments

trading

Proceeds from sales and maturities of fixed
maturity investments available for sale

Net (purchases) sales of short term

investments

Net sales of other investments
Net purchases of other assets
Dividends and return of capital from

subsidiaries

Contributions to subsidiaries
Due (from) to subsidiaries
Net payments related to sale of

discontinued operations
Net cash provided by (used in)

investing activities

Cash flows (used in) provided by

financing activities
Dividends paid – RenaissanceRe common

Dividends paid – preference shares
RenaissanceRe common share

repurchases

Net repayment of debt
Redemption of 6.60% Series D preference

Third party DaVinciRe share transactions

Net cash (used in) provided by

financing activities

Effect of exchange rate changes on foreign

currency cash

Net (decrease) increase in cash and cash

equivalents

Net decrease in cash and cash

equivalents of discontinued operations

Cash and cash equivalents, beginning of

period

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

RenaissanceRe
Consolidated

128,567 $

(10,376) $

598,738 $

716,929

744,211

140,626

7,308,030

8,192,867

(692,783)

(73,800)

(7,769,655)

(8,536,238)

—

65,168

(80,485)
—
—

979,311
(366,210)
(15,359)

(10,624)
—
—

9,541
(50,000)
241

159,886
150,828
(4,079)

(988,852)
416,210
15,118

68,777
150,828
(4,079)

—
—
—

—

(9,000)

—

(9,000)

568,685

6,984

(647,346)

(71,677)

(53,356)
(34,895)

(463,309)
—

(150,000)
—

(701,560)

—

—
—

—

—
—

—
(1,937)

—
164,927

(53,356)
(34,895)

(463,309)
(1,937)

(150,000)
164,927

162,990

(538,570)

1,692

(4,308)

(3,392)

116,074

108,374

—

13,946

10,606

4,920
1,528 $

166,299
296,319 $

181,825
304,145

Cash and cash equivalents, end of period $

6,298 $

(1)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.

F-93

Condensed Consolidating Statement of Cash Flows
for the year ended December 31, 2011
Cash flows (used in) provided by

operating activities

Net cash (used in) provided by

operating activities

Cash flows provided by (used in)

investing activities
Proceeds from sales and maturities of fixed

maturity investments trading

Purchases of fixed maturity investments

trading

Proceeds from sales and maturities of fixed
maturity investments available for sale
Purchases of fixed maturity investments

available for sale

Net purchases of equity investments trading

Net (purchases) sales of short term

investments

Net sales (purchases) of other investments
Net purchases of investments in other

ventures

Net sales of other assets
Dividends and return of capital from

subsidiaries

Contributions to subsidiaries
Due to (from) subsidiary
Net proceeds from sale of discontinued

operations

Net cash provided by (used in)

investing activities

Cash flows (used in) provided by

financing activities
Dividends paid – RenaissanceRe common

Dividends paid – preference shares
RenaissanceRe common share

repurchases

Net (repayment) issuance of debt
Third party DaVinciRe share repurchases

Net cash (used in) provided by

financing activities

Effect of exchange rate changes on foreign

currency cash

Net increase (decrease) in cash and cash

equivalents

Net decrease in cash and cash

equivalents of discontinued operations
Cash and cash equivalents, beginning of

year

RenaissanceRe
Holdings Ltd.
(Parent
Guarantor)

RenRe North
America
Holdings Inc.
(Subsidiary
Issuer)

Other
RenaissanceRe
Holdings Ltd.
Subsidiaries
and
Eliminations
(Non-guarantor
Subsidiaries)
(1)

RenaissanceRe
Consolidated

(58,721) $

(56,438) $

281,092 $

165,933

532,864

221,189

5,335,415

6,089,468

(684,951)

(322,318)

(5,264,354)

(6,271,623)

—

—
—

(6,014)
102,717

—
—

945,195
(272,366)
6,059

—

—
—

9,184
—

—
—

9,306
(8,294)
3,780

106,362

(4,107)
(47,995)

99,978
(51,777)

(39,000)
58,318

(954,501)
280,660
(9,839)

(4,107)
(47,995)

103,148
50,940

(39,000)
58,318

—
—
—

—

269,520

—

269,520

623,504

182,367

(490,840)

315,031

(53,460)
(35,000)

(191,619)
(277,512)
—

—
—

—
(124,949)
—

—
202,461
(62,157)

(53,460)
(35,000)

(191,619)
(200,000)
(62,157)

(557,591)

(124,949)

140,304

(542,236)

—

7,192

—

3,414

—

980

—

518

(68,926)

(60,754)

16,441

3,940
4,920 $

218,784
166,299 $

226,138
181,825

Cash and cash equivalents, end of year

10,606 $

(1)

Includes all other subsidiaries of RenaissanceRe Holdings Ltd. and eliminations.

F-94

NOTE 23. SUBSEQUENT EVENTS

On February 19, 2014, RenaissanceRe’s Board of Directors approved an increase in the authorized share
repurchase program to an aggregate amount of $500.0 million. Unless terminated earlier by resolution of
RenaissanceRe’s Board of Directors, the program will expire when the Company has repurchased the full
value of the shares authorized.

During January 2014, DaVinciRe redeemed a portion of its outstanding shares from all existing DaVinciRe
shareholders, including the Company, while a new DaVinciRe shareholder purchased shares in DaVinciRe.
The net redemption as a result of these transactions was $300.0 million. In connection with the redemption,
DaVinciRe retained a $60.0 million holdback. The Company’s noncontrolling economic ownership in
DaVinciRe subsequent to these transactions is 26.5%, effective January 1, 2014. The Company expects its
noncontrolling economic ownership in DaVinciRe to fluctuate over time.

Subsequent to December 31, 2013 and through the period ended February 19, 2014, third-party investors
subscribed for an aggregate of $42.2 million of the participating, non-voting common shares of Medici. As a
result of these subscriptions, the Company’s ownership in Medici decreased to 46.8%, effective February 1,
2014.

F-95

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

INDEX TO SCHEDULES TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm on Schedules . . . . . . . . . . . . . . . . . . . .

I .

II .

III

Summary of Investments other than Investments in Related Parties . . . . . . . . . . . . . . . . . . . .

Condensed Financial Information of Registrant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplementary Insurance Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplemental Schedule of Reinsurance Premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplementary Insurance Information Concerning Property-Casualty Insurance Operations. .

Schedules other than those listed above are omitted for the reason that they are not applicable.

Page

S-2

S-3

S-4

S-7

S-8

S-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF RENAISSANCERE HOLDINGS LTD.

We have audited the consolidated financial statements of RenaissanceRe Holdings Ltd. as of
December 31, 2013 and 2012, and for each of the three years in the period ended December 31, 2013, and
have issued our report thereon dated February 20, 2014 (included elsewhere in this Annual Report on Form
10-K). Our audits also included the financial statement schedules listed in Item 15(a) (2) of this Annual
Report on Form 10-K for the year ended December 31, 2013. These schedules are the responsibility of the
Company’s management. Our responsibility is to express an opinion based on our audits.

In our opinion, the financial statement schedules referred to above, when considered in relation to the basic
financial statements taken as a whole, present fairly in all material respects the information set forth therein.

/s/ Ernst & Young Ltd.

Hamilton, Bermuda
February 20, 2014

S-2

SCHEDULE I

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

SUMMARY OF INVESTMENTS
OTHER THAN INVESTMENTS IN RELATED PARTIES
(THOUSANDS OF UNITED STATES DOLLARS)

December 31, 2013

Amortized
Cost

Market Value

Amount at
which shown
in the
Balance Sheet

187,815
332,935
234,531
1,783,043
346,740
242,344
311,681
14,802
$ 4,811,985

$ 1,358,094 $ 1,352,413 $ 1,352,413
186,050
334,580
237,479
1,803,415
341,908
257,938
314,236
15,258
4,843,277
1,044,779
254,776
573,264
105,616
$ 6,821,712 $ 6,821,712

186,050
334,580
237,479
1,803,415
341,908
257,938
314,236
15,258
4,843,277
1,044,779
254,776
573,264
105,616

Type of investment:
Fixed maturity investments

U.S. treasuries
Agencies
Non-U.S. government (Sovereign debt)
Non-U.S. government-backed corporate
Corporate
Agency mortgage-backed
Non-agency mortgage-backed
Commercial mortgage-backed
Asset-backed

Total fixed maturity investments

Short term investments
Equity investments
Other investments
Investments in other ventures, under equity method

Total investments

S-3

SCHEDULE II

RENAISSANCERE HOLDINGS LTD.
CONDENSED FINANCIAL INFORMATION OF REGISTRANT

RENAISSANCERE HOLDINGS LTD.
BALANCE SHEETS
AT DECEMBER 31, 2013 AND 2012
(PARENT COMPANY)
(THOUSANDS OF UNITED STATES DOLLARS)

Assets
Fixed maturity investments trading, at fair value (Amortized cost $Nil and

$324,160 at December 31, 2013 and 2012, respectively)

Short term investments, at fair value

Total investments

Cash and cash equivalents

Investments in subsidiaries

Due from subsidiaries

Dividends due from subsidiaries

Accrued investment income

Receivable for investments sold

Other assets

Total Assets

Liabilities and Shareholders’ Equity

Liabilities
Notes and bank loans payable

Contributions due to subsidiaries

Payable for investments purchased

Other liabilities

Total Liabilities

Shareholders’ Equity
Preference shares: $1.00 par value – 16,000,000 shares issued and

outstanding at December 31, 2013 (December 31, 2012 – 16,000,000)

Common shares: $1.00 par value – 43,646,436 shares issued and

outstanding at December 31, 2013 (December 31, 2012 – 45,542,203)

Accumulated other comprehensive income

Retained earnings

Total Shareholders’ Equity

Total Liabilities and Shareholders’ Equity

At December 31,

2013

2012

— $

210,719
210,719

8,796

337,376
234,763

572,139

6,298

3,294,729

2,864,793

16,479

280,273

—

32,467

20,829

2,535

60,149

112,234

114,956

$ 3,923,244 $ 3,674,166

— $

100,000

—

18,860

11,371

9,694

50,036

171,101

400,000

43,646

4,131

45,542

13,622

3,456,607

3,043,901

3,904,384

3,503,065

$ 3,923,244 $ 3,674,166

S-4

RENAISSANCERE HOLDINGS LTD.
CONDENSED FINANCIAL INFORMATION OF REGISTRANT – CONTINUED

SCHEDULE II

RENAISSANCERE HOLDINGS LTD.
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
(PARENT COMPANY)
(THOUSANDS OF UNITED STATES DOLLARS)

Revenues
Net investment income

Net foreign exchange (losses) gains

Other income (loss)

Net realized and unrealized (losses) gains on investments

Total revenues

Expenses
Interest expense

Operating and corporate expenses

Total expenses

(Loss) income before equity in net income (losses) of

subsidiaries and taxes

Equity in net income (losses) of subsidiaries

Income (loss) before taxes

Income tax benefit

Net income (loss)

Dividends on preference shares

Year ended December 31,

2013

2012

2011

4,213 $

14,195 $

20,182

(7)

106

(483)

3,829

734

26,302

27,036

(23,207)

713,831

690,624

—

690,624

(24,948)

2,822

14,862

31,912

5,875

9,179

15,054

16,858

584,051

600,909

—

600,909

(34,895)

112

(11)

12,040

32,323

10,472

6,644

17,116

15,207

(73,066)

(57,859)

624

(57,235)

(35,000)

Net income (loss) available (attributable) to
RenaissanceRe common shareholders

665,676 $

566,014 $

(92,235)

RENAISSANCERE HOLDINGS LTD.
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
(PARENT COMPANY)
(THOUSANDS OF UNITED STATES DOLLARS)

Comprehensive income (loss)

Net income (loss)
Comprehensive income (loss) attributable to

RenaissanceRe

Year ended December 31,

2013

2012

2011

690,624 $

600,909 $

(57,235)

690,624 $

600,909 $

(57,235)

S-5

RENAISSANCERE HOLDINGS LTD.
CONDENSED FINANCIAL INFORMATION OF REGISTRANT – CONTINUED

SCHEDULE II

RENAISSANCERE HOLDINGS LTD.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
(PARENT COMPANY)
(THOUSANDS OF UNITED STATES DOLLARS)

Cash flows (used in) provided by operating activities:

Net income (loss)

Less: equity in net (income) loss of subsidiaries

Adjustments to reconcile net income (loss) to net cash (used in)

provided by operating activities

Net unrealized losses (gains) included in net investment income

Net unrealized (gains) losses included in other income (loss)

Net realized and unrealized gains on investments

Other

Net cash (used in) provided by operating activities

Cash flows provided by investing activities:

Proceeds from maturities and sales of fixed maturity investments

trading

Purchases of fixed maturity investments trading

Net sales (purchases) of short term investments

Net sales (purchases) of other investments

Dividends and return of capital from subsidiaries

Contributions to subsidiaries

Due (from) to subsidiary

Net cash provided by investing activities

Cash flows used in financing activities:

Dividends paid – RenaissanceRe common shares

Dividends paid – preference shares

RenaissanceRe common share repurchases

Redemption of 6.08% Series C preference shares

Redemption of 6.60% Series D preference shares

Issuance of 5.375% Series E preference share, net of expenses

Net repayment of debt

Net cash used in financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of year

Cash and cash equivalents, end of year

Year ended December 31,

2013

2012

2011

690,624

600,909

(57,235)

(713,831)

(584,051)

(23,207)

16,858

73,066

15,831

483

—

(20)

(15,222)

(37,966)

348

(193)

(14,862)

126,416

128,567

(1,696)

304

(12,040)

(61,120)

(58,721)

880,749

744,211

532,864

(491,768)

(692,783)

(684,951)

21,217

(80,485)

—

504,241

979,311

(6,014)

102,717

945,195

(500,652)

(366,210)

(272,366)

17,446

431,233

(15,359)

568,685

6,059

623,504

(49,267)

(24,948)

(207,410)

(125,000)

(150,000)

265,856

(100,000)

(390,769)

2,498

6,298

(53,356)

(34,895)

(53,460)

(35,000)

(463,309)

(191,619)

—

(150,000)

—

(701,560)

(4,308)

10,606

—

(277,512)

(557,591)

7,192

3,414

8,796

6,298

10,606

S-6

SCHEDULE III

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

SUPPLEMENTARY INSURANCE INFORMATION
(THOUSANDS OF UNITED STATES DOLLARS)

December 31, 2013

Year ended December 31, 2013

Future
Policy
Benefits,
Losses,
Claims
and
Loss
Expenses

Deferred
Policy
Acquisition
Costs

Unearned
Premiums

Premium
Revenue

Net
Investment
Income

Benefits,
Claims,
Losses
and
Settlement
Expenses

Amortization
of Deferred
Policy
Acquisition
Costs

Other
Operating
Expenses

Net
Written
Premiums

Catastrophe
Reinsurance $

Specialty
Reinsurance

Lloyd’s

Other

Total

37,889

$ 780,987

$ 279,465

$ 723,705

— $

7,908

49,161

$ 108,130

$ 753,078

26,727

17,068

—

506,268

218,367

58,108

115,278

83,145

214,306

176,029

—

586

208,028

67,236

95,693

450

41,538

34,823

(21)

31,780

50,540

655

248,562

201,697

610

81,684

$1,563,730

$ 477,888

$1,114,626

208,028

171,287

125,501

$ 191,105

$1,203,947

December 31, 2012

Year ended December 31, 2012

Future
Policy
Benefits,
Losses,
Claims
and
Loss
Expenses

Deferred
Policy
Acquisition
Costs

Unearned
Premiums

Premium
Revenue

Net
Investment
Income

Benefits,
Claims,
Losses
and
Settlement
Expenses

Amortization
of Deferred
Policy
Acquisition
Costs

Other
Operating
Expenses

Net
Written
Premiums

Catastrophe
Reinsurance $

Specialty
Reinsurance

Lloyd’s

Other

Total

28,306

$1,184,258

$ 261,456

$ 781,738

— $

165,209

66,665

$ 103,811

$ 766,035

15,010

9,306

—

478,313

149,470

67,336

84,058

54,003

—

164,685

122,968

—

(36)

165,725

76,813

80,242

2,947

23,826

22,864

187

29,124

45,680

536

201,552

135,131

(61)

52,622

$1,879,377

$ 399,517

$1,069,355

165,725

325,211

113,542

$ 179,151

$1,102,657

December 31, 2011

Year ended December 31, 2011

Future
Policy
Benefits,
Losses,
Claims
and
Loss
Expenses

Deferred
Policy
Acquisition
Costs

Unearned
Premiums

Premium
Revenue

Net
Investment
Income

Benefits,
Claims,
Losses
and
Settlement
Expenses

Amortization
of Deferred
Policy
Acquisition
Costs

Other
Operating
Expenses

Net
Written
Premiums

Catastrophe
Reinsurance $

Specialty
Reinsurance

Lloyd’s

Other

Total

28,059

$1,341,908

$ 260,746

$ 737,545

— $

770,350

62,882

$ 100,932

$ 773,560

6,864

8,039

759

471,618

87,495

91,333

41,099

43,367

2,443

135,543

76,386

1,575

—

146,871

13,354

73,259

4,216

20,096

14,031

367

30,319

36,732

1,678

139,939

98,617

657

43,721

$1,992,354

$ 347,655

$ 951,049

146,871

861,179

97,376

$ 169,661

$1,012,773

S-7

SCHEDULE IV

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

SUPPLEMENTAL SCHEDULE OF REINSURANCE PREMIUMS
(THOUSANDS OF UNITED STATES DOLLARS)

Year ended December 31, 2013

Property and liability premiums

earned

Year ended December 31, 2012

Property and liability premiums

earned

Year ended December 31, 2011

Property and liability premiums

earned

Gross
Amounts

Ceded to
Other
Companies

Assumed
From Other
Companies

Net Amount

Percentage
of Amount
Assumed
to Net

44,530 $ 412,415 $ 1,482,511 $1,114,626

133%

34,028 $ 430,374 $ 1,465,701 $1,069,355

137%

17,794 $ 422,950 $ 1,356,205 $ 951,049

143%

SCHEDULE VI

RENAISSANCERE HOLDINGS LTD. AND SUBSIDIARIES

SUPPLEMENTARY INSURANCE INFORMATION CONCERNING
PROPERTY-CASUALTY INSURANCE OPERATIONS
(THOUSANDS OF UNITED STATES DOLLARS)

Deferred
Policy
Acquisition
Costs

Reserves for
Unpaid
Claims
and Claim
Adjustment
Expenses

Discount, if
any,
Deducted

Unearned
Premiums

Earned
Premiums

Net
Investment
Income

Affiliation with Registrant
Consolidated Subsidiaries

Year ended December 31, 2013

Year ended December 31, 2012

Year ended December 31, 2011

81,684

$ 1,563,730

52,622

$ 1,879,377

43,721

$ 1,992,354

— $ 477,888

$1,114,626

$ 208,028

— $ 399,517

$1,069,355

$ 165,725

— $ 347,655

$ 951,049

$ 146,871

Affiliation with Registrant
Consolidated Subsidiaries

Claims and Claim
Adjustment Expenses
Incurred Related to

Current
Year

Prior Year

Amortization
of Deferred
Policy
Acquisition
Costs

Paid
Claims
and Claim
Adjustment
Expenses

Net
Premiums
Written

Year ended December 31, 2013

$ 315,241

$ (143,954) $

125,501

$ 395,447

$1,203,947

Year ended December 31, 2012

$ 483,180

$ (157,969) $

113,542

$ 226,671

$1,102,657

Year ended December 31, 2011

$ 993,168

$ (131,989) $

97,376

$ 428,986

$1,012,773

S-8

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

EXHIBITS

FORM 10-K

Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year
ended December 31, 2013.

RenaissanceRe Holdings Ltd.

Exhibits

(a)

Financial Statements, Financial Statement Schedules and Exhibits.

Financial Statements

Financial Statement Schedules

3.1

3.2

3.3

3.4

4.1

4.2

Exhibits

Memorandum of Association. (1)

Amended and Restated Bye-Laws. (2)

Memorandum of Increase in Share Capital of RenaissanceRe Holdings Ltd. (3)

Specimen Common Share certificate. (1)

Certificate of Designation, Preferences and Rights of 6.08% Series C Preference Shares. (4)

Certificate of Designation, Preferences and Rights of 5.375% Series E Preference Shares. (5)

4.2(a)

Form of Stock Certificate Evidencing the 5.375% Series E Preference Shares. (5)

4.3

4.3(a)

4.3(b)

4.3(c)

4.4

4.4(a)

4.5

4.5(a)

4.6

Senior Indenture, dated as of March 17, 2010, among RenRe North America Holdings Inc., as
Issuer, RenaissanceRe Holdings Ltd., as Guarantor, and Deutsche Bank Trust Companies
America, as Trustee. (6)

Senior Debt Securities Guarantee Agreement, dated as of March 17, 2010, between
RenaissanceRe Holdings Ltd., as Guarantor, and Deutsche Bank Trust Companies America, as
Guarantee Trustee. (6)

Waiver Agreement, dated as of January 21, 2011, by and among RenRe North America
Holdings Inc., RenaissanceRe Holdings Ltd. and Deutsche Bank Trust Company Americas, as
Trustee. (7)

Master Reimbursement Agreement, dated as of April 29, 2009, by and between Renaissance
Reinsurance Ltd. and Citibank Europe PLC. (10)

Pledge Agreement, dated as of April 29, 2009, by and between Renaissance Reinsurance Ltd.
and Citibank Europe PLC. (10)

4.7

Facility Letter, dated September 17, 2010, from Citibank Europe plc to Renaissance
Reinsurance Ltd., DaVinci Reinsurance Ltd. and Glencoe Insurance Ltd. (11)

4.7(a)

4.7(b)

10.1

10.2

10.3

10.4

10.5

10.5(a)

10.5(b)

10.5(c)

10.6

10.7

10.8

10.8(a)

10.8(b)

10.8(c)

10.8(d)

10.8(e)

10.8(f)

10.8(g)

10.8(h)

10.8(i)

10.8(j)

10.9

10.9(a)

10.9(b)

Further Amended and Restated Employment Agreement, dated as of May 15, 2013, by and
between RenaissanceRe Holdings Ltd. and Kevin J. O'Donnell (13)

Form of the Amended and Restated Employment Agreement for Named Executive Officers
(other than our Chief Executive Officer). (14)

Further Amended and Restated Employment Agreement, dated as of October 23, 2013, by and
between RenaissanceRe Holdings Ltd. and Jeffrey D. Kelly. (15)

Transition and Services Agreement, dated as of May 15, 2013, between RenaissanceRe
Holdings Ltd. and Neill A. Currie. (13)

Further Amended and Restated Employment Agreement, dated as of February 19, 2009,
between RenaissanceRe Holdings Ltd. and Neill A. Currie. (16)
Amendment No. 1 to the Further Amended and Restated Employment Agreement, dated
January 8, 2010, by and among RenaissanceRe Holdings Ltd. and Neill A. Currie. (17)