During PartnerRe’s first 25 years as a reinsurer, everything has changed and nothing has changed. From its roots as a pure catastrophe player, PartnerRe has dramatically evolved—or diversified—over the years.

Executive Summary

"There's been more change over the last two years inside PartnerRe than there's been over the last 10," according to President and CEO Emmanuel Clarke. The reinsurance company's leader discussed its evolution with International Editor L.S. Howard, including its strategy to focus on being a pure reinsurer. He also described a culture of innovation and a decentralized structure—two ingredients that have helped the one-time catastrophe player to be nimble in moving out of commodity business to become a specialty provider of customized coverages. See related article on Clarke's leadership lessons.

PartnerRe was one of the new breed of catastrophe reinsurers that set up in Bermuda after Hurricane Andrew in 1993. Today, its property-catastrophe business represents up to 5 percent of net premium, while life and health reinsurance is close to 25 percent of premium, affirmed Emmanuel Clarke, president and CEO of PartnerRe Ltd. and CEO Specialty.

In the early days of PartnerRe’s existence, property-cat premiums provided profitable returns in the double digits, Clarke recalled. But with the influx of traditional and alternative capital, and a large number of competitors, the margins have been compressed and profits are lower, he said.

While cat reinsurance used to be one of the biggest contributors to earnings for the reinsurance industry, now it’s a commodity, one class out of many, Clarke said. PartnerRe’s major profit contributors are and will continue to be generated from classes where there are more barriers to entry, where it’s more difficult to jump into the market, particularly for alternative capital players, he said.

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