RenaissanceRe under ratings watch
AM Best has placed Bermudian reinsurer RenaissanceRe and its subsidiaries under review with negative implications for financial strength and debt ratings.
The rating review follows the company’s receipt of a Wells Notice from the Securities and Exchange Commission (SEC) on 27 September following restatements of financial results.
It is the third Wells Notice relating to RenaissanceRe and indicates that the SEC is preparing to take civil action against the company.
In July CEO James Stanard and senior vice-president Michael Cash had received Wells Notices for their involvement in finite transactions at the company.
In the latest edition of Insider Week’s sister publication IQ we quoted a senior industry source as saying that Stanard was in a “difficult position” with the SEC and its new chairman Christopher Cox.
He added: “What is clear is that Stanard will lose credibility and can’t run the company under current circumstances.”
RenaissanceRe said it is cooperating with the SEC and other government agencies investigating the firm.
In February, the company said it planned to restate financial results for 2001 through 2003 to correct accounting errors discovered in connection with an internal review.
Operating subsidiaries included in AM Best’s negative review include Renaissance Reinsurance, Glencoe Insurance, Lantana Insurance, Stonington Insurance Company and Stonington Lloyds. Also under review is DaVinci Reinsurance which is partially owned by RenaissanceRe.