UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

CURRENT REPORT

Pursuant To Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): July 28, 2014

PartnerRe Ltd.

(Exact Name of Registrant as Specified in Charter)

Bermuda

(State or Other Jurisdiction of Incorporation)

 

001-14536		Not Applicable
(Commission File Number)		(IRS Employer Identification No.)
Wellesley House, 90 Pitts Bay Road, Pembroke, Bermuda		HM 08
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (441) 292-0888

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02	Results of Operations and Financial Condition

On July 28, 2014, PartnerRe Ltd. issued a press release reporting its 2014 second quarter results. A copy of the press release, as well as a financial supplement, are attached hereto as Exhibits 99.1 and 99.2, respectively, to this Form 8-K and are hereby incorporated by reference to this Item 2.02.

As provided in General Instruction B.2 of Form 8-K, the information and exhibits contained in this Form 8-K are not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, are not otherwise subject to the liabilities of that section and are not incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.

 

Item 8.01	Other Events

On July 28, 2014, PartnerRe Ltd. issued a press release reporting that its Board of Directors has declared a dividend of $0.67 per common share. A copy of the press release is attached as Exhibit 99.3 to this Form 8-K and is hereby incorporated by reference to this Item 8.01.

 

Item 9.01	Financial Statements and Exhibits

(d)	Exhibits.

Exhibit No.		Description
99.1		Press Release of PartnerRe Ltd., dated July 28, 2014
99.2		Financial Supplement
99.3		Press Release of PartnerRe Ltd., dated July 28, 2014

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

						PartnerRe Ltd.
						(Registrant)
Date:		July 28, 2014				By:		/s/ Marc Wetherhill
								Name: Marc Wetherhill
								Title:   Chief Legal Counsel

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Index to Exhibits

 

Exhibit No.			Description
99.1			Press Release of PartnerRe Ltd., dated July 28, 2014
99.2			Financial Supplement
99.3			Press Release of PartnerRe Ltd., dated July 28, 2014

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Exhibit 99.1

News Release

PartnerRe Ltd. Reports Second Quarter and Half Year 2014 Results

•	Second Quarter Operating Earnings per share of $2.60; Net Income per share of $5.02

•	Second Quarter Annualized Operating ROE of 9.5%; Annualized Net Income ROE of 18.4%

•	Half Year Operating Earnings per share of $5.97; Net Income per share of $10.64

•	Half Year Annualized Operating ROE of 10.9%; Annualized Net Income ROE of 19.5%

•	Book Value of $118.96 per share, up 4.2% for the quarter and up 8.9% year-to-date

•	Tangible Book Value of $107.80 per share, up 4.6% for the quarter and up 9.5% year-to-date

PEMBROKE, Bermuda, July 28, 2014 — PartnerRe Ltd. (NYSE: PRE) today reported net income of $257.7 million, or $5.02 per share for the second quarter of 2014. This includes net after-tax realized and unrealized gains on investments of $123.7 million, or $2.41 per share. The net loss for the second quarter of 2013 was $190.4 million, or $3.37 per share, including net after-tax realized and unrealized losses on investments of $230.0 million, or $4.07 per share. The Company reported operating earnings of $133.5 million, or $2.60 per share, for the second quarter of 2014. This compares to operating earnings of $51.1 million, or $0.90 per share, for the second quarter of 2013.

Net income for the first six months of 2014 was $553.3 million, or $10.64 per share. This includes net after-tax realized and unrealized gains on investments of $239.6 million, or $4.61 per share. Net income for the first six months of 2013 was $20.2 million, or $0.34 per share, including net after-tax realized and unrealized losses on investments of $217.7 million, or $3.72 per share. Operating earnings for the first six months of 2014 were $310.4 million, or $5.97 per share. This compares to operating earnings of $253.1 million, or $4.32 per share, for the first six months of 2013.

Operating earnings or loss excludes certain net after-tax realized and unrealized investment gains and losses, net after-tax foreign exchange gains and losses, certain net after-tax interest in results of equity method investments and the loss on redemption of preferred shares, and is calculated after the payment of preferred dividends. All references to per share amounts in the text of this press release are on a fully diluted basis.

Commenting on results, PartnerRe President & Chief Executive Officer Costas Miranthis said, “We had a good second quarter, on the back of the strong results we posted in the first quarter. Our seasonal earnings pattern for catastrophe premium resulted in lower cat premiums earned during the second quarter. In addition, we experienced a higher than average number of mid-sized individual non-catastrophe losses, an area where we expect some quarterly volatility. We are pleased however that the underlying loss ratio on attritional losses continues to be healthy. We also had very strong investment performance during the

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

quarter. All together, this culminated in us growing our dividend-adjusted tangible book value per share by 10.8% for the first six months of 2014.”

Mr. Miranthis added, “Market conditions remain very competitive and excess reinsurance capacity is putting pressure on premium rates as well as on terms and conditions. While this is a difficult market, I am confident that our experienced teams coupled with the strength of our franchise will enable us to tackle the challenges ahead.”

Highlights for the second quarter and first six months of 2014 compared to the same periods in 2013 include:

Results of operations:

•

For the second quarter, net premiums written of $1.4 billion were up 8%, or 7% on a constant foreign exchange basis. The increase was driven by the Life and Health segment and the North America and Global Specialty Non-life sub-segments. The increase was primarily driven by PartnerRe Health's accident and health business in the Life and Health segment and new business written at the January 1 renewals across multiple lines of business in the North America and Global Specialty Non-life sub-segments. These increases were partially offset by decreases in the Catastrophe and Global (Non-U.S.) P&C Non-life sub-segments. For the first six months of 2014, net premiums written of $3.2 billion were up 7% primarily due to the same factors describing the second quarter.

•

For the second quarter, net premiums earned of $1.4 billion were up 12%, or 11% on a constant foreign exchange basis. The increase was primarily driven by PartnerRe Health's business in the Life and Health segment and the earning of new business written in 2013 and 2014 in the North America and Global Specialty Non-life sub-segments. For the first six months of 2014, net premiums earned of $2.6 billion were up 11%, or 10% on a constant foreign exchange basis, primarily due to the same factors describing the second quarter.

•

For the second quarter, the Non-life combined ratio was 91.5%. The combined ratio benefited from favorable prior year development of 15.4 points (or $161 million). Except for the Catastrophe sub-segment, all other Non-life sub-segments experienced net favorable development on prior accident years during the second quarter. For the first six months of 2014, the Non-life combined ratio was 87.8%. The combined ratio benefited from favorable prior year development of 16.0 points (or $325 million). All Non-life sub-segments experienced net favorable development on prior accident years during the first six months of 2014.

•	For the second quarter, net investment income of $130 million was up 4%, or 3% on a constant foreign exchange basis, primarily driven by the impact of a rise in the U.S. Consumer Price Index on our Treasury Inflation Protected Securities portfolio and certain other one-time favorable adjustments, partially offset by lower reinvestment rates. For the first six months of 2014, net

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

investment income of $247 million was down 1% primarily reflecting lower reinvestment rates, partially offset by various factors.

•	For the second quarter and first six months of 2014, pre-tax net realized and unrealized investment gains were $166 million and $308 million, respectively, primarily reflecting decreases in longer-term risk-free interest rates, narrowing credit spreads, and improvements in worldwide equity markets.

•	For the second quarter, the effective tax rate on operating earnings and non-operating earnings was 16% and 28%, respectively. For the first six months of 2014, the effective tax rate on operating earnings and non-operating earnings was 15% and 24%, respectively.

Balance sheet and capitalization:

•	Total investments, cash and funds held – directly managed were $17.5 billion at June 30, 2014, comparable to December 31, 2013.

•	Net Non-life loss and loss expense reserves were $10.2 billion at June 30, 2014, down 2% compared to December 31, 2013.

•	Net policy benefits for life and annuity contracts were $2.1 billion at June 30, 2014, up 7% compared to December 31, 2013.

•	Total capital was $7.7 billion at June 30, 2014, up 3% compared to December 31, 2013 primarily driven by net income for the first six months of 2014, which was partially offset by share repurchases and common and preferred dividend payments.

•

The Company repurchased approximately 1.3 million common shares at a total cost of approximately $133 million during the second quarter of 2014. The average repurchase price of $105.12 per share represents an 8% discount to the diluted book value per share at March 31, 2014. Since July 1, 2014, the Company has repurchased 150 thousand common shares at a total cost of approximately $16 million. As of July 28, 2014, approximately 1.7 million common shares remained under the current repurchase authorization.

•	Total shareholders’ equity attributable to PartnerRe was $6.9 billion at June 30, 2014, up 3% compared to December 31, 2013. The increase was driven by the same factors described above for total capital.

•

Book value per common share was $118.96 at June 30, 2014, a record high for PartnerRe, up 8.9% compared to $109.26 at December 31, 2013. Tangible book value per common share was $107.80 at June 30, 2014, up 9.5% compared to $98.49 at December 31, 2013. The increases were primarily driven by net income and the accretive impact of share repurchases, which was partially offset by common and preferred dividend payments.

Segment and sub-segment highlights for the second quarter and first six months of 2014 compared to the same periods in 2013 include:

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

Non-life:

•

For the second quarter, the Non-life segment’s net premiums written were up 3%. The increase was reported in the North America and Global Specialty sub-segments and was partially offset by decreases in the Global (Non-U.S.) P&C and Catastrophe sub-segments. For the first six months of 2014, the Non-life segment’s net premiums written were up 4% due to the same factors describing the second quarter.

•

For the second quarter, the North America sub-segment’s net premiums written were up 9% primarily driven by new business written in the agriculture, multi-line and credit/surety lines of business at the January 1, 2014 renewals. The increases were partially offset by cancellations and renewal decreases in the property line of business. This sub-segment reported a technical ratio of 87.6%, which included 17.3 points (or $68 million) of net favorable prior year loss development. For the first six months of 2014, the North America sub-segment’s net premiums written were up 14% primarily due to the same factors describing the second quarter and due to the restructuring of a significant treaty in the agriculture line of business. This sub-segment reported a technical ratio of 90.2%, which included 12.0 points (or $92 million) of net favorable prior year loss development.

•

For the second quarter, the Global (Non-U.S.) P&C sub-segment’s net premiums written were down 6%, or 7% on a constant foreign exchange basis, primarily due to downward prior year premium adjustments in the motor line of business and cancellations in the property line of business. These decreases were partially offset by new business written in the motor line of business. This sub-segment reported a technical ratio of 82.5%, which included 16.2 points (or $30 million) of net favorable prior year loss development. For the first six months of 2014, the Global (Non-U.S.) P&C sub-segment’s net premiums written were down 3%, or 4% on a constant foreign exchange basis, primarily driven by cancellations due to pricing, increased retentions, and share decreases in the property line of business. This sub-segment reported a technical ratio of 82.5%, which included 21.0 points (or $77 million) of net favorable prior year loss development.

•

For the second quarter, the Global Specialty sub-segment’s net premiums written were up 6%, or 4% on a constant foreign exchange basis, primarily due to new business written in prior periods in the specialty casualty, multi-line and agriculture lines of business. These increases were partially offset by lower premium adjustments in the engineering line of business and cancellations in the marine line of business. This sub-segment reported a technical ratio of 90.7%, which included 17.1 points (or $69 million) of net favorable prior year loss development and 4.5 points (or $18 million) of net adverse prior quarter development. For the first six months of 2014, the Global Specialty sub-segment’s net premiums written were up 7%, or 6% on a constant foreign exchange basis, primarily due to the same factors describing the second quarter. This sub-segment reported a technical ratio of 85.3%, which included 16.9 points (or $128 million) of net favorable prior year loss development.

•	For the second quarter, the Catastrophe sub-segment’s net premiums written were down 9%, or 8% on a constant foreign exchange basis, primarily due to the impact of reinstatement premiums

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

related to the European and Canadian floods in the second quarter of 2013. New business written during the second quarter was offset by cancellations, non-renewals and the restructuring of certain treaties. This sub-segment reported a technical ratio of 46.4%, which included 10.2 points (or $6 million) of net adverse prior year loss development. For the first six months of 2014, the Catastrophe sub-segment’s net premiums written were down 13%, or 12% on a constant foreign exchange basis, primarily due to the same factors describing the second quarter. This sub-segment reported a technical ratio of 10.5%, which included 20.2 points (or $28 million) of net favorable prior year loss development.

 

Life and Health:

•

For the second quarter, the Life and Health segment’s net premiums written were up 34%, or 29% on a constant foreign exchange basis. The increase was primarily driven by PartnerRe Health’s accident and health line of business and, to a lesser extent, the mortality and longevity lines of business. For the first six months of 2014, the Life and Health segment’s net premiums written were up 23%, or 20% on a constant foreign exchange basis, primarily due to the same factors describing the second quarter.

•

For the second quarter, the Life and Health segment’s allocated underwriting result, which includes allocated investment income and operating expenses, decreased to $18 million compared to $19 million in the same period of 2013 primarily due to a lower level of net favorable prior year loss development, which was partially offset by increased profitability from the PartnerRe Health business. For the first six months of 2014, the Life and Health segment’s allocated underwriting result, which includes allocated investment income and operating expenses, decreased to $32 million compared to $35 million in the same period of 2013 primarily due to the same factors describing the second quarter.

Corporate and Other:

•

For the second quarter, investment and capital markets activities contributed income of $290 million to pre-tax net income, excluding investment income allocated to the Life and Health segment. Of this amount, income of $119 million was included in pre-tax operating earnings and income of $171 million related to net realized and unrealized gains on investments and earnings from equity method investee companies was included in pre-tax non-operating earnings. For the first six months of 2014, investment and capital markets activities contributed income of $538 million to pre-tax net income, excluding investment income allocated to the Life and Health segment. Of this amount, income of $219 million was included in pre-tax operating earnings and income of $319 million related to net realized and unrealized gains on investments and earnings from equity method investee companies was included in pre-tax non-operating earnings.

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

Separately, as announced by the Company earlier today, the Board of Directors declared a quarterly dividend of $0.67 per common share. The dividend will be payable on August 29, 2014 to common shareholders of record on August 18, 2014.

The Company has posted its second quarter 2014 financial supplement on its website www.partnerre.com in the Investor Relations section on the Financial Reports page under Supplementary Financial Data, which includes a reconciliation of GAAP and non-GAAP measures.

The Company will hold a dial-in conference call and question and answer session with investors at 10 a.m. Eastern tomorrow, July 29. Investors and analysts are encouraged to call in 15 minutes prior to the commencement of the call. The conference call can be accessed by dialing (800)-533-7619 or, from outside the United States, by dialing (785)-830-1923. The media are invited to listen to the call live over the Internet on the Investor Relations section of PartnerRe’s web site, www.partnerre.com. To listen to the webcast, please log on to the broadcast at least five minutes prior to the start.

 

_________________________________________

 

Net income/loss per share is defined as net income/loss attributable to PartnerRe common shareholders divided by the weighted average number of fully diluted shares outstanding for the period. Net income/loss attributable to PartnerRe common shareholders is defined as net income/loss attributable to PartnerRe less preferred dividends and loss on redemption of preferred shares.

Operating earnings/loss is defined as net income/loss available to PartnerRe common shareholders excluding certain after-tax net realized and unrealized gains/losses on investments, after-tax net foreign exchange gains/losses, the loss on redemption of preferred shares and certain after-tax interest in earnings/losses of equity method investments. Operating earnings/loss per share is defined as operating earnings/loss divided by the weighted average number of fully diluted shares outstanding for the period.

The Company uses operating earnings, diluted operating earnings per share and annualized operating return on beginning diluted book value per common and common share equivalents outstanding to measure performance, as these measures focus on the underlying fundamentals of our operations without the impact of after-tax net realized and unrealized gains/losses on investments (except where the Company has made a strategic investment in an insurance or reinsurance related investee), after-tax net foreign exchange gains/losses, and the after-tax interest in earnings/losses of equity method investments (except where the Company has made a strategic investment in an insurance or reinsurance related investee and where the Company does not control the investees activities).

The Company uses technical ratio and technical result as measures of underwriting performance. The technical ratio is defined as the sum of the loss and acquisition ratios. These metrics exclude other operating expenses.

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

The Company also uses combined ratio to measure results for the Non-life segment. The combined ratio is the sum of the technical and other operating expense ratios.

The Company uses allocated underwriting result as a measure of underwriting performance for its Life and Health operations. This metric is defined as net premiums earned, other income or loss and allocated net investment income less life policy benefits, acquisition costs and other operating expenses.

The Company uses total capital, which is defined as total shareholders’ equity attributable to PartnerRe, long-term debt, senior notes and CENts, to manage the capital structure of the Company.

The Company calculates Tangible Book Value using common shareholders’ equity attributable to PartnerRe less goodwill and intangible assets, net of tax. The Company calculates Diluted Tangible Book Value per Common Share using Tangible Book Value divided by the weighted average number of PartnerRe common shares and common share equivalents outstanding. The Company uses these measures as the basis for its prime measure of long-term financial performance (annualized growth in Diluted Tangible Book Value per Common Share plus dividends).

 

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PartnerRe Ltd. is a leading global reinsurer, providing multi-line reinsurance to insurance companies. The Company, through its wholly owned subsidiaries, also offers capital markets products that include weather and credit protection to financial, industrial and service companies. Risks reinsured include property, casualty, motor, agriculture, aviation/space, catastrophe, credit/surety, engineering, energy, marine, specialty property, specialty casualty, multiline and other lines in its Non-life operations, mortality, longevity and accident and health in its Life and Health operations, and alternative risk products. For the year ended December 31, 2013, total revenues were $5.5 billion. At June 30, 2014, total assets were $23.4 billion, total capital was $7.7 billion and total shareholders’ equity attributable to PartnerRe was $6.9 billion.

PartnerRe on the Internet: www.partnerre.com

Forward-looking statements contained in this press release are based on the Company’s assumptions and expectations concerning future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are subject to significant business, economic and competitive risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. PartnerRe’s forward-looking statements could be affected by numerous foreseeable and unforeseeable events and developments such as exposure to catastrophe, or other large property and casualty losses, credit, interest, currency and other risks associated with the Company’s investment portfolio, adequacy of reserves, levels and pricing of new and renewal business achieved, changes in accounting policies, risks associated with implementing business strategies, and other factors identified in the Company’s filings with the Securities and Exchange Commission. In light of the significant uncertainties inherent in the forward-looking information contained herein, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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News Release

on which they are made. The Company disclaims any obligation to publicly update or revise any forward-looking information or statements.

 

Contacts:		PartnerRe Ltd.		Sard Verbinnen & Co.
		(441) 292-0888		(212) 687-8080
		Investor Contact: Robin Sidders		Drew Brown/Daniel Goldstein
		Media Contact: Celia Powell

 

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com

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PartnerRe Ltd.

Consolidated Statements of Operations and Comprehensive Income (Loss)

(Expressed in thousands of U.S. dollars, except share and per share data)

(Unaudited) 

	For the three months ended June 30, 2014				For the three months ended June 30, 2013				For the six months ended June 30, 2014				For the six months ended June 30, 2013
Revenues
Gross premiums written	$	1,462,307			$	1,340,582			$	3,334,047			$	3,097,467
Net premiums written	$	1,418,665			$	1,309,318			$	3,157,159			$	2,945,750
Increase in unearned premiums	(65,596		)		(100,682		)		(550,308		)		(590,434		)
Net premiums earned	1,353,069				1,208,636				2,606,851				2,355,316
Net investment income	129,967				124,503				246,834				248,207
Net realized and unrealized investment gains (losses)	165,717				(299,215		)		307,888				(276,272		)
Other income	9,265				3,878				9,669				7,805
Total revenues	1,658,018				1,037,802				3,171,242				2,335,056
Expenses
Losses and loss expenses and life policy benefits	883,846				866,843				1,633,303				1,527,794
Acquisition costs	302,573				241,743				567,181				475,942
Other operating expenses (1)	107,072				144,833				218,534				260,874
Interest expense	12,240				12,232				24,477				24,460
Amortization of intangible assets	7,003				7,045				14,005				14,091
Net foreign exchange (gains) losses	(2,023		)		10,584				(2,693		)		8,543
Total expenses	1,310,711				1,283,280				2,454,807				2,311,704
Income (loss) before taxes and interest in earnings (losses) of equity method investments	347,307				(245,478		)		716,435				23,352
Income tax expense (benefit)	78,440				(74,569		)		140,746				(32,894		)
Interest in earnings (losses) of equity method investments	4,925				(3,479		)		10,989				3,736
Net income (loss)	273,792				(174,388		)		586,678				59,982
Net income attributable to noncontrolling interests	(1,951		)		(1,183		)		(4,995		)		(1,183		)
Net income (loss) attributable to PartnerRe	271,841				(175,571		)		581,683				58,799
Preferred dividends	14,184				14,796				28,367				29,494
Loss on redemption of preferred shares	—				—				—				9,135
Net income (loss) attributable to PartnerRe common shareholders	$	257,657			$	(190,367	)		$	553,316			$	20,170
Operating earnings attributable to PartnerRe common shareholders	$	133,508			$	51,055			$	310,418			$	253,144
Comprehensive income (loss) attributable to PartnerRe	$	288,630			$	(187,445	)		$	583,023			$	27,858
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	2.66			$	0.90			$	6.09			$	4.41
Net realized and unrealized investment gains (losses), net of tax	2.46				(4.07		)		4.70				(3.79		)
Net foreign exchange losses, net of tax	(0.06		)		(0.10		)		(0.08		)		(0.12		)
Loss on redemption of preferred shares	—				—				—				(0.16		)
Interest in earnings (losses) of equity method investments, net of tax	0.07				(0.10		)		0.15				0.01
Basic net income (loss)	$	5.13			$	(3.37	)		$	10.86			$	0.35
Weighted average number of common shares outstanding	50,241,216				56,485,882				50,942,980				57,449,528
Diluted operating earnings (1)	$	2.60			$	0.90			$	5.97			$	4.32
Net realized and unrealized investment gains (losses), net of tax	2.41				(4.07		)		4.61				(3.72		)
Net foreign exchange losses, net of tax	(0.06		)		(0.10		)		(0.08		)		(0.11		)
Loss on redemption of preferred shares	—				—				—				(0.16		)
Interest in earnings (losses) of equity method investments, net of tax	0.07				(0.10		)		0.14				0.01
Diluted net income (loss)	$	5.02			$	(3.37	)		$	10.64			$	0.34
Weighted average number of common shares and common share equivalents outstanding	51,328,761				56,485,882				52,024,451				58,534,526
Dividends declared per common share	$	0.67			$	0.64			$	1.34			$	1.28
(1) Expense and per share impacts, pre-tax, related to the restructuring of the Company's business support operations and Global Non-life operations:
Expense related to restructuring	$	2,482			$	43,242			$	1,655			$	43,242
Per share impacts related to restructuring	$	0.05			$	0.77			$	0.03			$	0.74

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PartnerRe Ltd.

Consolidated Balance Sheets

(Expressed in thousands of U.S. dollars, except per share and parenthetical share and per share data)

(Unaudited) 

	June 30,				December 31,
	2014				2013
Assets
Investments:
Fixed maturities, at fair value	$	14,006,770			$	13,593,303
Short-term investments, at fair value	31,849				13,546
Equities, at fair value	1,253,082				1,221,053
Other invested assets	293,127				320,981
Total investments	15,584,828				15,148,883
Funds held – directly managed	669,713				785,768
Cash and cash equivalents	1,208,220				1,496,485
Accrued investment income	170,508				185,717
Reinsurance balances receivable	3,015,727				2,465,713
Reinsurance recoverable on paid and unpaid losses	358,804				308,892
Funds held by reinsured companies	863,491				843,081
Deferred acquisition costs	755,769				644,952
Deposit assets	95,133				351,905
Net tax assets	23,231				14,133
Goodwill	456,380				456,380
Intangible assets	173,085				187,090
Other assets	71,584				149,296
Total assets	$	23,446,473			$	23,038,295
Liabilities
Unpaid losses and loss expenses	$	10,399,775			$	10,646,318
Policy benefits for life and annuity contracts	2,127,412				1,974,133
Unearned premiums	2,357,544				1,723,767
Other reinsurance balances payable	254,750				202,549
Deposit liabilities	74,265				328,588
Net tax liabilities	237,302				284,442
Accounts payable, accrued expenses and other	217,033				291,350
Debt related to senior notes	750,000				750,000
Debt related to capital efficient notes	70,989				70,989
Total liabilities	16,489,070				16,272,136
Shareholders’ Equity
Common shares (par value $1.00; issued: 2014, 87,107,093 shares; 2013, 86,657,045 shares)	87,107				86,657
Preferred shares (par value $1.00; issued and outstanding: 2014 and 2013, 34,150,000 shares; aggregate liquidation value: 2014 and 2013, $853,750)	34,150				34,150
Additional paid-in capital	3,928,468				3,901,627
Accumulated other comprehensive loss	(10,898		)		(12,238		)
Retained earnings	5,891,822				5,406,797
Common shares held in treasury, at cost (2014, 37,284,611 shares; 2013, 34,213,611 shares)	(3,020,602		)		(2,707,461		)
Total shareholders’ equity attributable to PartnerRe	6,910,047				6,709,532
Noncontrolling interests	47,356				56,627
Total shareholders’ equity	6,957,403				6,766,159
Total liabilities and shareholders’ equity	$	23,446,473			$	23,038,295
Diluted Book Value Per Common Share and Common Share Equivalents Outstanding (1) (2)	$	118.96			$	109.26
Diluted Tangible Book Value Per Common Share and Common Share Equivalents Outstanding (1) (2)	$	107.80			$	98.49
Number of Common Shares and Common Share Equivalents Outstanding (2)	50,910,028				53,596,034

(1)	Excludes the aggregate liquidation value of preferred shares (2014 and 2013, $853,750) and noncontrolling interests (2014, $47,356; 2013, $56,627).

(2)	Common share and common share equivalents outstanding are calculated using the Treasury Method for all potentially dilutive shares.

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited) 

	For the three months ended June 30, 2014
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non-life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	400			$	155			$	438			$	143			$	1,136			$	326			$	—			$	1,462
Net premiums written	$	392			$	148			$	432			$	136			$	1,108			$	311			$	—			$	1,419
(Increase) decrease in unearned premiums	(2		)		39				(26		)		(77		)		(66		)		—				—				(66		)
Net premiums earned	$	390			$	187			$	406			$	59			$	1,042			$	311			$	—			$	1,353
Losses and loss expenses and life policy benefits	(240		)		(103		)		(270		)		(19		)		(632		)		(252		)		—				(884		)
Acquisition costs	(102		)		(52		)		(98		)		(8		)		(260		)		(43		)		—				(303		)
Technical result	$	48			$	32			$	38			$	32			$	150			$	16			$	—			$	166
Other income																	1				3				5				9
Other operating expenses																	(61		)		(16		)		(30		)		(107		)
Underwriting result																	$	90			$	3			n/a				$	68
Net investment income																					15				115				130
Allocated underwriting result (1)																					$	18			n/a				n/a
Net realized and unrealized investment gains																									166				166
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange gains																									2				2
Income tax expense																									(78		)		(78		)
Interest in earnings of equity method investments																									5				5
Net income																									n/a				$	274
Loss ratio (2)	61.5		%		54.6		%		66.5		%		33.4		%		60.6		%
Acquisition ratio (3)	26.1				27.9				24.2				13.0				25.0
Technical ratio (4)	87.6		%		82.5		%		90.7		%		46.4		%		85.6		%
Other operating expense ratio (5)																	5.9
Combined ratio (6)																	91.5		%
	For the three months ended June 30, 2013
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non-life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	372			$	160			$	413			$	161			$	1,106			$	233			$	2			$	1,341
Net premiums written	$	360			$	158			$	409			$	149			$	1,076			$	232			$	1			$	1,309
(Increase) decrease in unearned premiums	(3		)		11				(37		)		(70		)		(99		)		—				(1		)		(100		)
Net premiums earned	$	357			$	169			$	372			$	79			$	977			$	232			$	—			$	1,209
Losses and loss expenses and life policy benefits	(245		)		(106		)		(284		)		(51		)		(686		)		(181		)		—				(867		)
Acquisition costs	(79		)		(34		)		(90		)		(6		)		(209		)		(33		)		—				(242		)
Technical result	$	33			$	29			$	(2	)		$	22			$	82			$	18			$	—			$	100
Other income																	—				3				1				4
Other operating expenses																	(60		)		(17		)		(68		)		(145		)
Underwriting result																	$	22			$	4			n/a				$	(41	)
Net investment income																					15				110				125
Allocated underwriting result (1)																					$	19			n/a				n/a
Net realized and unrealized investment losses																									(299		)		(299		)
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange losses																									(11		)		(11		)
Income tax benefit																									75				75
Interest in losses of equity method investments																									(4		)		(4		)
Net loss																									n/a				$	(174	)
Loss ratio (2)	68.6		%		62.9		%		76.6		%		64.1		%		70.3		%
Acquisition ratio (3)	22.1				19.9				24.1				8.5				21.4
Technical ratio (4)	90.7		%		82.8		%		100.7		%		72.6		%		91.7		%
Other operating expense ratio (5)																	6.1
Combined ratio (6)																	97.8		%

(1)	Allocated underwriting result is defined as net premiums earned, other income or loss and allocated net investment income less life policy benefits, acquisition costs and other operating expenses.

(2)	Loss ratio is obtained by dividing losses and loss expenses by net premiums earned.

(3)	Acquisition ratio is obtained by dividing acquisition costs by net premiums earned.

(4)	Technical ratio is defined as the sum of the loss ratio and the acquisition ratio.

(5)	Other operating expense ratio is obtained by dividing other operating expenses by net premiums earned.

(6)	Combined ratio is defined as the sum of the technical ratio and the other operating expense ratio.

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited) 

	For the six months ended June 30, 2014
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non-life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	930			$	519			$	917			$	353			$	2,719			$	615			$	—			$	3,334
Net premiums written	$	919			$	508			$	822			$	315			$	2,564			$	593			$	—			$	3,157
Increase in unearned premiums	(151		)		(141		)		(61		)		(177		)		(530		)		(20		)		—				(550		)
Net premiums earned	$	768			$	367			$	761			$	138			$	2,034			$	573			$	—			$	2,607
Losses and loss expenses and life policy benefits	(499		)		(196		)		(471		)		1				(1,165		)		(468		)		—				(1,633		)
Acquisition costs	(194		)		(107		)		(178		)		(15		)		(494		)		(73		)		—				(567		)
Technical result	$	75			$	64			$	112			$	124			$	375			$	32			$	—			$	407
Other income																	2				4				4				10
Other operating expenses																	(126		)		(34		)		(59		)		(219		)
Underwriting result																	$	251			$	2			n/a				$	198
Net investment income																					30				217				247
Allocated underwriting result (1)																					$	32			n/a				n/a
Net realized and unrealized investment gains																									308				308
Interest expense																									(25		)		(25		)
Amortization of intangible assets																									(14		)		(14		)
Net foreign exchange gains																									3				3
Income tax expense																									(141		)		(141		)
Interest in earnings of equity method investments																									11				11
Net income																									n/a				$	587
Loss ratio (2)	65.0		%		53.5		%		61.9		%		(0.9		)%		57.3		%
Acquisition ratio (3)	25.2				29.0				23.4				11.4				24.3
Technical ratio (4)	90.2		%		82.5		%		85.3		%		10.5		%		81.6		%
Other operating expense ratio (5)																	6.2
Combined ratio (6)																	87.8		%
	For the six months ended June 30, 2013
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non-life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	819			$	532			$	857			$	399			$	2,607			$	486			$	4			$	3,097
Net premiums written	$	807			$	525			$	771			$	360			$	2,463			$	481			$	2			$	2,946
Increase in unearned premiums	(117		)		(190		)		(62		)		(195		)		(564		)		(25		)		(2		)		(591		)
Net premiums earned	$	690			$	335			$	709			$	165			$	1,899			$	456			$	—			$	2,355
Losses and loss expenses and life policy benefits	(485		)		(173		)		(469		)		(39		)		(1,166		)		(363		)		1				(1,528		)
Acquisition costs	(151		)		(84		)		(165		)		(17		)		(417		)		(59		)		—				(476		)
Technical result	$	54			$	78			$	75			$	109			$	316			$	34			$	1			$	351
Other income																	—				6				2				8
Other operating expenses																	(126		)		(35		)		(100		)		(261		)
Underwriting result																	$	190			$	5			n/a				$	98
Net investment income																					30				218				248
Allocated underwriting result (1)																					$	35			n/a				n/a
Net realized and unrealized investment losses																									(276		)		(276		)
Interest expense																									(24		)		(24		)
Amortization of intangible assets																									(14		)		(14		)
Net foreign exchange losses																									(9		)		(9		)
Income tax benefit																									33				33
Interest in earnings of equity method investments																									4				4
Net income																									n/a				$	60
Loss ratio (2)	70.2		%		51.8		%		66.1		%		23.8		%		61.4		%
Acquisition ratio (3)	21.9				24.9				23.3				10.5				22.0
Technical ratio (4)	92.1		%		76.7		%		89.4		%		34.3		%		83.4		%
Other operating expense ratio (5)																	6.6
Combined ratio (6)																	90.0		%

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		Exhibit 99.2

                                    

 

  

PartnerRe Ltd.

Financial Supplement

Financial Information

as at June 30, 2014

(unaudited)

The following financial supplement is provided to assist in your understanding of

PartnerRe Ltd.

This report is for information purposes only. It should be read in conjunction with

documents filed with the SEC by PartnerRe Ltd., including the Company’s Annual

Report on Form 10-K and Quarterly Reports on Form 10-Q.

 

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PartnerRe Ltd.

Financial Supplement - June 30, 2014

Table of Contents

	Page
Regulation G
Life Value in Force
Consolidated Financial Statements
Consolidated Statements of Operations	1-2
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Cash Flows	4-5
Consolidated Statements of Comprehensive Income (Loss)	6
Segment Information
For the three months ended June 30, 2014 and 2013	7-8
For the six months ended June 30, 2014 and 2013	9-10
Non-life segment	11-12
North America sub-segment	13-14
Global (Non-U.S.) P&C sub-segment	15-16
Global Specialty sub-segment	17-18
Catastrophe sub-segment	19-20
Life and Health segment	21-22
Corporate and Other	23-24
Distribution of Premiums
Distribution of Premiums by line of business, geography and production source	25-26
Distribution of Premiums by reinsurance type	27-28
Investments
Investment Portfolio	29
Distribution of Corporate Bonds	30
Distribution of Equities	31
Distribution of Mortgage/Asset-Backed Securities	32
Other Invested Assets including Private Markets and Derivative Exposures	33
Funds Held - Directly Managed Portfolio	34
Distribution of Corporate Bonds - Funds Held - Directly Managed Portfolio	35
Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses)	36-37
Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses) on Funds Held - Directly Managed Portfolio	38-39
Loss Reserves
Analysis of Unpaid Losses and Loss Expenses	40-41
Analysis of Policy Benefits for Life and Annuity Contracts	42-43
Reserve Development	44-45
Natural Catastrophe Probable Maximum Losses (PMLs)	46
Reconciliation of GAAP and non-GAAP measures	47-50
Diluted Book Value per Common Share - Treasury Stock Method	51
Diluted Book Value and Diluted Tangible Book Value per Common Share - Rollforward	52-54

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PartnerRe Ltd.

Regulation G

In addition to the GAAP financial measures set forth in this Financial Supplement, the Company has also included certain non-GAAP financial measures within the meaning of Regulation G. Management believes that these non-GAAP financial measures are important to investors, analysts, rating agencies and others who use the Company’s financial information and will help provide a consistent basis for comparison between quarters and for comparison with other companies within the industry. However, investors should consider these non-GAAP measures in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP.

The reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures in accordance with Regulation G is included within the relevant tables.

Operating Earnings (Loss) available to PartnerRe Common Shareholders (Operating Earnings (Loss)), Diluted Operating Earnings (Loss) per Common Share and Annualized Operating Return on Beginning Diluted Book Value per Common Share and Common Share Equivalents Outstanding (Annualized Operating ROE): The Company uses Operating Earnings (Loss), Diluted Operating Earnings (Loss) per Common Share and Annualized Operating ROE to measure performance, as these measures focus on the underlying fundamentals of the Company’s operations. Operating Earnings (Loss) exclude the impact of net realized and unrealized gains and losses on investments, net of tax (except where the Company has made a strategic investment in an insurance or reinsurance related investee), net foreign exchange gains and losses, net of tax, loss on redemption of preferred shares and the interest in earnings (losses) of equity method investments, net of tax (except where the Company has made a strategic investment in an insurance or reinsurance related investee and where the Company does not control the investee’s activities), and are calculated after preferred dividends. The Company calculates Diluted Operating Earnings (Loss) per Common Share using Operating Earnings (Loss) for the period divided by the weighted average number of PartnerRe common shares and common share equivalents outstanding. The Company calculates Annualized Operating ROE using annualized Diluted Operating Earnings (Loss) per Common Share for the period divided by the Diluted Book Value per PartnerRe common share and common share equivalents outstanding as of the beginning of the year. Operating Earnings (Loss) and Diluted Operating Earnings (Loss) per Common Share should not be viewed as a substitute for Net Income (Loss) or Diluted Net Income (Loss) per Common Share prepared in accordance with GAAP. Annualized Operating ROE supplements GAAP information.

Tangible Book Value and Diluted Tangible Book Value per PartnerRe Common Share and Common Share Equivalents Outstanding: The Company calculates Tangible Book Value using common shareholders’ equity attributable to PartnerRe less goodwill and intangible assets, net of tax. The Company calculates Diluted Tangible Book Value per Common Share using Tangible Book Value divided by the weighted average number of PartnerRe common shares and common share equivalents outstanding. The Company uses these measures as the basis for its prime measure of long-term financial performance (annualized growth in Diluted Tangible Book Value per Common Share plus dividends). Management believes annualized growth in Diluted Tangible Book Value per Common Share plus dividends aligns the Company’s stated long-term objectives with the measure most investors use to evaluate total shareholder value creation given that it focuses on the tangible value of total shareholder returns, excluding the impact of goodwill and intangibles.

Book Value and Tangible Book Value excluding Net Unrealized Gains and Losses on Fixed Income Securities and Funds Held - Directly Managed, Net of Tax (Book Value and Tangible Book Value excluding NURGL) and Diluted Book Value and Diluted Tangible Book Value per PartnerRe Common Share and Common Share Equivalents Outstanding (Diluted Book Value and Diluted Tangible Book Value per Common Share) excluding Net Unrealized Gains and Losses on Fixed Income Securities and Funds Held - Directly Managed, Net of Tax (Diluted Book Value and Diluted Tangible Book Value per Common Share excluding NURGL): The Company calculates Book Value and Tangible Book Value excluding NURGL using common shareholders’ equity attributable to PartnerRe and Tangible Book Value, respectively, less net unrealized gains and losses on fixed income securities and funds held - directly managed, net of tax. Book Value and Tangible Book Value excluding NURGL focuses on the underlying fundamentals of the Company’s financial position without the impact of interest rates and credit spreads on the unrealized gains and losses on fixed income securities and funds held - directly managed, net of tax. The Company calculates Diluted Book Value and Diluted Tangible Book Value per Common Share excluding NURGL divided by the weighted average number of common shares and common share equivalents outstanding.

Total Capital: The Company calculates Total Capital as the sum of common shareholders’ equity attributable to PartnerRe, preferred shares, long-term debt, senior notes and capital efficient notes. The Company uses Total Capital as a measure to manage the capital structure of the Company.

All references to per share data, per common share data, common shares and common share equivalent data, and common shareholders’ equity data throughout this Financial Supplement relates to PartnerRe Ltd.’s (PartnerRe) common shareholders.

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PartnerRe Ltd.

Life Value In Force

The Company calculates Value in Force (VIF) for its Life portfolio, which represents the value of the Life portfolio that is not recognized in the Consolidated Balance Sheets prepared under generally accepted accounting principles in the United States (U.S. GAAP). Accordingly, there is no corresponding measure that is prepared in accordance with U.S. GAAP. Management believes that this is useful information for investors, analysts, rating agencies and others. The Life VIF calculation includes the business written in the Company’s Life and Health segment, except for the PartnerRe Health business.

The Company’s Life VIF calculation uses market consistent techniques, but primarily differs from a full Market Consistent Embedded Value (MCEV) calculation, as defined in the European Insurance CFO Forum MCEV principles, due to: (i) different methodologies used; and ii) the Life VIF is only a component of MCEV and, specifically, the tangible assets backing the liabilities are not considered in the Company’s calculation.

The Company’s Life VIF, which is calculated on a going concern basis, is the sum of:

•

present value of future profits - which is defined as the net present value of shareholders’ projected after-tax cash flows from the in-force business on a best-estimate assumption basis. The discount rates used reflect currency-specific market yields on zero coupon government bonds at given durations and are applied to projected deterministic cash flows and to calculate risk-free investment returns. The best-estimate is defined as median biometric assumptions and does not include any provision for adverse deviation. The Company attributes no value to future new business or renewals of short-term business. Allocated inflated-adjusted expenses are projected on a best estimate basis;

•	cost of non-hedgeable risks - which is defined as the cost of holding capital for non-hedgeable financial and non-hedgeable non-financial risks, such as a mortality deviation from shocks or changes in trends. The non-hedgeable risk capital has been determined using an internal economic capital model calibrated to a 99.6% Value at Risk (VaR) corresponding to a 1 in 250 year event;

•	frictional costs - which is defined as the cost of double taxation or investment management charges on assets backing required capital;

•

time value of options and guarantees (TVOG) - which is defined as the difference between the market value and the intrinsic value of the option calculated using stochastic techniques. The TVOG is significant to the guaranteed minimum death benefit (GMDB) portfolio where the Company covers death claims on savings plans, where the sum reinsured is the difference between the invested premium amount and the current fund value; and

•	cost of non-economic excess encumbered capital - which is defined as the cost of any encumbered capital in excess of economic capital required by local regulations.

Actuarial non-economic assumptions, such as current and future mortality, are based on the most recent experience available, combined with internal and industry benchmarks, including trend expectation where appropriate.

The Life VIF is sensitive to changes in assumptions. In particular, the Life VIF is sensitive to changes in yield curves that are used for discounting, changes in equity market value assumptions and implied volatilities.

The Company performs a detailed Life VIF calculation on an annual basis and performs a roll-forward approach on an interim quarterly basis.

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PartnerRe Ltd.

Consolidated Statements of Operations

(Expressed in thousands of U.S. dollars, except share and per share data)

(Unaudited)

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Revenues
Gross premiums written	$	1,462,307			$	1,871,740			$	1,190,761			$	1,281,477			$	1,340,582
Net premiums written	$	1,418,665			$	1,738,494			$	1,186,002			$	1,264,775			$	1,309,318
(Increase) decrease in unearned premiums	(65,596		)		(484,712		)		235,422				156,694				(100,682		)
Net premiums earned	1,353,069				1,253,782				1,421,424				1,421,469				1,208,636
Net investment income	129,967				116,867				114,351				121,811				124,503
Net realized and unrealized investment gains (losses)	165,717				142,172				99,419				16,118				(299,215		)
Other income	9,265				404				3,361				5,399				3,878
Total revenues	1,658,018				1,513,225				1,638,555				1,564,797				1,037,802
Expenses
Losses and loss expenses and life policy benefits	883,846				749,457				879,014				750,999				866,843
Acquisition costs	302,573				264,608				318,738				282,948				241,743
Other operating expenses (1)	107,072				111,462				131,125				108,467				144,833
Interest expense	12,240				12,238				12,236				12,233				12,232
Amortization of intangible assets	7,003				7,002				6,044				7,045				7,045
Net foreign exchange (gains) losses	(2,023		)		(670		)		8,382				1,279				10,584
Total expenses	1,310,711				1,144,097				1,355,539				1,162,971				1,283,280
Income (loss) before taxes and interest in earnings (losses) of equity method investments	347,307				369,128				283,016				401,826				(245,478		)
Income tax expense (benefit)	78,440				62,305				11,078				70,232				(74,569		)
Interest in earnings (losses) of equity method investments	4,925				6,064				3,988				5,941				(3,479		)
Net income (loss)	273,792				312,887				275,926				337,535				(174,388		)
Net income attributable to noncontrolling interests	(1,951		)		(3,044		)		(4,138		)		(4,112		)		(1,183		)
Net income (loss) attributable to PartnerRe	271,841				309,843				271,788				333,423				(175,571		)
Preferred dividends	14,184				14,184				14,184				14,184				14,796
Net income (loss) attributable to PartnerRe common shareholders	$	257,657			$	295,659			$	257,604			$	319,239			$	(190,367	)
Operating earnings attributable to PartnerRe common shareholders	$	133,508			$	176,910			$	157,405			$	311,184			$	51,055
Comprehensive income (loss) attributable to PartnerRe	$	288,630			$	294,394			$	265,577			$	347,740			$	(187,445	)
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	2.66			$	3.43			$	2.97			$	5.80			$	0.90
Net realized and unrealized investment gains (losses), net of tax	2.46				2.24				1.73				(0.02		)		(4.07		)
Net foreign exchange (losses) gains, net of tax	(0.06		)		(0.02		)		0.07				0.10				(0.10		)
Interest in earnings (losses) of equity method investments, net of tax	0.07				0.07				0.09				0.07				(0.10		)
Basic net income (loss)	$	5.13			$	5.72			$	4.86			$	5.95			$	(3.37	)
Weighted average number of common shares outstanding	50,241,216				51,652,177				53,013,136				53,671,245				56,485,882
Diluted operating earnings (1)	$	2.60			$	3.36			$	2.91			$	5.70			$	0.90
Net realized and unrealized investment gains (losses), net of tax	2.41				2.20				1.70				(0.03		)		(4.07		)
Net foreign exchange (losses) gains, net of tax	(0.06		)		(0.02		)		0.07				0.10				(0.10		)
Interest in earnings (losses) of equity method investments, net of tax	0.07				0.07				0.08				0.07				(0.10		)
Diluted net income (loss)	$	5.02			$	5.61			$	4.76			$	5.84			$	(3.37	)
Weighted average number of common shares and common share equivalents outstanding	51,328,761				52,727,573				54,165,736				54,625,151				56,485,882
Dividends declared per common share	$	0.67			$	0.67			$	0.64			$	0.64			$	0.64

(1) Includes an expense related to the restructuring of the Company’s business support operations and Global Non-life operations. See page 23 for the expense and per share impacts.

1

---

PartnerRe Ltd.

Consolidated Statements of Operations

(Expressed in thousands of U.S. dollars, except share and per share data)

(Unaudited)

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Revenues
Gross premiums written	$	3,334,047			$	3,097,467				$	5,569,706			$	4,718,235
Net premiums written	$	3,157,159			$	2,945,750				$	5,396,526			$	4,572,860
Increase in unearned premiums	(550,308		)		(590,434		)			(198,316		)		(86,921		)
Net premiums earned	2,606,851				2,355,316					5,198,210				4,485,939
Net investment income	246,834				248,207					484,367				571,338
Net realized and unrealized investment gains (losses)	307,888				(276,272		)			(160,735		)		493,409
Other income	9,669				7,805					16,565				11,920
Total revenues	3,171,242				2,335,056					5,538,407				5,562,606
Expenses
Losses and loss expenses and life policy benefits	1,633,303				1,527,794					3,157,808				2,804,610
Acquisition costs	567,181				475,942					1,077,628				936,909
Other operating expenses (1)	218,534				260,874					500,466				411,374
Interest expense	24,477				24,460					48,929				48,895
Amortization of intangible assets	14,005				14,091					27,180				31,799
Net foreign exchange (gains) losses	(2,693		)		8,543					18,203				175
Total expenses	2,454,807				2,311,704					4,830,214				4,233,762
Income before taxes and interest in earnings of equity method investments	716,435				23,352					708,193				1,328,844
Income tax expense (benefit)	140,746				(32,894		)			48,416				204,284
Interest in earnings of equity method investments	10,989				3,736					13,665				9,954
Net income	586,678				59,982					673,442				1,134,514
Net income attributable to noncontrolling interests	(4,995		)		(1,183		)			(9,434		)		—
Net income attributable to PartnerRe	581,683				58,799					664,008				1,134,514
Preferred dividends	28,367				29,494					57,861				61,622
Loss on redemption of preferred shares	—				9,135					9,135				—
Net income attributable to PartnerRe common shareholders	$	553,316			$	20,170				$	597,012			$	1,072,892
Operating earnings attributable to PartnerRe common shareholders	$	310,418			$	253,144				$	721,733			$	663,791
Comprehensive income attributable to PartnerRe	$	583,023			$	27,858				$	641,173			$	1,157,755
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	6.09			$	4.41				$	13.03			$	10.55
Net realized and unrealized investment gains (losses), net of tax	4.70				(3.79		)			(2.30		)		6.23
Net foreign exchange (losses) gains, net of tax	(0.08		)		(0.12		)			0.05				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.15				0.01					0.16				0.14
Basic net income	$	10.86			$	0.35				$	10.78			$	17.05
Weighted average number of common shares outstanding	50,942,980				57,449,528					55,378,980				62,915,992
Diluted operating earnings (1)	$	5.97			$	4.32				$	12.79			$	10.43
Net realized and unrealized investment gains (losses), net of tax	4.61				(3.72		)			(2.25		)		6.17
Net foreign exchange (losses) gains, net of tax	(0.08		)		(0.11		)			0.04				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.14				0.01					0.16				0.14
Diluted net income	$	10.64			$	0.34				$	10.58			$	16.87
Weighted average number of common shares and common share equivalents outstanding	52,024,451				58,534,526					56,448,105				63,615,748
Dividends declared per common share	$	1.34			$	1.28				$	2.56			$	2.48

(1) Includes an expense related to the restructuring of the Company’s business support operations and Global Non-life operations. See page 24 for the expense and per share impacts.

2

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PartnerRe Ltd.

Condensed Consolidated Balance Sheets

(Expressed in thousands of U.S. dollars, except share and per share data)

(Unaudited)

		June 30,						March 31,						December 31,						September 30,						June 30,							December 31,
		2014						2014						2013						2013						2013							2012
Assets
Total investments		$	15,584,828					$	15,479,461					$	15,148,883					$	15,107,800					$	14,968,652						$	15,973,230
Funds held - directly managed		669,713						764,386						785,768						813,497						842,415							930,741
Cash and cash equivalents		1,208,220						1,269,037						1,496,485						1,551,062						1,261,540							1,121,705
Accrued investment income		170,508						190,169						185,717						175,164						172,794							184,315
Reinsurance balances receivable		3,015,727						3,064,301						2,465,713						2,564,015						2,477,340							1,991,991
Reinsurance recoverable on paid and unpaid losses		358,804						362,149						308,892						339,169						356,011							348,086
Funds held by reinsured companies		863,491						849,256						843,081						831,704						782,992							805,489
Deferred acquisition costs		755,769						725,584						644,952						680,972						676,084							568,391
Goodwill		456,380						456,380						456,380						456,380						456,380							456,380
Intangible assets		173,085						180,088						187,090						193,134						200,179							214,270
Other assets		189,948						176,692						515,334						425,310						376,193							385,834
Total Assets		$	23,446,473					$	23,517,503					$	23,038,295					$	23,138,207					$	22,570,580						$	22,980,432
Liabilities
Unpaid losses and loss expenses		$	10,399,775					$	10,529,717					$	10,646,318					$	10,564,542					$	10,336,368						$	10,709,371
Policy benefits for life and annuity contracts		2,127,412						2,118,479						1,974,133						1,908,575						1,799,332							1,813,244
Unearned premiums		2,357,544						2,299,250						1,723,767						1,997,853						2,162,112							1,534,625
Other reinsurance balances payable		254,750						269,487						202,549						232,711						244,583							238,578
Debt obligations		820,989						820,989						820,989						820,989						820,989							820,989
Other liabilities		528,600						638,982						904,380						989,361						791,920							930,129
Total liabilities		16,489,070						16,676,904						16,272,136						16,514,031						16,155,304							16,046,936
Total shareholders’ equity attributable to PartnerRe		6,910,047						6,780,928						6,709,532						6,571,687						6,366,957							6,933,496
Noncontrolling interests		47,356						59,671						56,627						52,489						48,319							—
Total shareholders’ equity		6,957,403						6,840,599						6,766,159						6,624,176						6,415,276							6,933,496
Total liabilities and shareholders’ equity		$	23,446,473					$	23,517,503					$	23,038,295					$	23,138,207					$	22,570,580						$	22,980,432
Diluted Book Value Per Common Share		$	118.96					$	114.13					$	109.26					$	105.53					$	99.65						$	100.84
Diluted Tangible Book Value Per Common Share		$	107.80					$	103.10					$	98.49					$	94.86					$	89.09						$	90.86
Number of Common Shares and Common Share Equivalents Outstanding		50,910,028						51,935,217						53,596,034						54,181,672						55,325,581							59,893,366
Capital Structure:
Senior notes (1)		$	750,000		10	%		$	750,000		10	%		$	750,000		10	%		$	750,000		10	%		$	750,000		10	%			$	750,000		10	%
Capital efficient notes (2)		63,384			1			63,384			1			63,384			1			63,384			1			63,384			1				63,384			1
Preferred shares, aggregate liquidation value		853,750			11			853,750			11			853,750			11			853,750			12			853,750			12				893,750			11
Common shareholders’ equity attributable to PartnerRe		6,056,297			78			5,927,178			78			5,855,782			78			5,717,937			77			5,513,207			77				6,039,746			78
Total Capital		$	7,723,431		100	%		$	7,594,312		100	%		$	7,522,916		100	%		$	7,385,071		100	%		$	7,180,341		100	%			$	7,746,880		100	%

(1)	PartnerRe Finance A LLC and PartnerRe Finance B LLC, the issuers of the senior notes, do not meet U.S. GAAP consolidation requirements. Accordingly, the Company shows the related intercompany debt of $250.0 million and $500.0 million, respectively, on its Condensed Consolidated Balance Sheets.

(2)	PartnerRe Finance II, the issuer of the capital efficient notes, does not meet U.S. GAAP consolidation requirements. Accordingly, the Company shows the related intercompany debt of $71.0 million on its Condensed Consolidated Balance Sheets.

3

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PartnerRe Ltd.

Condensed Consolidated Statements of Cash Flows

(Expressed in millions of U.S. dollars)

(Unaudited)

 

		For the three months ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2014				2014				2013				2013				2013
Net cash provided by operating activities:
Underwriting operations		$	66			$	33			$	133			$	201			$	8
Investment income		176				142				138				161				173
Taxes and foreign exchange		(100		)		(96		)		(27		)		(9		)		(65		)
Net cash provided by operating activities		$	142			$	79			$	244			$	353			$	116
Net cash provided by operating activities		$	142			$	79			$	244			$	353			$	116
Net cash (used in) provided by investing activities		(15		)		(71		)		(167		)		95				200
Net cash used in financing activities		(189		)		(232		)		(130		)		(169		)		(342		)
Effect of foreign exchange rate changes on cash		1				(3		)		(2		)		10				1
(Decrease) increase in cash and cash equivalents		(61		)		(227		)		(55		)		289				(25		)
Cash and cash equivalents - beginning of period		1,269				1,496				1,551				1,262				1,287
Cash and cash equivalents - end of period		$	1,208			$	1,269			$	1,496			$	1,551			$	1,262

4

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PartnerRe Ltd.

Condensed Consolidated Statements of Cash Flows

(Expressed in millions of U.S. dollars)

(Unaudited)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Net cash provided by operating activities:
Underwriting operations	$	99			$	3				$	337			$	100
Investment income	319				339					637				717
Taxes and foreign exchange	(197		)		(111		)			(147		)		(124		)
Net cash provided by operating activities	$	221			$	231				$	827			$	693
Net cash provided by operating activities	$	221			$	231				$	827			$	693
Net cash (used in) provided by investing activities	(86		)		489					418				(219		)
Net cash used in financing activities	(421		)		(567		)			(866		)		(688		)
Effect of foreign exchange rate changes on cash	(2		)		(13		)			(5		)		(6		)
(Decrease) increase in cash and cash equivalents	(288		)		140					374				(220		)
Cash and cash equivalents - beginning of period	1,496				1,122					1,122				1,342
Cash and cash equivalents - end of period	$	1,208			$	1,262				$	1,496			$	1,122

5

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PartnerRe Ltd.

Consolidated Statements of Comprehensive Income (Loss)

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Net income (loss) attributable to PartnerRe	$	271,841			$	309,843			$	271,788			$	333,423			$	(175,571	)
Change in currency translation adjustment	17,020				(15,223		)		(14,866		)		14,432				(11,514		)
Change in net unrealized gains or losses on investments, net of tax	(222		)		(225		)		(226		)		(229		)		(230		)
Change in unfunded pension obligation, net of tax	(9		)		(1		)		8,881				114				(130		)
Comprehensive income (loss) attributable to PartnerRe	$	288,630			$	294,394			$	265,577			$	347,740			$	(187,445	)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Net income attributable to PartnerRe	$	581,683			$	58,799				$	664,008			$	1,134,514
Change in currency translation adjustment	1,797				(31,344		)			(31,778		)		28,488
Change in net unrealized gains or losses on investments, net of tax	(447		)		(463		)			(918		)		(953		)
Change in unfunded pension obligation, net of tax	(10		)		866					9,861				(4,294		)
Comprehensive income attributable to PartnerRe	$	583,023			$	27,858				$	641,173			$	1,157,755

6

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

For the three months ended June 30, 2014
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non- life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	400			$	155			$	438			$	143			$	1,136			$	326			$	—			$	1,462
Net premiums written	$	392			$	148			$	432			$	136			$	1,108			311				$	—			$	1,419
(Increase) decrease in unearned premiums	(2		)		39				(26		)		(77		)		(66		)		—				—				(66		)
Net premiums earned	$	390			$	187			$	406			$	59			$	1,042			$	311			$	—			$	1,353
Losses and loss expenses and life policy benefits	(240		)		(103		)		(270		)		(19		)		(632		)		(252		)		—				(884		)
Acquisition costs	(102		)		(52		)		(98		)		(8		)		(260		)		(43		)		—				(303		)
Technical result	$	48			$	32			$	38			$	32			$	150			$	16			$	—			$	166
Other income																	1				3				5				9
Other operating expenses																	(61		)		(16		)		(30		)		(107		)
Underwriting result																	$	90			$	3			n/a				$	68
Net investment income																					15				115				130
Allocated underwriting result (1)																					$	18			n/a				n/a
Net realized and unrealized investment gains																									166				166
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange gains																									2				2
Income tax expense																									(78		)		(78		)
Interest in earnings of equity method investments																									5				5
Net income																									n/a				$	274
Loss ratio (2)	61.5		%		54.6		%		66.5		%		33.4		%		60.6		%
Acquisition ratio (3)	26.1				27.9				24.2				13.0				25.0
Technical ratio (4)	87.6		%		82.5		%		90.7		%		46.4		%		85.6		%
Other operating expense ratio (5)																	5.9
Combined ratio (6)																	91.5		%

 

(1)	Allocated underwriting result is defined as net premiums earned, other income or loss and allocated net investment income less life policy benefits, acquisition costs and other operating expenses.

(2)	Loss ratio is obtained by dividing losses and loss expenses by net premiums earned.

(3)	Acquisition ratio is obtained by dividing acquisition costs by net premiums earned.

(4)	Technical ratio is defined as the sum of the loss ratio and the acquisition ratio.

(5)	Other operating expense ratio is obtained by dividing other operating expenses by net premiums earned.

(6)	Combined ratio is defined as the sum of the technical ratio and the other operating expense ratio.

7

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

 

For the three months ended June 30, 2013
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non- life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	372			$	160			$	413			$	161			$	1,106			$	233			$	2			$	1,341
Net premiums written	$	360			$	158			$	409			$	149			$	1,076			$	232			$	1			$	1,309
(Increase) decrease in unearned premiums	(3		)		11				(37		)		(70		)		(99		)		—				(1		)		(100		)
Net premiums earned	$	357			$	169			$	372			$	79			$	977			$	232			$	—			$	1,209
Losses and loss expenses and life policy benefits	(245		)		(106		)		(284		)		(51		)		(686		)		(181		)		—				(867		)
Acquisition costs	(79		)		(34		)		(90		)		(6		)		(209		)		(33		)		—				(242		)
Technical result	$	33			$	29			$	(2	)		$	22			$	82			$	18			$	—			$	100
Other income																	—				3				1				4
Other operating expenses																	(60		)		(17		)		(68		)		(145		)
Underwriting result																	$	22			$	4			n/a				$	(41	)
Net investment income																					15				110				125
Allocated underwriting result (1)																					$	19			n/a				n/a
Net realized and unrealized investment losses																									(299		)		(299		)
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange losses																									(11		)		(11		)
Income tax benefit																									75				75
Interest in losses of equity method investments																									(4		)		(4		)
Net loss																									n/a				$	(174	)
Loss ratio (2)	68.6		%		62.9		%		76.6		%		64.1		%		70.3		%
Acquisition ratio (3)	22.1				19.9				24.1				8.5				21.4
Technical ratio (4)	90.7		%		82.8		%		100.7		%		72.6		%		91.7		%
Other operating expense ratio (5)																	6.1
Combined ratio (6)																	97.8		%

8

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

 

For the six months ended June 30, 2014
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non- life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	930			$	519			$	917			$	353			$	2,719			$	615			$	—			$	3,334
Net premiums written	$	919			$	508			$	822			$	315			$	2,564			$	593			$	—			$	3,157
Increase in unearned premiums	(151		)		(141		)		(61		)		(177		)		(530		)		(20		)		—				(550		)
Net premiums earned	$	768			$	367			$	761			$	138			$	2,034			$	573			$	—			$	2,607
Losses and loss expenses and life policy benefits	(499		)		(196		)		(471		)		1				(1,165		)		(468		)		—				(1,633		)
Acquisition costs	(194		)		(107		)		(178		)		(15		)		(494		)		(73		)		—				(567		)
Technical result	$	75			$	64			$	112			$	124			$	375			$	32			$	—			$	407
Other income																	2				4				4				10
Other operating expenses																	(126		)		(34		)		(59		)		(219		)
Underwriting result																	$	251			$	2			n/a				$	198
Net investment income																					30				217				247
Allocated underwriting result (1)																					$	32			n/a				n/a
Net realized and unrealized investment gains																									308				308
Interest expense																									(25		)		(25		)
Amortization of intangible assets																									(14		)		(14		)
Net foreign exchange gains																									3				3
Income tax expense																									(141		)		(141		)
Interest in earnings of equity method investments																									11				11
Net income																									n/a				$	587
Loss ratio (2)	65.0		%		53.5		%		61.9		%		(0.9		)%		57.3		%
Acquisition ratio (3)	25.2				29.0				23.4				11.4				24.3
Technical ratio (4)	90.2		%		82.5		%		85.3		%		10.5		%		81.6		%
Other operating expense ratio (5)																	6.2
Combined ratio (6)																	87.8		%

 

9

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

 

For the six months ended June 30, 2013
	North America				Global (Non-U.S.) P&C				Global Specialty				Catastrophe				Total Non- life segment				Life and Health segment				Corporate and Other				Total
Gross premiums written	$	819			$	532			$	857			$	399			$	2,607			$	486			$	4			$	3,097
Net premiums written	$	807			$	525			$	771			$	360			$	2,463			$	481			$	2			$	2,946
Increase in unearned premiums	(117		)		(190		)		(62		)		(195		)		(564		)		(25		)		(2		)		(591		)
Net premiums earned	$	690			$	335			$	709			$	165			$	1,899			$	456			$	—			$	2,355
Losses and loss expenses and life policy benefits	(485		)		(173		)		(469		)		(39		)		(1,166		)		(363		)		1				(1,528		)
Acquisition costs	(151		)		(84		)		(165		)		(17		)		(417		)		(59		)		—				(476		)
Technical result	$	54			$	78			$	75			$	109			$	316			$	34			$	1			$	351
Other income																	—				6				2				8
Other operating expenses																	(126		)		(35		)		(100		)		(261		)
Underwriting result																	$	190			$	5			n/a				$	98
Net investment income																					30				218				248
Allocated underwriting result (1)																					$	35			n/a				n/a
Net realized and unrealized investment losses																									(276		)		(276		)
Interest expense																									(24		)		(24		)
Amortization of intangible assets																									(14		)		(14		)
Net foreign exchange losses																									(9		)		(9		)
Income tax benefit																									33				33
Interest in earnings of equity method investments																									4				4
Net income																									n/a				$	60
Loss ratio (2)	70.2		%		51.8		%		66.1		%		23.8		%		61.4		%
Acquisition ratio (3)	21.9				24.9				23.3				10.5				22.0
Technical ratio (4)	92.1		%		76.7		%		89.4		%		34.3		%		83.4		%
Other operating expense ratio (5)																	6.6
Combined ratio (6)																	90.0		%

10

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Non-life segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	1,136			$	1,583			$	941			$	1,041			$	1,106
Net premiums written	$	1,108			$	1,456			$	937			$	1,026			$	1,076
Net premiums earned	$	1,042			$	992			$	1,162			$	1,173			$	977
Losses and loss expenses	(632		)		(534		)		(677		)		(557		)		(686		)
Acquisition costs	(260		)		(233		)		(276		)		(259		)		(209		)
Technical result	$	150			$	225			$	209			$	357			$	82
Other income	1				1				—				2				—
Other operating expenses	(61		)		(65		)		(70		)		(62		)		(60		)
Underwriting result	$	90			$	161			$	139			$	297			$	22
Loss ratio (2)	60.6		%		53.8		%		58.2		%		47.5		%		70.3		%
Acquisition ratio (3)	25.0				23.6				23.8				22.1				21.4
Technical ratio (4)	85.6		%		77.4		%		82.0		%		69.6		%		91.7		%
Other operating expense ratio (5)	5.9				6.5				6.0				5.3				6.1
Combined ratio (6)	91.5		%		83.9		%		88.0		%		74.9		%		97.8		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $2.7 million and $4.7 million, respectively, compared to the three months ended June 30, 2013.

11

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Non-life segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	2,719			$	2,607				$	4,590			$	3,910
Net premiums written	$	2,564			$	2,463				$	4,427			$	3,768
Net premiums earned	$	2,034			$	1,899				$	4,235			$	3,684
Losses and loss expenses	(1,165		)		(1,166		)			(2,400		)		(2,155		)
Acquisition costs	(494		)		(417		)			(953		)		(821		)
Technical result	$	375			$	316				$	882			$	708
Other income	2				—					3				5
Other operating expenses	(126		)		(126		)			(259		)		(257		)
Underwriting result	$	251			$	190				$	626			$	456
Loss ratio (2)	57.3		%		61.4		%			56.7		%		58.5		%
Acquisition ratio (3)	24.3				22.0					22.5				22.3
Technical ratio (4)	81.6		%		83.4		%			79.2		%		80.8		%
Other operating expense ratio (5)	6.2				6.6					6.1				7.0
Combined ratio (6)	87.8		%		90.0		%			85.3		%		87.8		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $0.7 million and $(2.8) million, respectively, compared to the six months ended June 30, 2013.

12

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

North America sub-segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	400			$	530			$	372			$	409			$	372
Net premiums written	$	392			$	527			$	372			$	408			$	360
Net premiums earned	$	390			$	379			$	417			$	425			$	357
Losses and loss expenses	(240		)		(260		)		(293		)		(197		)		(245		)
Acquisition costs	(102		)		(92		)		(98		)		(101		)		(79		)
Technical result	$	48			$	27			$	26			$	127			$	33
Loss ratio (2)	61.5		%		68.6		%		70.2		%		46.3		%		68.6		%
Acquisition ratio (3)	26.1				24.3				23.5				23.9				22.1
Technical ratio (4)	87.6		%		92.9		%		93.7		%		70.2		%		90.7		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	31		%		31		%		40		%		31		%		28		%
Casualty	38				33				33				37				38
Credit/Surety	6				8				4				3				5
Motor	3				4				4				3				4
Multiline	8				9				5				4				5
Other	3				1				1				8				3
Property	11				14				13				14				17
Total	100		%		100		%		100		%		100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(1.6) million and $(1.3) million, respectively, compared to the three months ended June 30, 2013.

13

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

North America sub-segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	930			$	819				$	1,601			$	1,221
Net premiums written	$	919			$	807				$	1,587			$	1,219
Net premiums earned	$	768			$	690				$	1,533			$	1,176
Losses and loss expenses	(499		)		(485		)			(975		)		(816		)
Acquisition costs	(194		)		(151		)			(351		)		(291		)
Technical result	$	75			$	54				$	207			$	69
Loss ratio (2)	65.0		%		70.2		%			63.6		%		69.4		%
Acquisition ratio (3)	25.2				21.9					22.9				24.7
Technical ratio (4)	90.2		%		92.1		%			86.5		%		94.1		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	31		%		25		%			30		%		19		%
Casualty	35				39					37				43
Credit/Surety	7				3					3				4
Motor	4				4					4				4
Multiline	8				8					6				7
Other	2				5					5				3
Property	13				16					15				20
Total	100		%		100		%			100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(4.3) million and $(3.1) million, respectively, compared to the six months ended June 30, 2013.

14

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global (Non-U.S.) P&C sub-segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	155			$	364			$	128			$	157			$	160
Net premiums written	$	148			$	361			$	128			$	157			$	158
Net premiums earned	$	187			$	179			$	213			$	195			$	169
Losses and loss expenses	(103		)		(94		)		(110		)		(90		)		(106		)
Acquisition costs	(52		)		(54		)		(62		)		(50		)		(34		)
Technical result	$	32			$	31			$	41			$	55			$	29
Loss ratio (2)	54.6		%		52.4		%		51.5		%		46.0		%		62.9		%
Acquisition ratio (3)	27.9		%		30.1				29.4				25.7				19.9
Technical ratio (4)	82.5		%		82.5		%		80.9		%		71.7		%		82.8		%
Distribution of Net Premiums Written by Major Lines of Business:
Casualty	8		%		10		%		5		%		9		%		10		%
Motor	37				37				54				35				34
Property	55				53				41				56				56
Total	100		%		100		%		100		%		100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $1.2 million and $2.8 million, respectively, compared to the three months ended June 30, 2013.

15

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global (Non-U.S.) P&C sub-segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	519			$	532				$	818			$	684
Net premiums written	$	508			$	525				$	811			$	681
Net premiums earned	$	367			$	335				$	743			$	678
Losses and loss expenses	(196		)		(173		)			(373		)		(415		)
Acquisition costs	(107		)		(84		)			(196		)		(167		)
Technical result	$	64			$	78				$	174			$	96
Loss ratio (2)	53.5		%		51.8		%			50.2		%		61.3		%
Acquisition ratio (3)	29.0				24.9					26.4				24.6
Technical ratio (4)	82.5		%		76.7		%			76.6		%		85.9		%
Distribution of Net Premiums Written by Major Lines of Business:
Casualty	9		%		10		%			9		%		11		%
Motor	37				34					37				28
Property	54				56					54				61
Total	100		%		100		%			100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $3.5 million and $0.7 million, respectively, compared to the six months ended June 30, 2013.

16

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global Specialty sub-segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	438			$	479			$	423			$	396			$	413
Net premiums written	$	432			$	389			$	419			$	389			$	409
Net premiums earned	$	406			$	355			$	415			$	382			$	372
Losses and loss expenses	(270		)		(201		)		(223		)		(228		)		(284		)
Acquisition costs	(98		)		(79		)		(105		)		(92		)		(90		)
Technical result	$	38			$	75			$	87			$	62			$	(2	)
Loss ratio (2)	66.5		%		56.6		%		53.8		%		59.8		%		76.6		%
Acquisition ratio (3)	24.2				22.4				25.2				24.0				24.1
Technical ratio (4)	90.7		%		79.0		%		79.0		%		83.8		%		100.7		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	14		%		13		%		8		%		6		%		11		%
Aviation/Space	13				8				16				13				12
Credit/Surety	15				19				17				19				18
Energy	5				3				5				6				6
Engineering	9				10				16				14				14
Marine	15				16				19				19				19
Multiline	6				10				3				3				3
Other	1				1				—				—				—
Specialty casualty	10				14				8				8				6
Specialty property	12				6				8				12				11
Total	100		%		100		%		100		%		100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $5.1 million and $4.9 million, respectively, compared to the three months ended June 30, 2013.

17

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global Specialty sub-segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	917			$	857				$	1,676			$	1,505
Net premiums written	$	822			$	771				$	1,579			$	1,415
Net premiums earned	$	761			$	709				$	1,506			$	1,373
Losses and loss expenses	(471		)		(469		)			(920		)		(821		)
Acquisition costs	(178		)		(165		)			(362		)		(321		)
Technical result	$	112			$	75				$	224			$	231
Loss ratio (2)	61.9		%		66.1		%			61.1		%		59.8		%
Acquisition ratio (3)	23.4				23.3					24.0				23.4
Technical ratio (4)	85.3		%		89.4		%			85.1		%		83.2		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	13		%		10		%			9		%		6		%
Aviation/Space	11				11					13				15
Credit/Surety	17				19					19				19
Energy	4				5					5				7
Engineering	9				13					14				12
Marine	16				20					19				22
Multiline	8				3					3				—
Other	1				—					—				—
Specialty casualty	12				10					9				7
Specialty property	9				9					9				12
Total	100		%		100		%			100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $5.4 million and $4.2 million, respectively, compared to the six months ended June 30, 2013.

18

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Catastrophe sub-segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	143			$	210			$	18			$	79			$	161
Net premiums written	$	136			$	179			$	18			$	72			$	149
Net premiums earned	$	59			$	79			$	117			$	171			$	79
Losses and loss expenses	(19		)		21				(51		)		(42		)		(51		)
Acquisition costs	(8		)		(8		)		(11		)		(16		)		(6		)
Technical result	$	32			$	92			$	55			$	113			$	22
Loss ratio (2)	33.4		%		(26.5		)%		43.2		%		24.5		%		64.1		%
Acquisition ratio (3)	13.0				10.1				9.5				9.0				8.5
Technical ratio (4)	46.4		%		(16.4		)%		52.7		%		33.5		%		72.6		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(1.9) million and $(1.6) million, respectively, compared to the three months ended June 30, 2013.

19

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Catastrophe sub-segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	353			$	399				$	495			$	500
Net premiums written	$	315			$	360				$	450			$	453
Net premiums earned	$	138			$	165				$	453			$	457
Losses and loss expenses	1				(39		)			(132		)		(103		)
Acquisition costs	(15		)		(17		)			(44		)		(42		)
Technical result	$	124			$	109				$	277			$	312
Loss ratio (2)	(0.9		)%		23.8		%			29.0		%		22.4		%
Acquisition ratio (3)	11.4				10.5					9.7				9.3
Technical ratio (4)	10.5		%		34.3		%			38.7		%		31.7		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(4.0) million and $(4.7) million, respectively, compared to the six months ended June 30, 2013.

20

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Life and Health segment

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Gross premiums written	$	326			$	289			$	250			$	235			$	233
Net premiums written	$	311			$	282			$	249			$	234			$	232
Net premiums earned	$	311			$	262			$	258			$	243			$	232
Life policy benefits	(252		)		(215		)		(202		)		(195		)		(181		)
Acquisition costs	(43		)		(32		)		(42		)		(24		)		(33		)
Technical result	$	16			$	15			$	14			$	24			$	18
Other income	3				1				3				3				3
Other operating expenses	(16		)		(17		)		(19		)		(17		)		(17		)
Underwriting result	$	3			$	(1	)		$	(2	)		$	10			$	4
Net investment income	15				15				15				15				15
Allocated underwriting result (1)	$	18			$	14			$	13			$	25			$	19
Distribution of Net Premiums Written by Major Lines of Business:
Accident and Health	27		%		16		%		15		%		17		%		14		%
Longevity	22				25				27				26				26
Mortality	51				59				58				57				60
Total	100		%		100		%		100		%		100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $11.7 million and $11.4 million, respectively, compared to the three months ended June 30, 2013.

21

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Life and Health segment

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	615			$	486				$	972			$	802
Net premiums written	$	593			$	481				$	964			$	799
Net premiums earned	$	573			$	456				$	957			$	795
Life policy benefits	(468		)		(363		)			(760		)		(647		)
Acquisition costs	(73		)		(59		)			(125		)		(116		)
Technical result	$	32			$	34				$	72			$	32
Other income	4				6					11				4
Other operating expenses	(34		)		(35		)			(71		)		(52		)
Underwriting result	$	2			$	5				$	12			$	(16	)
Net investment income	30				30					61				64
Allocated underwriting result (1)	$	32			$	35				$	73			$	48
Distribution of Net Premiums Written by Major Lines of Business:
Accident and Health	22		%		13		%			15		%		3		%
Longevity	23				25					26				31
Mortality	55				62					59				66
Total	100		%		100		%			100		%		100		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $16.1 million and $15.4 million, respectively, compared to the six months ended June 30, 2013.

22

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Corporate and Other

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014 (A)				2014				2013				2013				2013
Technical result	$	—			$	—			$	1			$	6			$	—
Other income	5				(2		)		—				—				1
Corporate expenses - costs of restructuring (1)	(2		)		—				(12		)		(2		)		(43		)
Corporate expenses	(27		)		(28		)		(28		)		(25		)		(23		)
Other operating expenses	(1		)		(1		)		(2		)		(2		)		(2		)
Net investment income	115				102				99				107				110
Net realized and unrealized investment gains (losses)	166				142				99				16				(299		)
Interest expense	(12		)		(12		)		(12		)		(12		)		(12		)
Amortization of intangible assets	(7		)		(7		)		(6		)		(7		)		(7		)
Net foreign exchange gains (losses)	2				—				(8		)		(1		)		(11		)
Income tax (expense) benefit	(78		)		(62		)		(11		)		(70		)		75
Interest in earnings (losses) of equity method investments	5				6				4				6				(4		)

 

(1)

The costs of restructuring relate to the Company’s reorganization of its business support and Global Non-life operations. During the three months ended June 30, 2014 and the three months ended December 31, 2013, these costs predominantly comprised of facility exit costs, while during the three months ended September 30, 2013 and the three months ended June 30, 2013, these costs predominantly comprised of severance costs related to the Company’s voluntary and involuntary termination plans. For the three months ended June 30, 2014, three months ended December 31, 2013, three months ended September 30, 2013 and three months ended June 30, 2013, these costs had a per diluted share impact, pre-tax, of $0.05, $0.22, $0.04 and $0.77, respectively.

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Corporate and Other

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Technical result	$	—			$	1				$	8			$	4
Other income	4				2					3				3
Corporate expenses - costs of restructuring (1)	(2		)		(43		)			(58		)		—
Corporate expenses	(55		)		(53		)			(105		)		(88		)
Other operating expenses	(2		)		(4		)			(7		)		(14		)
Net investment income	217				218					423				507
Net realized and unrealized investment gains (losses)	308				(276		)			(161		)		494
Interest expense	(25		)		(24		)			(49		)		(49		)
Amortization of intangible assets	(14		)		(14		)			(27		)		(32		)
Net foreign exchange gains (losses)	3				(9		)			(18		)		—
Income tax (expense) benefit	(141		)		33					(49		)		(204		)
Interest in earnings (losses) of equity method investments	11				4					14				10

 

(1)

The costs of restructuring relate to the Company’s reorganization of its business support and Global Non-life operations. During the six months ended June 30, 2014, these costs predominantly comprised of facility exit costs. During the six months ended June 30, 2013 and the year ended December 31, 2013, these costs predominantly comprised of severance costs related to the Company's voluntary and involuntary termination plans, and to a lesser extent, facility exit costs. For the six months ended June 30, 2014 and 2013 and the year ended December 31, 2013, these costs had a per diluted share impact, pre-tax, of $0.03, $0.74, and $1.03, respectively.

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited) 

	For the three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2014			2014			2013			2013			2013
Distribution of Net Premiums Written by Line of Business:
Non-life
Property and casualty
Casualty	11	%		12	%		11	%		13	%		12	%
Motor	5			9			7			5			5
Multiline and other	5			5			3			5			3
Property	9			15			8			12			11
Specialty
Agriculture	13			12			15			12			11
Aviation/Space	4			2			6			4			4
Catastrophe	9			10			1			6			11
Credit/Surety	6			7			7			7			7
Energy	1			1			2			2			2
Engineering	3			2			6			4			4
Marine	5			4			7			6			6
Specialty casualty	3			3			3			2			2
Specialty property	4			2			3			4			4
Life and Health	22			16			21			18			18
	100	%		100	%		100	%		100	%		100	%
Distribution of Gross Premiums Written by Geography:
Asia, Australia and New Zealand	13	%		9	%		11	%		11	%		13	%
Europe	35			45			39			35			36
Latin America, Caribbean and Africa	9			8			11			12			10
North America	43			38			39			42			41
	100	%		100	%		100	%		100	%		100	%
Distribution of Gross Premiums Written by Production Source:
Broker	69	%		71	%		67	%		72	%		72	%
Direct	31			29			33			28			28
	100	%		100	%		100	%		100	%		100	%

25

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited)

 

	For the six months ended							For the year ended
	June 30,			June 30,				December 31,			December 31,
	2014			2013				2013			2012
Distribution of Net Premiums Written by Line of Business:
Non-life
Property and casualty
Casualty	12	%		13	%			12	%		13	%
Motor	7			7				7			5
Multiline and other	5			4				4			3
Property	12			15				12			14
Specialty
Agriculture	13			10				11			7
Aviation/Space	3			3				4			5
Catastrophe	10			12				8			10
Credit/Surety	6			6				6			7
Energy	1			1				2			2
Engineering	3			3				4			4
Marine	4			5				6			7
Specialty casualty	3			3				3			2
Specialty property	2			2				3			4
Life and Health	19			16				18			17
	100	%		100	%			100	%		100	%
Distribution of Gross Premiums Written by Geography:
Asia, Australia and New Zealand	11	%		10	%			11	%		11	%
Europe	41			42				40			41
Latin America, Caribbean and Africa	8			10				10			11
North America	40			38				39			37
	100	%		100	%			100	%		100	%
Distribution of Gross Premiums Written by Production Source:
Broker	70	%		71	%			71	%		69	%
Direct	30			29				29			31
	100	%		100	%			100	%		100	%

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited)

 

	For the three months ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2014			2014			2013			2013			2013
Distribution of Gross Premiums Written by Reinsurance Type for the Non-life sub-segment:
North America
Non-Proportional	11	%		24	%		7	%		14	%		17	%
Proportional	89			76			93			86			83
Total	100	%		100	%		100	%		100	%		100	%
Global (Non-U.S.) P&C
Non-Proportional	8	%		37	%		4	%		10	%		10	%
Proportional	92			63			96			90			90
Total	100	%		100	%		100	%		100	%		100	%
Global Specialty
Non-Proportional	16	%		26	%		11	%		16	%		18	%
Proportional	84			74			89			84			82
Total	100	%		100	%		100	%		100	%		100	%
Catastrophe
Non-Proportional	96	%		98	%		97	%		96	%		97	%
Proportional	4			2			3			4			3
Total	100	%		100	%		100	%		100	%		100	%
Non-life total
Non-Proportional	23	%		38	%		10	%		20	%		28	%
Proportional	77			62			90			80			72
Total	100	%		100	%		100	%		100	%		100	%

27

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited)

 

	For the six months ended							For the year ended
	June 30,			June 30,				December 31,			December 31,
	2014			2013				2013			2012
Distribution of Gross Premiums Written by Reinsurance Type for the Non-life sub-segment:
North America
Non-Proportional	19	%		25	%			18	%		26	%
Proportional	81			75				82			74
Total	100	%		100	%			100	%		100	%
Global (Non-U.S.) P&C
Non-Proportional	28	%		28	%			21	%		24	%
Proportional	72			72				79			76
Total	100	%		100	%			100	%		100	%
Global Specialty
Non-Proportional	21	%		25	%			19	%		20	%
Proportional	79			75				81			80
Total	100	%		100	%			100	%		100	%
Catastrophe
Non-Proportional	97	%		98	%			98	%		98	%
Proportional	3			2				2			2
Total	100	%		100	%			100	%		100	%
Non-life total
Non-Proportional	32	%		37	%			28	%		33	%
Proportional	68			63				72			67
Total	100	%		100	%			100	%		100	%

28

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PartnerRe Ltd.

Investment Portfolio

(Expressed in millions of U.S. dollars)

(Unaudited)

	June 30,							March 31,							December 31,							September 30,							June 30,								December 31,
	2014							2014							2013							2013							2013								2012
Investments:
Fixed maturities
U.S. government	$	1,827			12	%		$	1,850			12	%		$	1,599			11	%		$	1,459			10	%		$	960			6	%			$	1,113			7	%
U.S. government sponsored enterprises	29				—			16				—			25				—			36				—			31				—				18				—
U.S. states, territories and municipalities	221				1			130				1			124				1			306				2			237				2				243				1
Non-U.S. sovereign government, supranational and government related	2,289				15			2,332				15			2,354				15			2,344				16			2,140				14				2,376				15
Corporates	5,981				38			5,989				39			6,049				40			6,042				40			6,246				42				6,656				42
Mortgage/asset-backed securities	3,660				24			3,581				23			3,442				23			3,494				23			3,766				25				3,989				25
Total fixed maturities	14,007				90			13,898				90			13,593				90			13,681				91			13,380				89				14,395				90
Short-term investments	32				—			29				—			14				—			37				—			29				—				151				1
Equities	1,253				8			1,250				8			1,221				8			1,122				7			1,173				8				1,094				7
Other invested assets	293				2			302				2			321				2			268				2			387				3				333				2
Total investments	$	15,585			100	%		$	15,479			100	%		$	15,149			100	%		$	15,108			100	%		$	14,969			100	%			$	15,973			100	%
Cash and cash equivalents	1,208							1,269							1,496							1,551							1,262								1,122
Total investments and cash	$	16,793						$	16,748						$	16,645						$	16,659						$	16,231							$	17,095
Maturity distribution:
One year or less	$	428			3	%		$	383			3	%		$	378			3	%		$	492			4	%		$	654			5				$	1,081			7	%
More than one year through five years	5,212				37			5,359				38			5,057				37			4,790				35			4,377				33				4,198				29
More than five years through ten years	3,790				27			3,806				27			3,962				29			3,883				28			3,705				27				4,337				30
More than ten years	949				7			798				6			768				6			1,059				8			907				7				941				7
Subtotal	10,379				74			10,346				74			10,165				75			10,224				75			9,643				72				10,557				73
Mortgage/asset-backed securities	3,660				26			3,581				26			3,442				25			3,494				25			3,766				28				3,989				27
Total	$	14,039			100	%		$	13,927			100	%		$	13,607			100	%		$	13,718			100	%		$	13,409			100	%			$	14,546			100	%
Credit quality by market value:
AAA	12			%				13			%				14			%				14			%				13			%					13			%
AA	43							42							41							39							40								42
A	20							21							21							22							24								23
BBB	17							16							16							16							15								15
Below Investment Grade/Unrated	8							8							8							9							8								7
	100			%				100			%				100			%				100			%				100			%					100			%
Expected average duration (1)	3.4			Yrs				3.2			Yrs				3.0			Yrs				2.7			Yrs				2.6			Yrs					2.7			Yrs
Average yield to maturity at market (1)	2.2			%				2.5			%				2.5			%				2.5			%				2.6			%					2.0			%
Average credit quality	A							A							A							A							A								A

 (1) Includes funds holding fixed income securities that are classified with equities under generally accepted accounting principles in the United States.

29

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PartnerRe Ltd.

Distribution of Corporate Bonds

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

June 30, 2014
	Fair Value				Percentage to Total Fair Value of Corporate Bonds				Percentage to Invested Assets and cash				Largest single issuer as a percentage of Invested Assets and cash
Distribution by sector - Corporate bonds
Finance	$	1,492,225			25.0		%		8.9		%		0.9		%
Consumer noncyclical	801,180				13.4				4.8				0.3
Communications	751,564				12.6				4.5				0.5
Utilities	575,258				9.6				3.4				0.3
Energy	511,259				8.5				3.0				0.2
Industrials	467,203				7.8				2.8				0.2
Consumer cyclical	353,337				5.9				2.1				0.2
Insurance	292,811				4.9				1.7				0.2
Basic materials	183,269				3.1				1.1				0.2
Technology	156,363				2.6				0.9				0.2
Real estate investment trusts	142,792				2.4				0.9				0.1
Government guaranteed corporate debt	118,946				2.0				0.7				0.7
Catastrophe bonds	95,998				1.6				0.6				0.1
Longevity and mortality bonds	24,617				0.4				0.1				0.1
Diversified	13,830				0.2				0.1				0.1
Total Corporate bonds	$	5,980,652			100.0		%		35.6		%
Finance sector - Corporate bonds
Banks	$	831,871			13.9		%		5.0		%
Investment banking and brokerage	326,399				5.5				2.0
Financial services	188,991				3.2				1.1
Commercial and consumer finance	122,717				2.0				0.7
Other	22,247				0.4				0.1
Total finance sector - Corporate bonds	$	1,492,225			25.0		%		8.9		%
	AAA				AA				A				BBB				Non-Investment Grade/Unrated				Total
Credit quality of finance sector - Corporate bonds
Banks	$	8,090			$	105,447			$	530,687			$	187,647			$	—			$	831,871
Investment banking and brokerage	—				—				285,123				40,143				1,133				326,399
Financial services	—				144,256				37,461				4,193				3,081				188,991
Commercial and consumer finance	—				514				20,276				101,927				—				122,717
Other	—				5,210				13,080				3,957				—				22,247
Total finance sector - Corporate bonds	$	8,090			$	255,427			$	886,627			$	337,867			$	4,214			$	1,492,225
% of total	1		%		17		%		59		%		23		%		—				100		%

Concentration of investment risk

The top 10 Corporate bond issuers account for 18.0% of the Company’s total corporate bonds. The single largest issuer accounts for 2.6% of the Company’s total Corporate bonds.

30

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PartnerRe Ltd.

Distribution of Equities

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	June 30, 2014
	Fair Value				Percentage to Total Fair Value of Equities			Percentage to Invested Assets and cash			Largest single issuer as a percentage of Invested Assets and cash
Distribution by sector - Equities
Real estate investment trusts	$	224,501			22.1	%		1.3	%		0.2	%
Energy	154,368				15.2			0.9			0.1
Finance	127,536				12.5			0.8			0.2
Insurance	122,864				12.1			0.7			0.6
Consumer noncyclical	100,022				9.8			0.6			—
Communications	80,623				7.9			0.5			0.1
Technology	60,074				5.9			0.4			0.1
Industrials	49,759				4.9			0.3			—
Consumer cyclical	41,279				4.1			0.3			—
Utilities	35,141				3.5			0.2			0.1
Basic materials	17,773				1.8			0.1			—
Diversified	2,079				0.2			—			—
Total	$	1,016,019			100.0	%		6.1	%
Mutual funds and exchange traded funds (ETFs)
Funds holding fixed income securities	190,060							1.1
Funds and ETFs holding equities	47,003							0.3
Total Equities	$	1,253,082						7.5	%

Concentration of investment risk

The single largest fund in funds and ETFs holding equities is an emerging markets fixed income fund, which accounts for 8.3% of the Company’s total equities. Excluding equity securities held in mutual funds and exchange traded funds, the top 10 common stock issuers account for 26.7% of the Company’s total equities. Excluding equity securities held in mutual funds and exchange traded funds, the single largest issuer accounts for 10.0% of the Company’s total equities.

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PartnerRe Ltd.

Distribution of Mortgage/Asset-Backed Securities ⁽¹⁾ 

(Expressed in thousands of U.S. dollars)

(Unaudited)

Fixed Maturities - Mortgage/Asset-Backed Securities by type and by rating

 

	Rating at June 30, 2014
	GNMA				GSEs				AAA				AA				A				BBB				Non-Investment Grade/Unrated				Total
U.S. Asset-Backed Securities	$	—			$	—			$	133,189			$	139,043			$	103,803			$	376			$	505,840			$	882,251
U.S. Collaterized Mortgage Obligations	—				2,879				3,635				—				—				—				—				6,514
U.S. Mortgage Backed Securities (MBS)	417,424				1,400,138				—				—				—				—				—				1,817,562
U.S. Commercial Mortgage Backed Securities (CMBS)	5,609				—				8,264				12,734				14,059				—				1,878				42,544
U.S. MBS Interest Only	33,907				63,767				4,129				—				—				—				15,964				117,767
	$	456,940			$	1,466,784			$	149,217			$	151,777			$	117,862			$	376			$	523,682			$	2,866,638
Non-U.S. Asset-Backed Securities	$	—			$	—			$	161,019			$	78,098			$	56,649			$	15,755			$	20,800			$	332,321
Non-U.S. Collaterized Mortgage Obligations	—				—				167,741				69,164				54,338				—				—				291,243
Non-U.S. Commercial Mortgage Backed Securities (CMBS)	—				—				8,544				—				—				—				—				8,544
Non-U.S. Mortgage Backed Securities (MBS)	—				—				161,855				—				—				—				—				161,855
	$	—			$	—			$	499,159			$	147,262			$	110,987			$	15,755			$	20,800			$	793,963
Total mortgage/asset-backed securities	$	456,940			$	1,466,784			$	648,376			$	299,039			$	228,849			$	16,131			$	544,482			$	3,660,601
Corporate Securities	—				28,728				—				—				—				—				—				28,728
Total	$	456,940			$	1,495,512			$	648,376			$	299,039			$	228,849			$	16,131			$	544,482			$	3,689,329
% of total	12		%		41		%		18		%		8		%		6		%		—				15		%		100		%

 

(1)	In addition to the mortgage/asset-backed securities above, the Company has derivatives exposure to to-be-announced mortgage-backed securities with a notional value of $154.2 million and a carrying value of $1.7 million at June 30, 2014 within Other Invested Assets.

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PartnerRe Ltd.

Other Invested Assets including Private Markets and Derivative Exposures

(Expressed in thousands of U.S. dollars)

(Unaudited)

Carrying and Notional Values of Private Markets Investments and Other Invested Assets

 

	June 30, 2014																					March 31, 2014									December 31, 2013
	Investments				Fair Value of Derivatives				Carrying Value				Net Notional Amount of Derivatives / Other				Total Net Exposures (1)					Carrying Value				Total Net Exposures (1)					Carrying Value				Total Net Exposures (1)
Private Markets Investments
Principal Finance - Investments	$	102,848			$	—			$	102,848			$	—			$	102,848				$	102,916			$	102,916				$	112,636			$	112,636
Principal Finance - Derivative Exposure Assumed (2)	—				(9,047		)		(9,047		)		42,605				33,558					(6,099		)		36,637					(931		)		30,809
Insurance-Linked Securities	—				(950		)		(950		)		270,969				270,019					(740		)		269,512					(268		)		268,456
Strategic Investments	188,373				—				188,373				—				188,373					181,079				181,079					168,854				168,854
Total other invested assets - Private Markets Exposure Assumed	291,221				(9,997		)		281,224				313,574				594,798					277,156				590,144					280,291				580,755
Other Credit Derivatives - Exposure Assumed	—				—				—				—				—					—				—					—				—
Other Credit Derivatives - Protection Purchased	—				—				—				—				—					—				—					(71		)		(14,071		)
Other (3)	8,891				3,012				11,903													25,339									40,761
Total other invested assets	$	300,112			$	(6,985	)		$	293,127												$	302,495								$	320,981

 

(1)

The total net exposures originated in Private Markets are $1,576 million at June 30, 2014 ($1,474 million and $1,484 million at March 31, 2014 and December 31, 2013, respectively). In addition to the net exposures listed above of $595 million at June 30, 2014 ($590 million and $581 million at March 31, 2014 and December 31, 2013, respectively), the Company has the following other net exposures originated in Private Markets:

•	Principal Finance: $711 million of assets listed under Investments - Fixed Maturities and $10 million listed under Investments - Equities for a total exposure of $857 million at June 30, 2014 ($794 million and $793 million at March 31, 2014 and December 31, 2013, respectively).

•	Insurance-Linked Securities: $121 million of bonds listed under Investments - Fixed Maturities for a total exposure of $391 million at June 30, 2014 ($347 million and $361 million at March 31, 2014 and December 31, 2013, respectively).

•	Strategic Investments: $138 million of assets listed under Investments - Equities and $2 million of assets listed under Other Assets for a total exposure of $328 million at June 30, 2014 ($333 million and $330 million at March 31, 2014 and December 31, 2013, respectively).

(2)	The Company enters into interest rate swaps to mitigate notional exposure on certain fixed maturities and total return swaps. Accordingly, the notional value of these interest rate swaps is not presented in the table.

(3)	Other includes foreign currency and fixed income hedging instruments used to manage currency and duration exposure, respectively, and other miscellaneous invested assets.

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PartnerRe Ltd.

Funds Held - Directly Managed Portfolio

(Expressed in millions of U.S. dollars)

(Unaudited)

 

	June 30, 2014							March 31, 2014							December 31, 2013							September 30, 2013							June 30, 2013								December 31, 2012
Investments:
Fixed maturities
U.S. government	$	105			20	%		$	104			17	%		$	108			19	%		$	111			17	%		$	107			16	%			$	129			15	%
U.S. government sponsored enterprises	50				10			50				8			50				9			57				9			65				10				90				11
Non-U.S. sovereign government, supranational and government related	128				25			179				30			137				25			193				30			196				29				234				28
Corporates	215				42			245				41			249				44			259				41			287				43				362				44
Total fixed maturities	498				97	%		578				96			544				97			620				97			655				98				815				98
Short-term investments	—				—			3				1			2				—			2				1			—				—				—				—
Other invested assets	16				3	%		15				3			15				3			16				2			15				2				18				2
Total investments	$	514			100	%		$	596			100	%		$	561			100	%		$	638			100	%		$	670			100	%			$	833			100	%
Cash and cash equivalents	41							37							85							34							20								54
Total investments and cash	$	555						$	633						$	646						$	672						$	690							$	887
Accrued investment income	6							7							7							9							8								10
Other funds held assets/liabilities	109							124							133							133							144								34
Total funds held - directly managed	$	670						$	764						$	786						$	814						$	842							$	931
Maturity distribution:
One year or less	$	72			15	%		$	99			17	%		$	89			16	%		$	97			16	%		$	114			17	%			$	133			17	%
More than one year through five years	261				52			298				51			331				61			377				60			403				62				515				63
More than five years through ten years	165				33			157				27			109				20			122				20			108				16				141				17
More than ten years	—				—			27				5			17				3			26				4			30				5				26				3
Total	$	498			100	%		$	581			100	%		$	546			100	%		$	622			100	%		$	655			100	%			$	815			100	%
Credit quality by market value:
AAA	12			%				15			%				13			%				12			%				12			%					12			%
AA	62							58							58							56							56								58
A	18							21							22							26							26								24
BBB	8							6							7							6							6								6
	100			%				100			%				100			%				100			%				100			%					100			%
Expected average duration	3.4			Yrs				3.3			Yrs				2.9			Yrs				3.1			Yrs				3.1			Yrs					3.0			Yrs
Average yield to maturity at market	1.1			%				1.2			%				1.2			%				1.2			%				1.3			%					1.0			%
Average credit quality	AA							AA							AA							AA							AA								AA

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PartnerRe Ltd.

Distribution of Corporate Bonds

Funds Held - Directly Managed Portfolio

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

		June 30, 2014
		Fair Value				Percentage to Total Fair Value of Corporate Bonds				Percentage to Funds Held - Directly Managed Investments and cash				Largest single issuer as a percentage of Funds Held - Directly Managed Investments and cash
Distribution by sector - Corporate bonds
Finance		$	72,758			33.9		%		13.1		%		1.9		%
Consumer noncyclical		34,384				16.0				6.2				1.6
Energy		31,300				14.6				5.7				1.7
Utilities		21,710				10.1				3.9				1.1
Communications		13,465				6.3				2.4				0.7
Basic materials		12,314				5.7				2.2				0.9
Consumer cyclical		8,492				4.0				1.5				1.3
Government guaranteed corporate debt		8,187				3.8				1.5				1.4
Industrials		4,392				2.1				0.8				0.6
Technology		4,077				1.9				0.8				0.7
Real estate investment trusts		3,403				1.6				0.6				0.6
Total Corporate bonds		$	214,482			100.0		%		38.7		%
Finance sector - Corporate bonds
Banks		$	57,772			26.9		%		10.4		%
Financial services		9,659				4.5				1.7
Investment banking and brokerage		5,327				2.5				1.0
Total finance sector - Corporate bonds		$	72,758			33.9		%		13.1		%
		AAA				AA				A				BBB				Total
Credit quality of finance sector - Corporate bonds
Banks		$	13,578			$	23,139			$	19,357			$	1,698			$	57,772
Financial services		—				5,347				4,312				—				9,659
Investment banking and brokerage		5,327				—				—				—				5,327
Total finance sector - Corporate bonds		$	18,905			$	28,486			$	23,669			$	1,698			$	72,758
% of total		26		%		39		%		33		%		2		%		100		%

Concentration of investment risk

The Top 10 corporate bond issuers account for 37.2% of the Company’s total corporate bonds within the Funds Held - Directly Managed Portfolio. The single largest issuer accounts for 5.0% of the Company’s total corporate bonds within the Funds Held - Directly Managed portfolio.

35

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PartnerRe Ltd.

Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses)

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Fixed maturities	$	114,637			$	111,019			$	108,580			$	110,911			$	110,727
Short-term investments, cash and cash equivalents	193				269				421				266				320
Equities	14,473				7,134				6,278				9,140				12,799
Funds held and other	8,963				7,740				8,252				8,824				8,536
Funds held - directly managed	3,229				3,933				4,785				4,902				5,010
Investment expenses	(11,528		)		(13,228		)		(13,965		)		(12,232		)		(12,889		)
Net investment income (1)	$	129,967			$	116,867			$	114,351			$	121,811			$	124,503
Net realized investment gains on fixed maturities and short-term investments	$	31,205			$	25,022			$	18,363			$	18,642			$	40,026
Net realized investment gains on equities	33,678				827				6,049				15,057				34,790
Net realized (losses) gains on other invested assets	(17,753		)		9,935				(78,098		)		80,065				7,378
Change in net unrealized (losses) gains on other invested assets	(14,121		)		(25,678		)		98,809				(103,406		)		83,285
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	123,434				119,799				(68,619		)		10,259				(395,757		)
Change in net unrealized investment gains (losses) on equities	6,322				10,325				126,551				(891		)		(57,715		)
Net other realized and unrealized investment gains (losses)	611				991				198				(2,192		)		696
Net realized and unrealized investment gains (losses) on funds held - directly managed	2,341				951				(3,834		)		(1,416		)		(11,918		)
Net realized and unrealized investment gains (losses)	$	165,717			$	142,172			$	99,419			$	16,118			$	(299,215	)

 

(1)	Comparisons of net investment income between periods include the impact of foreign exchange variances. For the three months ended June 30, 2014, net investment income includes foreign exchange impacts of $1.4 million compared to the three months ended June 30, 2013.

36

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PartnerRe Ltd.

Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses)

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Fixed maturities	$	225,656			$	226,809				$	446,299			$	512,833
Short-term investments, cash and cash equivalents	462				1,199					1,886				2,905
Equities	21,607				17,571					32,989				26,207
Funds held and other	16,703				17,140					34,215				44,109
Funds held - directly managed	7,162				10,815					20,502				29,031
Investment expenses	(24,756		)		(25,327		)			(51,524		)		(43,747		)
Net investment income (1)	$	246,834			$	248,207				$	484,367			$	571,338
Net realized investment gains on fixed maturities and short-term investments	$	56,227			$	81,570				$	118,575			$	172,987
Net realized investment gains on equities	34,504				54,110					75,217				72,155
Net realized (losses) gains on other invested assets	(7,818		)		18,530					20,497				(16,691		)
Change in net unrealized (losses) gains on other invested assets	(39,799		)		61,249					56,652				(9,568		)
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	243,233				(467,427		)			(525,787		)		186,063
Change in net unrealized investment gains (losses) on equities	16,647				(7,649		)			118,010				66,253
Net other realized and unrealized investment gains (losses)	1,602				(113		)			(2,107		)		5,843
Net realized and unrealized investment gains (losses) on funds held - directly managed	3,292				(16,542		)			(21,792		)		16,367
Net realized and unrealized investment gains (losses)	$	307,888			$	(276,272	)			$	(160,735	)		$	493,409

 

(1)	Comparisons of net investment income between periods include the impact of foreign exchange variances. For the six months ended June 30, 2014, net investment income includes foreign exchange impacts of $1.5 million compared to the six months ended June 30, 2013.

37

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PartnerRe Ltd.

Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses)

Funds Held - Directly Managed Portfolio

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Fixed maturities	$	2,936			$	3,725			$	4,054			$	4,697			$	4,717
Short-term investments, cash and cash equivalents	9				31				343				299				227
Other	456				378				285				316				364
Investment expenses	(172		)		(201		)		103				(410		)		(298		)
Net investment income	$	3,229			$	3,933			$	4,785			$	4,902			$	5,010
Net realized investment gains (losses) on fixed maturities and short-term investments	$	1,601			$	197			$	1,695			$	(618	)		$	3,495
Net realized investment gains (losses) on other invested assets	—				—				—				81				(62		)
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	259				942				(4,618		)		(969		)		(14,621		)
Change in net unrealized investment gains (losses) on other invested assets	481				(188		)		(911		)		90				(730		)
Net realized and unrealized investment gains (losses) on funds held - directly managed	$	2,341			$	951			$	(3,834	)		$	(1,416	)		$	(11,918	)

38

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PartnerRe Ltd.

Composition of Net Investment Income and Net Realized and Unrealized Investment Gains (Losses)

Funds Held - Directly Managed Portfolio

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Fixed maturities	$	6,660			$	10,053				$	18,804			$	27,760
Short-term investments, cash and cash equivalents	40				604					1,246				1,046
Other	835				686					1,287				1,647
Investment expenses	(373		)		(528		)			(835		)		(1,422		)
Net investment income	$	7,162			$	10,815				$	20,502			$	29,031
Net realized investment gains on fixed maturities and short-term investments	$	1,799			$	4,944				$	6,021			$	8,405
Net realized investment (losses) gains on other invested assets	—				(62		)			19				—
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	1,200				(18,589		)			(24,176		)		6,583
Change in net unrealized investment gains (losses) on other invested assets	293				(2,835		)			(3,656		)		1,379
Net realized and unrealized investment gains (losses) on funds held - directly managed	$	3,292			$	(16,542	)			$	(21,792	)		$	16,367

39

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PartnerRe Ltd.

Analysis of Unpaid Losses and Loss Expenses

(Expressed in thousands of U.S. dollars)

(Unaudited) 

	As at and for the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Reconciliation of beginning and ending liability for unpaid losses and loss expenses:
Gross liability at beginning of period	$	10,529,717			$	10,646,318			$	10,564,542			$	10,336,368			$	10,323,786
Reinsurance recoverable at beginning of period	(251,666		)		(267,384		)		(285,206		)		(276,295		)		(292,711		)
Net liability at beginning of period	10,278,051				10,378,934				10,279,336				10,060,073				10,031,075
Net incurred losses related to:
Current year	792,275				698,170				849,706				793,894				813,492
Prior years	(160,880		)		(164,327		)		(173,000		)		(238,354		)		(127,350		)
	631,395				533,843				676,706				555,540				686,142
Change in reserve agreement (1)	2,324				(10,760		)		(3,607		)		(19,967		)		(7		)
Net losses paid	(767,435		)		(635,175		)		(589,413		)		(474,012		)		(632,011		)
Effects of foreign exchange rate changes	10,897				11,209				15,912				157,702				(25,126		)
Net liability at end of period	10,155,232				10,278,051				10,378,934				10,279,336				10,060,073
Reinsurance recoverable at end of period	244,543				251,666				267,384				285,206				276,295
Gross liability at end of period	$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542			$	10,336,368
Breakdown of gross liability at end of period:
Case reserves	$	4,425,723			$	4,552,142			$	4,663,164			$	4,711,580			$	4,645,378
Additional case reserves	380,582				332,758				403,145				401,752				346,553
Incurred but not reported reserves	5,593,470				5,644,817				5,580,009				5,451,210				5,344,437
Gross liability at end of period	$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542			$	10,336,368
Breakdown of gross liability at end of period by Non-life sub-segment:
North America	$	3,468,159			$	3,550,399			$	3,535,946			$	3,397,875			$	3,332,288
Global (Non-U.S.) P&C	2,364,579				2,428,416				2,444,129				2,424,923				2,388,789
Global Specialty	3,975,834				3,920,012				3,951,543				3,978,436				3,817,570
Catastrophe	591,203				630,890				714,700				763,308				797,721
Gross liability at end of period	$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542			$	10,336,368
Unrecognized time value of non-life reserves (2)	$	621,803			$	665,021			$	733,528			$	688,734			$	658,929
Non-life paid loss ratio data:
Non-life paid losses to incurred losses ratio	121.6		%		119.0		%		87.1		%		85.3		%		92.1		%
Non-life paid losses to net premiums earned ratio	73.7		%		64.0		%		50.7		%		40.2		%		64.7		%

(1) The change in the reserve agreement is due to adverse (favorable) development on Paris Re’s reserves which are guaranteed by Axa under the reserve agreement.

(2) The unrecognized time value of non-life reserves represents the difference between the recorded gross/net liability for unpaid losses and loss expenses and the amount of gross/net liability for unpaid losses and loss expenses that would be recorded if the underlying unpaid losses and loss expenses were discounted. The unrecognized time value, or discount, in the non-life reserves is calculated by applying appropriate risk-free rates by currency and duration to the underlying unpaid losses and loss expenses.

40

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PartnerRe Ltd.

Analysis of Unpaid Losses and Loss Expenses

(Expressed in thousands of U.S. dollars)

(Unaudited) 

	As at and for the six months ended									As at and for the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Reconciliation of beginning and ending liability for unpaid losses and loss expenses:
Gross liability at beginning of period	$	10,646,318			$	10,709,371				$	10,709,371			$	11,273,091
Reinsurance recoverable at beginning of period	(267,384		)		(291,330		)			(291,330		)		(353,105		)
Net liability at beginning of period	10,378,934				10,418,041					10,418,041				10,919,986
Net incurred losses related to:
Current year	1,490,445				1,475,156					3,118,755				2,785,694
Prior years	(325,208		)		(310,145		)			(721,499		)		(628,065		)
	1,165,237				1,165,011					2,397,256				2,157,629
Change in reserve agreement (1)	(8,435		)		(25,970		)			(49,544		)		(86,163		)
Net losses paid	(1,402,610		)		(1,338,134		)			(2,401,559		)		(2,705,062		)
Effects of foreign exchange rate changes	22,106				(158,875		)			14,740				131,651
Net liability at end of period	10,155,232				10,060,073					10,378,934				10,418,041
Reinsurance recoverable at end of period	244,543				276,295					267,384				291,330
Gross liability at end of period	$	10,399,775			$	10,336,368				$	10,646,318			$	10,709,371
Breakdown of gross liability at end of period:
Case reserves	$	4,425,723			$	4,645,378				$	4,663,164			$	4,872,591
Additional case reserves	380,582				346,553					403,145				343,549
Incurred but not reported reserves	5,593,470				5,344,437					5,580,009				5,493,231
Gross liability at end of period	$	10,399,775			$	10,336,368				$	10,646,318			$	10,709,371
Breakdown of gross liability at end of period by Non-life sub-segment:
North America	$	3,468,159			$	3,332,288				$	3,535,946			$	3,373,852
Global (Non-U.S.) P&C	2,364,579				2,388,789					2,444,129				2,507,761
Global Specialty	3,975,834				3,817,570					3,951,543				3,868,700
Catastrophe	591,203				797,721					714,700				959,058
Gross liability at end of period	$	10,399,775			$	10,336,368				$	10,646,318			$	10,709,371
Unrecognized time value of non-life reserves (2)	$	621,803			$	658,929				$	733,528			$	465,625
Non-life paid loss ratio data:
Non-life paid losses to incurred losses ratio	120.4		%		114.9		%			100.2		%		125.4		%
Non-life paid losses to net premiums earned ratio	69.0		%		70.4		%			56.6		%		73.3		%

(1) The change in the reserve agreement is due to favorable development on Paris Re’s reserves which are guaranteed by Axa under the reserve agreement.

(2) The unrecognized time value of non-life reserves represents the difference between the recorded gross/net liability for unpaid losses and loss expenses and the amount of gross/net liability for unpaid losses and loss expenses that would be recorded if the underlying unpaid losses and loss expenses were discounted. The unrecognized time value, or discount, in the non-life reserves is calculated by applying appropriate risk-free rates by currency and duration to the underlying unpaid losses and loss expenses.

41

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PartnerRe Ltd.

Analysis of Policy Benefits for Life and Annuity Contracts

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	As at and for the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Reconciliation of beginning and ending policy benefits for life and annuity contracts:
Gross liability at beginning of period	$	2,118,479			$	1,974,133			$	1,908,575			$	1,799,332			$	1,763,413
Reinsurance recoverable at beginning of period	(7,691		)		(7,022		)		(6,978		)		(6,432		)		(9,798		)
Net liability at beginning of period	2,110,788				1,967,111				1,901,597				1,792,900				1,753,615
Liability acquired related to the acquisition of Presidio	—				—				—				—				—
Net incurred losses related to:
Current year	258,100				218,307				207,998				208,839				192,285
Prior years	(5,649		)		(2,693		)		(5,690		)		(13,380		)		(11,584		)
	252,451				215,614				202,308				195,459				180,701
Net losses paid	(274,295		)		(74,812		)		(160,309		)		(149,895		)		(153,770		)
Effects of foreign exchange rate changes	14,765				2,875				23,515				63,133				12,354
Net liability at end of period	2,103,709				2,110,788				1,967,111				1,901,597				1,792,900
Reinsurance recoverable at end of period	23,703				7,691				7,022				6,978				6,432
Gross liability at end of period	$	2,127,412			$	2,118,479			$	1,974,133			$	1,908,575			$	1,799,332
Life value in force	$	197,000			$	208,300			$	188,000			$	171,000			$	100,000

42

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PartnerRe Ltd.

Analysis of Policy Benefits for Life and Annuity Contracts

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	As at and for the six months ended									As at and for the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Reconciliation of beginning and ending policy benefits for life and annuity contracts:
Gross liability at beginning of period	$	1,974,133			$	1,813,244				$	1,813,244			$	1,645,662
Reinsurance recoverable at beginning of period	(7,022		)		(20,684		)			(20,684		)		(9,874		)
Net liability at beginning of period	1,967,111				1,792,560					1,792,560				1,635,788
Liability acquired related to the acquisition of Presidio	—				—					—				54,071
Net incurred losses related to:
Current year	476,408				382,758					799,596				661,343
Prior years	(8,342		)		(19,975		)			(39,044		)		(14,362		)
	468,066				362,783					760,552				646,981
Net losses paid	(349,107		)		(315,341		)			(625,546		)		(593,690		)
Effects of foreign exchange rate changes	17,639				(47,102		)			39,545				49,410
Net liability at end of period	2,103,709				1,792,900					1,967,111				1,792,560
Reinsurance recoverable at end of period	23,703				6,432					7,022				20,684
Gross liability at end of period	$	2,127,412			$	1,799,332				$	1,974,133			$	1,813,244
Life value in force	$	197,000			$	100,000				$	188,000			$	110,000

43

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PartnerRe Ltd.

Reserve Development

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

		For the three months ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2014				2014				2013				2013				2013
Prior year net favorable (adverse) reserve development:
Non-life segment:
North America		$	67,404			$	24,515			$	67,202			$	94,466			$	31,226
Global (Non-U.S.) P&C		30,278				46,713				48,793				37,493				36,149
Global Specialty		69,244				59,214				61,379				77,760				27,780
Catastrophe		(6,046		)		33,885				(4,374		)		28,635				32,195
Total Non-life net prior year reserve development		$	160,880			$	164,327			$	173,000			$	238,354			$	127,350
Non-life segment:
Net prior year reserve development due to changes in premiums		$	(8,631	)		$	(9,669	)		$	(23,458	)		$	(23,508	)		$	(12,714	)
Net prior year reserve development due to all other factors (2)		169,511				173,996				196,458				261,862				140,064
Total Non-life net prior year reserve development		$	160,880			$	164,327			$	173,000			$	238,354			$	127,350
Life and Health segment:
Net prior year reserve development due to GMDB (1)		$	980			$	3,031			$	6,388			$	11,087			$	3,493
Net prior year reserve development due to all other factors (2)		4,669				(338		)		(698		)		2,293				8,091
Total Life and Health net prior year reserve development		$	5,649			$	2,693			$	5,690			$	13,380			$	11,584

 

(1)	The guaranteed minimum death benefit (GMDB) reserves are sensitive to volatility in certain referenced global equity markets. At June 30, 2014, a 10% increase in the referenced global equity market would have decreased reserves by approximately $2.7 million, while a 10% decrease in the referenced global equity market would have increased reserves by approximately $3.3 million.

(2)	Net prior year reserve development due to all other factors includes, but is not limited to loss experience, changes in assumptions and changes in methodology.

44

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PartnerRe Ltd.

Reserve Development

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Prior year net favorable (adverse) reserve development:
Non-life segment:
North America	$	91,919			$	61,171				$	222,839			$	218,483
Global (Non-U.S.) P&C	76,991				93,766					180,052				114,279
Global Specialty	128,459				88,244					227,383				250,523
Catastrophe	27,839				66,964					91,225				44,780
Total Non-life net prior year reserve development	$	325,208			$	310,145				$	721,499			$	628,065
Non-life segment:
Net prior year reserve development due to changes in premiums	$	(18,300	)		$	(23,844	)			$	(70,810	)		$	(93,971	)
Net prior year reserve development due to all other factors (2)	343,508				333,989					792,309				722,036
Total Non-life net prior year reserve development	$	325,208			$	310,145				$	721,499			$	628,065
Life and Health segment:
Net prior year reserve development due to GMDB (1)	$	4,012			$	9,142				$	26,617			$	10,009
Net prior year reserve development due to all other factors (2)	4,330				10,833					12,427				4,353
Total Life and Health net prior year reserve development	$	8,342			$	19,975				$	39,044			$	14,362

 

(1)	The guaranteed minimum death benefit (GMDB) reserves are sensitive to volatility in certain referenced global equity markets. At June 30, 2014, a 10% increase in the referenced global equity market would have decreased reserves by approximately $2.7 million, while a 10% decrease in the referenced global equity market would have increased reserves by approximately $3.3 million.

(2)	Net prior year reserve development due to all other factors includes, but is not limited to loss experience, changes in assumptions and changes in methodology.

                                                                       

45

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PartnerRe Ltd.

Natural Catastrophe Probable Maximum Losses (PMLs)

(Expressed in millions of U.S. dollars)

(Unaudited)

Single occurrence estimated net PML exposure ⁽¹⁾ 

 

				April 1, 2014								January 1, 2014								October 1, 2013								July 1, 2013								April 1, 2013
Zone		Peril		1-in-250 year PML				1-in-500 year PML (Earthquake perils only)				1-in-250 year PML				1-in-500 year PML (Earthquake perils only)				1-in-250 year PML				1-in-500 year PML (Earthquake perils only)				1-in-250 year PML				1-in-500 year PML (Earthquake perils only)				1-in-250 year PML				1-in-500 year PML (Earthquake perils only)
U.S. Southeast		Hurricane		$	966							$	908							$	1,054							$	1,054							$	1,115
U.S. Northeast		Hurricane		1,014								1,008								1,121								1,121								1,019
U.S. Gulf Coast		Hurricane		978								960								1,025								1,025								1,001
Caribbean		Hurricane		183								192								276								276								270
Europe		Windstorm		630								626								872								872								850
Japan		Typhoon		147								128								124								124								169
California		Earthquake		587				$	689			589				$	668			575				$	679			575				$	679			574				$	685
British Columbia		Earthquake		209				431				214				378				305				513				305				513				310				559
Japan		Earthquake		433				465				432				466				435				457				435				457				463				488
Australia		Earthquake		348				449				332				426				418				552				418				552				439				557
New Zealand		Earthquake		193				222				203				223				250				272				250				272				261				282

 

(1)	The PML estimates are pre-tax and net of retrocession and reinstatement premiums. The peril zones in this disclosure are major peril zones for the industry. The Company has exposures in other peril zones that can potentially generate losses greater than the PML estimates in this disclosure.

The Company estimates that the incremental loss at the 1-in-250 year return period from a U.S. hurricane impacting more than one of the three hurricane risk zones in the United States would be 20% higher than the PML of the largest zone impacted. In addition, there is the potential for a hurricane to impact the Caribbean peril zone and one or more U.S. hurricane peril zones.

For more information regarding cautionary language related to the Natural Catastrophe PML disclosure and the forward-looking statements, as well as uncertainties and limitations associated with certain assumptions and the methodology used, you must refer to the Company’s natural catastrophe PML information and definitions, see Business - Natural Catastrophe Probable Maximum Loss (PML) in Item 1 of Part 1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

46

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PartnerRe Ltd.

Reconciliation of GAAP and non-GAAP measures

(in thousands of U.S. dollars, except per share data)

(Unaudited)

 

	For the three months ended
	June 30,				March 31,				December 31,				September 30,				June 30,
	2014				2014				2013				2013				2013
Reconciliation of GAAP and non-GAAP measures:
Annualized return on beginning diluted book value per common share calculated with net income (loss) per share attributable to common shareholders (1)	18.4		%		20.5		%		18.9		%		23.2		%		(13.4		)%
Less:
Annualized net realized and unrealized investment gains (losses), net of tax, on beginning diluted book value per common share (1)	8.8				8.0				6.7				(0.1		)		(16.2		)
Annualized net foreign exchange (losses) gains, net of tax, on beginning diluted book value per common share (1)	(0.2		)		(0.1		)		0.3				0.4				(0.4		)
Annualized net interest in earnings (losses) of equity method investments, net of tax, on beginning diluted book value per common share (1)	0.3				0.3				0.4				0.3				(0.4		)
Annualized operating return on beginning diluted book value per common share (1)	9.5		%		12.3		%		11.5		%		22.6		%		3.6		%
Net income (loss) attributable to PartnerRe	$	271,841			$	309,843			$	271,788			$	333,423			$	(175,571	)
Less:
Net realized and unrealized investment gains (losses), net of tax	123,734				115,817				91,781				(1,272		)		(229,966		)
Net foreign exchange (losses) gains, net of tax	(3,175		)		(971		)		3,869				5,338				(5,898		)
Interest in earnings (losses) of equity method investments, net of tax	3,590				3,903				4,549				3,989				(5,558		)
Dividends to preferred shareholders	14,184				14,184				14,184				14,184				14,796
Operating earnings attributable to PartnerRe common shareholders	$	133,508			$	176,910			$	157,405			$	311,184			$	51,055
Per diluted common share:
Net income (loss) attributable to PartnerRe common shareholders	$	5.02			$	5.61			$	4.76			$	5.84			$	(3.37	)
Less:
Net realized and unrealized investment gains (losses), net of tax	2.41				2.20				1.70				(0.03		)		(4.07		)
Net foreign exchange (losses) gains, net of tax	(0.06		)		(0.02		)		0.07				0.10				(0.10		)
Interest in earnings (losses) of equity method investments, net of tax	0.07				0.07				0.08				0.07				(0.10		)
Operating earnings attributable to PartnerRe common shareholders	$	2.60			$	3.36			$	2.91			$	5.70			$	0.90

 

(1)	Excluding preferred shares of $853,750 at January 1, 2014 and $893,750 at January 1, 2013 and 2012.

47

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PartnerRe Ltd.

Reconciliation of GAAP and non-GAAP measures

(in thousands of U.S. dollars, except per share data)

(Unaudited)

 

	For the six months ended									For the year ended
	June 30,				June 30,					December 31,				December 31,
	2014				2013					2013				2012
Reconciliation of GAAP and non-GAAP measures:
Annualized return on beginning diluted book value per common share calculated with net income per share attributable to common shareholders (1)	19.5		%		0.7		%			10.5		%		19.9		%
Less:
Annualized net realized and unrealized investment gains (losses), net of tax, on beginning diluted book value per common share (1)	8.4				(7.4		)			(2.2		)		7.3
Annualized net foreign exchange (losses) gains, net of tax, on beginning diluted book value per common share (1)	(0.1		)		(0.2		)			—				0.1
Annualized net interest in earnings of equity method investments, net of tax, on beginning diluted book value per common share (1)	0.3				—					0.2				0.2
Annualized loss on redemption of preferred shares, on beginning diluted book value per common share (1)	—				(0.3		)			(0.2		)		—
Annualized operating return on beginning diluted book value per common share (1)	10.9		%		8.6		%			12.7		%		12.3		%
Net income attributable to PartnerRe	$	581,683			$	58,799				$	664,008			$	1,134,514
Less:
Net realized and unrealized investment gains (losses), net of tax	239,551				(217,691		)			(127,182		)		392,014
Net foreign exchange (losses) gains, net of tax	(4,146		)		(6,685		)			2,521				8,345
Interest in earnings of equity method investments, net of tax	7,493				537					9,075				8,742
Dividends to preferred shareholders	28,367				29,494					57,861				61,622
Operating earnings attributable to PartnerRe common shareholders	$	310,418			$	253,144				$	721,733			$	663,791
Per diluted common share:
Net income attributable to PartnerRe common shareholders	$	10.64			$	0.34				$	10.58			$	16.87
Less:
Net realized and unrealized investment gains (losses), net of tax	4.61				(3.72		)			(2.25		)		6.17
Net foreign exchange (losses) gains, net of tax	(0.08		)		(0.11		)			0.04				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.14				0.01					0.16				0.14
Operating earnings attributable to PartnerRe common shareholders	$	5.97			$	4.32				$	12.79			$	10.43

 

(1)	Excluding preferred shares of $853,750 at January 1, 2014 and $893,750 at January 1, 2013 and 2012.

48

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PartnerRe Ltd.

Reconciliation of GAAP and non-GAAP measures

(in thousands of U.S. dollars, except share and per share data)

(Unaudited)

 

	June 30,				March 31,				December 31,				September 30,				June 30,					December 31,
	2014				2014				2013				2013				2013					2012
Reconciliation of GAAP and non-GAAP measures:
Total shareholders’ equity	$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176			$	6,415,276				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	47,356				59,671				56,627				52,489				48,319					—
Common shareholders’ equity attributable to PartnerRe	6,056,297				5,927,178				5,855,782				5,717,937				5,513,207					6,039,746
Less:
Goodwill	456,380				456,380				456,380				456,380				456,380					456,380
Intangible assets, net of tax	111,990				116,331				120,900				121,922				127,662					141,249
Tangible book value	$	5,487,927			$	5,354,467			$	5,278,502			$	5,139,635			$	4,929,165				$	5,442,117
Common shares and common share equivalents outstanding	50,910,028				51,935,217				53,596,034				54,181,672				55,325,581					59,893,366
Equals:
Diluted tangible book value per common share	$	107.80			$	103.10			$	98.49			$	94.86			$	89.09				$	90.86

49

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PartnerRe Ltd.

Reconciliation of GAAP and non-GAAP measures

(in thousands of U.S. dollars, except share and per share data)

(Unaudited)

 

	June 30,				March 31,				December 31,				September 30,				June 30,					December 31,
	2014				2014				2013				2013				2013					2012
Reconciliation of GAAP and non-GAAP measures:
Total shareholders’ equity	$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176			$	6,415,276				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	47,356				59,671				56,627				52,489				48,319					—
Common shareholders’ equity attributable to PartnerRe	6,056,297				5,927,178				5,855,782				5,717,937				5,513,207					6,039,746
Less:
Goodwill	456,380				456,380				456,380				456,380				456,380					456,380
Intangible assets, net of tax	111,990				116,331				120,900				121,922				127,662					141,249
Tangible book value	5,487,927				5,354,467				5,278,502				5,139,635				4,929,165					5,442,117
Net unrealized gains on fixed income securities and funds held - directly managed, net of tax (NURGL)	388,648				299,871				223,995				194,144				291,987					657,604
Book value excluding NURGL	$	5,667,649			$	5,627,307			$	5,631,787			$	5,523,793			$	5,221,220				$	5,382,142
Tangible book value excluding NURGL	$	5,099,279			$	5,054,596			$	5,054,507			$	4,945,491			$	4,637,178				$	4,784,513
Divided by:
Number of common shares and common share equivalents outstanding	50,910,028				51,935,217				53,596,034				54,181,672				55,325,581					59,893,366
Equals:
Diluted book value per common share excluding NURGL	$	111.33			$	108.35			$	105.08			$	101.95			$	94.37				$	89.86
Diluted tangible book value per common share excluding NURGL	$	100.16			$	97.33			$	94.31			$	91.28			$	83.82				$	79.88

50

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PartnerRe Ltd.

Diluted Book Value per Common Share - Treasury Stock Method ⁽¹⁾ 

(in thousands of U.S. dollars, except share and per share data)

(Unaudited)

 

	June 30,				March 31,				December 31,				September 30,				June 30,					December 31,
	2014				2014				2013				2013				2013					2012
Basic book value per common share
Total shareholders’ equity	$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176			$	6,415,276				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	47,356				59,671				56,627				52,489				48,319					—
Common shareholders’ equity attributable to PartnerRe	$	6,056,297			$	5,927,178			$	5,855,782			$	5,717,937			$	5,513,207				$	6,039,746
Basic common shares outstanding	49,822,482				50,859,821				52,443,434				53,227,765				54,321,732					58,909,375
Basic book value per common share	$	121.56			$	116.54			$	111.66			$	107.42			$	101.49				$	102.53
Common shareholders’ equity attributable to PartnerRe	$	6,056,297			$	5,927,178			$	5,855,782			$	5,717,937			$	5,513,207				$	6,039,746
Basic common shares outstanding	49,822,482				50,859,821				52,443,434				53,227,765				54,321,732					58,909,375
Add:
Stock options and other	2,121,937				2,230,335				2,382,771				2,438,798				2,614,443					2,892,514
Restricted stock units	893,521				848,006				870,054				887,442				900,577					864,269
Less:
Stock options and other bought back via treasury stock method	1,927,912				2,002,945				2,100,225				2,372,333				2,511,171					2,772,792
Diluted common shares and common share equivalents outstanding	50,910,028				51,935,217				53,596,034				54,181,672				55,325,581					59,893,366
Diluted book value per common share	$	118.96			$	114.13			$	109.26			$	105.53			$	99.65				$	100.84

 

(1)	This method assumes that proceeds received upon exercise of options will be used to repurchase the Company’s common shares at the average market price. Unvested restricted stock and the dilutive impact of the Company’s forward sale contracts, if any, are also added to determine the diluted common shares and common share equivalents outstanding.

51

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PartnerRe Ltd.

Diluted Book Value per Common Share - Rollforward

(in millions of U.S. dollars, except per share data)

(Unaudited)

 

	As at and for the three months ended June 30, 2014									As at and for the three months ended June 30, 2013
	Common shareholders’ equity				Diluted book value per common share					Common shareholders’ equity				Diluted book value per common share
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at beginning of period	$	5,927			$	114.13				$	6,057			$	102.96
Technical result	166				3.23					100				1.77
Other operating expenses	(107		)		(2.09		)			(145		)		(2.56		)
Net investment income	130				2.53					125				2.20
Amortization of intangible assets	(7		)		(0.14		)			(7		)		(0.13		)
Other, net	(5		)		(0.08		)			(9		)		(0.15		)
Operating income tax (expense) benefit	(29		)		(0.57		)			2				0.03
Preferred dividends	(14		)		(0.28		)			(15		)		(0.26		)
Operating earnings	134				2.60					51				0.90
Net realized and unrealized investment gains (losses), net of tax	124				2.41					(230		)		(4.07		)
Net foreign exchange losses, net of tax	(3		)		(0.06		)			(6		)		(0.10		)
Interest in earnings (losses) of equity method investments, net of tax	3				0.07					(5		)		(0.10		)
Net income (loss) attributable to PartnerRe common shareholders	258				5.02					(190		)		(3.37		)
Common share dividends	(34		)		(0.67		)			(37		)		(0.64		)
Change in currency translation adjustment	17				0.33					(12		)		(0.20		)
Repurchase of common shares, net	(112		)		0.13					(305		)		0.70
Change in other accumulated comprehensive income or loss, net of tax	—				—					—				(0.01		)
Impact of change in number of common and common share equivalents outstanding	n/a				0.02					n/a				0.21
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at end of period	$	6,056			$	118.96				$	5,513			$	99.65
Goodwill	(456		)		(8.96		)			(456		)		(8.25		)
Intangible assets, net of tax	(112		)		(2.20		)			(128		)		(2.31		)
Tangible common shareholders’ equity attributable to PartnerRe / diluted tangible book value per common share at end of period	$	5,488			107.80					$	4,929			$	89.09

52

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PartnerRe Ltd.

Diluted Book Value per Common Share - Rollforward

(in millions of U.S. dollars, except per share data)

(Unaudited) 

	As at and for the six months ended June 30, 2014									As at and for the six months ended June 30, 2013
	Common shareholders’ equity				Diluted book value per common share					Common shareholders’ equity				Diluted book value per common share
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at beginning of period	$	5,856			$	109.26				$	6,040			$	100.84
Technical result	407				7.83					351				6.01
Other operating expenses	(219		)		(4.20		)			(261		)		(4.46		)
Net investment income	247				4.74					248				4.24
Amortization of intangible assets	(14		)		(0.27		)			(14		)		(0.24		)
Other, net	(21		)		(0.39		)			(19		)		(0.34		)
Operating income tax expense	(62		)		(1.19		)			(23		)		(0.39		)
Preferred dividends	(28		)		(0.55		)			(29		)		(0.50		)
Operating earnings	310				5.97					253				4.32
Net realized and unrealized investment gains (losses), net of tax	240				4.61					(218		)		(3.72		)
Net foreign exchange losses, net of tax	(4		)		(0.08		)			(7		)		(0.11		)
Loss on redemption of preferred shares	—				—					(9		)		(0.16		)
Interest in earnings of equity method investments, net of tax	7				0.14					1				0.01
Net income attributable to PartnerRe common shareholders	553				10.64					20				0.34
Common share dividends	(68		)		(1.34		)			(74		)		(1.28		)
Change in currency translation adjustment	2				0.03					(31		)		(0.54		)
Repurchase of common shares, net	(286		)		0.11					(442		)		0.51
Preferred share issuance costs	—				—					(9		)		(0.15		)
Recognition of loss on redemption of preferred shares	—				—					9				0.16
Change in other accumulated comprehensive income or loss, net of tax	(1		)		(0.01		)			—				0.01
Impact of change in number of common and common share equivalents outstanding	n/a				0.27					n/a				(0.24		)
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at end of period	$	6,056			$	118.96				$	5,513			$	99.65
Goodwill	(456		)		(8.96		)			(456		)		(8.25		)
Intangible assets, net of tax	(112		)		(2.20		)			(128		)		(2.31		)
Tangible common shareholders’ equity attributable to PartnerRe / diluted tangible book value per common share at end of period	$	5,488			107.80					$	4,929			$	89.09

53

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PartnerRe Ltd.

Diluted Book Value per Common Share - Rollforward

(in millions of U.S. dollars, except per share data)

(Unaudited)

 

	As at and for the year ended December 31, 2013									As at and for the year ended December 31, 2012
	Common shareholders’ equity				Diluted book value per common share					Common shareholders’ equity				Diluted book value per common share
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at beginning of period	$	6,040			$	100.84				$	5,574			$	84.82
Technical result	962				17.06					744				11.70
Other operating expenses	(500		)		(8.87		)			(411		)		(6.47		)
Net investment income	484				8.58					571				8.98
Amortization of intangible assets	(27		)		(0.48		)			(32		)		(0.50		)
Other, net	(47		)		(0.85		)			(36		)		(0.58		)
Operating income tax expense	(92		)		(1.63		)			(110		)		(1.73		)
Preferred dividends	(58		)		(1.02		)			(62		)		(0.97		)
Operating earnings	722				12.79					664				10.43
Net realized and unrealized investment (losses) gains, net of tax	(127		)		(2.25		)			392				6.17
Net foreign exchange gains, net of tax	2				0.04					8				0.13
Loss on redemption of preferred shares	(9		)		(0.16		)			—				—
Interest in earnings of equity method investments, net of tax	9				0.16					9				0.14
Net income attributable to PartnerRe common shareholders	597				10.58					1,073				16.87
Common share dividends	(142		)		(2.56		)			(156		)		(2.48		)
Change in currency translation adjustment	(32		)		(0.56		)			28				0.45
Repurchase of common shares, net	(616		)		0.84					(474		)		2.07
Preferred shares issuance costs	(9		)		(0.15		)			—				—
Recognition of loss on redemption of preferred shares	9				0.16					—				—
Change in other accumulated comprehensive income or loss, net of tax	9				0.16					(5		)		(0.08		)
Impact of change in number of common and common share equivalents outstanding	n/a				(0.05		)			n/a				(0.81		)
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at end of period	$	5,856			$	109.26				$	6,040			$	100.84
Goodwill	(456		)		(8.51		)			(456		)		(7.62		)
Intangibles, net of tax	(121		)		(2.26		)			(142		)		(2.36		)
Tangible common shareholders’ equity attributable to PartnerRe / diluted tangible book value per common share at end of period	$	5,279			$	98.49				$	5,442			$	90.86

54

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Exhibit 99.3

News Release

PartnerRe Ltd. Declares Quarterly Dividend of $0.67 Per Ordinary Share

PEMBROKE, Bermuda, July 28, 2014 — PartnerRe Ltd. (NYSE:PRE) today announced that its Board of Directors has declared a dividend of $0.67 per common share.

The dividend will be payable on August 29, 2014, to common shareholders of record on August 18, 2014.

 

 

PartnerRe Ltd. is a leading global reinsurer, providing multi-line reinsurance to insurance companies. The Company, through its wholly owned subsidiaries, also offers capital markets products that include weather and credit protection to financial, industrial and service companies. Risks reinsured include property, casualty, motor, agriculture, aviation/space, catastrophe, credit/surety, engineering, energy, marine, specialty property, specialty casualty, multiline and other lines in its Non-life operations, mortality, longevity and accident and health in its Life and Health operations, and alternative risk products. For the year ended December 31, 2013, total revenues were $5.5 billion. At March 31, 2014, total assets were $23.5 billion, total capital was $7.6 billion and total shareholders’ equity attributable to PartnerRe was $6.8 billion.

PartnerRe on the Internet: www.partnerre.com

 

Contacts:		PartnerRe Ltd.		Sard Verbinnen & Co.
		(441) 292-0888		(212) 687-8080
		Investor Contact: Robin Sidders		Drew Brown/Daniel Goldstein
		Media Contact: Celia Powell

 

PartnerRe Ltd. Wellesley House, 5th Floor 90 Pitts Bay Road Pembroke, Bermuda HM 08	Telephone +1 441 292 0888 Fax +1 441 292 6080 www.partnerre.com