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): October 27, 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 October 27, 2014, PartnerRe Ltd. issued a press release reporting its 2014 third 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 October 27, 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 October 27, 2014
99.2		Financial Supplement
99.3		Press Release of PartnerRe Ltd., dated October 27, 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:		October 27, 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 October 27, 2014
99.2			Financial Supplement
99.3			Press Release of PartnerRe Ltd., dated October 27, 2014

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Exhibit 99.1

                                                    

News Release

PartnerRe Ltd. Reports Third Quarter and Nine Month 2014 Results

•	Third Quarter Operating Earnings per share of $4.47; Net Income per share of $3.60

•	Third Quarter Annualized Operating ROE of 16.4%; Annualized Net Income ROE of 13.2%

•	Nine Month Operating Earnings per share of $10.42; Net Income per share of $14.26

•	Nine Month Annualized Operating ROE of 12.7%; Annualized Net Income ROE of 17.4%

•	Book Value of $121.95 per share, up 2.5% for the quarter and up 11.6% year-to-date

•	Tangible Book Value of $110.75 per share, up 2.7% for the quarter and up 12.4% year-to-date

PEMBROKE, Bermuda, October 27, 2014 — PartnerRe Ltd. (NYSE: PRE) today reported net income of $182.2 million, or $3.60 per share for the third quarter of 2014. This includes net after-tax realized and unrealized losses on investments of $35.4 million, or $0.70 per share. Net income for the third quarter of 2013 was $319.2 million, or $5.84 per share, including net after-tax realized and unrealized losses on investments of $1.3 million, or $0.03 per share. The Company reported operating earnings of $226.7 million, or $4.47 per share, for the third quarter of 2014. This compares to operating earnings of $311.2 million, or $5.70 per share, for the third quarter of 2013.

Net income for the first nine months of 2014 was $735.5 million, or $14.26 per share. This includes net after-tax realized and unrealized gains on investments of $204.1 million, or $3.95 per share. Net income for the first nine months of 2013 was $339.4 million, or $5.93 per share, including net after-tax realized and unrealized losses on investments of $219.0 million, or $3.83 per share. Operating earnings for the first nine months of 2014 were $537.1 million, or $10.42 per share. This compares to operating earnings of $564.3 million, or $9.86 per share, for the first nine 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, “I am very pleased with our third quarter results. While the absence of major catastrophe losses and the continued favorable reserve development were important factors in our operating performance, the foundation of these results is our seasoned diversified portfolio. Our strong operating results allowed us to absorb some volatility in investment markets and continue on our path of compounding book value per share.”

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

Mr. Miranthis added, “There has been no change in our view of the current competitive environment. We continue to see current conditions as challenging, but we are confident in our ability to identify opportunities to create value for our shareholders over the long-term.”

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

Results of operations:

•

For the third quarter, net premiums written of $1.3 billion were up 6%, or 5% on a constant foreign exchange basis. The increase was driven by the Life and Health segment and the Global Specialty Non-life sub-segment. The increase was primarily driven by PartnerRe Health's accident and health business and new business in the mortality and longevity lines in the Life and Health segment and new business written at the January 1 renewals across multiple lines of business in the Global Specialty Non-life sub-segment. These increases were partially offset by decreases in the North America and Catastrophe Non-life sub-segments. For the first nine months of 2014, net premiums written of $4.5 billion were up 7%, or 6% on a constant foreign exchange basis. The increase was driven by the same factors describing the third quarter and new business written at the January 1 renewals across multiple lines of business in the North America Non-life sub-segment. These increases were partially offset by decreases in the Catastrophe and Global (Non-U.S.) P&C Non-life sub-segments.

•

For the third quarter, net premiums earned of $1.6 billion were up 10%, or 8% on a constant foreign exchange basis. The increase was primarily driven by PartnerRe Health's accident and health business and new business in the mortality and longevity lines in the Life and Health segment and the earning of new business written in 2013 and 2014 in the Global Specialty Non-life sub-segment. These increases were partially offset by a decrease in the Catastrophe Non-life sub-segment. For the first nine months of 2014, net premiums earned of $4.2 billion were up 10%, or 9% on a constant foreign exchange basis. The increase was primarily due to the same factors describing the third quarter and increases in the North America and Global (Non-U.S.) P&C Non-life sub-segments. These increases were partially offset by a decrease in the Catastrophe Non-life sub-segment.

•

For the third quarter, the Non-life combined ratio was 84.2%. The combined ratio benefited from favorable prior year development of 13.5 points (or $166 million). All Non-life sub-segments experienced net favorable development from prior accident years during the third quarter. For the first nine months of 2014, the Non-life combined ratio was 86.4%. The combined ratio benefited from favorable prior year development of 15.1 points (or $491 million). All Non-life sub-segments experienced net favorable development from prior accident years during the first nine months of 2014.

•	For the third quarter, net investment income of $118 million was down 3%, or 4% on a constant foreign exchange basis, primarily driven by lower reinvestment rates. For the first nine months of

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

2014, net investment income of $365 million was down 1%, or 2% on a constant foreign exchange basis, primarily reflecting lower reinvestment rates, partially offset by various factors.

•	For the third quarter, pre-tax net realized and unrealized investment losses were $34 million, primarily reflecting a modest widening of credit spreads. For the first nine months of 2014, pre-tax realized and unrealized investment gains were $273 million, primarily reflecting decreases in risk-free interest rates and improvements in worldwide equity markets.

•	For the third quarter, the effective tax rate on operating earnings and non-operating earnings was 8.1% and (116.9)%, respectively. For the first nine months of 2014, the effective tax rate on operating earnings and non-operating earnings was 12.4% and 34.1%, respectively.

Balance sheet and capitalization:

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

•	Net Non-life loss and loss expense reserves were $10.0 billion at September 30, 2014, down 4% compared to December 31, 2013.

•	Net policy benefits for life and annuity contracts were $2.1 billion at September 30, 2014, up 6% compared to December 31, 2013.

•	Total capital was $7.8 billion at September 30, 2014, up 4% compared to December 31, 2013 primarily driven by net income for the first nine months of 2014, which was partially offset by share repurchases and common and preferred dividend payments.

•

The Company repurchased approximately 0.5 million common shares at a total cost of approximately $55 million during the third quarter of 2014. The average repurchase price of $108.36 per share represents a 9% discount to the diluted book value per share at June 30, 2014. Since October 1, 2014, the Company has repurchased 450 thousand common shares at a total cost of approximately $50 million. As of October 27, 2014, approximately 4.5 million common shares remained under the current repurchase authorization.

•	Total shareholders’ equity attributable to PartnerRe was $7.0 billion at September 30, 2014, up 5% compared to December 31, 2013. The increase was driven by the same factors described above for total capital.

•

Book value per common share was $121.95 at September 30, 2014, a record high for PartnerRe, up 11.6% compared to $109.26 at December 31, 2013. Tangible book value per common share was $110.75 at September 30, 2014, up 12.4% 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 third quarter and first nine 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 third quarter, the Non-life segment’s net premiums written were down 1%. The decrease was reported in the North America and Catastrophe sub-segments and was partially offset by an increase in the Global Specialty sub-segment. For the first nine months of 2014, the Non-life segment’s net premiums written were up 3%, or 2% on a constant foreign exchange basis. The increase was reported in the North America and Global Specialty sub-segments and was partially offset by decreases in the Catastrophe and Global (Non-U.S.) P&C sub-segments.

•

For the third quarter, the North America sub-segment’s net premiums written were down 9% primarily driven by the restructuring of a large treaty and lower premium adjustments in the agriculture line of business and cancellations in the structured property line of business. These increases were partially offset by new business written in the motor and credit/surety lines of business at the January 1, 2014 renewals. This sub-segment reported a technical ratio of 83.1%, which included 19.5 points (or $83 million) of net favorable prior year loss development. For the first nine months of 2014, the North America sub-segment’s net premiums written were up 6%, or 7% on a constant foreign exchange basis, primarily due to new business in the credit/surety, agriculture, multi-line and motor lines of business. These increases were partially offset by cancellations and non-renewals in the property and structured property lines of business. This sub-segment reported a technical ratio of 87.7%, which included 14.7 points (or $175 million) of net favorable prior year loss development.

•

For the third quarter, the Global (Non-U.S.) P&C sub-segment’s net premiums written were up 5%, or 3% on a constant foreign exchange basis, primarily due to an increased participation on an existing motor treaty and, to a lesser extent, new business in the motor line of business. These increases were partially offset by cancellations in the property line of business. This sub-segment reported a technical ratio of 88.7%, which included 14.6 points (or $29 million) of net favorable prior year loss development. For the first nine months of 2014, the Global (Non-U.S.) P&C sub-segment’s net premiums written were down 1%, or 2% 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 84.7%, which included 18.7 points (or $106 million) of net favorable prior year loss development.

•

For the third quarter, the Global Specialty sub-segment’s net premiums written were up 10%, or 9% on a constant foreign exchange basis, primarily due to new business written in prior periods and increases in January 1 renewed premiums in the agriculture and multi-line lines of business. This sub-segment reported a technical ratio of 85.8%, which included 11.4 points (or $51 million) of net favorable prior year loss development. For the first nine months of 2014, the Global Specialty sub-segment’s net premiums written were up 8%, or 7% on a constant foreign exchange basis, primarily due to the same factors describing the increases in the third quarter. These increases were partially offset by a decrease in the marine and energy lines of business primarily due to cancellations in prior periods and lower premium adjustments in the engineering line of business. This sub-segment reported a technical ratio of 85.5%, which included 14.9 points (or $179 million) of net favorable prior year loss development.

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

•

For the third quarter, the Catastrophe sub-segment’s net premiums written were down 24%, or 25% on a constant foreign exchange basis, primarily due to cancellations, non-renewals and share decreases. This sub-segment reported a technical ratio of 36.9%, which included 8.2 points (or $13 million) of net adverse prior quarter loss development on events that occurred in the first half of 2014, and 1.7 points (or $3 million) of net favorable prior year loss development. For the first nine months of 2014, the Catastrophe sub-segment’s net premiums written were down 15%, or 14% on a constant foreign exchange basis, primarily due to the same factors describing the third quarter and due to the impact of reinstatement premiums recorded in 2013 related to the European and Canadian floods. This sub-segment reported a technical ratio of 24.4%, which included 10.4 points (or $31 million) of net favorable prior year loss development.

 

Life and Health:

•

For the third quarter, the Life and Health segment’s net premiums written were up 39%, or 34% on a constant foreign exchange basis. The increase was primarily driven by PartnerRe Health’s accident and health line of business and new business in the mortality and longevity lines of business. For the first nine months of 2014, the Life and Health segment’s net premiums written were up 28%, or 25% on a constant foreign exchange basis, primarily due to the same factors describing the third quarter.

•

For the third quarter, the Life and Health segment’s allocated underwriting result, which includes allocated investment income and operating expenses, decreased to $20 million compared to $25 million in the same period of 2013. This decrease was 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 nine months of 2014, the Life and Health segment’s allocated underwriting result decreased to $52 million compared to $60 million in the same period of 2013 primarily due to the same factors describing the third quarter.

Corporate and Other:

•

For the third quarter, investment activities contributed income of $75 million to pre-tax net income, excluding investment income allocated to the Life and Health segment. Of this amount, income of $104 million was included in pre-tax operating earnings and a loss of $29 million related to net realized and unrealized losses on investments and earnings from equity method investee companies was included in pre-tax non-operating losses. For the first nine months of 2014, investment activities contributed income of $612 million to pre-tax net income, excluding investment income allocated to the Life and Health segment. Of this amount, income of $322 million was included in pre-tax operating earnings and income of $290 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 December 1, 2014 to common shareholders of record on November 20, 2014.

The Company has posted its third quarter 2014 financial supplement on its website www.partnerre.com in the Financial Information section of the Investor Relations 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, October 28. 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 (866)-575-6539 or, from outside the United States, by dialing (913)-312-0867. 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 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).

 

_____________________________________________

 

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, multi-line 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 September 30, 2014, total assets were $23.2 billion, total capital was $7.8 billion and total shareholders’ equity attributable to PartnerRe was $7.0 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

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

	For the three months ended September 30, 2014				For the three months ended September 30, 2013				For the nine months ended September 30, 2014				For the nine months ended September 30, 2013
Revenues
Gross premiums written	$	1,361,280			$	1,281,477			$	4,695,327			$	4,378,944
Net premiums written	$	1,342,690			$	1,264,775			$	4,499,849			$	4,210,525
Decrease (increase) in unearned premiums	213,924				156,694				(336,384		)		(433,740		)
Net premiums earned	1,556,614				1,421,469				4,163,465				3,776,785
Net investment income	118,176				121,811				365,010				370,017
Net realized and unrealized investment (losses) gains	(34,420		)		16,118				273,468				(260,154		)
Other income	2,223				5,399				11,892				13,205
Total revenues	1,642,593				1,564,797				4,813,835				3,899,853
Expenses
Losses and loss expenses and life policy benefits	959,543				750,999				2,592,847				2,278,793
Acquisition costs	321,756				282,948				888,937				758,890
Other operating expenses (1)	108,615				108,467				327,149				369,340
Interest expense	12,241				12,233				36,719				36,694
Amortization of intangible assets	7,003				7,045				21,007				21,136
Net foreign exchange (gains) losses	(8,206		)		1,279				(10,900		)		9,822
Total expenses	1,400,952				1,162,971				3,855,759				3,474,675
Income before taxes and interest in earnings of equity method investments	241,641				401,826				958,076				425,178
Income tax expense	45,617				70,232				186,363				37,338
Interest in earnings of equity method investments	5,294				5,941				16,283				9,677
Net income	201,318				337,535				787,996				397,517
Net income attributable to noncontrolling interests	(4,920		)		(4,112		)		(9,914		)		(5,296		)
Net income attributable to PartnerRe	196,398				333,423				778,082				392,221
Preferred dividends	14,184				14,184				42,551				43,678
Loss on redemption of preferred shares	—				—				—				9,135
Net income attributable to PartnerRe common shareholders	$	182,214			$	319,239			$	735,531			$	339,408
Operating earnings attributable to PartnerRe common shareholders	$	226,660			$	311,184			$	537,078			$	564,328
Comprehensive income attributable to PartnerRe	$	198,578			$	347,740			$	781,602			$	375,597
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	4.58			$	5.80			$	10.64			$	10.05
Net realized and unrealized investment (losses) gains, net of tax	(0.72		)		(0.02		)		4.05				(3.90		)
Net foreign exchange (losses) gains, net of tax	(0.24		)		0.10				(0.32		)		(0.03		)
Loss on redemption of preferred shares	—				—				—				(0.16		)
Interest in earnings of equity method investments, net of tax	0.06				0.07				0.21				0.08
Basic net income	$	3.68			$	5.95			$	14.58			$	6.04
Weighted average number of common shares outstanding	49,514,980				53,671,245				50,461,749				56,176,260
Diluted operating earnings (1)	$	4.47			$	5.70			$	10.42			$	9.86
Net realized and unrealized investment (losses) gains, net of tax	(0.70		)		(0.03		)		3.95				(3.83		)
Net foreign exchange (losses) gains, net of tax	(0.23		)		0.10				(0.31		)		(0.02		)
Loss on redemption of preferred shares	—				—				—				(0.16		)
Interest in earnings of equity method investments, net of tax	0.06				0.07				0.20				0.08
Diluted net income	$	3.60			$	5.84			$	14.26			$	5.93
Weighted average number of common shares and common share equivalents outstanding	50,681,325				54,625,151				51,566,134				57,217,561
Dividends declared per common share	$	0.67			$	0.64			$	2.01			$	1.92
(1) Expense and per share data, pre-tax, related to the restructuring of the Company's business support operations and Global Non-life operations:
Expense related to the restructuring	$	3,360			$	2,437			$	5,015			$	45,679
Expense per share data related to the restructuring	$	0.07			$	0.04			$	0.10			$	0.80

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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)   

	September 30,				December 31,
	2014				2013
Assets
Investments:
Fixed maturities, at fair value	$	13,950,629			$	13,593,303
Short-term investments, at fair value	37,016				13,546
Equities, at fair value	1,001,307				1,221,053
Other invested assets	299,260				320,981
Total investments	15,288,212				15,148,883
Funds held – directly managed	650,374				785,768
Cash and cash equivalents	1,519,287				1,496,485
Accrued investment income	171,050				185,717
Reinsurance balances receivable	2,974,668				2,465,713
Reinsurance recoverable on paid and unpaid losses	317,071				308,892
Funds held by reinsured companies	808,686				843,081
Deferred acquisition costs	707,481				644,952
Deposit assets	104,218				351,905
Net tax assets	5,029				14,133
Goodwill	456,380				456,380
Intangible assets	166,083				187,090
Other assets	38,804				149,296
Total assets	$	23,207,343			$	23,038,295
Liabilities
Unpaid losses and loss expenses	$	10,264,001			$	10,646,318
Policy benefits for life and annuity contracts	2,113,463				1,974,133
Unearned premiums	2,048,550				1,723,767
Other reinsurance balances payable	237,175				202,549
Deposit liabilities	71,857				328,588
Net tax liabilities	234,651				284,442
Accounts payable, accrued expenses and other	350,401				291,350
Debt related to senior notes	750,000				750,000
Debt related to capital efficient notes	70,989				70,989
Total liabilities	16,141,087				16,272,136
Shareholders’ Equity
Common shares (par value $1.00; issued: 2014, 87,141,960 shares; 2013, 86,657,045 shares)	87,142				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	3,936,396				3,901,627
Accumulated other comprehensive loss	(8,718		)		(12,238		)
Retained earnings	6,040,875				5,406,797
Common shares held in treasury, at cost (2014, 37,794,611 shares; 2013, 34,213,611 shares)	(3,075,865		)		(2,707,461		)
Total shareholders’ equity attributable to PartnerRe	7,013,980				6,709,532
Noncontrolling interests	52,276				56,627
Total shareholders’ equity	7,066,256				6,766,159
Total liabilities and shareholders’ equity	$	23,207,343			$	23,038,295
Diluted Book Value Per Common Share and Common Share Equivalents Outstanding (1) (2)	$	121.95			$	109.26
Diluted Tangible Book Value Per Common Share and Common Share Equivalents Outstanding (1) (2)	$	110.75			$	98.49
Number of Common Shares and Common Share Equivalents Outstanding (2)	50,513,695				53,596,034

(1)	Excludes the aggregate liquidation value of preferred shares (2014 and 2013, $853,750) and noncontrolling interests (2014, $52,276; 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 September 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	$	372			$	162			$	432			$	59			$	1,025			$	336			$	—			$	1,361
Net premiums written	$	372			$	164			$	428			$	55			$	1,019			$	325			$	(1	)		$	1,343
Decrease in unearned premiums	52				38				20				98				208				6				—				214
Net premiums earned	$	424			$	202			$	448			$	153			$	1,227			$	331			$	(1	)		$	1,557
Losses and loss expenses and life policy benefits	(247		)		(123		)		(279		)		(39		)		(688		)		(272		)		—				(960		)
Acquisition costs	(106		)		(56		)		(105		)		(17		)		(284		)		(38		)		—				(322		)
Technical result	$	71			$	23			$	64			$	97			$	255			$	21			$	(1	)		$	275
Other (loss) income																	(1		)		2				1				2
Other operating expenses																	(62		)		(17		)		(29		)		(108		)
Underwriting result																	$	192			$	6			n/a				$	169
Net investment income																					14				104				118
Allocated underwriting result (1)																					$	20			n/a				n/a
Net realized and unrealized investment losses																									(34		)		(34		)
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange gains																									8				8
Income tax expense																									(46		)		(46		)
Interest in earnings of equity method investments																									5				5
Net income																									n/a				$	201
Loss ratio (2)	58.2		%		61.1		%		62.3		%		25.2		%		56.1		%
Acquisition ratio (3)	24.9				27.6				23.5				11.7				23.1
Technical ratio (4)	83.1		%		88.7		%		85.8		%		36.9		%		79.2		%
Other operating expense ratio (5)																	5.0
Combined ratio (6)																	84.2		%
	For the three months ended September 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	$	409			$	157			$	396			$	79			$	1,041			$	235			$	5			$	1,281
Net premiums written	$	408			$	157			$	389			$	72			$	1,026			$	234			$	5			$	1,265
Decrease (increase) in unearned premiums	17				38				(7		)		99				147				9				—				156
Net premiums earned	$	425			$	195			$	382			$	171			$	1,173			$	243			$	5			$	1,421
Losses and loss expenses and life policy benefits	(197		)		(90		)		(228		)		(42		)		(557		)		(195		)		1				(751		)
Acquisition costs	(101		)		(50		)		(92		)		(16		)		(259		)		(24		)		—				(283		)
Technical result	$	127			$	55			$	62			$	113			$	357			$	24			$	6			$	387
Other income																	2				3				—				5
Other operating expenses																	(62		)		(17		)		(29		)		(108		)
Underwriting result																	$	297			$	10			n/a				$	284
Net investment income																					15				107				122
Allocated underwriting result (1)																					$	25			n/a				n/a
Net realized and unrealized investment gains																									16				16
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange losses																									(1		)		(1		)
Income tax expense																									(70		)		(70		)
Interest in earnings of equity method investments																									6				6
Net income																									n/a				$	338
Loss ratio (2)	46.3		%		46.0		%		59.8		%		24.5		%		47.5		%
Acquisition ratio (3)	23.9				25.7				24.0				9.0				22.1
Technical ratio (4)	70.2		%		71.7		%		83.8		%		33.5		%		69.6		%
Other operating expense ratio (5)																	5.3
Combined ratio (6)																	74.9		%

(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 nine months ended September 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	$	1,302			$	682			$	1,348			$	412			$	3,744			$	951			$	—			$	4,695
Net premiums written	$	1,291			$	672			$	1,250			$	370			$	3,583			$	918			$	(1	)		$	4,500
Increase in unearned premiums	(99		)		(104		)		(42		)		(78		)		(323		)		(14		)		—				(337		)
Net premiums earned	$	1,192			$	568			$	1,208			$	292			$	3,260			$	904			$	(1	)		$	4,163
Losses and loss expenses and life policy benefits	(747		)		(319		)		(749		)		(38		)		(1,853		)		(740		)		—				(2,593		)
Acquisition costs	(299		)		(162		)		(283		)		(34		)		(778		)		(111		)		—				(889		)
Technical result	$	146			$	87			$	176			$	220			$	629			$	53			$	(1	)		$	681
Other income																	1				6				5				12
Other operating expenses																	(187		)		(52		)		(88		)		(327		)
Underwriting result																	$	443			$	7			n/a				$	366
Net investment income																					45				320				365
Allocated underwriting result (1)																					$	52			n/a				n/a
Net realized and unrealized investment gains																									273				273
Interest expense																									(36		)		(36		)
Amortization of intangible assets																									(21		)		(21		)
Net foreign exchange gains																									11				11
Income tax expense																									(186		)		(186		)
Interest in earnings of equity method investments																									16				16
Net income																									n/a				$	788
Loss ratio (2)	62.6		%		56.2		%		62.1		%		12.9		%		56.8		%
Acquisition ratio (3)	25.1				28.5				23.4				11.5				23.9
Technical ratio (4)	87.7		%		84.7		%		85.5		%		24.4		%		80.7		%
Other operating expense ratio (5)																	5.7
Combined ratio (6)																	86.4		%
	For the nine months ended September 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	$	1,228			$	690			$	1,253			$	478			$	3,649			$	722			$	8			$	4,379
Net premiums written	$	1,215			$	682			$	1,159			$	433			$	3,489			$	715			$	7			$	4,211
Increase in unearned premiums	(99		)		(152		)		(68		)		(97		)		(416		)		(17		)		(1		)		(434		)
Net premiums earned	$	1,116			$	530			$	1,091			$	336			$	3,073			$	698			$	6			$	3,777
Losses and loss expenses and life policy benefits	(682		)		(263		)		(697		)		(81		)		(1,723		)		(558		)		2				(2,279		)
Acquisition costs	(253		)		(134		)		(257		)		(33		)		(677		)		(82		)		—				(759		)
Technical result	$	181			$	133			$	137			$	222			$	673			$	58			$	8			$	739
Other income																	3				9				1				13
Other operating expenses																	(189		)		(52		)		(128		)		(369		)
Underwriting result																	$	487			$	15			n/a				$	383
Net investment income																					45				325				370
Allocated underwriting result (1)																					$	60			n/a				n/a
Net realized and unrealized investment losses																									(260		)		(260		)
Interest expense																									(37		)		(37		)
Amortization of intangible assets																									(21		)		(21		)
Net foreign exchange losses																									(10		)		(10		)
Income tax expense																									(37		)		(37		)
Interest in earnings of equity method investments																									10				10
Net income																									n/a				$	398
Loss ratio (2)	61.1		%		49.7		%		63.9		%		24.2		%		56.1		%
Acquisition ratio (3)	22.7				25.2				23.6				9.7				22.0
Technical ratio (4)	83.8		%		74.9		%		87.5		%		33.9		%		78.1		%
Other operating expense ratio (5)																	6.1
Combined ratio (6)																	84.2		%

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		Exhibit 99.2

                                    

 

  

PartnerRe Ltd.

Financial Supplement

Financial Information

as at September 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 - September 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	6
Segment Information
For the three months ended September 30, 2014 and 2013	7-8
For the nine months ended September 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 for the Non-life sub-segment	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)
Single Occurrence Estimated Net PML Exposure	46
Impact of new methodology on Estimated Gross PML Exposure (April 1, 2014 only)	47
Reconciliation of GAAP and non-GAAP measures	48-51
Diluted Book Value per Common Share - Treasury Stock Method	52
Diluted Book Value and Diluted Tangible Book Value per Common Share - Rollforward	53-55

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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 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
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Revenues
Gross premiums written	$	1,361,280			$	1,462,307			$	1,871,740			$	1,190,761			$	1,281,477
Net premiums written	$	1,342,690			$	1,418,665			$	1,738,494			$	1,186,002			$	1,264,775
Decrease (increase) in unearned premiums	213,924				(65,596		)		(484,712		)		235,422				156,694
Net premiums earned	1,556,614				1,353,069				1,253,782				1,421,424				1,421,469
Net investment income	118,176				129,967				116,867				114,351				121,811
Net realized and unrealized investment (losses) gains	(34,420		)		165,717				142,172				99,419				16,118
Other income	2,223				9,265				404				3,361				5,399
Total revenues	1,642,593				1,658,018				1,513,225				1,638,555				1,564,797
Expenses
Losses and loss expenses and life policy benefits	959,543				883,846				749,457				879,014				750,999
Acquisition costs	321,756				302,573				264,608				318,738				282,948
Other operating expenses (1)	108,615				107,072				111,462				131,125				108,467
Interest expense	12,241				12,240				12,238				12,236				12,233
Amortization of intangible assets	7,003				7,003				7,002				6,044				7,045
Net foreign exchange (gains) losses	(8,206		)		(2,023		)		(670		)		8,382				1,279
Total expenses	1,400,952				1,310,711				1,144,097				1,355,539				1,162,971
Income before taxes and interest in earnings of equity method investments	241,641				347,307				369,128				283,016				401,826
Income tax expense	45,617				78,440				62,305				11,078				70,232
Interest in earnings of equity method investments	5,294				4,925				6,064				3,988				5,941
Net income	201,318				273,792				312,887				275,926				337,535
Net income attributable to noncontrolling interests	(4,920		)		(1,951		)		(3,044		)		(4,138		)		(4,112		)
Net income attributable to PartnerRe	196,398				271,841				309,843				271,788				333,423
Preferred dividends	14,184				14,184				14,184				14,184				14,184
Net income attributable to PartnerRe common shareholders	$	182,214			$	257,657			$	295,659			$	257,604			$	319,239
Operating earnings attributable to PartnerRe common shareholders	$	226,660			$	133,508			$	176,910			$	157,405			$	311,184
Comprehensive income attributable to PartnerRe	$	198,578			$	288,630			$	294,394			$	265,577			$	347,740
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	4.58			$	2.66			$	3.43			$	2.97			$	5.80
Net realized and unrealized investment (losses) gains, net of tax	(0.72		)		2.46				2.24				1.73				(0.02		)
Net foreign exchange (losses) gains, net of tax	(0.24		)		(0.06		)		(0.02		)		0.07				0.10
Interest in earnings of equity method investments, net of tax	0.06				0.07				0.07				0.09				0.07
Basic net income	$	3.68			$	5.13			$	5.72			$	4.86			$	5.95
Weighted average number of common shares outstanding	49,514,980				50,241,216				51,652,177				53,013,136				53,671,245
Diluted operating earnings (1)	$	4.47			$	2.60			$	3.36			$	2.91			$	5.70
Net realized and unrealized investment (losses) gains, net of tax	(0.70		)		2.41				2.20				1.70				(0.03		)
Net foreign exchange (losses) gains, net of tax	(0.23		)		(0.06		)		(0.02		)		0.07				0.10
Interest in earnings of equity method investments, net of tax	0.06				0.07				0.07				0.08				0.07
Diluted net income	$	3.60			$	5.02			$	5.61			$	4.76			$	5.84
Weighted average number of common shares and common share equivalents outstanding	50,681,325				51,328,761				52,727,573				54,165,736				54,625,151
Dividends declared per common share	$	0.67			$	0.67			$	0.67			$	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 data.

1

---

PartnerRe Ltd.

Consolidated Statements of Operations

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

(Unaudited)

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Revenues
Gross premiums written	$	4,695,327			$	4,378,944				$	5,569,706			$	4,718,235
Net premiums written	$	4,499,849			$	4,210,525				$	5,396,526			$	4,572,860
Increase in unearned premiums	(336,384		)		(433,740		)			(198,316		)		(86,921		)
Net premiums earned	4,163,465				3,776,785					5,198,210				4,485,939
Net investment income	365,010				370,017					484,367				571,338
Net realized and unrealized investment gains (losses)	273,468				(260,154		)			(160,735		)		493,409
Other income	11,892				13,205					16,565				11,920
Total revenues	4,813,835				3,899,853					5,538,407				5,562,606
Expenses
Losses and loss expenses and life policy benefits	2,592,847				2,278,793					3,157,808				2,804,610
Acquisition costs	888,937				758,890					1,077,628				936,909
Other operating expenses (1)	327,149				369,340					500,466				411,374
Interest expense	36,719				36,694					48,929				48,895
Amortization of intangible assets	21,007				21,136					27,180				31,799
Net foreign exchange (gains) losses	(10,900		)		9,822					18,203				175
Total expenses	3,855,759				3,474,675					4,830,214				4,233,762
Income before taxes and interest in earnings of equity method investments	958,076				425,178					708,193				1,328,844
Income tax expense	186,363				37,338					48,416				204,284
Interest in earnings of equity method investments	16,283				9,677					13,665				9,954
Net income	787,996				397,517					673,442				1,134,514
Net income attributable to noncontrolling interests	(9,914		)		(5,296		)			(9,434		)		—
Net income attributable to PartnerRe	778,082				392,221					664,008				1,134,514
Preferred dividends	42,551				43,678					57,861				61,622
Loss on redemption of preferred shares	—				9,135					9,135				—
Net income attributable to PartnerRe common shareholders	$	735,531			$	339,408				$	597,012			$	1,072,892
Operating earnings attributable to PartnerRe common shareholders	$	537,078			$	564,328				$	721,733			$	663,791
Comprehensive income attributable to PartnerRe	$	781,602			$	375,597				$	641,173			$	1,157,755
Earnings and dividends per share data attributable to PartnerRe common shareholders:
Basic operating earnings	$	10.64			$	10.05				$	13.03			$	10.55
Net realized and unrealized investment gains (losses), net of tax	4.05				(3.90		)			(2.30		)		6.23
Net foreign exchange (losses) gains, net of tax	(0.32		)		(0.03		)			0.05				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.21				0.08					0.16				0.14
Basic net income	$	14.58			$	6.04				$	10.78			$	17.05
Weighted average number of common shares outstanding	50,461,749				56,176,260					55,378,980				62,915,992
Diluted operating earnings (1)	$	10.42			$	9.86				$	12.79			$	10.43
Net realized and unrealized investment gains (losses), net of tax	3.95				(3.83		)			(2.25		)		6.17
Net foreign exchange (losses) gains, net of tax	(0.31		)		(0.02		)			0.04				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.20				0.08					0.16				0.14
Diluted net income	$	14.26			$	5.93				$	10.58			$	16.87
Weighted average number of common shares and common share equivalents outstanding	51,566,134				57,217,561					56,448,105				63,615,748
Dividends declared per common share	$	2.01			$	1.92				$	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 data.

2

---

PartnerRe Ltd.

Condensed Consolidated Balance Sheets

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

(Unaudited)

		September 30,						June 30,						March 31,						December 31,						September 30,							December 31,
		2014						2014						2014						2013						2013							2012
Assets
Total investments		$	15,288,212					$	15,584,828					$	15,479,461					$	15,148,883					$	15,107,800						$	15,973,230
Funds held - directly managed		650,374						669,713						764,386						785,768						813,497							930,741
Cash and cash equivalents		1,519,287						1,208,220						1,269,037						1,496,485						1,551,062							1,121,705
Accrued investment income		171,050						170,508						190,169						185,717						175,164							184,315
Reinsurance balances receivable		2,974,668						3,015,727						3,064,301						2,465,713						2,564,015							1,991,991
Reinsurance recoverable on paid and unpaid losses		317,071						358,804						362,149						308,892						339,169							348,086
Funds held by reinsured companies		808,686						863,491						849,256						843,081						831,704							805,489
Deferred acquisition costs		707,481						755,769						725,584						644,952						680,972							568,391
Goodwill		456,380						456,380						456,380						456,380						456,380							456,380
Intangible assets		166,083						173,085						180,088						187,090						193,134							214,270
Other assets		148,051						189,948						176,692						515,334						425,310							385,834
Total assets		$	23,207,343					$	23,446,473					$	23,517,503					$	23,038,295					$	23,138,207						$	22,980,432
Liabilities
Unpaid losses and loss expenses		$	10,264,001					$	10,399,775					$	10,529,717					$	10,646,318					$	10,564,542						$	10,709,371
Policy benefits for life and annuity contracts		2,113,463						2,127,412						2,118,479						1,974,133						1,908,575							1,813,244
Unearned premiums		2,048,550						2,357,544						2,299,250						1,723,767						1,997,853							1,534,625
Other reinsurance balances payable		237,175						254,750						269,487						202,549						232,711							238,578
Debt obligations		820,989						820,989						820,989						820,989						820,989							820,989
Other liabilities		656,909						528,600						638,982						904,380						989,361							930,129
Total liabilities		16,141,087						16,489,070						16,676,904						16,272,136						16,514,031							16,046,936
Total shareholders’ equity attributable to PartnerRe		7,013,980						6,910,047						6,780,928						6,709,532						6,571,687							6,933,496
Noncontrolling interests		52,276						47,356						59,671						56,627						52,489							—
Total shareholders’ equity		7,066,256						6,957,403						6,840,599						6,766,159						6,624,176							6,933,496
Total liabilities and shareholders’ equity		$	23,207,343					$	23,446,473					$	23,517,503					$	23,038,295					$	23,138,207						$	22,980,432
Diluted Book Value Per Common Share		$	121.95					$	118.96					$	114.13					$	109.26					$	105.53						$	100.84
Diluted Tangible Book Value Per Common Share		$	110.75					$	107.80					$	103.10					$	98.49					$	94.86						$	90.86
Number of Common Shares and Common Share Equivalents Outstanding		50,513,695						50,910,028						51,935,217						53,596,034						54,181,672							59,893,366
Capital Structure:
Senior notes (1)		$	750,000		9	%		$	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			11			853,750			12				893,750			11
Common shareholders’ equity attributable to PartnerRe		6,160,230			79			6,056,297			78			5,927,178			78			5,855,782			78			5,717,937			77				6,039,746			78
Total Capital		$	7,827,364		100	%		$	7,723,431		100	%		$	7,594,312		100	%		$	7,522,916		100	%		$	7,385,071		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
		September 30,				June 30,				March 31,				December 31,				September 30,
		2014				2014				2014				2013				2013
Net cash provided by operating activities:
Underwriting operations		$	240			$	66			$	33			$	133			$	201
Investment income		140				176				142				138				161
Taxes and foreign exchange		(18		)		(100		)		(96		)		(27		)		(9		)
Net cash provided by operating activities		$	362			$	142			$	79			$	244			$	353
Net cash provided by operating activities		$	362			$	142			$	79			$	244			$	353
Net cash provided by (used in) investing activities		84				(15		)		(71		)		(167		)		95
Net cash used in financing activities		(99		)		(189		)		(232		)		(130		)		(169		)
Effect of foreign exchange rate changes on cash		(36		)		1				(3		)		(2		)		10
Increase (decrease) in cash and cash equivalents		311				(61		)		(227		)		(55		)		289
Cash and cash equivalents - beginning of period		1,208				1,269				1,496				1,551				1,262
Cash and cash equivalents - end of period		$	1,519			$	1,208			$	1,269			$	1,496			$	1,551

4

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PartnerRe Ltd.

Condensed Consolidated Statements of Cash Flows

(Expressed in millions of U.S. dollars)

(Unaudited)

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Net cash provided by operating activities:
Underwriting operations	$	339			$	205				$	337			$	100
Investment income	458				500					637				717
Taxes and foreign exchange	(214		)		(121		)			(147		)		(124		)
Net cash provided by operating activities	$	583			$	584				$	827			$	693
Net cash provided by operating activities	$	583			$	584				$	827			$	693
Net cash (used in) provided by investing activities	(2		)		584					418				(219		)
Net cash used in financing activities	(520		)		(736		)			(866		)		(688		)
Effect of foreign exchange rate changes on cash	(38		)		(3		)			(5		)		(6		)
Increase (decrease) increase in cash and cash equivalents	23				429					374				(220		)
Cash and cash equivalents - beginning of period	1,496				1,122					1,122				1,342
Cash and cash equivalents - end of period	$	1,519			$	1,551				$	1,496			$	1,122

5

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PartnerRe Ltd.

Consolidated Statements of Comprehensive Income

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Net income attributable to PartnerRe	$	196,398			$	271,841			$	309,843			$	271,788			$	333,423
Change in currency translation adjustment	1,412				17,020				(15,223		)		(14,866		)		14,432
Change in net unrealized gains or losses on investments, net of tax	(221		)		(222		)		(225		)		(226		)		(229		)
Change in unfunded pension obligation, net of tax	989				(9		)		(1		)		8,881				114
Comprehensive income attributable to PartnerRe	$	198,578			$	288,630			$	294,394			$	265,577			$	347,740

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Net income attributable to PartnerRe	$	778,082			$	392,221				$	664,008			$	1,134,514
Change in currency translation adjustment	3,209				(16,912		)			(31,778		)		28,488
Change in net unrealized gains or losses on investments, net of tax	(668		)		(692		)			(918		)		(953		)
Change in unfunded pension obligation, net of tax	979				980					9,861				(4,294		)
Comprehensive income attributable to PartnerRe	$	781,602			$	375,597				$	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 September 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	$	372			$	162			$	432			$	59			$	1,025			$	336			$	—			$	1,361
Net premiums written	$	372			$	164			$	428			$	55			$	1,019			325				$	(1	)		$	1,343
Decrease in unearned premiums	52				38				20				98				208				6				—				214
Net premiums earned	$	424			$	202			$	448			$	153			$	1,227			$	331			$	(1	)		$	1,557
Losses and loss expenses and life policy benefits	(247		)		(123		)		(279		)		(39		)		(688		)		(272		)		—				(960		)
Acquisition costs	(106		)		(56		)		(105		)		(17		)		(284		)		(38		)		—				(322		)
Technical result	$	71			$	23			$	64			$	97			$	255			$	21			$	(1	)		$	275
Other (loss) income																	(1		)		2				1				2
Other operating expenses																	(62		)		(17		)		(29		)		(108		)
Underwriting result																	$	192			$	6			n/a				$	169
Net investment income																					14				104				118
Allocated underwriting result (1)																					$	20			n/a				n/a
Net realized and unrealized investment losses																									(34		)		(34		)
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange gains																									8				8
Income tax expense																									(46		)		(46		)
Interest in earnings of equity method investments																									5				5
Net income																									n/a				$	201
Loss ratio (2)	58.2		%		61.1		%		62.3		%		25.2		%		56.1		%
Acquisition ratio (3)	24.9				27.6				23.5				11.7				23.1
Technical ratio (4)	83.1		%		88.7		%		85.8		%		36.9		%		79.2		%
Other operating expense ratio (5)																	5.0
Combined ratio (6)																	84.2		%

 

(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 September 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	$	409			$	157			$	396			$	79			$	1,041			$	235			$	5			$	1,281
Net premiums written	$	408			$	157			$	389			$	72			$	1,026			$	234			$	5			$	1,265
Decrease (increase) in unearned premiums	17				38				(7		)		99				147				9				—				156
Net premiums earned	$	425			$	195			$	382			$	171			$	1,173			$	243			$	5			$	1,421
Losses and loss expenses and life policy benefits	(197		)		(90		)		(228		)		(42		)		(557		)		(195		)		1				(751		)
Acquisition costs	(101		)		(50		)		(92		)		(16		)		(259		)		(24		)		—				(283		)
Technical result	$	127			$	55			$	62			$	113			$	357			$	24			$	6			$	387
Other income																	2				3				—				5
Other operating expenses																	(62		)		(17		)		(29		)		(108		)
Underwriting result																	$	297			$	10			n/a				$	284
Net investment income																					15				107				122
Allocated underwriting result (1)																					$	25			n/a				n/a
Net realized and unrealized investment gains																									16				16
Interest expense																									(12		)		(12		)
Amortization of intangible assets																									(7		)		(7		)
Net foreign exchange losses																									(1		)		(1		)
Income tax expense																									(70		)		(70		)
Interest in earnings of equity method investments																									6				6
Net income																									n/a				$	338
Loss ratio (2)	46.3		%		46.0		%		59.8		%		24.5		%		47.5		%
Acquisition ratio (3)	23.9				25.7				24.0				9.0				22.1
Technical ratio (4)	70.2		%		71.7		%		83.8		%		33.5		%		69.6		%
Other operating expense ratio (5)																	5.3
Combined ratio (6)																	74.9		%

8

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

 

For the nine months ended September 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	$	1,302			$	682			$	1,348			$	412			$	3,744			$	951			$	—			$	4,695
Net premiums written	$	1,291			$	672			$	1,250			$	370			$	3,583			$	918			$	(1	)		$	4,500
Increase in unearned premiums	(99		)		(104		)		(42		)		(78		)		(323		)		(14		)		—				(337		)
Net premiums earned	$	1,192			$	568			$	1,208			$	292			$	3,260			$	904			$	(1	)		$	4,163
Losses and loss expenses and life policy benefits	(747		)		(319		)		(749		)		(38		)		(1,853		)		(740		)		—				(2,593		)
Acquisition costs	(299		)		(162		)		(283		)		(34		)		(778		)		(111		)		—				(889		)
Technical result	$	146			$	87			$	176			$	220			$	629			$	53			$	(1	)		$	681
Other income																	1				6				5				12
Other operating expenses																	(187		)		(52		)		(88		)		(327		)
Underwriting result																	$	443			$	7			n/a				$	366
Net investment income																					45				320				365
Allocated underwriting result (1)																					$	52			n/a				n/a
Net realized and unrealized investment gains																									273				273
Interest expense																									(36		)		(36		)
Amortization of intangible assets																									(21		)		(21		)
Net foreign exchange gains																									11				11
Income tax expense																									(186		)		(186		)
Interest in earnings of equity method investments																									16				16
Net income																									n/a				$	788
Loss ratio (2)	62.6		%		56.2		%		62.1		%		12.9		%		56.8		%
Acquisition ratio (3)	25.1				28.5				23.4				11.5				23.9
Technical ratio (4)	87.7		%		84.7		%		85.5		%		24.4		%		80.7		%
Other operating expense ratio (5)																	5.7
Combined ratio (6)																	86.4		%

 

9

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

 

For the nine months ended September 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	$	1,228			$	690			$	1,253			$	478			$	3,649			$	722			$	8			$	4,379
Net premiums written	$	1,215			$	682			$	1,159			$	433			$	3,489			$	715			$	7			$	4,211
Increase in unearned premiums	(99		)		(152		)		(68		)		(97		)		(416		)		(17		)		(1		)		(434		)
Net premiums earned	$	1,116			$	530			$	1,091			$	336			$	3,073			$	698			$	6			$	3,777
Losses and loss expenses and life policy benefits	(682		)		(263		)		(697		)		(81		)		(1,723		)		(558		)		2				(2,279		)
Acquisition costs	(253		)		(134		)		(257		)		(33		)		(677		)		(82		)		—				(759		)
Technical result	$	181			$	133			$	137			$	222			$	673			$	58			$	8			$	739
Other income																	3				9				1				13
Other operating expenses																	(189		)		(52		)		(128		)		(369		)
Underwriting result																	$	487			$	15			n/a				$	383
Net investment income																					45				325				370
Allocated underwriting result (1)																					$	60			n/a				n/a
Net realized and unrealized investment losses																									(260		)		(260		)
Interest expense																									(37		)		(37		)
Amortization of intangible assets																									(21		)		(21		)
Net foreign exchange losses																									(10		)		(10		)
Income tax expense																									(37		)		(37		)
Interest in earnings of equity method investments																									10				10
Net income																									n/a				$	398
Loss ratio (2)	61.1		%		49.7		%		63.9		%		24.2		%		56.1		%
Acquisition ratio (3)	22.7				25.2				23.6				9.7				22.0
Technical ratio (4)	83.8		%		74.9		%		87.5		%		33.9		%		78.1		%
Other operating expense ratio (5)																	6.1
Combined ratio (6)																	84.2		%

10

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Non-life segment

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014 (A)				2014				2014				2013				2013
Gross premiums written	$	1,025			$	1,136			$	1,583			$	941			$	1,041
Net premiums written	$	1,019			$	1,108			$	1,456			$	937			$	1,026
Net premiums earned	$	1,227			$	1,042			$	992			$	1,162			$	1,173
Losses and loss expenses	(688		)		(632		)		(534		)		(677		)		(557		)
Acquisition costs	(284		)		(260		)		(233		)		(276		)		(259		)
Technical result	$	255			$	150			$	225			$	209			$	357
Other (loss) income	(1		)		1				1				—				2
Other operating expenses	(62		)		(61		)		(65		)		(70		)		(62		)
Underwriting result	$	192			$	90			$	161			$	139			$	297
Loss ratio (2)	56.1		%		60.6		%		53.8		%		58.2		%		47.5		%
Acquisition ratio (3)	23.1				25.0				23.6				23.8				22.1
Technical ratio (4)	79.2		%		85.6		%		77.4		%		82.0		%		69.6		%
Other operating expense ratio (5)	5.0				5.9				6.5				6.0				5.3
Combined ratio (6)	84.2		%		91.5		%		83.9		%		88.0		%		74.9		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $7.5 million and $7.9 million, respectively, compared to the three months ended September 30, 2013.

11

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Non-life segment

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	3,744			$	3,649				$	4,590			$	3,910
Net premiums written	$	3,583			$	3,489				$	4,427			$	3,768
Net premiums earned	$	3,260			$	3,073				$	4,235			$	3,684
Losses and loss expenses	(1,853		)		(1,723		)			(2,400		)		(2,155		)
Acquisition costs	(778		)		(677		)			(953		)		(821		)
Technical result	$	629			$	673				$	882			$	708
Other income	1				3					3				5
Other operating expenses	(187		)		(189		)			(259		)		(257		)
Underwriting result	$	443			$	487				$	626			$	456
Loss ratio (2)	56.8		%		56.1		%			56.7		%		58.5		%
Acquisition ratio (3)	23.9				22.0					22.5				22.3
Technical ratio (4)	80.7		%		78.1		%			79.2		%		80.8		%
Other operating expense ratio (5)	5.7				6.1					6.1				7.0
Combined ratio (6)	86.4		%		84.2		%			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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $8.1 million and $5.1 million, respectively, compared to the nine months ended September 30, 2013.

12

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

North America sub-segment

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014 (A)				2014				2014				2013				2013
Gross premiums written	$	372			$	400			$	530			$	372			$	409
Net premiums written	$	372			$	392			$	527			$	372			$	408
Net premiums earned	$	424			$	390			$	379			$	417			$	425
Losses and loss expenses	(247		)		(240		)		(260		)		(293		)		(197		)
Acquisition costs	(106		)		(102		)		(92		)		(98		)		(101		)
Technical result	$	71			$	48			$	27			$	26			$	127
Loss ratio (2)	58.2		%		61.5		%		68.6		%		70.2		%		46.3		%
Acquisition ratio (3)	24.9				26.1				24.3				23.5				23.9
Technical ratio (4)	83.1		%		87.6		%		92.9		%		93.7		%		70.2		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	22		%		31		%		31		%		40		%		31		%
Casualty	40				38				33				33				37
Credit/Surety	7				6				8				4				3
Motor	7				3				4				4				3
Multiline	6				8				9				5				4
Other	3				3				1				1				8
Property	15				11				14				13				14
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 September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(0.7) million and $(1.1) million, respectively, compared to the three months ended September 30, 2013.

13

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

North America sub-segment

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	1,302			$	1,228				$	1,601			$	1,221
Net premiums written	$	1,291			$	1,215				$	1,587			$	1,219
Net premiums earned	$	1,192			$	1,116				$	1,533			$	1,176
Losses and loss expenses	(747		)		(682		)			(975		)		(816		)
Acquisition costs	(299		)		(253		)			(351		)		(291		)
Technical result	$	146			$	181				$	207			$	69
Loss ratio (2)	62.6		%		61.1		%			63.6		%		69.4		%
Acquisition ratio (3)	25.1				22.7					22.9				24.7
Technical ratio (4)	87.7		%		83.8		%			86.5		%		94.1		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	28		%		27		%			30		%		19		%
Casualty	37				38					37				43
Credit/Surety	7				2					3				4
Motor	5				4					4				4
Multiline	8				7					6				7
Other	2				6					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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(5.0) million and $(4.2) million, respectively, compared to the nine months ended September 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
	September 30,				June 30,			March 31,				December 31,				September 30,
	2014 (A)				2014			2014				2013				2013
Gross premiums written	$	162			155			$	364			$	128			$	157
Net premiums written	$	164			148			$	361			$	128			$	157
Net premiums earned	$	202			187			$	179			$	213			$	195
Losses and loss expenses	(123		)		(103	)		(94		)		(110		)		(90		)
Acquisition costs	(56		)		(52	)		(54		)		(62		)		(50		)
Technical result	$	23			32			$	31			$	41			$	55
Loss ratio (2)	61.1		%		54.6	%		52.4		%		51.5		%		46.0		%
Acquisition ratio (3)	27.6				27.9			30.1				29.4				25.7
Technical ratio (4)	88.7		%		82.5	%		82.5		%		80.9		%		71.7		%
Distribution of Net Premiums Written by Major Lines of Business:
Casualty	7		%		8	%		10		%		5		%		9		%
Motor	43				37			37				54				35
Property	50				55			53				41				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 September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $2.8 million and $4.1 million, respectively, compared to the three months ended September 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 nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	682			$	690				$	818			$	684
Net premiums written	$	672			$	682				$	811			$	681
Net premiums earned	$	568			$	530				$	743			$	678
Losses and loss expenses	(319		)		(263		)			(373		)		(415		)
Acquisition costs	(162		)		(134		)			(196		)		(167		)
Technical result	$	87			$	133				$	174			$	96
Loss ratio (2)	56.2		%		49.7		%			50.2		%		61.3		%
Acquisition ratio (3)	28.5				25.2					26.4				24.6
Technical ratio (4)	84.7		%		74.9		%			76.6		%		85.9		%
Distribution of Net Premiums Written by Major Lines of Business:
Casualty	9		%		10		%			9		%		11		%
Motor	38				34					37				28
Property	53				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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $6.3 million and $4.8 million, respectively, compared to the nine months ended September 30, 2013.

16

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global Specialty sub-segment

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014 (A)				2014				2014				2013				2013
Gross premiums written	$	432			$	438			$	479			$	423			$	396
Net premiums written	$	428			$	432			$	389			$	419			$	389
Net premiums earned	$	448			$	406			$	355			$	415			$	382
Losses and loss expenses	(279		)		(270		)		(201		)		(223		)		(228		)
Acquisition costs	(105		)		(98		)		(79		)		(105		)		(92		)
Technical result	$	64			$	38			$	75			$	87			$	62
Loss ratio (2)	62.3		%		66.5		%		56.6		%		53.8		%		59.8		%
Acquisition ratio (3)	23.5				24.2				22.4				25.2				24.0
Technical ratio (4)	85.8		%		90.7		%		79.0		%		79.0		%		83.8		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	11		%		14		%		13		%		8		%		6		%
Aviation/Space	13				13				8				16				13
Credit/Surety	16				15				19				17				19
Energy	5				5				3				5				6
Engineering	10				9				10				16				14
Marine	18				15				16				19				19
Multiline	8				6				10				3				3
Other	1				1				1				—				—
Specialty casualty	7				10				14				8				8
Specialty property	11				12				6				8				12
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 September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $4.9 million and $5.1 million, respectively, compared to the three months ended September 30, 2013.

17

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Global Specialty sub-segment

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	1,348			$	1,253				$	1,676			$	1,505
Net premiums written	$	1,250			$	1,159				$	1,579			$	1,415
Net premiums earned	$	1,208			$	1,091				$	1,506			$	1,373
Losses and loss expenses	(749		)		(697		)			(920		)		(821		)
Acquisition costs	(283		)		(257		)			(362		)		(321		)
Technical result	$	176			$	137				$	224			$	231
Loss ratio (2)	62.1		%		63.9		%			61.1		%		59.8		%
Acquisition ratio (3)	23.4				23.6					24.0				23.4
Technical ratio (4)	85.5		%		87.5		%			85.1		%		83.2		%
Distribution of Net Premiums Written by Major Lines of Business:
Agriculture	13		%		9		%			9		%		6		%
Aviation/Space	11				12					13				15
Credit/Surety	17				19					19				19
Energy	4				6					5				7
Engineering	10				13					14				12
Marine	16				19					19				22
Multiline	8				3					3				—
Other	1				—					—				—
Specialty casualty	10				9					9				7
Specialty property	10				10					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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $10.2 million and $9.3 million, respectively, compared to the nine months ended September 30, 2013.

18

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Catastrophe sub-segment

 

	For the three months ended
	September 30,				June 30,			March 31,				December 31,				September 30,
	2014 (A)				2014			2014				2013				2013
Gross premiums written	$	59			143			$	210			$	18			$	79
Net premiums written	$	55			136			$	179			$	18			$	72
Net premiums earned	$	153			59			$	79			$	117			$	171
Losses and loss expenses	(39		)		(19	)		21				(51		)		(42		)
Acquisition costs	(17		)		(8	)		(8		)		(11		)		(16		)
Technical result	$	97			32			$	92			$	55			$	113
Loss ratio (2)	25.2		%		33.4	%		(26.5		)%		43.2		%		24.5		%
Acquisition ratio (3)	11.7				13.0			10.1				9.5				9.0
Technical ratio (4)	36.9		%		46.4	%		(16.4		)%		52.7		%		33.5		%

 

(A)	Comparisons of net premiums written and net premiums earned between periods include the impact of foreign exchange variances. For the three months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $0.6 million and $(0.1) million, respectively, compared to the three months ended September 30, 2013.

19

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Catastrophe sub-segment

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	412			$	478				$	495			$	500
Net premiums written	$	370			$	433				$	450			$	453
Net premiums earned	$	292			$	336				$	453			$	457
Losses and loss expenses	(38		)		(81		)			(132		)		(103		)
Acquisition costs	(34		)		(33		)			(44		)		(42		)
Technical result	$	220			$	222				$	277			$	312
Loss ratio (2)	12.9		%		24.2		%			29.0		%		22.4		%
Acquisition ratio (3)	11.5				9.7					9.7				9.3
Technical ratio (4)	24.4		%		33.9		%			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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $(3.4) million and $(4.8) million, respectively, compared to the nine months ended September 30, 2013.

20

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Life and Health segment

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014 (A)				2014				2014				2013				2013
Gross premiums written	$	336			$	326			$	289			$	250			$	235
Net premiums written	$	325			$	311			$	282			$	249			$	234
Net premiums earned	$	331			$	311			$	262			$	258			$	243
Life policy benefits	(272		)		(252		)		(215		)		(202		)		(195		)
Acquisition costs	(38		)		(43		)		(32		)		(42		)		(24		)
Technical result	$	21			$	16			$	15			$	14			$	24
Other income	2				3				1				3				3
Other operating expenses	(17		)		(16		)		(17		)		(19		)		(17		)
Underwriting result	$	6			$	3			$	(1	)		$	(2	)		$	10
Net investment income	14				15				15				15				15
Allocated underwriting result (1)	$	20			$	18			$	14			$	13			$	25
Distribution of Net Premiums Written by Major Lines of Business:
Accident and Health	24		%		27		%		16		%		15		%		17		%
Longevity	26				22				25				27				26
Mortality	50				51				59				58				57
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 September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $10.9 million and $11.2 million, respectively, compared to the three months ended September 30, 2013.

21

---

PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Life and Health segment

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014 (A)				2013					2013				2012
Gross premiums written	$	951			$	722				$	972			$	802
Net premiums written	$	918			$	715				$	964			$	799
Net premiums earned	$	904			$	698				$	957			$	795
Life policy benefits	(740		)		(558		)			(760		)		(647		)
Acquisition costs	(111		)		(82		)			(125		)		(116		)
Technical result	$	53			$	58				$	72			$	32
Other income	6				9					11				4
Other operating expenses	(52		)		(52		)			(71		)		(52		)
Underwriting result	$	7			$	15				$	12			$	(16	)
Net investment income	45				45					61				64
Allocated underwriting result (1)	$	52			$	60				$	73			$	48
Distribution of Net Premiums Written by Major Lines of Business:
Accident and Health	23		%		14		%			15		%		3		%
Longevity	24				26					26				31
Mortality	53				60					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 nine months ended September 30, 2014, net premiums written and net premiums earned include foreign exchange impacts of $27.0 million and $26.6 million, respectively, compared to the nine months ended September 30, 2013.

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Corporate and Other

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Technical result	$	(1	)		$	—			$	—			$	1			$	6
Other income (loss)	1				5				(2		)		—				—
Corporate expenses - costs of restructuring (1)	(3		)		(2		)		—				(12		)		(2		)
Corporate expenses	(26		)		(27		)		(28		)		(28		)		(25		)
Other operating expenses	—				(1		)		(1		)		(2		)		(2		)
Net investment income	104				115				102				99				107
Net realized and unrealized investment (losses) gains	(34		)		166				142				99				16
Interest expense	(12		)		(12		)		(12		)		(12		)		(12		)
Amortization of intangible assets	(7		)		(7		)		(7		)		(6		)		(7		)
Net foreign exchange gains (losses)	8				2				—				(8		)		(1		)
Income tax expense	(46		)		(78		)		(62		)		(11		)		(70		)
Interest in earnings of equity method investments	5				5				6				4				6

 

(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 September 30, 2014, 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 September 30, 2014, the three months ended June 30, 2014, the three months ended December 31, 2013 and the three months ended September 30, 2013, these costs had a per diluted share impact, pre-tax, of $0.07, $0.05, $0.22, and $0.04, respectively.

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PartnerRe Ltd.

Segment Information

(Expressed in millions of U.S. dollars)

(Unaudited)

Corporate and Other

 

	For the nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Technical result	$	(1	)		$	8				$	8			$	4
Other income	5				1					3				3
Corporate expenses - costs of restructuring (1)	(5		)		(46		)			(58		)		—
Corporate expenses	(82		)		(76		)			(105		)		(88		)
Other operating expenses	(1		)		(6		)			(7		)		(14		)
Net investment income	320				325					423				507
Net realized and unrealized investment gains (losses)	273				(260		)			(161		)		494
Interest expense	(36		)		(37		)			(49		)		(49		)
Amortization of intangible assets	(21		)		(21		)			(27		)		(32		)
Net foreign exchange gains (losses)	11				(10		)			(18		)		—
Income tax expense	(186		)		(37		)			(49		)		(204		)
Interest in earnings of equity method investments	16				10					14				10

 

(1)

The costs of restructuring relate to the Company’s reorganization of its business support and Global Non-life operations. During the nine months ended September 30, 2014, these costs predominantly comprised of facility exit costs. During the nine months ended September 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 nine months ended September 30, 2014 and 2013 and the year ended December 31, 2013, these costs had a per diluted share impact, pre-tax, of $0.10, $0.80, and $1.03, respectively.

24

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited) 

	For the three months ended
	September 30,			June 30,			March 31,			December 31,			September 30,
	2014			2014			2014			2013			2013
Distribution of Net Premiums Written by Line of Business:
Non-life
Property and casualty
Casualty	12	%		11	%		12	%		11	%		13	%
Motor	7			5			9			7			5
Multiline and other	5			5			5			3			5
Property	10			9			15			8			12
Specialty
Agriculture	10			13			12			15			12
Aviation/Space	4			4			2			6			4
Catastrophe	4			9			10			1			6
Credit/Surety	7			6			7			7			7
Energy	2			1			1			2			2
Engineering	3			3			2			6			4
Marine	6			5			4			7			6
Specialty casualty	2			3			3			3			2
Specialty property	4			4			2			3			4
Life and Health	24			22			16			21			18
	100	%		100	%		100	%		100	%		100	%
Distribution of Gross Premiums Written by Geography:
Asia, Australia and New Zealand	13	%		13	%		9	%		11	%		11	%
Europe	39			35			45			39			35
Latin America, Caribbean and Africa	10			9			8			11			12
North America	38			43			38			39			42
	100	%		100	%		100	%		100	%		100	%
Distribution of Gross Premiums Written by Production Source:
Broker	69	%		69	%		71	%		67	%		72	%
Direct	31			31			29			33			28
	100	%		100	%		100	%		100	%		100	%

25

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited)

 

	For the nine months ended							For the year ended
	September 30,			September 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			14				12			14
Specialty
Agriculture	12			10				11			7
Aviation/Space	3			3				4			5
Catastrophe	8			10				8			10
Credit/Surety	6			6				6			7
Energy	1			1				2			2
Engineering	3			4				4			4
Marine	5			5				6			7
Specialty casualty	3			3				3			2
Specialty property	3			3				3			4
Life and Health	20			17				18			17
	100	%		100	%			100	%		100	%
Distribution of Gross Premiums Written by Geography:
Asia, Australia and New Zealand	12	%		11	%			11	%		11	%
Europe	40			40				40			41
Latin America, Caribbean and Africa	9			10				10			11
North America	39			39				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
	September 30,			June 30,			March 31,			December 31,			September 30,
	2014			2014			2014			2013			2013
Distribution of Gross Premiums Written by Reinsurance Type for the Non-life sub-segment:
North America
Non-Proportional	16	%		11	%		24	%		7	%		14	%
Proportional	84			89			76			93			86
Total	100	%		100	%		100	%		100	%		100	%
Global (Non-U.S.) P&C
Non-Proportional	12	%		8	%		37	%		4	%		10	%
Proportional	88			92			63			96			90
Total	100	%		100	%		100	%		100	%		100	%
Global Specialty
Non-Proportional	13	%		16	%		26	%		11	%		16	%
Proportional	87			84			74			89			84
Total	100	%		100	%		100	%		100	%		100	%
Catastrophe
Non-Proportional	97	%		96	%		98	%		97	%		96	%
Proportional	3			4			2			3			4
Total	100	%		100	%		100	%		100	%		100	%
Non-life total
Non-Proportional	19	%		23	%		38	%		10	%		20	%
Proportional	81			77			62			90			80
Total	100	%		100	%		100	%		100	%		100	%

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PartnerRe Ltd.

Distribution of Premiums

(Unaudited)

 

	For the nine months ended							For the year ended
	September 30,			September 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	18	%		22	%			18	%		26	%
Proportional	82			78				82			74
Total	100	%		100	%			100	%		100	%
Global (Non-U.S.) P&C
Non-Proportional	25	%		24	%			21	%		24	%
Proportional	75			76				79			76
Total	100	%		100	%			100	%		100	%
Global Specialty
Non-Proportional	19	%		22	%			19	%		20	%
Proportional	81			78				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	28	%		32	%			28	%		33	%
Proportional	72			68				72			67
Total	100	%		100	%			100	%		100	%

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PartnerRe Ltd.

Investment Portfolio

(Expressed in millions of U.S. dollars)

(Unaudited)

	September 30,							June 30,							March 31,							December 31,							September 30,								December 31,
	2014							2014							2014							2013							2013								2012
Investments:
Fixed maturities
U.S. government	$	2,160			14	%		$	1,827			12	%		$	1,850			12	%		$	1,599			11	%		$	1,459			10	%			$	1,113			7	%
U.S. government sponsored enterprises	25				—			29				—			16				—			25				—			36				—				18				—
U.S. states, territories and municipalities	321				2			221				1			130				1			124				1			306				2				243				1
Non-U.S. sovereign government, supranational and government related	2,209				14			2,289				15			2,332				15			2,354				15			2,344				16				2,376				15
Corporates	5,706				37			5,981				38			5,989				39			6,049				40			6,042				40				6,656				42
Mortgage/asset-backed securities	3,530				24			3,660				24			3,581				23			3,442				23			3,494				23				3,989				25
Total fixed maturities	13,951				91			14,007				90			13,898				90			13,593				90			13,681				91				14,395				90
Short-term investments	37				—			32				—			29				—			14				—			37				—				151				1
Equities	1,001				7			1,253				8			1,250				8			1,221				8			1,122				7				1,094				7
Other invested assets	299				2			293				2			302				2			321				2			268				2				333				2
Total investments	$	15,288			100	%		$	15,585			100	%		$	15,479			100	%		$	15,149			100	%		$	15,108			100	%			$	15,973			100	%
Cash and cash equivalents	1,519							1,208							1,269							1,496							1,551								1,122
Total investments and cash	$	16,807						$	16,793						$	16,748						$	16,645						$	16,659							$	17,095
Maturity distribution:
One year or less	$	401			3	%		$	428			3	%		$	383			3	%		$	378			3	%		$	492			4				$	1,081			7	%
More than one year through five years	5,279				38			5,212				37			5,359				38			5,057				37			4,790				35				4,198				29
More than five years through ten years	3,747				27			3,790				27			3,806				27			3,962				29			3,883				28				4,337				30
More than ten years	1,031				7			949				7			798				6			768				6			1,059				8				941				7
Subtotal	10,458				75			10,379				74			10,346				74			10,165				75			10,224				75				10,557				73
Mortgage/asset-backed securities	3,530				25			3,660				26			3,581				26			3,442				25			3,494				25				3,989				27
Total	$	13,988			100	%		$	14,039			100	%		$	13,927			100	%		$	13,607			100	%		$	13,718			100	%			$	14,546			100	%
Credit quality by market value:
AAA	12			%				12			%				13			%				14			%				14			%					13			%
AA	44							43							42							41							39								42
A	19							20							21							21							22								23
BBB	17							17							16							16							16								15
Below Investment Grade/Unrated	8							8							8							8							9								7
	100			%				100			%				100			%				100			%				100			%					100			%
Expected average duration (1)	3.5			Yrs				3.4			Yrs				3.2			Yrs				3.0			Yrs				2.7			Yrs					2.7			Yrs
Average yield to maturity at market (1)	2.3			%				2.2			%				2.5			%				2.5			%				2.5			%					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)

 

September 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	$	1,412,875			24.8		%		8.4		%		0.9		%
Consumer noncyclical	774,358				13.6				4.6				0.2
Communications	676,859				11.9				4.0				0.5
Utilities	585,241				10.2				3.5				0.3
Industrials	478,790				8.4				2.9				0.2
Energy	469,721				8.2				2.8				0.2
Consumer cyclical	318,617				5.6				1.9				0.2
Insurance	268,639				4.7				1.6				0.2
Basic materials	167,404				2.9				1.0				0.2
Technology	147,631				2.6				0.9				0.2
Real estate investment trusts	139,598				2.4				0.8				0.1
Government guaranteed corporate debt	135,210				2.4				0.8				0.8
Catastrophe bonds	95,948				1.7				0.6				0.1
Longevity and mortality bonds	22,601				0.4				0.1				0.1
Diversified	12,994				0.2				0.1				0.1
Total Corporate bonds	$	5,706,486			100.0		%		34.0		%
Finance sector - Corporate bonds
Banks	$	777,289			13.6		%		4.6		%
Investment banking and brokerage	314,358				5.5				1.9
Financial services	189,752				3.4				1.1
Commercial and consumer finance	113,258				2.0				0.7
Other	18,218				0.3				0.1
Total finance sector - Corporate bonds	$	1,412,875			24.8		%		8.4		%
	AAA				AA				A				BBB				Non-Investment Grade/Unrated				Total
Credit quality of finance sector - Corporate bonds
Banks	$	—			$	122,633			$	479,148			$	165,323			$	10,185			$	777,289
Investment banking and brokerage	—				—				273,678				39,545				1,135				314,358
Financial services	—				136,374				46,697				3,975				2,706				189,752
Commercial and consumer finance	—				510				18,508				94,240				—				113,258
Other	—				3,878				10,372				3,968				—				18,218
Total finance sector - Corporate bonds	$	—			$	263,395			$	828,403			$	307,051			$	14,026			$	1,412,875
% of total	—		%		19		%		58		%		22		%		1.0		%		100		%

Concentration of investment risk

The top 10 Corporate bond issuers account for 17.8% of the Company’s total corporate bonds. The single largest issuer accounts for 2.8% 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)

 

	September 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	$	213,461			22.6	%		1.3	%		0.2	%
Energy	155,113				16.4			0.9			0.2
Insurance	127,740				13.5			0.8			0.6
Finance	97,577				10.3			0.6			0.1
Consumer noncyclical	91,334				9.7			0.5			—
Communications	74,585				7.9			0.4			0.1
Technology	55,166				5.9			0.3			0.1
Industrials	43,930				4.7			0.3			—
Consumer cyclical	36,252				3.8			0.2			—
Utilities	32,012				3.4			0.2			0.1
Basic materials	15,457				1.6			0.1			—
Diversified	1,922				0.2			—			—
Total	$	944,549			100.0	%		5.6	%
Mutual funds and exchange traded funds (ETFs)
Funds and ETFs holding equities	48,383							0.3
Funds holding fixed income securities	8,375							—
Total Equities	$	1,001,307						5.9	%

Concentration of investment risk

The single largest fund in funds and ETFs holding equities is an SPDR Equity Index ETF, which accounts for 3.6% 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 28.2% of the Company’s total equities. Excluding equity securities held in mutual funds and exchange traded funds, the single largest issuer accounts for 11.4% 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 September 30, 2014
	GNMA				GSEs				AAA				AA				A				BBB				Non-Investment Grade/Unrated				Total
U.S. Asset-Backed Securities	$	—			$	—			$	133,584			$	140,541			$	94,128			$	275			$	474,040			$	842,568
U.S. Collaterized Mortgage Obligations	—				2,706				3,557				—				—				—				—				6,263
U.S. Mortgage Backed Securities (MBS)	402,145				1,390,647				—				—				—				—				—				1,792,792
U.S. Commercial Mortgage Backed Securities (CMBS)	5,530				—				8,041				12,583				13,962				—				2,003				42,119
U.S. MBS Interest Only	30,762				64,126				3,980				—				—				—				15,722				114,590
	$	438,437			$	1,457,479			$	149,162			$	153,124			$	108,090			$	275			$	491,765			$	2,798,332
Non-U.S. Asset-Backed Securities	$	—			$	—			$	134,352			$	68,964			$	65,188			$	15,525			$	21,187			$	305,216
Non-U.S. Collaterized Mortgage Obligations	—				—				149,964				64,636				49,135				—				—				263,735
Non-U.S. Commercial Mortgage Backed Securities (CMBS)	—				—				8,120				—				—				—				—				8,120
Non-U.S. Mortgage Backed Securities (MBS)	—				—				154,490				—				—				—				—				154,490
	$	—			$	—			$	446,926			$	133,600			$	114,323			$	15,525			$	21,187			$	731,561
Total mortgage/asset-backed securities	$	438,437			$	1,457,479			$	596,088			$	286,724			$	222,413			$	15,800			$	512,952			$	3,529,893
Corporate Securities	—				24,940				—				—				—				—				—				24,940
Total	$	438,437			$	1,482,419			$	596,088			$	286,724			$	222,413			$	15,800			$	512,952			$	3,554,833
% of total	12		%		42		%		17		%		8		%		6		%		1		%		14		%		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 $176.0 million and a carrying value of $(0.5) million at September 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

 

	September 30, 2014																					June 30, 2014									March 31, 2014
	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	$	101,723			$	—			$	101,723			$	—			$	101,723				$	102,848			$	102,848				$	102,916			$	102,916
Principal Finance - Derivative Exposure Assumed (2)	—				(11,315		)		(11,315		)		42,569				31,254					(9,047		)		33,558					(6,099		)		36,637
Insurance-Linked Securities	—				(375		)		(375		)		281,238				280,863					(950		)		270,019					(740		)		269,512
Strategic Investments	197,376				—				197,376				—				197,376					188,373				188,373					181,079				181,079
Total other invested assets - Private Markets Exposure Assumed	299,099				(11,690		)		287,409				323,807				611,216					281,224				594,798					277,156				590,144
Other (3)	8,902				2,949				11,851													11,903									25,339
Total other invested assets	$	308,001			$	(8,741	)		$	299,260												$	293,127								$	302,495

 

(1)

The total net exposures originated in Private Markets are $1,599 million at September 30, 2014 ($1,576 million and $1,474 million at June 30, 2014 and March 31, 2004, respectively). In addition to the net exposures listed above of $611 million at September 30, 2014 ($595 million and $590 million at June 30, 2014 and March 31, 2014, respectively), the Company has the following other net exposures originated in Private Markets:

•	Principal Finance: $715 million of assets listed under Investments - Fixed Maturities and $10 million listed under Investments - Equities for a total exposure of $858 million at September 30, 2014 ($857 million and $794 million at June 30, 2014 and March 31, 2014, respectively).

•	Insurance-Linked Securities: $118 million of bonds listed under Investments - Fixed Maturities for a total exposure of $399 million at September 30, 2014 ($391 million and $347 million at June 30, 2014 and March 31, 2014, respectively).

•	Strategic Investments: $143 million of assets listed under Investments - Equities and $2 million of assets listed under Other Assets for a total exposure of $342 million at September 30, 2014 ($328 million and $333 million at June 30, 2014 and March 31, 2014, 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)

 

	September 30, 2014							June 30, 2014							March 31, 2014							December 31, 2013							September 30, 2013								December 31, 2012
Investments:
Fixed maturities
U.S. government	$	104			22	%		$	105			20	%		$	104			17	%		$	108			19	%		$	111			17	%			$	129			15	%
U.S. government sponsored enterprises	45				9			50				10			50				8			50				9			57				9				90				11
Non-U.S. sovereign government, supranational and government related	123				26			128				25			179				30			137				25			193				30				234				28
Corporates	192				40			215				42			245				41			249				44			259				41				362				44
Total fixed maturities	464				97	%		498				97	%		578				96			544				97			620				97				815				98
Short-term investments	—				—			—				—			3				1			2				—			2				1				—				—
Other invested assets	15				3	%		16				3	%		15				3			15				3			16				2				18				2
Total investments	$	479			100	%		$	514			100	%		$	596			100	%		$	561			100	%		$	638			100	%			$	833			100	%
Cash and cash equivalents	53							41							37							85							34								54
Total investments and cash	$	532						$	555						$	633						$	646						$	672							$	887
Accrued investment income	6							6							7							7							9								10
Other funds held assets/liabilities	112							109							124							133							133								34
Total funds held - directly managed	$	650						$	670						$	764						$	786						$	814							$	931
Maturity distribution:
One year or less	$	87			19	%		$	72			15	%		$	99			17	%		$	89			16	%		$	97			16	%			$	133			17	%
More than one year through five years	258				56			261				52			298				51			331				61			377				60				515				63
More than five years through ten years	117				25			165				33			157				27			109				20			122				20				141				17
More than ten years	2				—			—				—			27				5			17				3			26				4				26				3
Total	$	464			100	%		$	498			100	%		$	581			100	%		$	546			100	%		$	622			100	%			$	815			100	%
Credit quality by market value:
AAA	12			%				12			%				15			%				13			%				12			%					12			%
AA	64							62							58							58							56								58
A	17							18							21							22							26								24
BBB	7							8							6							7							6								6
	100			%				100			%				100			%				100			%				100			%					100			%
Expected average duration	3.1			Yrs				3.4			Yrs				3.3			Yrs				2.9			Yrs				3.1			Yrs					3.0			Yrs
Average yield to maturity at market	0.9			%				1.1			%				1.2			%				1.2			%				1.2			%					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)

 

		September 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		$	59,674			31.1		%		11.2		%		2.0		%
Consumer noncyclical		31,543				16.5				5.9				1.6
Energy		30,662				16.0				5.8				1.8
Utilities		18,771				9.8				3.5				1.1
Communications		12,718				6.6				2.4				0.8
Basic materials		10,267				5.4				1.9				0.9
Consumer cyclical		8,351				4.4				1.6				1.4
Government guaranteed corporate debt		7,934				4.1				1.5				1.4
Industrials		4,319				2.3				0.8				0.6
Technology		4,027				2.1				0.8				0.8
Real estate investment trusts		3,355				1.7				0.6				0.6
Total Corporate bonds		$	191,621			100.0		%		36.0		%
Finance sector - Corporate bonds
Banks		$	47,501			24.8		%		8.9		%
Financial services		9,211				4.8				1.7
Investment banking and brokerage		2,962				1.5				0.6
Total finance sector - Corporate bonds		$	59,674			31.1		%		11.2		%
		AAA				AA				A				BBB				Total
Credit quality of finance sector - Corporate bonds
Banks		$	12,963			$	21,925			$	11,047			$	1,566			$	47,501
Financial services		—				4,959				4,252				—				9,211
Investment banking and brokerage		2,962				—				—				—				2,962
Total finance sector - Corporate bonds		$	15,925			$	26,884			$	15,299			$	1,566			$	59,674
% of total		27		%		45		%		26		%		2		%		100		%

Concentration of investment risk

The Top 10 corporate bond issuers account for 38.1% of the Company’s total corporate bonds within the Funds Held - Directly Managed Portfolio. The single largest issuer accounts for 5.5% of the Company’s total corporate bonds within the Funds Held - Directly Managed portfolio.

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PartnerRe Ltd.

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

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Fixed maturities	$	108,290			$	114,637			$	111,019			$	108,580			$	110,911
Short-term investments, cash and cash equivalents	216				193				269				421				266
Equities	11,999				14,473				7,134				6,278				9,140
Funds held and other	7,493				8,963				7,740				8,252				8,824
Funds held - directly managed	3,485				3,229				3,933				4,785				4,902
Investment expenses	(13,307		)		(11,528		)		(13,228		)		(13,965		)		(12,232		)
Net investment income (1)	$	118,176			$	129,967			$	116,867			$	114,351			$	121,811
Net realized investment gains on fixed maturities and short-term investments	$	37,809			$	31,205			$	25,022			$	18,363			$	18,642
Net realized investment gains on equities	33,894				33,678				827				6,049				15,057
Net realized gains (losses) on other invested assets	7,019				(17,753		)		9,935				(78,098		)		80,065
Change in net unrealized (losses) gains on other invested assets	(6,538		)		(14,121		)		(25,678		)		98,809				(103,406		)
Change in net unrealized investment (losses) gains on fixed maturities and short-term investments	(75,537		)		123,434				119,799				(68,619		)		10,259
Change in net unrealized investment (losses) gains on equities	(31,093		)		6,322				10,325				126,551				(891		)
Net other realized and unrealized investment gains (losses)	575				611				991				198				(2,192		)
Net realized and unrealized investment (losses) gains on funds held - directly managed	(549		)		2,341				951				(3,834		)		(1,416		)
Net realized and unrealized investment (losses) gains	$	(34,420	)		$	165,717			$	142,172			$	99,419			$	16,118

 

(1)	Comparisons of net investment income between periods include the impact of foreign exchange variances. For the three months ended September 30, 2014, net investment income includes foreign exchange impacts of $1.3 million compared to the three months ended September 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 nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Fixed maturities	$	333,946			$	337,720				$	446,299			$	512,833
Short-term investments, cash and cash equivalents	678				1,465					1,886				2,905
Equities	33,606				26,711					32,989				26,207
Funds held and other	24,196				25,963					34,215				44,109
Funds held - directly managed	10,647				15,717					20,502				29,031
Investment expenses	(38,063		)		(37,559		)			(51,524		)		(43,747		)
Net investment income (1)	$	365,010			$	370,017				$	484,367			$	571,338
Net realized investment gains on fixed maturities and short-term investments	$	94,036			$	100,212				$	118,575			$	172,987
Net realized investment gains on equities	68,399				69,167					75,217				72,155
Net realized (losses) gains on other invested assets	(799		)		98,595					20,497				(16,691		)
Change in net unrealized (losses) gains on other invested assets	(46,337		)		(42,157		)			56,652				(9,568		)
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	167,696				(457,168		)			(525,787		)		186,063
Change in net unrealized investment (losses) gains on equities	(14,447		)		(8,540		)			118,010				66,253
Net other realized and unrealized investment gains (losses)	2,177				(2,305		)			(2,107		)		5,843
Net realized and unrealized investment gains (losses) on funds held - directly managed	2,743				(17,958		)			(21,792		)		16,367
Net realized and unrealized investment gains (losses)	$	273,468			$	(260,154	)			$	(160,735	)		$	493,409

 

(1)	Comparisons of net investment income between periods include the impact of foreign exchange variances. For the nine months ended September 30, 2014, net investment income includes foreign exchange impacts of $2.7 million compared to the nine months ended September 30, 2013.

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PartnerRe Ltd.

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

Funds Held - Directly Managed Portfolio

(Expressed in thousands of U.S. dollars)

(Unaudited)

 

	For the three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Fixed maturities	$	3,128			$	2,936			$	3,725			$	4,054			$	4,697
Short-term investments, cash and cash equivalents	8				9				31				343				299
Other	527				456				378				285				316
Investment expenses	(178		)		(172		)		(201		)		103				(410		)
Net investment income	$	3,485			$	3,229			$	3,933			$	4,785			$	4,902
Net realized investment (losses) gains on fixed maturities and short-term investments	$	(32	)		$	1,601			$	197			$	1,695			$	(618	)
Net realized investment gains on other invested assets	—				—				—				—				81
Change in net unrealized investment (losses) gains on fixed maturities and short-term investments	(209		)		259				942				(4,618		)		(969		)
Change in net unrealized investment (losses) gains on other invested assets	(308		)		481				(188		)		(911		)		90
Net realized and unrealized investment (losses) gains on funds held - directly managed	$	(549	)		$	2,341			$	951			$	(3,834	)		$	(1,416	)

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 nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Fixed maturities	$	9,789			$	14,750				$	18,804			$	27,760
Short-term investments, cash and cash equivalents	48				903					1,246				1,046
Other	1,362				1,002					1,287				1,647
Investment expenses	(552		)		(938		)			(835		)		(1,422		)
Net investment income	$	10,647			$	15,717				$	20,502			$	29,031
Net realized investment gains on fixed maturities and short-term investments	$	1,766			$	4,326				$	6,021			$	8,405
Net realized investment gains on other invested assets	—				19					19				—
Change in net unrealized investment gains (losses) on fixed maturities and short-term investments	991				(19,558		)			(24,176		)		6,583
Change in net unrealized investment (losses) gains on other invested assets	(14		)		(2,745		)			(3,656		)		1,379
Net realized and unrealized investment gains (losses) on funds held - directly managed	$	2,743			$	(17,958	)			$	(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
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Reconciliation of beginning and ending liability for unpaid losses and loss expenses:
Gross liability at beginning of period	$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542			$	10,336,368
Reinsurance recoverable at beginning of period	(244,543		)		(251,666		)		(267,384		)		(285,206		)		(276,295		)
Net liability at beginning of period	10,155,232				10,278,051				10,378,934				10,279,336				10,060,073
Net incurred losses related to:
Current year	853,508				792,275				698,170				849,706				793,894
Prior years	(165,763		)		(160,880		)		(164,327		)		(173,000		)		(238,354		)
	687,745				631,395				533,843				676,706				555,540
Change in reserve agreement (1)	—				2,324				(10,760		)		(3,607		)		(19,967		)
Net losses paid	(513,127		)		(767,435		)		(635,175		)		(589,413		)		(474,012		)
Effects of foreign exchange rate changes	(315,187		)		10,897				11,209				15,912				157,702
Net liability at end of period	10,014,663				10,155,232				10,278,051				10,378,934				10,279,336
Reinsurance recoverable at end of period	249,338				244,543				251,666				267,384				285,206
Gross liability at end of period	$	10,264,001			$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542
Breakdown of gross liability at end of period:
Case reserves	$	4,420,406			$	4,425,723			$	4,552,142			$	4,663,164			$	4,711,580
Additional case reserves	321,607				380,582				332,758				403,145				401,752
Incurred but not reported reserves	5,521,988				5,593,470				5,644,817				5,580,009				5,451,210
Gross liability at end of period	$	10,264,001			$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542
Breakdown of gross liability at end of period by Non-life sub-segment:
North America	$	3,541,332			$	3,468,159			$	3,550,399			$	3,535,946			$	3,397,875
Global (Non-U.S.) P&C	2,261,968				2,364,579				2,428,416				2,444,129				2,424,923
Global Specialty	3,924,377				3,975,834				3,920,012				3,951,543				3,978,436
Catastrophe	536,324				591,203				630,890				714,700				763,308
Gross liability at end of period	$	10,264,001			$	10,399,775			$	10,529,717			$	10,646,318			$	10,564,542
Unrecognized time value of non-life reserves (2)	$	603,499			$	621,803			$	665,021			$	733,528			$	688,734
Non-life paid loss ratio data:
Non-life paid losses to incurred losses ratio	74.6		%		121.6		%		119.0		%		87.1		%		85.3		%
Non-life paid losses to net premiums earned ratio	41.9		%		73.7		%		64.0		%		50.7		%		40.2		%

(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 nine months ended									As at and for the year ended
	September 30,				September 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	2,343,953				2,269,049					3,118,755				2,785,694
Prior years	(490,970		)		(548,499		)			(721,499		)		(628,065		)
	1,852,983				1,720,550					2,397,256				2,157,629
Change in reserve agreement (1)	(8,435		)		(45,937		)			(49,544		)		(86,163		)
Net losses paid	(1,915,738		)		(1,812,146		)			(2,401,559		)		(2,705,062		)
Effects of foreign exchange rate changes	(293,081		)		(1,172		)			14,740				131,651
Net liability at end of period	10,014,663				10,279,336					10,378,934				10,418,041
Reinsurance recoverable at end of period	249,338				285,206					267,384				291,330
Gross liability at end of period	$	10,264,001			$	10,564,542				$	10,646,318			$	10,709,371
Breakdown of gross liability at end of period:
Case reserves	$	4,420,406			$	4,711,580				$	4,663,164			$	4,872,591
Additional case reserves	321,607				401,752					403,145				343,549
Incurred but not reported reserves	5,521,988				5,451,210					5,580,009				5,493,231
Gross liability at end of period	$	10,264,001			$	10,564,542				$	10,646,318			$	10,709,371
Breakdown of gross liability at end of period by Non-life sub-segment:
North America	$	3,541,332			$	3,397,875				$	3,535,946			$	3,373,852
Global (Non-U.S.) P&C	2,261,968				2,424,923					2,444,129				2,507,761
Global Specialty	3,924,377				3,978,436					3,951,543				3,868,700
Catastrophe	536,324				763,308					714,700				959,058
Gross liability at end of period	$	10,264,001			$	10,564,542				$	10,646,318			$	10,709,371
Unrecognized time value of non-life reserves (2)	$	603,499			$	688,734				$	733,528			$	465,625
Non-life paid loss ratio data:
Non-life paid losses to incurred losses ratio	103.4		%		105.3		%			100.2		%		125.4		%
Non-life paid losses to net premiums earned ratio	58.8		%		58.9		%			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
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
Reconciliation of beginning and ending policy benefits for life and annuity contracts:
Gross liability at beginning of period	$	2,127,412			$	2,118,479			$	1,974,133			$	1,908,575			$	1,799,332
Reinsurance recoverable at beginning of period	(23,703		)		(7,691		)		(7,022		)		(6,978		)		(6,432		)
Net liability at beginning of period	2,103,709				2,110,788				1,967,111				1,901,597				1,792,900
Net incurred losses related to:
Current year	273,394				258,100				218,307				207,998				208,839
Prior years	(1,596		)		(5,649		)		(2,693		)		(5,690		)		(13,380		)
	271,798				252,451				215,614				202,308				195,459
Net losses paid	(178,847		)		(274,295		)		(74,812		)		(160,309		)		(149,895		)
Effects of foreign exchange rate changes	(108,630		)		14,765				2,875				23,515				63,133
Net liability at end of period	2,088,030				2,103,709				2,110,788				1,967,111				1,901,597
Reinsurance recoverable at end of period	25,433				23,703				7,691				7,022				6,978
Gross liability at end of period	$	2,113,463			$	2,127,412			$	2,118,479			$	1,974,133			$	1,908,575
Life value in force	$	180,200			$	197,000			$	208,300			$	188,000			$	171,000

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 nine months ended									As at and for the year ended
	September 30,				September 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	749,802				591,597					799,596				661,343
Prior years	(9,938		)		(33,354		)			(39,044		)		(14,362		)
	739,864				558,243					760,552				646,981
Net losses paid	(527,954		)		(465,237		)			(625,546		)		(593,690		)
Effects of foreign exchange rate changes	(90,991		)		16,031					39,545				49,410
Net liability at end of period	2,088,030				1,901,597					1,967,111				1,792,560
Reinsurance recoverable at end of period	25,433				6,978					7,022				20,684
Gross liability at end of period	$	2,113,463			$	1,908,575				$	1,974,133			$	1,813,244
Life value in force	$	180,200			$	171,000				$	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
		September 30,				June 30,				March 31,				December 31,				September 30,
		2014				2014				2014				2013				2013
Prior year net favorable (adverse) reserve development:
Non-life segment:
North America		$	82,788			$	67,404			$	24,515			$	67,202			$	94,466
Global (Non-U.S.) P&C		29,404				30,278				46,713				48,793				37,493
Global Specialty		50,959				69,244				59,214				61,379				77,760
Catastrophe		2,612				(6,046		)		33,885				(4,374		)		28,635
Total Non-life net prior year reserve development		$	165,763			$	160,880			$	164,327			$	173,000			$	238,354
Non-life segment:
Net prior year reserve development due to changes in premiums		$	(11,215	)		$	(8,631	)		$	(9,669	)		$	(23,458	)		$	(23,508	)
Net prior year reserve development due to all other factors (2)		176,978				169,511				173,996				196,458				261,862
Total Non-life net prior year reserve development		$	165,763			$	160,880			$	164,327			$	173,000			$	238,354
Life and Health segment:
Net prior year reserve development due to GMDB (1)		$	(329	)		$	980			$	3,031			$	6,388			$	11,087
Net prior year reserve development due to all other factors (2)		1,925				4,669				(338		)		(698		)		2,293
Total Life and Health net prior year reserve development		$	1,596			$	5,649			$	2,693			$	5,690			$	13,380

 

(1)	The guaranteed minimum death benefit (GMDB) reserves are sensitive to volatility in certain referenced global equity markets. At September 30, 2014, a 10% increase in the referenced global equity market would have decreased reserves by approximately $2.6 million, while a 10% decrease in the referenced global equity market would have increased reserves by approximately $3.2 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 nine months ended									For the year ended
	September 30,				September 30,					December 31,				December 31,
	2014				2013					2013				2012
Prior year net favorable (adverse) reserve development:
Non-life segment:
North America	$	174,707			$	155,637				$	222,839			$	218,483
Global (Non-U.S.) P&C	106,395				131,259					180,052				114,279
Global Specialty	179,418				166,004					227,383				250,523
Catastrophe	30,450				95,599					91,225				44,780
Total Non-life net prior year reserve development	$	490,970			$	548,499				$	721,499			$	628,065
Non-life segment:
Net prior year reserve development due to changes in premiums	$	(29,516	)		$	(47,352	)			$	(70,810	)		$	(93,971	)
Net prior year reserve development due to all other factors (2)	520,486				595,851					792,309				722,036
Total Non-life net prior year reserve development	$	490,970			$	548,499				$	721,499			$	628,065
Life and Health segment:
Net prior year reserve development due to GMDB (1)	$	3,683			$	20,229				$	26,617			$	10,009
Net prior year reserve development due to all other factors (2)	6,255				13,125					12,427				4,353
Total Life and Health net prior year reserve development	$	9,938			$	33,354				$	39,044			$	14,362

 

(1)	The guaranteed minimum death benefit (GMDB) reserves are sensitive to volatility in certain referenced global equity markets. At September 30, 2014, a 10% increase in the referenced global equity market would have decreased reserves by approximately $2.6 million, while a 10% decrease in the referenced global equity market would have increased reserves by approximately $3.2 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⁾⁽²⁾ 

 

				July 1, 2014 (2)									April 1, 2014								January 1, 2014								October 1, 2013								July 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		$	757								$	966							$	908							$	1,054							$	1,054
U.S. Northeast		Hurricane		909									1,014								1,008								1,121								1,121
U.S. Gulf Coast		Hurricane		870									978								960								1,025								1,025
Caribbean		Hurricane		189									183								192								276								276
Europe		Windstorm		722									630								626								872								872
Japan		Typhoon		145									147								128								124								124
California		Earthquake		588				$	675				587				$	689			589				$	668			575				$	679			575				$	679
British Columbia		Earthquake		204				391					209				431				214				378				305				513				305				513
Japan		Earthquake		427				481					433				465				432				466				435				457				435				457
Australia		Earthquake		367				495					348				449				332				426				418				552				418				552
New Zealand		Earthquake		218				279					193				222				203				223				250				272				250				272

 

(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.

(2)

Effective July 1, 2014, the Company introduced a new methodology to calculate the Natural Catastrophe PML that uses a more granular application of pricing adjustments, correlation, and retrocession at the treaty level. In the above table, only the July 1, 2014 PML data reflects the new methodology. The table on page 47 shows the impact of the new methodology on the gross PML data reported as of April 1, 2014.

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.

Natural Catastrophe Probable Maximum Losses (PMLs)

(Unaudited)

Impact of new methodology on estimated gross PML exposure (April 1, 2014) ⁽¹⁾ 

 

				April 1, 2014 (1)
Zone		Peril		1-in-250 year PML			1-in-500 year PML (Earthquake perils only)
U.S. Southeast		Hurricane		(12	)%
U.S. Northeast		Hurricane		(5	)
U.S. Gulf Coast		Hurricane		(7	)
Caribbean		Hurricane		3
Europe		Windstorm		9
Japan		Typhoon		1
California		Earthquake		(8	)		(3	)%
British Columbia		Earthquake		(5	)		—
Japan		Earthquake		(1	)		(3	)
Australia		Earthquake		—			4
New Zealand		Earthquake		—			4

 

(1)	Effective July 1, 2014, the Company introduced a new methodology to calculate the Natural Catastrophe PML that uses a more granular application of pricing adjustments, correlation, and retrocession at the treaty level. The table above shows the impact of the new methodology on the gross PML data reported as of April 1, 2014 (see page 46).

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.

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 three months ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2014				2014				2014				2013				2013
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)	13.2		%		18.4		%		20.5		%		18.9		%		23.2		%
Less:
Annualized net realized and unrealized investment (losses) gains, net of tax, on beginning diluted book value per common share (1)	(2.5		)		8.8				8.0				6.7				(0.1		)
Annualized net foreign exchange (losses) gains, net of tax, on beginning diluted book value per common share (1)	(0.9		)		(0.2		)		(0.1		)		0.3				0.4
Annualized net interest in earnings of equity method investments, net of tax, on beginning diluted book value per common share (1)	0.2				0.3				0.3				0.4				0.3
Annualized operating return on beginning diluted book value per common share (1)	16.4		%		9.5		%		12.3		%		11.5		%		22.6		%
Net income attributable to PartnerRe	$	196,398			$	271,841			$	309,843			$	271,788			$	333,423
Less:
Net realized and unrealized investment (losses) gains, net of tax	(35,426		)		123,734				115,817				91,781				(1,272		)
Net foreign exchange (losses) gains, net of tax	(11,913		)		(3,175		)		(971		)		3,869				5,338
Interest in earnings of equity method investments, net of tax	2,893				3,590				3,903				4,549				3,989
Dividends to preferred shareholders	14,184				14,184				14,184				14,184				14,184
Operating earnings attributable to PartnerRe common shareholders	$	226,660			$	133,508			$	176,910			$	157,405			$	311,184
Per diluted common share:
Net income attributable to PartnerRe common shareholders	$	3.60			$	5.02			$	5.61			$	4.76			$	5.84
Less:
Net realized and unrealized investment (losses) gains, net of tax	(0.70		)		2.41				2.20				1.70				(0.03		)
Net foreign exchange (losses) gains, net of tax	(0.23		)		(0.06		)		(0.02		)		0.07				0.10
Interest in earnings of equity method investments, net of tax	0.06				0.07				0.07				0.08				0.07
Operating earnings attributable to PartnerRe common shareholders	$	4.47			$	2.60			$	3.36			$	2.91			$	5.70

 

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

48

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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 nine months ended									For the year ended
	September 30,				September 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)	17.4		%		7.8		%			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)	4.8				(5.1		)			(2.2		)		7.3
Annualized net foreign exchange (losses) gains, net of tax, on beginning diluted book value per common share (1)	(0.4		)		—					—				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				0.1					0.2				0.2
Annualized loss on redemption of preferred shares, on beginning diluted book value per common share (1)	—				(0.2		)			(0.2		)		—
Annualized operating return on beginning diluted book value per common share (1)	12.7		%		13.0		%			12.7		%		12.3		%
Net income attributable to PartnerRe	$	778,082			$	392,221				$	664,008			$	1,134,514
Less:
Net realized and unrealized investment gains (losses), net of tax	204,125				(218,963		)			(127,182		)		392,014
Net foreign exchange (losses) gains, net of tax	(16,059		)		(1,348		)			2,521				8,345
Interest in earnings of equity method investments, net of tax	10,387				4,526					9,075				8,742
Dividends to preferred shareholders	42,551				43,678					57,861				61,622
Operating earnings attributable to PartnerRe common shareholders	$	537,078			$	564,328				$	721,733			$	663,791
Per diluted common share:
Net income attributable to PartnerRe common shareholders	$	14.26			$	5.93				$	10.58			$	16.87
Less:
Net realized and unrealized investment gains (losses), net of tax	3.95				(3.83		)			(2.25		)		6.17
Net foreign exchange (losses) gains, net of tax	(0.31		)		(0.02		)			0.04				0.13
Loss on redemption of preferred shares	—				(0.16		)			(0.16		)		—
Interest in earnings of equity method investments, net of tax	0.20				0.08					0.16				0.14
Operating earnings attributable to PartnerRe common shareholders	$	10.42			$	9.86				$	12.79			$	10.43

 

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

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)

 

	September 30,				June 30,				March 31,				December 31,				September 30,					December 31,
	2014				2014				2014				2013				2013					2012
Reconciliation of GAAP and non-GAAP measures:
Total shareholders’ equity	$	7,066,256			$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	52,276				47,356				59,671				56,627				52,489					—
Common shareholders’ equity attributable to PartnerRe	6,160,230				6,056,297				5,927,178				5,855,782				5,717,937					6,039,746
Less:
Goodwill	456,380				456,380				456,380				456,380				456,380					456,380
Intangible assets, net of tax	109,327				111,990				116,331				120,900				121,922					141,249
Tangible book value	$	5,594,523			$	5,487,927			$	5,354,467			$	5,278,502			$	5,139,635				$	5,442,117
Common shares and common share equivalents outstanding	50,513,695				50,910,028				51,935,217				53,596,034				54,181,672					59,893,366
Equals:
Diluted tangible book value per common share	$	110.75			$	107.80			$	103.10			$	98.49			$	94.86				$	90.86

50

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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)

 

	September 30,				June 30,				March 31,				December 31,				September 30,					December 31,
	2014				2014				2014				2013				2013					2012
Reconciliation of GAAP and non-GAAP measures:
Total shareholders’ equity	$	7,066,256			$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	52,276				47,356				59,671				56,627				52,489					—
Common shareholders’ equity attributable to PartnerRe	6,160,230				6,056,297				5,927,178				5,855,782				5,717,937					6,039,746
Less:
Goodwill	456,380				456,380				456,380				456,380				456,380					456,380
Intangible assets, net of tax	109,327				111,990				116,331				120,900				121,922					141,249
Tangible book value	5,594,523				5,487,927				5,354,467				5,278,502				5,139,635					5,442,117
Net unrealized gains on fixed income securities and funds held - directly managed, net of tax (NURGL)	316,706				388,648				299,871				223,995				194,144					657,604
Book value excluding NURGL	$	5,843,524			$	5,667,649			$	5,627,307			$	5,631,787			$	5,523,793				$	5,382,142
Tangible book value excluding NURGL	$	5,277,817			$	5,099,279			$	5,054,596			$	5,054,507			$	4,945,491				$	4,784,513
Divided by:
Number of common shares and common share equivalents outstanding	50,513,695				50,910,028				51,935,217				53,596,034				54,181,672					59,893,366
Equals:
Diluted book value per common share excluding NURGL	$	115.68			$	111.33			$	108.35			$	105.08			$	101.95				$	89.86
Diluted tangible book value per common share excluding NURGL	$	104.48			$	100.16			$	97.33			$	94.31			$	91.28				$	79.88

51

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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)

 

	September 30,				June 30,				March 31,				December 31,				September 30,					December 31,
	2014				2014				2014				2013				2013					2012
Basic book value per common share
Total shareholders’ equity	$	7,066,256			$	6,957,403			$	6,840,599			$	6,766,159			$	6,624,176				$	6,933,496
Less:
Preferred shares, aggregate liquidation value	853,750				853,750				853,750				853,750				853,750					893,750
Noncontrolling interests	52,276				47,356				59,671				56,627				52,489					—
Common shareholders’ equity attributable to PartnerRe	$	6,160,230			$	6,056,297			$	5,927,178			$	5,855,782			$	5,717,937				$	6,039,746
Basic common shares outstanding	49,347,349				49,822,482				50,859,821				52,443,434				53,227,765					58,909,375
Basic book value per common share	$	124.83			$	121.56			$	116.54			$	111.66			$	107.42				$	102.53
Common shareholders’ equity attributable to PartnerRe	$	6,160,230			$	6,056,297			$	5,927,178			$	5,855,782			$	5,717,937				$	6,039,746
Basic common shares outstanding	49,347,349				49,822,482				50,859,821				52,443,434				53,227,765					58,909,375
Add:
Stock options and other	2,005,535				2,121,937				2,230,335				2,382,771				2,438,798					2,892,514
Restricted stock units	895,359				893,521				848,006				870,054				887,442					864,269
Less:
Stock options and other bought back via treasury stock method	1,734,548				1,927,912				2,002,945				2,100,225				2,372,333					2,772,792
Diluted common shares and common share equivalents outstanding	50,513,695				50,910,028				51,935,217				53,596,034				54,181,672					59,893,366
Diluted book value per common share	$	121.95			$	118.96			$	114.13			$	109.26			$	105.53				$	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.

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 three months ended September 30, 2014									As at and for the three months ended September 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	$	6,056			$	118.96				$	5,513			$	99.65
Technical result	275				5.43					387				7.09
Other operating expenses	(108		)		(2.12		)			(108		)		(1.98		)
Net investment income	118				2.33					122				2.23
Amortization of intangible assets	(7		)		(0.14		)			(7		)		(0.13		)
Other, net	(15		)		(0.32		)			(11		)		(0.20		)
Operating income tax expense	(22		)		(0.43		)			(58		)		(1.05		)
Preferred dividends	(14		)		(0.28		)			(14		)		(0.26		)
Operating earnings	227				4.47					311				5.70
Net realized and unrealized investment losses, net of tax	(35		)		(0.70		)			(1		)		(0.03		)
Net foreign exchange (losses) gains, net of tax	(12		)		(0.23		)			5				0.10
Interest in earnings of equity method investments, net of tax	2				0.06					4				0.07
Net income attributable to PartnerRe common shareholders	182				3.60					319				5.84
Common share dividends	(33		)		(0.67		)			(34		)		(0.64		)
Change in currency translation adjustment	1				0.03					14				0.26
Repurchase of common shares, net	(47		)		0.18					(94		)		0.27
Change in other accumulated comprehensive income or loss, net of tax	1				0.02					—				—
Impact of change in number of common and common share equivalents outstanding	n/a				(0.17		)			n/a				0.15
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at end of period	$	6,160			$	121.95				$	5,718			$	105.53
Goodwill	(456		)		(9.04		)			(456		)		(8.42		)
Intangible assets, net of tax	(109		)		(2.16		)			(122		)		(2.25		)
Tangible common shareholders’ equity attributable to PartnerRe / diluted tangible book value per common share at end of period	$	5,595			110.75					$	5,140			$	94.86

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 nine months ended September 30, 2014									As at and for the nine months ended September 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	681				13.20					739				12.92
Other operating expenses	(327		)		(6.34		)			(369		)		(6.46		)
Net investment income	365				7.08					370				6.47
Amortization of intangible assets	(21		)		(0.41		)			(21		)		(0.37		)
Other, net	(34		)		(0.66		)			(31		)		(0.53		)
Operating income tax expense	(84		)		(1.62		)			(80		)		(1.41		)
Preferred dividends	(43		)		(0.83		)			(44		)		(0.76		)
Operating earnings	537				10.42					564				9.86
Net realized and unrealized investment gains (losses), net of tax	204				3.95					(219		)		(3.83		)
Net foreign exchange losses, net of tax	(16		)		(0.31		)			(1		)		(0.02		)
Loss on redemption of preferred shares	—				—					(9		)		(0.16		)
Interest in earnings of equity method investments, net of tax	11				0.20					4				0.08
Net income attributable to PartnerRe common shareholders	736				14.26					339				5.93
Common share dividends	(102		)		(2.01		)			(108		)		(1.92		)
Change in currency translation adjustment	3				0.06					(17		)		(0.30		)
Repurchase of common shares, net	(333		)		0.29					(537		)		0.78
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	—				0.01					1				0.01
Impact of change in number of common and common share equivalents outstanding	n/a				0.08					n/a				0.18
Common shareholders’ equity attributable to PartnerRe / diluted book value per common share at end of period	$	6,160			$	121.95				$	5,718			$	105.53
Goodwill	(456		)		(9.04		)			(456		)		(8.42		)
Intangible assets, net of tax	(109		)		(2.16		)			(122		)		(2.25		)
Tangible common shareholders’ equity attributable to PartnerRe / diluted tangible book value per common share at end of period	$	5,595			110.75					$	5,140			$	94.86

54

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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

55

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Exhibit 99.3

News Release

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

PEMBROKE, Bermuda, October 27, 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 December 1, 2014, to common shareholders of record on November 20, 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 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

 

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