Moody's agreed, citing strong earnings performance and the replenishment of capital among reasons for the rating agency's restoration of a stable outlook.

"The stable outlook also reflects Moody's comfort with PartnerRe's risk management practices," Moody's said in a statement, noting that it considers a "focused approach to risk analysis and exposure management" to be a distinguishing characteristic for the reinsurer.

Moody's said that PartnerRe also distinguishes itself from peers with sparing purchase of retrocessional protection and that its ratings affirmation reflected PartnerRe's sound fundamentals and diversified business, as well as its ability to identify and adapt to market changes.

Mr. Thiele suggested that while returns will be good for the company in 2007--allowing it to achieve a stated goal of 10 percent growth on book value for another year--earnings this year are just about as good as they get.

"Overall, we expect to see...returns-on-capital for non-life business lower than those of 2006, but still at attractive levels," he said, predicting low to mid-teens returns on capital in 2007.

He said strong pricing will continue for United States wind business, while in other areas--including U.S. casualty reinsurance--he predicted a gradual erosion of profits.

Mr. Thiele noted that while clients are expecting reinsurers to recognize their good results over the past few years, there's "nothing dramatic" going on in renewal discussions and that financially strong reinsurers are not yet seeing enormous pressure from clients.

Recently, he said he attended major insurance conferences in Monte Carlo, at the Greenbriar, and in Baden Baden, and "would have to characterize all three events basically noneventful."

"Discussions we've had would suggest that renewals will be orderly and not acrimonious," Mr. Thiele related, highlighting U.S. wind business as the one possible exception where differences between insurers and reinsurers could still come up. "Otherwise, I don't think you should expect a lot of fireworks out of Jan. 1 renewals."

Mr. Thiele also said there were no worrisome loss issues on the horizon. "We looked at stock option issue. We don't believe that we will see the same order of magnitude as some of the issues that occurred earlier in the decade," he said, explaining that he didn't perceive the opportunity for many shareholder suits or class actions to arise from options backdating allegations.