Ratings agencies A.M. Best Co. and Standard & Poor's said in January that the announcement would not affect the company's ratings.

RenaissanceRe reported fourth-quarter net realized investment gains of $7.2 million and $2.5 million in the fourth quarters of 2007 and 2006, respectively.

For the full year, net income fell 23 percent, down $184.6 million to $612.4 million.

RenaissanceRe said in a statement that while it benefited from a hard market for property-catastrophe reinsurance and a low level of insured catastrophe losses in 2006, its results in 2007 were negatively impacted by a reduced level of gross premiums written.

Premiums were off due primarily to declining prices as well as $56.7 million and $45.2 million in net negative impact related to the flooding in the United Kingdom and European windstorm Kyrill, respectively.

Operating income per diluted common share was $2.64 in the fourth quarter of 2007, compared to $2.74 in the fourth quarter of 2006. Net income available to common shareholders was $62.2 million, or 88 cents per diluted common share in the fourth quarter of 2007, compared to net income available to common shareholders of $201.1 million, or $2.78 per diluted common share for the same quarter of 2006.

The company's book value per common share increased 19.3 percent in 2007, compared to a 40.2 percent increase in 2006.

Fourth quarter highlights:

o Gross premiums written for fourth-quarter 2007 were $122.2 million, a $72.7 million decrease from fourth quarter 2006.

o The company said it generated $177.3 million of underwriting income and had a combined ratio of 47.3 percent in the fourth quarter of 2007, compared to $177.3 million of underwriting income and a combined ratio of 53.4 percent in the fourth quarter of 2006.

o The company also said it experienced $106.8 million of favorable development on prior-year reserves in the fourth quarter of 2007, compared to $29.9 million in the fourth quarter of 2006.

Neill A. Currie, chief executive officer, commented: "I am pleased to report strong full-year earnings, resulting in an increase in book value per common share of over 19 percent and an operating return on equity of 27 percent. These earnings are a result of a relatively low level of insured catastrophe losses for the full year, solid investment income and strong performance by our team."

He continued, "Although our premium volume is down, we are pleased with the results of our Jan.1 renewals and have constructed an attractive portfolio of business for 2008." He said the company plans to maintain underwriting discipline and focus on profit rather than premium volume.

The company's fourth-quarter 2007 results include a previously announced $131.2 million loss related to ChannelRe which, when combined with a $4.5 million reversal of the company's share of ChannelRe's accumulated other comprehensive loss, results in the full reduction in the company's carried value of ChannelRe from $126.7 million on Sept. 30, 2007 to zero as of Dec. 31, 2007.

The reduction in carried value principally arises from ChannelRe's estimate of its fourth-quarter unrealized mark-to-market losses from financial guaranty contracts accounted for as derivatives.