Greenlight Capital Re, Ltd. (NASDAQ:GLRE) Q1 2022 Earnings Conference Call April 4, 2022 9:00 AM ET

Company Participants

Simon Burton - CEO

David Einhorn - Chairman

Neil Greenspan - CFO

Conference Call Participants

Operator

Thank you for joining the Greenlight Re Conference Call for the First Quarter of 2022 Earnings.

The company reminds you that forward-looking statements may be made on this call are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but rather reflect the company's current expectations, estimates and predictions about future results and events and are subject to risks, uncertainties and assumptions, including those enumerated in the company's Form 10-K for the year ended December 31, 2021, and other documents filed by the company with the SEC. If one or more risks or uncertainties materialize or if the company's underlying assumptions prove to be incorrect, actual results may vary materially from the company's projections. The company undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

After the prepared remarks, we will be conducting a question-and-answer session. [Operator Instructions].

I would now like to turn the call over to Greenlight Re's CEO, Mr. Simon Burton. Please go ahead, sir.

Simon Burton

Good morning everyone and thanks for joining the call. The first quarter of the year used to be considered a benign period for the reinsurance industry, with only the occasional large loss, those days seem destined now. Two years ago we were contemplating the impact from the onset of COVID, last year Winter Storm Uri set new weather records, and this year, Ukraine has enjoyed a massive ground invasion, while Russia is facing extensive economic sanctions.

During the first quarter, we recognized $13.6 million of losses from the Russian-Ukrainian conflict, which contributed 10.8 percentage points to our 106.2% combined ratio. While the conflicts impact on our combined ratio is substantial, it reflects the growth in our short-tailed specialty business that is otherwise performing well. The Russian-Ukrainian conflict is highly complex, particularly as it relates to the impact of Russian sanctions.

I'd like to highlight a few points about our reserve estimates. The loss estimate relates to an IBNR provision on losses incurred up to March 31, 2022. We have not received any reported losses to date. Our estimate includes an assessment of losses incurred in both Ukraine and Russia. A portion of our exposure to the conflict including marine, energy, political violence, terror and whole account risks is protected by retrocessional policy that attaches at $10 million and provides $20 million of coverage to us. The first quarter loss estimate does not reach the attachment point of this cover.