Moody's lowers PartnerRe

Moody's Investors Service said it downgraded PartnerRe Ltd.'s senior debt to provisional A3 from provisional A2 and the insurance financial strength ratings of its principal operating subsidiaries to A1 from Aa3.

The downgrade is due to the company's recent earnings volatility and decline in equity capital, a result of outsized 2011 catastrophe losses relative to most of its peers, Moody's said, and a more conservative assessment of the firm's business profile relative to its larger, more diversified peers.

The outlook is stable.

The ratings reflect the company's strong franchise as a leading international property-casualty reinsurer, the group's leadership position in specialty reinsurance lines, its diversified book both by geography and by line of business, as well as its high quality investment portfolio and prudent reserving philosophy, the agency said.

These strengths are tempered by the group's significant gross lines risk retentions, which can contribute to volatility in earnings, Moody's added.

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