Gen Re

General Reinsurance Corporation

File:Gen Re logo.svg
Company type	Subsidiary
Industry	Insurance
Founded	1921 (1921) (General Reinsurance Corp.) 1846 (1846) (Kölnische Rückversicherung)
Headquarters	Stamford, Connecticut , United States
Area served	Worldwide
Key people	Charlie Shamieh (chairman) Kara Raiguel (president and CEO)
Products	Reinsurance
Parent	Berkshire Hathaway
Website	genre.com

General Reinsurance Corporation stands as a prominent American multinational specializing in property/casualty and life/health reinsurance, providing an extensive array of products and services. Operating primarily as a direct reinsurer, Gen Re maintains a worldwide presence with more than 40 offices. It functions as a wholly owned subsidiary under the umbrella of Berkshire Hathaway.

The company’s reinsurance operations boast leading financial strength evaluations:

• A.M. Best: A++ (Superior)
• Standard & Poor's: AA+
• Moody's: Aa1

General Re Corporation acts as the holding entity for Gen Re’s international reinsurance and associated enterprises, which include General Reinsurance Corporation, General Re Life Corporation, and General Reinsurance AG. The organization also incorporates subsidiaries such as Gen Re Intermediaries, NEAM, General Star, Genesis, USAU, and Faraday.

History

Established in 1921 under the name General Casualty and Surety Reinsurance Corporation, the firm initially acquired the U.S. operations of the Norwegian Globe Insurance Company. In 1923, American investors rebranded it as General Reinsurance Corporation. By 1929, through the General Alliance Corporation, ownership of all General Re stock was consolidated, and a partnership was formed with Royal Exchange Assurance Group, creating one of the earliest casualty reinsurance groups in the United States focused solely on direct reinsurance.

In 1945, the company merged with Mellon Indemnity Corporation. It was a pioneer in professional casualty facultative reinsurance introduced in 1954, followed by property facultative reinsurance in 1956. Growth continued with the establishment of branches across North America and expansion into international markets from the 1950s through the 1970s. The headquarters relocated from New York City to Greenwich, Connecticut in 1974, then moved again to Stamford in 1984. The parent holding company, General Re Corporation, was formed in 1980 and subsequently listed on the NYSE under the ticker GRN.

A strategic partnership was established in 1994 with Cologne Re (founded in 1846), now known as General Reinsurance AG. Berkshire Hathaway acquired General Re Corporation in 1998. In 2003, General Reinsurance Corporation and Cologne Re combined their brands under "Gen Re." The acquisition of Cologne Re was finalized in 2009, with its renaming to General Reinsurance AG completed in 2010.

AIG Securities Fraud

In late 2000, Wall Street analysts raised concerns regarding a decrease in American International Group (AIG) loss reserves. To alleviate these concerns, AIG engaged in two artificial reinsurance transactions with Cologne Re Dublin, a subsidiary of General Reinsurance, which inflated AIG’s balance sheet by $500 million during late 2000 and early 2001. These deals lacked genuine economic substance but temporarily enhanced AIG’s financial presentation.

In 2005, New York Attorney General Eliot Spitzer initiated an inquiry into these transactions. AIG acknowledged that these arrangements could be interpreted as securities fraud since they artificially boosted its balance sheet and share price, causing investors to lose $500 million. John Houldsworth, CEO of Cologne Re Dublin, cooperated with the Department of Justice (DOJ) and Securities and Exchange Commission (SEC), pleading guilty to conspiracy charges connected to securities fraud.

The DOJ prosecuted five executives — four former Gen Re officials and one ex-AIG executive: CEO Ronald Ferguson was sentenced to two years imprisonment plus a $200,000 fine; CFO Elizabeth Monrad received an 18-month sentence with a $250,000 fine; Senior Vice Presidents Christopher Garand and Robert Graham were each sentenced to just over one year in prison accompanied by fines of $150,000 and $100,000 respectively; AIG Vice President Christian Milton was given four years incarceration along with a $200,000 fine.

In 2009, Houldsworth expressed remorse before U.S. District Judge Christopher Droney, resulting in a $5,000 penalty and community service totaling 400 hours during probation.

On August 1, 2011, the U.S. Court of Appeals for the Second Circuit overturned all five convictions and ordered a retrial after determining that the decline in share prices could not be directly attributed to the reinsurance transactions.

Resolution

In June 2012, the U.S. authorities discontinued legal proceedings against former executives of Gen Re under deferred prosecution agreements that had expired, thereby bringing the issue to a complete close. Additionally, civil lawsuits concerning AIG were resolved when the principal plaintiffs and Gen Re reached a settlement approved by the court in September 2013.

Office locations

Gen Re's main office is situated in Stamford, Connecticut. The firm has established a robust footprint throughout North America, with branch offices located in prominent cities such as Atlanta, Boston, Chicago, Columbus, Dallas, Hartford, Kansas City, Los Angeles, Montreal, New York, Philadelphia, San Francisco, Seattle, South Portland, St. Paul, and Toronto.

On an international scale, Gen Re maintains operations in vital markets including Latin America (Mexico City, São Paulo); Europe and the Middle East (Cologne, Copenhagen, Dubai, London, Madrid, Milan, Moscow, Paris, Vienna); Africa (Cape Town, Johannesburg); Asia (Beijing, Hong Kong, Mumbai, Seoul, Shanghai, Singapore, Taipei, Tokyo); and Australasia (Auckland, Sydney). These locations support the company’s broad business strategy and worldwide activities.

External links

• Welcome to Gen Re

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