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In 1994, General Reinsurance Corporation formed an alliance with what was then Cologne Re (Kölnische Rückversicherungs-Gesellschaft, which was founded in 1846), now General Reinsurance AG. In 1998, General Re Corporation was acquired by Berkshire Hathaway Inc., and in 2003 General Reinsurance Corporation and Cologne Re began marketing under the brand name of Gen Re.<ref name="History">{{cite web|url=http://www.genre.com/page/0,,ref=History-en,00.html|title=History of Gen Re|publisher=Gen Re|accessdate=12 June 2011}}</ref> In 2009, General Reinsurance Corporation completed its purchase of Cologne Re,<ref name="AcquisitionCologneRe">{{cite web|url=http://www.genre.com/pressrel/PressProfile/0,,site=gcr-en&ref=pressrel131-en,00.html|title=Ad hoc Announcement|publisher=Gen Re|accessdate=12 June 2011}}</ref> whose name was changed to General Reinsurance AG in 2010.<ref name="NamechangeCologneRe">{{cite web|url=http://www.genre.com/pressrel/PressProfile/0,,site=gcr-en&ref=pressrel146-en,00.html|title=Press Release|publisher=Gen Re|accessdate=12 June 2011}}</ref> The company continues to market as Gen Re.
In 1994, General Reinsurance Corporation formed an alliance with what was then Cologne Re (Kölnische Rückversicherungs-Gesellschaft, which was founded in 1846), now General Reinsurance AG. In 1998, General Re Corporation was acquired by Berkshire Hathaway Inc., and in 2003 General Reinsurance Corporation and Cologne Re began marketing under the brand name of Gen Re.<ref name="History">{{cite web|url=http://www.genre.com/page/0,,ref=History-en,00.html|title=History of Gen Re|publisher=Gen Re|accessdate=12 June 2011}}</ref> In 2009, General Reinsurance Corporation completed its purchase of Cologne Re,<ref name="AcquisitionCologneRe">{{cite web|url=http://www.genre.com/pressrel/PressProfile/0,,site=gcr-en&ref=pressrel131-en,00.html|title=Ad hoc Announcement|publisher=Gen Re|accessdate=12 June 2011}}</ref> whose name was changed to General Reinsurance AG in 2010.<ref name="NamechangeCologneRe">{{cite web|url=http://www.genre.com/pressrel/PressProfile/0,,site=gcr-en&ref=pressrel146-en,00.html|title=Press Release|publisher=Gen Re|accessdate=12 June 2011}}</ref> The company continues to market as Gen Re.

===AIG Securities Fraud===
{{main|American International Group}}
In 2000, [[American International Group|American International Group (AIG)]] became short of liquidity, and hence its stock came under pressure. That same year, Gen Re Ireland CEO John Houldsworth agreed a deal to lend AIG $500M via a deal which made it look as if Gen Re bought two insurance contracts from AIG, one in 2000 and one in 2001 for $250M each. The bogus deal resultantly made it look like Gen Re paying AIG $500 million in premiums, when in reality Gen Re would pay no premiums, receiving $5 million from AIG for its involvement in the deal.<ref name=InsJour/>

In 2005, New York Attorney General [[Eliot Spitzer]] began an investigation into AIG. Soon afterwards, AIG came under market pressure, and admitted it had undertaken what could be construed as securities fraud. They admitted that the Gen Re deal had inflated AIG’s balance sheet and propped up AIG’s stock price. In the resultant stock crash, investors lost $500M in investments.<ref name=InsJour/>

Houldsworth agreed to turn state's witness for the [[Securities and Exchange Commission]], in agreement for a plea bargain. Houldsworth then pleaded guilty to conspiring to commit securities fraud, resultantly facing a sentence of up to five years in prison and $250,000 in fines. The final sentencing was placed on hold, subject to consequential SEC prosecutions.<ref name=InsJour/>

The SEC subsequently undertook successful prosecutions against five former Gen Re excutives: CEO Ronald Ferguson was sentenced to two years in prison and fined $200,000; CFO Elizabeth Monrad was sentenced to 18 months in prison and fined $250,000; Senior Vice President Christopher Garand was sentenced to a year and a day in prison and fined $150,000; Senior Vice President and Assistant General Counsel Robert Graham was sentenced to a year and a day in prison and fined $100,000; Vice President Christian Milton was sentenced to four years in prison and fined $200,000.<ref name=InsJour/>

In 2009, in front of District Judge Christopher Droney in Hartford, Houldsworth appologised. He was resultantly fined $5,000 and ordered to perform 400 hours of community service during a two year probation period.<ref name=InsJour>{{cite web|url=http://www.insurancejournal.com/news/national/2009/06/18/101524.htm|title=Former General Re Executive Given Probation|author=Dave Collins|publisher=Insurance Journal|date=June 18, 2009|accessdate=2012-03-14}}</ref>


==Business==
==Business==

Revision as of 00:28, 15 March 2012

Gen Re
Company typeCorporation
IndustryFinancial services
Founded1846
HeadquartersStamford, Connecticut, USA
Area served
Worldwide
Key people
Tad Montross (Chairman, President and CEO)[1]
ProductsReinsurance
ParentBerkshire Hathaway Inc.
Websitewww.genre.com

Gen Re is a leading property/casualty and life/health reinsurance company and is owned by Berkshire Hathaway Inc.

History

General Reinsurance Corporation’s history began in 1921 when two Norwegian companies, Norwegian Globe and Norwegian Assurance, merged and took the name General Casualty and Surety Reinsurance Corporation. In 1923, American investors acquired the company and changed the name to General Reinsurance Corporation. In 1929, General Reinsurance affirmed that it would be only a direct reinsurer. In 1954, the company created the first professional casualty facultative reinsurance department. Property facultative followed, beginning in 1956. North America branch offices were opened during this time. In the 1950s, General Reinsurance began writing reinsurance internationally, expanding in this area during the 1960s and 1970s. In 1980, General Re Corporation, the parent holding company, was listed on the New York Stock Exchange.

In 1994, General Reinsurance Corporation formed an alliance with what was then Cologne Re (Kölnische Rückversicherungs-Gesellschaft, which was founded in 1846), now General Reinsurance AG. In 1998, General Re Corporation was acquired by Berkshire Hathaway Inc., and in 2003 General Reinsurance Corporation and Cologne Re began marketing under the brand name of Gen Re.[2] In 2009, General Reinsurance Corporation completed its purchase of Cologne Re,[3] whose name was changed to General Reinsurance AG in 2010.[4] The company continues to market as Gen Re.

AIG Securities Fraud

Main article: American International Group

In 2000, American International Group (AIG) became short of liquidity, and hence its stock came under pressure. That same year, Gen Re Ireland CEO John Houldsworth agreed a deal to lend AIG $500M via a deal which made it look as if Gen Re bought two insurance contracts from AIG, one in 2000 and one in 2001 for $250M each. The bogus deal resultantly made it look like Gen Re paying AIG $500 million in premiums, when in reality Gen Re would pay no premiums, receiving $5 million from AIG for its involvement in the deal.[5]

In 2005, New York Attorney General Eliot Spitzer began an investigation into AIG. Soon afterwards, AIG came under market pressure, and admitted it had undertaken what could be construed as securities fraud. They admitted that the Gen Re deal had inflated AIG’s balance sheet and propped up AIG’s stock price. In the resultant stock crash, investors lost $500M in investments.[5]

Houldsworth agreed to turn state's witness for the Securities and Exchange Commission, in agreement for a plea bargain. Houldsworth then pleaded guilty to conspiring to commit securities fraud, resultantly facing a sentence of up to five years in prison and $250,000 in fines. The final sentencing was placed on hold, subject to consequential SEC prosecutions.[5]

The SEC subsequently undertook successful prosecutions against five former Gen Re excutives: CEO Ronald Ferguson was sentenced to two years in prison and fined $200,000; CFO Elizabeth Monrad was sentenced to 18 months in prison and fined $250,000; Senior Vice President Christopher Garand was sentenced to a year and a day in prison and fined $150,000; Senior Vice President and Assistant General Counsel Robert Graham was sentenced to a year and a day in prison and fined $100,000; Vice President Christian Milton was sentenced to four years in prison and fined $200,000.[5]

In 2009, in front of District Judge Christopher Droney in Hartford, Houldsworth appologised. He was resultantly fined $5,000 and ordered to perform 400 hours of community service during a two year probation period.[5]

Business

Reinsurers "insure insurance companies", i.e., they will pay a portion of an insurance company's claims in exchange for a portion of the premium received by the insurance company for policies that cover those claims.

As a direct reinsurer, Gen Re delivers reinsurance solutions to companies in all segments of the insurance industry on both a Treaty and Facultative basis. Gen Re's Property and Casualty reinsurance in North America is written through General Reinsurance Corporation and internationally through Germany-based General Reinsurance AG and other wholly owned affiliates. Gen Re's Life and Health reinsurance is written in North America through General Re Life Corporation and internationally through General Reinsurance AG.

General Re Corporation is a wholly owned subsidiary of Berkshire Hathaway Inc., the holding company run by investor Warren Buffett. Other businesses in the General Re Corporation group include: Gen Re Intermediaries, a reinsurance intermediary and risk advisor; General Star, a specialty and surplus lines provider; Genesis, an alternative risk insurance provider; Faraday, a London market reinsurance company; USAU, underwriters of aviation insurance; and GR-NEAM, an SEC-registered investment advisor servicing the insurance industry.

Office locations

Gen Re's headquarters are in Stamford, Connecticut. Branch and subsidiary offices are located all over the world:[6]

In North America, Gen Re also operates in Atlanta, Boston, Charlotte, Chicago, Columbus, Dallas, Hartford, Kansas City, Los Angeles, Montreal, New York, Philadelphia, San Francisco, Seattle, South Portland, St. Paul and Toronto.

Gen Re further operates in Latin America (Mexico City, São Paulo), Europe/Middle East (Beirut, Cologne, Copenhagen, London, Madrid, Milan, Moscow, Paris, Riga, Vienna, Warsaw), Africa (Cape Town, Johannesburg), Asia (Beijing, Hong Kong, Mumbai, Seoul, Shanghai, Singapore, Taipei, Tokyo) and Australasia (Auckland, Melbourne, Sydney).

References

  1. ^ "Senior Management Team". Gen Re. Retrieved 04 January 2012. {{cite web}}: Check date values in: |accessdate= (help)
  2. ^ "History of Gen Re". Gen Re. Retrieved 12 June 2011.
  3. ^ "Ad hoc Announcement". Gen Re. Retrieved 12 June 2011.
  4. ^ "Press Release". Gen Re. Retrieved 12 June 2011.
  5. ^ a b c d e Dave Collins (June 18, 2009). "Former General Re Executive Given Probation". Insurance Journal. Retrieved 2012-03-14.
  6. ^ "Office Directory". Gen Re. Retrieved 12 June 2011.
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