हाथी is a masculine noun, hence तैरता. Not all nouns ending with ई are feminine, though majority are, occasionally there will be nouns that are opposite to the rule, like हाथी or आदमी both being masculine nouns. Or nouns like महिला being feminine.
No this sentence will always be 'The elephant swims' if you want to put it into continuous form, that's another sentence, i.e 'The elephant is swimming' = हाथी तैर रहा है