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Daily Insurance Industry News
Sunday 25th of February 2018
August 1, 2011

Hiscox post £86.5m first-half loss

by Gill Montia

Story link: Hiscox post £86.5m first-half loss

Hiscox has reported a pre-tax loss of £85.6 million for the first half of 2011, compared with a profit of £97.2 million a year earlier, following “a tumultuous first six months”.

The specialist insurer recorded gross written premium of £847.5 million, down slightly from £904.3 million in the first half of 2010, although its UK business saw gross written premium rise by 8.8%, to £25.2 million.

Assets under management as at 30th June 2011 totalled almost £2.86 billion but with annualised return at 2%, investment return on financial assets came in at only £27.6 million (30th June 2010: £46.6 million).

The group’s combined ratio increased to 116.9% (2010: 93.6%), reflecting reduced income and the unusually high level of catastrophe losses.

However, catastrophe reserves remain unchanged and the firm reported that US catastrophe reinsurance rates are improving, with average rate rises of 10%, and substantially more in loss-affected areas.

Chairman, Robert Hiscox, comments: “It has been an exceptionally challenging first half-year, but we are in good shape to take advantage of increased rates in some catastrophe areas, and to accelerate the momentum of our retail businesses.”

The insurer has declared an interim dividend of 5.1 pence per share (H1 2010: 5 pence per share).

Last month, Hiscox announced that it envisages a 2012 capacity of £1 billion for Syndicate 33, an increase of £100 million from 2011.

The insurer said the increase is driven by anticipated improved market conditions, particularly in reinsurance lines, plus a desire to have sufficient capacity available in the event of a widespread market turn.

 

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