Hiscox swings back to profit; deploys more capital into 'hard market'

Specialist global re/insurer  Hiscox swung back to profit in the first half of 2021 after a challenging 2020, having suffered large losses from COVID-19 related claims. The carrier judiciously deployed more capital into a "hard market" for big-ticket lines and saw "material improvement" in its overall performance from the correction actions undertaken this year.

Hiscox reported a net profit of $133.4 million before tax in H1 2021, having made a loss of $138.9 million before tax in the same period of 2020.

Gross written premiums increased to $2.43 billion in H1 2021, up from $2.24 billion in H1 2020. Its group combined ratio declined dramatically to 93.1 percent for the half year, having been 114.6 percent for the same period in 2020.

Bronek Masojada (pictured), Hiscox’s chief executive officer, hailed it as “a good result driven by strong performances across all our businesses.”

He added: “Our investments in digital trading continue to bear fruit and market conditions are the best we have experienced for many years. Hiscox has the fire-power, new leadership and talent to capture the many opportunities ahead.”

Hiscox chairman Robert Childs said: "After a challenging 2020, when many of our customers were severely affected by Covid-19 restrictions resulting in large losses for Hiscox and the wider insurance industry, it is pleasing to see positive results in each of our three divisions.

"In Hiscox London Market and Hiscox Re & ILS, we have seen multiple years of rate improvements as the market worked its way out of a prolonged soft market; the evidence of these rate increases combined with disciplined underwriting actions can be seen in the attractive combined ratios and profits reported at half year. As markets have improved, we have judiciously deployed more capital enabling those businesses to grow their net premiums written at a faster rate than gross premiums written."

Childs stated that the company's retail growth overall is in line with expectations and underwriting profit performance remains on track. "I am optimistic about the outlook for the rest of the year," he said. "We have turned a corner, our business performance is on track and the course correction actions will continue to earn through."

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