Hiscox withdraws guidance for 2020 but 'confident' to return to 90-95% combined ratio by 2022

Specialist insurer Hiscox has taken several actions in light of the "extraordinary challenges" presented by COVID-19 pandemic, including the withdrawal of its 2020 financial guidance and suspension of dividend payment and buybacks.

The company's board has decided that the resolution to approve the 2019 final dividend of 29.6 cents per share, which was scheduled for payment on June 10, 2020, will no longer be put to shareholders at the Annual General Meeting (AGM).

The board has also agreed that for 2020 the company will not propose an interim dividend payment, or conduct any share buyback.

Additionally, the insurer has withdrawn all financial guidance for 2020 until there is more clarity.

"In view of the uncertain impact of COVID-19 on the global economy, the group is unable to accurately forecast the outlook for 2020," Hiscox said in a statement.

The company also noted that executive director bonuses will not be paid until the dividend has resumed. Executive directors were not eligible for a bonus for 2019 as ROE was below performance threshold level.

Hiscox said it has taken these measures with the support of regulators in order to help the company navigate through the extraordinary challenges presented by COVID-19.

The company insisted that its capital, liquidity and funding positions remain strong.

"Trading across the Group for the first two months of the year was ahead of expectations," it said. "We remain confident in our ability to return to our normal 90-95% combined ratio target range for the Retail business in 2022. We remain focused on supporting our customers, employees and other stakeholders through this crisis."

The insurer's combined ratio for financial year 2019 was 105.7 percent.