5th May 2020 17:58
(Alliance News) - Lloyd's of London underwriter Hiscox Ltd said Tuesday its gross written premiums edged upwards in the first quarter of 2020, as rises in Retail and the London Market more than offset a fall in Re & ILS.
Hiscox also announced that it would conduct a raising of funds through a placing, the proceeds of which will go towards allowing the FTSE 100 group to respond to upcoming growth opportunities as well as allow it withstand a range of downside scenarios.
Hiscox did not close how much it was intending to raise, or how many shares it would issue, but said that the amount of new shares would not exceed 20% of its entire issued share capital.
As at May 1, Hiscox had 296.1 million shares issued overall, meaning that the maximum amount of shares that would be issued came up to 59.2 million shares.
Shares in Hiscox closed 3.9% higher at 692.40 pence on Tuesday in London. The group said it will determine the placing price per share at the end of the bookbuild process.
UBS is acting as joint bookrunner, sole corporate broker and sole sponsor, while Goldman Sachs acts as joint bookrunner.
For the three months to the end of March, Hiscox reported gross written premiums at GBP1.18 billion, a 1% increase from GBP1.16 billion the same period the year before.
The insurer's Retail business saw a 7% rise in gross written premiums to USD635.1 million, as each business unit delivering robust growth. However, there was a reduction in new business in April due to lower economic activity from Covid-19 and government actions as a result of it.
For the quarter, the London Market business premiums rose by 11% to USD254.5 million, on continued strong rate momentum, with double digit rate improvement reported in nine of the 16 lines of business, such as US public company D&O, general liability, cargo, major property and household and commercial property.
However, Hiscox Re & ILS has gross written premiums dropping by 15% to USD292.2 million, due to rate inadequacy.
"In the first quarter, Hiscox has seen continued growth in our Retail and London Market divisions. Hiscox Re & ILS remained cautious. The business responded rapidly to the changing circumstances caused by the global Coronavirus pandemic, and almost all of our employees around the world are working from home. We have redeployed staff to frontline roles where possible," said Chief Executive Officer Bronek Masojada.
"We are announcing an equity placing today in order to respond to growth opportunities and rate improvement in the US wholesale and reinsurance markets. We have managed our investments prudently and our capital position is robust, with an estimated group regulatory solvency ratio at the end of March of 195%," Masojada added.
By Dayo Laniyan; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Hiscox