2nd Nov 2020 10:29
(Alliance News) - Lloyd's of London underwriter Hiscox Ltd said Monday its gross written premiums edged upwards for the first nine months of 2020, driven by strong growth from nearly all of its businesses.
As at September 30, Hiscox reported gross written premiums at USD3.26 billion in the year to date, a 2% increase from USD3.21 billion as of the same date a year before.
The insurer's Retail business remained the largest contributor, with a 4% year-on-year rise in gross written premiums to USD1.73 billion, driven by the easing of government restrictions and a steady increase in economic activity, together with shift toward digital.
Looking ahead, Hiscox Retail remains on track to hit its 90% to 95% combined ratio target in 2022. Any combined ratio below 100% means an insurer is making a profit from its underwriting.
For the period, the London Market business premiums rose by 7% to USD772.9 million, on continued strong rate momentum, Hiscox said, with double-digit rate improvement reported in 9 of the 16 lines of business.
However, premiums from Hiscox Re & ILS declined by 7% to USD772.9 million, held down by underwriting discipline and portfolio action, including the exiting of casualty reinsurance.
In terms of claims, Hiscox has reserved USD75 million for catastrophe claims in the third quarter, including claims from Hurricane Laura based on an insured market loss of USD8 billion.
There has been no change to the group's previous estimate for Covid-19 related claims, which total USD387 million net of reinsurance.
However, should travel restrictions continue into 2021, Hiscox has an additional USD30 million to USD40 million in potential exposure relating to event cancellations.
Hiscox, which has been at the centre of controversy over the refusal of UK insurers to pay out on business interruption claims related to the virus lockdowns, said such potential claims have been running off at about 8% per month since June. Any further claims from government-imposed restrictions in 2020 will benefit from reinsurance cover, it said.
Looking ahead, Hiscox said it remains committed to the paying of dividends, and will re-evaluate its position at the end of the year.
"We are benefiting from the inexorable shift towards digital in our Retail businesses thanks to our on-going investment in technology, as well as the strongest pricing we have seen in the London Market and in reinsurance for more than five years. We have the financial strength, operational resilience and underwriting expertise to take advantage of these favourable market trends," said Chief Executive Officer Bronek Masojada.
Shares in Hiscox were up 3.1% higher at 849.80 pence on Monday in London.
By Dayo Laniyan; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Hiscox