Hiscox reports 20%-plus price rises in cargo and hull

Insurer Hiscox has reported that in the marine and energy book price trends were resoundingly positive, with rates increasing by 24% in cargo, and 20% in hull.

However in its annual results it also noted that it had experienced a number of large marine liability losses, as well as having exposure to the explosion in Beirut last August.

The company fell to a loss of $268.5m for the year, from a gain of $53.1m the year before, and will not be paying a dividend. Covid-19 claims were reported to have had a significant impact on earnings.

  2020 2019
Gross premiums written $4,033.1m $4,030.7m
Net premiums earned $2,752.2m $2,635.6m
(Loss)/profit before tax $(268.5)m $53.1m
(Loss)/earnings per share ($) (91.6)¢ 17.2¢
(Loss)/earnings per share (£) (71.5)p 13.5p
Total ordinary dividend per share for the year 13.8¢*
Net asset value per share ($) 689.0¢ 768.2¢
Net asset value per share (£) 503.9p 580.1p
Group combined ratio 114.5% 106.8%**
Return on equity (annualized) (11.8)% 2.2%
Investment return (annualized) 2.8% 3.6%
Positive prior year development $32.0m $25.9m

*During 2020 the Board did not approve the 2019 final dividend of 29.6¢ per share. The 2019 total ordinary dividend per share has therefore been re-presented as 13.8¢ per share (from 43.4¢ per share).

** In 2020 the Group further refined how it manages and evaluates the performance of the business units. All foreign exchange gains and losses are now managed centrally. This has resulted in the re-presentation of the Group combined ratio for 2019 as 106.8% rather than 105.7%.

Hiscox said that it was targeting a 90% to 95% combined ratio by 2023.

Hiscox London Market comprises the internationally traded insurance business written by the Group’s London-based underwriters via Syndicate 33. Hiscox Re & ILS is the reinsurance division of the Hiscox Group, combining the underwriting platforms in Bermuda and London. The segment comprises the performance of Hiscox Insurance Company (Bermuda) Limited, excluding the internal quota share arrangements, with the reinsurance contracts written by Syndicate 33.