Hiscox swings to full-year profit

2nd Mar 2022 09:10

(Sharecast News) - Hiscox reported its strongest underwriting profit for five years on Wednesday, after the specialist insurer swung back into the black.

The Lloyd's of London firm reported a 5.9% rise in gross premiums written in the year to 31 December, to $4.27bn, while net premiums written rose 17.0% to $2.92bn.

Underwriting profits were $215.6m, compared to a loss of $370.6m a year previously. Bermuda-based Hiscox, which is listed in London, said it was the strongest underwriting profit for five years.

Group pre-tax profits were $190.8m, compared to a pre-tax loss of $268.5m the previous year, while earnings per share were 55.3 cents. Last year the insurer reported a loss per share of 91.6 cents, pushed into the red by pandemic-related claims.

Hiscox's combined ratio - a key indicator of an insurer's profitability - was 93.2% against 114.5% a year previously. A combined ratio below 100% indicates an underwriting profit.

Aki Hussain, chief executive, said: "I am pleased with the strong results the group has delivered despite elevated natural catastrophe losses, reflecting successful execution of our strategy and the management actions we have undertaken to improve the performance and quality of our portfolios.

"Hiscox has a significant technical underwriting capability, which combined with investment in digital, position us well to capitalise on the many opportunities ahead as we continue to serve our customers and build a sustainable insurance business."

Hussain took over as chief executive on 1 January following the retirement of former incumbent Bronek Masojada.

Looking to the current year, chair Robert Childs said: "We aim to grow our top-line profitability in this underwriting climate and continuously attract first-rate talent.

"In the insurance industry, catastrophes happen at any time, but there is a fair wind behind us and I am looking forward to a great year."

Hiscox said it had some limited exposure to the conflict in Ukraine, "through certain lines, including terrorism, political violence, war and marine", but that it had negligible exposure to investments in Ukrainian and Russian assets.

The group, which resumed dividends at the interim stage, is proposing a final dividend of 23.0 per share.

As at 0900 shares in Hiscox were 4% ahead at 932.6p.