Hiscox retail staff lavished with praise for stellar results

Hiscox retail division has been lavished with praise as the ‘stand out achievements’ in the insurer’s 2016 results, following a year of terrific growth.

Shore Capital analyst Eammon Flanagan, a veteran in reporting on insurance sector results, said: “By division, Hiscox Retail reported terrific growth in profits to c£158m (2015: £79m) reflecting a broadly stable underlying COR of 92%, forex gains and c15% growth in the net earned premiums.”

Flanagan said retail now accounted for around 60% of the group’s £354.5m profits, exlucing exchange rate movements. That group total was up 64% on the £216.1m it reported in 2015.

The powerhouse performance of its underwriting results alone cover the dividend cost. 

“This vindicates the group’s strategy of building and developing the retail units,” he said.

Flanagan said the international arm and Lloyd’s unit performances were stable. He added that Hiscox Re was ‘commendable’ in achieving a 66% combined ratio.

Hiscox plans for 2017

For the year ahead, some important developments for Hiscox will be the revamp of its IT in the UK broker business, which have already taken place in direct.

The firm is also gunning for a greater slice of the UK’s SME market and continued expansion in cyber product sales.

Hiscox’s strategy of creating a direct personal lines and direct small business arm has caught the attention of brokers. 

Broker Oakwood Insurance director Richard Austin told a packed conference of more than 100 high net worth (HNW) brokers at last year’s Insurance Times High Net Worth conference that Hiscox was making a big push into direct insurance, despite years of loyal intermediary support.

Austin said the insurer was offering competitive deals, making it harder for brokers to retain customers. He added: “They are cutting out the middle man. I hope that other insurers do not go that way.”