Preparation and research by underwriters led to 'vintage year', says chairman
A benign hurricane season and improved investment returns helped Hiscox record its best ever results.
The Lloyd’s insurer tripled profits before tax from £105.2m to £320.6m, in what chairman Robert Hiscox described as a “vintage” year.
Investments reversed from a 1.3% loss in 2008 to a 7.3% return last year, as the insurer kept its nerve by sticking to corporate bonds, quality mortgage securities, and cash and government bonds.
Hiscox admitted “mother nature was kind” with a quiet catastrophe season, but added: “Underwriters did an immense amount of preparation and research to underwrite a carefully controlled exposure.”
Hiscox’s London market – made up of reinsurance, specialty, marine and energy, property and casualty – was the biggest profit generator of the group’s three operations, contributing £179.9m.
Hiscox International – with offices in Bermuda, Guernsey and the USA – posted a £124m profit compared with just £4m in 2008. Premium income increased more than 24% in USA and Bermuda as the company took advantage of an upturn in rates.
Finally, Hiscox UK and Europe, the specialist retail unit, suffered a profit drop from £31.7m in 2008 to £20.5m last year, having been hit by a series of large, unconnected losses on the Continent.