Novae’s decision to return to shareholders the trapped capital freed by transferring business to its Lloyd’s syndicate appears to have found favour with the market. Its shares are up 6% compared with a week ago.
More pleasing for shareholders is that the capital return is just one piece of a four-part plan to lift return on equity. Novae is also cutting its reinsurance spend incrementally in 2010, 2011 and 2012, and is looking at selling its 2002 and prior-year run-off book.
Other insurers’ attempts at pleasing shareholders seem to be paying off too. Zurich announced it was planning to cut $500m (£319m) in costs and ensure its combined ratio is 3%-4% better than rivals’. Its shares are up 0.8% this week.
But this could be a case of a rising tide lifting all boats. After taking a pounding because of sovereign debt concerns, most insurers have posted increases – Aviva’s being most notable.
Prices
Market indices Movers price 7-day Currency
FTSE 100 5,770.28 Aviva (£) 380.40 +5.96% Dollar 1.58
FTSE 250 11,151.35 Zurich (CHF) 230.30 +0.83% Euro 1.18
FTSE All-share 2,988.60 AXA (€) 11.66 +1.65% Yen 130.13
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
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