Hiscox Re grows premiums as London Market expands
Hiscox reported growth across its reinsurance and London Market businesses in the first nine months of the year, with written premiums rising 4.5% at Hiscox Re to $1.33 billion.
The reinsurer does not disclose its combined ratio in its nine-month results.
The reinsurance division has reduced its net natural catastrophe exposure, particularly in retro, which is now 36% below peak hard-market levels. On the other hand, it continues to write new business in pro-rata property and specialty lines.
Aggregate reinsurance rates have declined by 14% over the first nine months, although they remain 55% above 2018 levels, Hiscox said, with 83% of its portfolio rated adequate or better at half-year.
Insurance-linked securities assets under management (AUM) reached a record high of $3.1 billion as of October 1, compared with $2.9 billion as of July 1, with around two-thirds in private ILS and the remainder in its catastrophe bond funds. Increases in AUM during the third quarter were due to strong retained earnings following a benign loss period.
Hiscox London Market, the division which offers specialty insurance across property, casualty, crisis management and marine, energy and specialty risks, increased premiums by 9.9% to $1.05 billion compared with $955.7 million a year ago.
Specialty rates reduced by 5% in aggregate over the first nine months of the year, consistent with the half-year position, although they are up 59% since 2018. Seventy-six per cent of the portfolio was rated adequate or better at half-year.
Hiscox is seeing increased demand for crisis management and marine, energy and specialty arising from the Middle East conflict and expansion into adjacent classes such as downstream energy and credit and political risk. However, these tailwinds were broadly offset by cycle management as competitive pressures persist, Hiscox said, most notably in terrorism and energy.
Aki Hussain (pictured), Hiscox CEO, said: “We are walking away from underpriced business while maintaining our position where economics are favourable and expanding into new specialty markets where conditions are attractive.”
Group-wide, what Hiscox calls insurance contract written premiums (ICWP) have grown by 9.5% to $4.4 billion in the first nine months, driven by accelerating momentum in its retail division.
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