Against a backdrop of heavy losses Bermuda-based specialist insurer Hiscox has increased its rates on some of its core businesses, including its London Market operations and reinsurance business.
The company’s total gross written premiums grew to $1.16 billion in the first quarter, up 3 percent year-on-year.
For Hiscox Re & ILS, rates are up by around 2 percent across its portfolio, with the retrocession and risk excess accounts achieving the highest increases.
Rates in US catastrophe-exposed businesses is up by low single digits.
However, rates in Hiscox's international book of business are down slightly in aggregate, e, despite increases of more than 25 percent on loss-affected Japanese business at the April renewals.
For Hiscox London Market, rates increased by around 4 percent across the portfolio, which it attributes to the cumulative impact of two consecutive years of heavy market losses and the Lloyd’s ‘Decile 10’ directive to drive rate improvement in the majority of classes.
In particular, cargo, marine hull and US public company directors and officers’ (D&O) have seen the most significant rate rises, all up double digits, while pricing in property lines "continues to firm".
“In the London Market and in reinsurance, where conditions are improving, we are growing in the right areas and maintaining our focus on writing profitable business,” said CEO Bronek Masojada.
Hiscox Re & ILS gross written premiums were down 4.6 percent to $342.8 million in the first quarter.
According to Hiscox, the main driver of this was a reduction of capital available to be deployed by the ILS funds following significant losses in 2018. Without the impact of ILS, premiums grew 3 percent.
"Our teams in London and Bermuda have done well to capitalise on rate improvement in property catastrophe reinsurance and retrocession, with the latter account achieving particularly strong growth," according to Hiscox's Q1 trading statement. "At the April renewals we secured double-digit increases in Japanese loss-affected business, but rates elsewhere in the international book were down."
Hiscox is optimistic that sustainable rate increases will continue throughout 2019, as the market recognises "significant deterioration on prior year losses and recent loss experience that requires an updated view of risk".
Hiscox, Reinsurance, ILS, Bermuda, London