Poor reinsurance performance drags down Hiscox 2014 results
BRITISH insurer Hiscox said reduced premiums in its reinsurance business were behind an overall drop in profit during 2014, which saw a record performance in the company’s UK and Europe operations.
The high net worth specialist posted profit before tax of £231m, down from £245m the previous year, despite total gross written premiums increasing from £1.7bn to £1.8bn. Profits in Hiscox UK and Europe hit £73.3m, up from £56.4m in 2013. Meanwhile, the group’s combined operating ratio worsened slightly, moving from 83 per cent to 83.9 per cent.
Bronek Masojada, Hiscox chief executive, said the results were “pretty strong”, and added that although decline in the reinsurance business had hit the overall figures, the firm’s “strategy of diversity and balance means we have options”. He commented: “The strategy of diversification we have pursued for decades means that, whatever the headwinds, we have the firepower to set our own course.”
Masojada said the company is looking to expand further in the US, while also continuing to grow in the UK and Europe.
He also stated that Hiscox is unlikely to follow the recent trend of consolidation in the UK insurance market, which has seen deals announced between XL Group and Catlin, with analysts predicting further transactions in coming months.
“We take the view that we are a public company so our responsibility is to drive value for shareholders,” Masojada commented. “We think we can make money for them by continuing to do what we are doing.”
Shares in Hiscox were up by 0.32 per cent yesterday.