Hiscox Reports Record Results

Hiscox reported record results for 2007, with pretax profits up 18 percent, to ?237.2 million ($360 million) compared to ?201.1million ($305.7 million) in 2006.

Gross written premium income increased 6.5 percent, to ?1.19 billion ($1.81 billion) compared to ?1.126 billion ($1.71 billion) in 2006. Net earned premium increased 8.6 percent, to ?965.2 million ($1.46 billion) compared to ?888.8 million ($1.35 billion) in 2006, the company said.

Hiscox said results were high, despite a weak dollar exchange rate persisting throughout 2007. The combined ratio was 84.4, versus 89.1 in 2006. Earnings per share on profit after tax increased 16.1 percent. Net assets per share rose 21 percent and return on equity was 28.8 percent compared with 28.9 percent in 2006.

Chairman Robert Hiscox said: “After a record result in 2006, I am delighted to announce a further record in 2007. We took full advantage of the strong rates for international reinsurance in London and Bermuda, added some gearing from our [reinsurance] sidecar 'Panther,' and with disciplined underwriting, skilful avoidance of various market losses and some help from Mother Nature, were handsomely rewarded.”

Mr. Hiscox said the firm's regional businesses in the United Kingdom, Europe and the United States continued to grow.

The U.K. business, he noted, made “a good profit despite the storms and floods. Our strategy of growing stable regional businesses will now become more valuable as some international rates fall following two years with relatively light catastrophes.

He added, “Our ambition remains to be a highly respected international specialist insurance and reinsurance company, built on a portfolio balanced between volatile international catastrophe business and more steady local and regional business. During the last year we made significant progress in strengthening the group.”

Hiscox Europe increased premium income by 25 percent and had a third year of profit despite losses from Windstorm Kyrill, “which bodes well for the future as we increase our product range,” said Mr. Hiscox.

He added that Hiscox USA “established a firm foothold and the acquisition of the American Live Stock Insurance Company, now renamed Hiscox Insurance Company Inc., will give the company the ability to market policies on an admitted basis,” in addition to the surplus lines basis using Hiscox Syndicate 33 at Lloyd's.