Hiscox reports strong written premium growth

Specialist insurer Hiscox reported strong growth in group insurance contract written premiums (ICWP) on Wednesday in the first nine months of the year, increasing 6.8% in constant currency to reach $3.76bn.

The AIM-traded firm attributed the growth to its strategic capital deployment in the London Market and Reinsurance and Insurance-Linked Securities (Re & ILS) sectors, as well as its focus on expanding its Retail business to drive profitable growth across the group.

Its net Group ICWP exhibited even more robust growth, surging 11.0%.

That was primarily fuelled by a 23.6% increase in Re & ILS and an 18.1% increase in the London Market.

Hiscox Retail ICWP reached $1.84bn, making for solid growth of 4.7% in constant currency.

That, the board said, was driven by excellent performance in Europe and continued positive momentum in the US Direct and Partnerships Distribution (DPD) segment.

However, the growth was partly offset by a cautious approach to expanding the US cyber segment and ongoing efforts to exit non-core underwriting partnerships in the UK.

Excluding those factors, the underlying Retail growth remained within the target range of 5% to 15%.

Hiscox said it expected the impact of US cyber to moderate in the fourth quarter, resulting in an overall growth rate pick-up as US broker initiatives took effect.

US DPD ICWP growth continued to accelerate, rising 9.2% in the third quarter, remaining on track to meet full-year 2023 guidance for growth toward the middle of the 5% to 15% range.

Hiscox Retail also remained aligned with its full-year 2023 growth guidance.

The London Market segment of Hiscox saw net ICWP increase by an impressive 18.1% to reach $676.7m.

That acceleration in growth, from 14.2% at the half-year mark, was underpinned by strong double-digit growth in marine, energy, speciality, and property.

Hiscox Re & ILS successfully deployed capital in the hard market, achieving substantial net ICWP growth of 23.6%, up from 17.9% at the half-year point, amounting to $438.3m.

Furthermore, Hiscox ILS funds delivered record performance, generating an increasing fee income for the group.

Despite an active third quarter, aggregate natural catastrophe losses year-to-date remained within budget.

Additionally, the investment result showed a gain of $201.7m, marking a positive return of 2.8% year-to-date - a significant improvement compared to the negative return of 4.2% in the same period last year.

“I am pleased we have continued to deliver disciplined profitable growth across the group,” said group chief executive officer Aki Hussain.

“Through a combination of management actions to improve the quality of our portfolios, increased capital deployment in big-ticket and a focus on the quality of growth in retail, we are in the best position for many years to grow and deliver strong risk-adjusted returns in each of our segments.

“As we look forward, market conditions remain positive across the group and we see plenty of attractive opportunities ahead.”

Reporting by Josh White for Sharecast.com.