Hiscox cancels dividend, withdraws guidance due to Covid-19

The insurer also withdrew its financial guidance for 2020 until it has more clarity on the impact of the pandemic. While trading across the group was ahead of expectations for the first two months of the year, Hiscox said it was unable to accurately forecast the outlook for 2020 due to "the uncertain impact of Covid-19 on the global economy".

Hiscox said that in order to help it "serve the needs of businesses and households through the extraordinary challenges presented by Covid-19" and with the support of its regulators, it has decided that the resolution to approve the 2019 final dividend of 29.6 cents per share will no longer be put to shareholders at the annual meeting. In addition, the company will not propose an interim dividend payment for 2020 or conduct any share buybacks.

The Prudential Regulation Authority wrote to insurers at the end of March asking that they be "prudent" in their approach to dividends.

Nevertheless, Hiscox said its capital, liquidity and funding positions remain "strong" and expressed confidence in its ability to return to its normal 90-95% combined ratio target range for the retail business in 2022.

Legal & General bucked the trend in the insurance segment, confirming late last Friday that it will be paying a final dividend for 2019 despite pressure from the PRA.