Q3 Interim Management Statement

Hamilton, Bermuda (7 November 2016) – Hiscox Ltd (LSE:HSX), the international specialist insurer, today issues its Interim Management Statement for the first nine months of the year to 30 September 2016.

Gross written premiums grew by 14.3% in local currency to £1858.2 million (2015: £1,536.9 million) with a strong performance across all segments. In reported currency gross written premiums grew by 20.9%, helped by material foreign exchange gains. Despite this growth, Hiscox London Market and Hiscox Re continue to face difficult trading conditions. Our retail businesses have performed well in a more stable environment.

Bronek Masojada, Hiscox Group CEO, commented: “It has been a good quarter for the Group, albeit flattered by foreign exchange gains. Our retail businesses continue to grow well, benefitting from long term investment in infrastructure and brand. However, margins are evaporating in some areas of the London Market, and we are adjusting our underwriting accordingly.”

Gross Written Premiums for the period:

  Gross Written Premiums
to 30 September 2016
Gross Written Premiums
to 30 September 2015
Growth in local currency Growth in Sterling
  US$/€m £m US$/€m £m % %
Hiscox Retail  






- Hiscox UK and Ireland  






- Hiscox Europe €173.9 £136.1 €160.8 £119.4


- Hiscox Special Risks*







- Hiscox USA







- DirectAsia**   £10.2   £13.9 (33.3)% (26.9)%
Hiscox London Market   £520.2  



Hiscox Re*** US$649.2 £466.8 US$512.1 £348.5 26.8% 34.0%
Total   £1858.2   £1,536.9 14.3%


*In 2016, we introduced the Hiscox Special Risks business unit which includes the business previously written into Hiscox Guernsey and the kidnap and ransom business from Hiscox London Market, Hiscox Europe and Hiscox USA. The relevant premium for the first three quarters of 2015 for those three business units was £22.5 million and has been restated above.

**Includes impact of the sale of DirectAsia Hong Kong to Well Link Group Holdings Limited.

***In 2016, we allocated casualty reinsurance business to Hiscox Re from Hiscox London Market. The relevant premium for the first three quarters of 2015 not reflected in the prior period’s comparative figures was £14.4 million.


It was another modest period for claims across Hiscox Retail. Hiscox London Market reported a more normal loss experience and thanks to good underwriting Hiscox Re avoided significant losses during the period.

October saw Hurricane Matthew hit the East Coast of the United States, the first material storm to make landfall in the United States since Hurricane Sandy in 2012. Based on an insured market loss of US$8 billion the Group set aside net US$35 million to cover claims and reduced profit commissions from the event. This loss is within our expected catastrophe loss budget for the year.

We avoided significant exposure to Hurricane Hermine and the Louisiana floods.


Across our retail businesses the rating environment is mixed. While rates are broadly flat in Hiscox USA and Hiscox Europe, Hiscox UK and Ireland is seeing marginal increases in luxury motor but on-going pressure in technology business.

In Hiscox London Market conditions remain difficult across the majority of classes, with aviation, marine and energy and US big-ticket property experiencing particularly intense rating pressure.

Hiscox Re saw rate pressure on international business, with less pressure on US catastrophe business. Going forward we are cautiously hopeful of an end to rate reductions in reinsurance, given depleting reserves, poor investment returns and recent catastrophes including Hurricane Matthew.


The investment result to 30 September 2016 was 1.9% on a non-annualised basis. With markets buoyed by the prospect of interest rates remaining lower for longer, the third quarter of 2016 has produced good results for both fixed income and equity investors. A hunt for yield has resulted in further gains from our bond portfolio, with corporate issues in particular benefitting from a narrowing of credit spreads. The rally in equities during the period has seen our risk assets make a useful contribution to investment income. Invested assets totalled £4.2 billion at the end of September, with asset allocation remaining largely unchanged from the end of June.

Hiscox Retail

Hiscox UK and Ireland

Hiscox UK and Ireland increased gross written premiums by 10.3% in local currency to £369.4 million (2015: £336.5 million), driven by specialty commercial, media, and art and private client lines. Underwriting partnerships also performed strongly, growing by 25%.

In the direct-to-consumer business, migration to a new online platform with an improved user experience has helped to drive good growth, particularly in commercial lines.

We continue to improve our private client offering with a renovations and extensions product for homeowners conducting building works. We also launched a liability product for tradespeople and contractors. Both are showing positive early signs.

Hiscox Europe

Hiscox Europe performed well in a flat rating environment, growing gross written premiums by 8.1% to €173.9 million (2015: €160.8million).This was driven by good performances in Germany, Spain and Benelux.

Hiscox Germany’s cyber offering has been particularly successful and our classic car product continues to be well-received in both Germany and Benelux. In Spain, partnerships with financial service providers are performing well.

Stéphane Flaquet was appointed Managing Director of Hiscox Europe during the third quarter.

Hiscox Special Risks

Hiscox Special Risks delivered gross written premiums of US$96.4 million (2015: US$113.2 million), a decrease of 14.8%. The team has done well to maintain market share while remaining disciplined in the face of intense competition. The business has also benefitted from a benign claims period.

During the third quarter we commenced a new partnership with International SOS, a leading medical and travel security risk services company, which complements our partnership with Control Risks.

Hiscox USA

Hiscox USA had a strong third quarter, growing year to date gross written premiums by 33.0% to US$400.9 million (2015: US$301.4 million). We continue to grow profitably in a mature market where our niche products and approach to service are proving popular.

Our professional risks business continues to perform well, with cyber delivering particularly good growth. On-going investment in the brand has seen our direct and partnerships business build further momentum and we now have more than 150,000 policies in force.

During the third quarter we launched workplace violence coverage for our management liability product and re-launched our industry-leading terrorism product to include a wider range of risks, such as the threat of an active shooter.

Hiscox USA avoided significant exposure to Hurricane Matthew.


DirectAsia delivered gross written premiums of £10.2 million (2015: £13.9 million), a reduction of 33.3%.

In August we completed the sale of the Hong Kong division DirectAsia to Well Link Group Holdings Limited. The transaction allows us to focus on our core Singapore and Thailand markets where we see most potential.

Hiscox London Market

Hiscox London Market increased gross written premiums by 9.3% in local currency to £520.2 million (2015: £442.4 million).

Growth in new product areas including product recall, general liability and marine cargo, is helping to offset reductions elsewhere.

We expect conditions in the London Market to remain difficult. We will continue to explore creative ways to navigate this soft market and are actively reducing in areas where rates are under severe pressure, particularly in aviation, marine and energy and US big ticket property. We expect the business to shrink materially in 2017.

Hiscox Re

Gross written premiums for Hiscox Re increased by 26.8% to US$649.2 million (2015: US$512.1 million), with casualty and specialty lines as well as business written for our ILS business being key drivers of growth. On a net basis premiums declined 5.2% to US$288.4 million (2015: US$304.2 million).

Kiskadee now has assets under management over US$1 billion and continues to attract interest from new and existing investors.

During the third quarter the team announced their ambition to develop a collateralised reinsurance ILS capability.


For further information:



Hiscox Ltd  
Jeremy Pinchin, Company Secretary +1 441 278 8300
Kylie O’Connor, Head of Communications +44 (0) 20 7448 6656
Tom Burns +44 (0)20 7404 5959
Simone Selzer +44 (0)20 7404 5959


Notes to editors

About The Hiscox Group

Hiscox is a global specialist insurer, headquartered in Bermuda and listed on the London Stock Exchange (LSE:HSX). Our ambition is to be a respected specialist insurer with a diverse portfolio by product and geography. We believe that building balance between catastrophe-exposed business and less volatile local specialty business gives us opportunities for profitable growth throughout the insurance cycle. It’s a long-standing strategy which in 2015 helped generate gross premiums written of £1,944.2 million and a profit before tax of £216.1 million.

The Hiscox Group employs over 2,200 people in 13 countries, and has customers worldwide. Through the retail businesses in the UK, Europe and the US, we offer a range of specialist insurance for professionals and business customers as well as homeowners. Internationally traded, bigger ticket business and reinsurance is underwritten through Hiscox London Market and Hiscox Re.

Our values define our business, with a focus on people, quality, courage and excellence in execution. We pride ourselves on being true to our word and our award-winning claims service is testament to that. For more information, visit www.hiscoxgroup.com.

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