Hiscox Profits up 186% to $388 Million

The newly Bermuda-based Hiscox Ltd. announced greatly improved preliminary results for the year ended December 31, 2006, with record pretax profits of £201.1 million ($388 million) compared to £70.2 million ($135.5 million) in 2005, a 186 percent rise.

Other earnings highlights included the following:
— Gross written premiums £1.1262 billion ($2.173 billion), compared to £861.2 million ($1.662 billion) in 2005
— Net earned premiums £888.8 million ($1.715 billion), compared to £693.3 million ($1.338 billion) in 2005.
— Net asset value per share rose to £7.00 ($13.50) from £4.75 ($9.16)
— Group combined ratio dropped to 88.3 percent from 96 percent
— Return on equity rose to 28.9 percent from 12.8 percent

Hiscox report also noted the following “Operational highlights:”
— Redomicile to Bermuda completed
— New operations, Hiscox Bermuda and Hiscox USA, made excellent starts
— Panther Re, the first Lloyd’s market sidecar, was launched substantially increasing Syndicate 33’s catastrophe reinsurance underwriting capacity
— Our investment in marketing in the UK, which featured our first ever TV advertising campaign, improved brand awareness and drove up demand.

Chairman Robert Hiscox commented: “It has been a very good year for Hiscox. Our decision to increase our catastrophe reinsurance book by opening in Bermuda after two bad catastrophe years and with every pundit forecasting more disasters has paid off handsomely. In addition, our retail businesses continue to grow in the UK, Europe and the USA.

“We will continue to focus on our specialist business lines around the world, aiming to build a balanced overall account with sustainable profitability.”

Summing up a very eventful – and successful – year Chief Executive Bronek Masojada commented: “Over the past two years the Hiscox Group has changed from a London focused business to a specialist business with a substantial global reach, delivering record results. Reflecting this change it is now domiciled in Bermuda. This evolution has been achieved largely by organic growth with substantial investments in building new businesses, supported at critical times with capital from shareholders.

“The market outlook is attractive but will become more challenging. Strong discipline will be required in deciding which risks to underwrite and which business initiatives to pursue. We believe that our strategy of balancing retail and volatile risks will give us the flexibility to make the right choices for the benefit of the business and its owners.”

The full report and additional comments by the Chairman and Chief Executive may be obtained on the Group’s web site at: http://www.hiscox.com.

Topics Profit Loss