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Insurer Hiscox posts higher profit as premiums rise

Posted On: Jul. 29, 2019 7:21 AM CST

Mexico Beach, Florida, after Hurricane Michael

(Reuters) — Insurer Hiscox Ltd. posted a rise in first-half profit on Monday as it earned more from premiums and saw strong returns on investment, helping it overcome claims stemming from typhoons and hurricanes last year.

The FTSE 100 constituent, which underwrites risks ranging from fine art and vintage cars to kidnap and ransom, said pretax profit rose 3.3% to $168 million in the six months ended June 30. That came in at the higher end of the $150 million to $170 million range the insurer targeted earlier this month.

Hiscox, a Lloyd’s of London insurer, said net premiums earned for the half-year period climbed to $1.31 billion from $1.28 billion a year earlier.

The company said rates rose about 5% in its London market segment and that it saw growth in many of its core lines including directors and officers liability insurance, cargo and marine hull.

“Looking ahead, with six consecutive quarters of rate growth in some Lloyd’s business, the market is in a better position than it has been for some time,” Chief Executive Officer Bronek Masojada said.

The company, however, said it saw a higher volume of claims in the first half of this year compared with a year earlier, adding it had bolstered reserves for claims from last year’s Typhoon Jebi in Japan and Hurricane Michael in Florida.

Earlier this month, Hiscox increased its reserves for potential claims from the natural calamities by roughly $40 million.