November 5, 2018 / 7:41 AM / 2 years ago

Hiscox earns more from premiums, says growth could moderate

(Reuters) - Lloyd’s of London underwriter Hiscox Ltd (HSX.L) on Monday reported a 14.3 percent rise in gross written premiums for the first nine months of the year, but warned that growth could moderate in the last quarter of the year.

The insurer, which underwrites a range of risks from oil refineries to hijacks, said it set aside $125 million (96.25 million pounds) to cover claims due to hurricanes Florence and Michael in the United States and typhoons Jebi and Trammi in East Asia.

“... I expect our growth to moderate over the balance of the year. It has been an active third quarter for claims across the Group, both from large losses and catastrophes,” Chief Executive Officer Bronek Masojada said in a statement.

Hiscox said gross written premiums rose to $3.04 billion from $2.66 billion a year earlier, adding that its London Market business had seen rates rise 5 percent year to date.

Following record insurance losses of more than $135 billion from hurricanes, earthquakes and wildfires last year, insurers had hoped for higher rates.

In the end, however, global property reinsurance prices rose less than expected, with strong competition limiting increases to single-digit percentages.

Hiscox also said its European subsidiary in Luxembourg would be ready to write business from the start of 2019, as the firm prepares for Britain potentially crashing out of the European Union without a deal.

Hiscox said the financial impact of re-organising the business in preparation for Brexit would be $15 million in 2018, with a capital injection of 40 million euros ($45.58 million) in the Luxembourg entity.

The underwriter said it expects full-year investment return to be subdued, citing on-going economic and global political tensions.

Reporting by Noor Zainab Hussain and Samantha Machado in Bengaluru; Editing by Saumyadeb Chakrabarty

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