LONDON (Reuters) - Bermuda-based insurer and reinsurer Hiscox (HSX.L) returned to profit in the first six months of 2012 as a spate of costly natural catastrophes that pushed it deep into the red a year earlier eased.
Hiscox, whose insurance spans oil refineries to fine art and vintage cars, made a pre-tax profit of 125.8 million pounds compared with a loss of 85.6 million pounds a year earlier.
Analysts had expected a profit of 109 million pounds, according to a company poll.
Hiscox, a major provider of event cancellation insurance in Britain, sidestepped some 10 million pounds of losses in the first half of this year by refusing to cover events including the Badminton horse trials that were abandoned due to heavy rain, Chief Executive Bronek Masojada said.
Outgoing chairman Robert Hiscox, said the results marked “a welcome return to our profitable course after the battering we and the insurance industry received from Mother Nature last year.”
In the first half of 2011, insurers paid out billions in claims after Japan and New Zealand were struck by major earthquakes.
Severe tornadoes in the United States and heavy flooding in Thailand made 2011 as a whole the industry’s second-costliest natural catastrophe year on record, with insured losses totalling $116 billion, according to reinsurer Swiss Re SRENH.VX.
The company, which insures wealthy individuals in continental Europe, has prepared for a potential breakup of the euro zone, Masojada added.
“If there is a change of currency the computers are ready to switch over to whatever currency emerges,” he said.
“At the operational level we’ve made our preparations.”
The company named its chief underwriting officer, Robert Childs, as the successor to Hiscox, who announced his intention to step down in February.
Hiscox shares were up 1 percent by 10:10 a.m. British time, outperforming the FTSE 250 .FTMC share index, which was 0.2 percent higher.
The stock has risen 8.3 percent in the past year, compared with a 4.5 percent decline in the FTSE non-life insurance index .FTASX8530.
Hiscox is paying a first-half dividend of 6 pence per share, an increase of 18 percent.
Reporting by Myles Neligan; Editing by Erica Billingham