Margins under pressure at specialist insurer Hiscox despite boost from fall in sterling
- Credit: PA
Hiscox said yesterday the Brexit-hit pound had helped bolster its third-quarter performance, but warned that margins were “evaporating” in some parts of the London market.
The specialist insurer said gross written premiums rose by a fifth to £1.858bn in the nine months to the end of September, up from £1.536bn over the period last year.
But chief executive Bronek Masojada said that despite Hiscox London Market growing 9% to £520.2m over the period it was still grappling with “difficult trading conditions”.
“It has been a good quarter for the group, albeit flattered by foreign exchange gains,” he said. “Our retail businesses continue to grow well, benefiting 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.”
Hiscox, whose locations in the UK include Colchester, said it was looking at “creative ways” to tackle the soft London market, which it expects to “shrink materially” next year too.
However, it said its US arm grew by a 33% to 400.9m US dollars (£323m) in the nine months to the end of September, adding that it had avoided “significant exposure” to Hurricane Hermine in September and the Louisiana floods.