Hiscox Swings Into First-Half Loss on Disasters
The firm had a net loss of 87 million pounds ($143 million) in the first six months of the year, compared with a profit of 78.6 million pounds in the year-earlier period, the Hamilton, Bermuda-based insurer said in a statement today.
Hiscox, like other Lloyd’s insurers such Beazley Plc, was hurt by Japan’s biggest earthquake on record as well as tornadoes in the U.S. earlier this year. The net cost of the U.S. tornadoes will be about 35 million pounds and losses from the Japanese earthquake will be between $60 million and $150 million, Hiscox said in June.
“It has been an exceptionally challenging first half,” Chairman Robert Hiscox said in the statement. “2011 is reported to be the most expensive catastrophe year to the insurance industry on record after just six months, worse than the full 12 months of 2005, the previous highest on record.”
The insurer said whether it can turn the loss into a profit for the full-year will depend on the nature of the hurricane season in the rest of 2011.
“We are quite positive on the second half, but it will all depends on how many hurricanes there are,” Chief Executive Officer Bronek Masojada said in a telephone interview today.
The stock rose 1.2 percent to 412.5 pence as of 9:05 a.m. in London trading, valuing the firm at about 1.6 billion pounds. Hiscox increased its first-half dividend to 5.1 pence a share, from 5 pence.