Lloyd’s insurer Hiscox’s UK retail gross written premium increased 8% to £86.2m in Q1 2011 from £79.8m in the same period last year.
Hiscox attributed the increase to continued good growth from its direct business, as well as the underwriting partnership with underwriting agency DUAL International.
Hiscox announced the partnership with DUAL in August 2010, under which the insurer providers up to 25% of the agency’s capacity to write business in the UK, Ireland, Italy and Australia.
However, GWP at Hiscox London Market dropped by 22.3% to £182.4m from £234.8m. During Q1 the division cut back in areas where rates were under pressure, mainly reinsurance and professional indemnity. However, Hiscox said the unit now sees opportunity where markets are improving, for example reinsurance.
Overall, Hiscox’s Q1 2011 gross written premium was down 8% on Q1 2010 to £453.5m from £504.1m. Hiscox said the reduction was caused by underwriting discipline and walking away from poorly-rated risks.
“We continue to underwrite for profit over volume in these tough market conditions,” said Hiscox chief executive Bronek Masojada in a statement. “This discipline has allowed us to keep our powder dry and we are ready to take advantage of rising reinsurance rates. Our own reinsurance cover remains substantially in place for the upcoming US hurricane season.”
Hiscox reported that while the first quarter began with rate reductions in reinsurance lines, the recent natural catastrophes have changed the market. It said rates are now back to 2010 levels with increases in some areas, especially in the Asia Pacific. “We expect increases to become widespread during the June/July renewal period with potential average rate rises of around 10% in US catastrophe business, as the market is also impacted by the new RMS 11 model,” Hiscox’s Q1 interim management statement read.
