Hiscox and Amlin results

Lloyd’s insurers Hiscox Limited and Amlin plc both released their results for the year ended 31 December 2014 yesterday, 2 March. Although overall profitability fell for both companies, despite an increase in written premiums, both felt that had they had delivered good results and both plan to pay investors special dividends.

Hiscox Limited

Hiscox pointed to its increasing proportion of retail business, which now accounts for more than half the group’s total written premium income, countering the competition it is facing in the reinsurance sector where renewal rates for catastrophe business were down by 12.5% in the January renewals.

Hiscox’ exposure to the major aviation losses of the year, including the two of Malaysia Airlines MH370 and MH17, Air Asia QZ8501, the Air Algerie flight to Mali and destruction of grounded aircraft at Tripoli was $6.8m. Funds under management for Hiscox ILS fund Kiskadee are expected to reach $500m by the middle of the year.

Reserve releases contributed £172m, up from £140m in 2013, while the investment result on the portfolio of £3,245m was equivalent to 1.8% (down marginally on the 1.9% achieved in 2013).

 The full results can be found here, and the analysts’ presentation slides here.

Amlin plc

Amlin reported a lower fall in average rating levels for catastrophe business, at 8.3%. The difference from Hiscox is due  to the balance of the account, with more of Amlin’s book made up of smaller, single state insurers. Across the book, Amlin reported a rate decrease of 3.6% in January.

The net loss to the aviation war book arising out of the various losses in 2014 was £12.8m, with the largest single catastrophe loss to the business being a US tornado in June costing £34m. Reserve releases contributed £89.6m to the bottom line, down from £133.5 m in 2013. The investment return on total funds of £4,406m was also down, from 3.6% in 2013 to 2.7% in 2014.

 The full results can be found here, and the analysts’ presentation slides here.