Hiscox Ltd has released to the LSE its 30^th June 2010 interim results and 2008 and 2009 syndicate estimates.

Interims

The full release is available here
Well worth reading in its own right; we note the following comments by Robert Hiscox:

"A year ago I wrote that the insurance cycle was alive and well, albeit split, with reinsurance more disciplined than insurance, and I hoped that CEO's would crack their whips to stop the decline in rates, especially when there are such slim investment pickings. Well it would appear that the record profits last year have caused a triumph of optimism over discipline. Despite the low investment returns and substantial losses of the first six months of this year, rates in many areas (particularly big ticket risks) have got steadily more competitive. However, motor and household rates have increased, and the reinsurance market has been steadier."

"Gross written premium income in our London Market unit reduced by 15% due to deliberate shrinking of lines where rates are under the greatest pressure, particularly large US property and catastrophe exposed small property.

The combined ratio improved despite the impact of claims from the Chilean earthquake, Windstorm Xynthia and the Deepwater Horizon energy loss, but helped by foreign exchange gains of £20.9 million.

As ever I am writing this in the midst of the hurricane season. After a benign year in 2009, Mother Nature has shown how capricious she can be. We wait to see if her temper improves.

We are ready to take advantage of improving market conditions in the offshore energy area where we have seen rates rises in excess of 20%. We expect a further tightening of capacity as competition retreats from the recent series of market losses.

As previously announced, aviation is another sector in which we see potential, and we have recruited a small but experienced team, led by David Slevin, to underwrite an aviation book, subject to the approval of Lloyd's.

If competitive market conditions remain in the big-ticket risk arena, we currently plan to reduce Syndicate 33's capacity to £900 million in 2011 (2010: £1 billion)."