Shares in insurance giant Hiscox nosedived this morning after the firm slumped to a loss of $107m (£88m) in the first half of the year, amid a steep decline in the value of its investment portfolio.
The FTSE-250 insurer said in a trading update today that its investments had fallen sharply to a loss of $214.1m, down from $61.9m in the same period last year.
Pre-tax profits meanwhile plummeted from $133.4m last year.
Boss Aki Hussain said he was “pleased” with the group’s performance however, after rate strengthening and “disciplined growth” drove lifted underwriting profitability.
“Whilst macro-economic and geo-political concerns are affecting the global economic outlook, our strategy and diverse portfolio of businesses continues to create opportunity, and we are well positioned to generate high quality growth and earnings,” he said.
“Our big-ticket businesses have experienced positive market conditions and our well-balanced portfolio is generating attractive returns. In Retail, ongoing investment in technology and brand is driving growth in 2022 and is expected to accelerate in 2023.”
Shares in the firm plunged nearly eight per cent in early trading this morning after the update.
Hiscox’s underwriting arm posted a strong performance however, with bosses reporting a combined ratio – a key measure of underwriting profitability – of 91.3 per cent versus 93.1 per cent.
Premiums written jumped by 9.2 per cent to $2.65bn, up from $2.43bn last year, despite foreign exchange headwinds from a strengthening US Dollar.
Hiscox said its losses from Ukraine and Russia, including in aviation, were $48m net of reinsurance.