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Hiscox suffers from the cost of canceled vacations, sporting events



(Reuters) – Strong payments for sporting events and holidays that were interrupted due to the crown virus crisis helped send the insurance company Hiscox Ltd. deep into the red on Monday and pummeled its shares to their lowest in more than two months.

The company, which operates in the insurance market Lloyd & # 39; s of London, set aside an increased $ 232 million for claims arising from the crisis, including for cancellations of major events and travel, up from an earlier estimate of up to $ 175 million .

Hiscox did not name the interrupted events, but Lloyd's insurance company usually plays a major role in insuring major events such as Wimbledon and the Olympics.

"It has been a test for six months," CEO Bronek Masojada told Reuters, adding that some claims were related to the insurance company's travel company repayments in the UK. "Some of these companies have gone and replaced the tab."

Hiscox shares fell 5.9% at 735 pence ($ 9.61

) to 0847 GMT, among the biggest losers in the FTSE's mid-cap index. They fell as low as 729.6 pence, the lowest since the end of May.

The company, which also guarantees a range of risks including for art, classic cars, kidnapping and redemption, reported a loss of $ 138.9 million in the six months ended June 30, compared to a profit of $ 168 million a year earlier.

Gross written premiums decreased 4.4% to $ 2.24 billion, while its combined ratio – an important measure of profitability – weakened to 114.6% from 98.8%. A level above 100% indicates an insurance loss.

Rivals Beazley PLC and Lancashire Insurance Co. (UK) Ltd. also turned to losses in the first half, with insurance companies facing one of their biggest claims years due to the pandemic. [19659002] Panmure analysts said the results were mixed but emphasized that Hiscox had seen a sharp rise in premium rates and reiterated a "buy" rating, while Peel Hunt reiterated a "hold" view, noting that the rules were "still far below"

Hiscox said it would not pay an interim dividend, as previously announced.

Hiscox is one of eight insurance companies in a case brought by the Financial Conduct Authority over disputed insurance policy for business interruption writings.The court hearing ended last week and a verdict is expected in mid-September.

Mr. Masojada said that if the insurers appealed the verdict, they would probably do so collectively.


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