Shares of Hiscox surge following announcement of buyback plan, despite reported losses from wildfires
Hiscox Boosts Profit Growth in 2025 Amidst Wildfire Claims
Hiscox, the international specialist insurer, has reported a growth in profit despite a slight fall in interim profit due to wildfire claims. The company's profit before tax for the first half of 2025 stood at $276.6 million, a testament to its resilience and strategic initiatives.
The growth is primarily driven by the strong performance of the Retail segment, which accounts for half of Hiscox's premiums. In Q1 2025, the Retail segment achieved a constant currency growth of 6.1%, fueled by successful digital direct and broker channels. This growth was supported by new products such as e-reputation insurance in France and startup coverage in Belgium, plus strategic market share capture campaigns in the U.S.
To further enhance underwriting efficiency and market access, Hiscox has undertaken a $200 million cost-saving program to 2028. Two-thirds of these savings are expected to directly enhance underwriting margins by improving the combined ratio through reductions in claims and expenses.
Hiscox has also demonstrated a commitment to shareholder value. The company increased its share buyback program from $175 million to $275 million in 2025, signaling confidence in capital generation. Additionally, the interim dividend was increased by 9.1%, and the ongoing share buyback was boosted by $100 million.
Despite a 2.4% decline in pretax interim profit due to wildfire claims, the overall group performance showed profitable growth in each business line and margin expansion. The art and private client segment saw a double-digit increase, further bolstering revenue streams.
In terms of operational discipline, Hiscox achieved a strong operating return on tangible equity of 14.5%. Hiscox London Market delivered a first-half combined ratio in the 80s, and Hiscox Re & ILS delivered underwriting profits despite wildfire losses. Fraud savings in the first half were ahead of those delivered in 2024.
In strategic moves, Hiscox made two acquisitions - one in Italy and another in a US insurtech - to expand its market presence and product offerings.
In conclusion, Hiscox's profit growth in 2025 reflects a combination of top-line premium growth in retail markets, disciplined cost control, diversified new product lines, and shareholder-friendly capital management, which offset the short-term profit impact of wildfire claims.
[1] Hiscox Press Release, Q1 2025 Trading Update [2] Hiscox Half-Year Results 2025 [3] Hiscox Investor Presentation, 2025 [4] Hiscox Annual Report and Accounts 2024 [5] Hiscox Press Release, Art and Private Client Growth 2025
- Despite the slight decline in interim profit due to wildfire claims, Hiscox's strategic initiatives in finance and business, such as the cost-saving program, new product launches, and share buyback program, have significantly contributed to the company's overall profit growth in 2025.
- Hiscox's expansion into new markets and product offerings through acquisitions in Italy and the US insurtech are part of its business strategy to boost profits and increase market share in the insurance sector.
