Hiscox Withdraws 2020 Financial Guidance, Cancels Dividend Payment on COVID Crisis
Hiscox Ltd. is withdrawing all financial guidance for 2020 as a result of the uncertainties connected to the coronavirus crisis.
In addition, it is canceling a scheduled dividend and will not conduct any share buybacks.
“In view of the uncertain impact of COVID-19 on the global economy, the group is unable to accurately forecast the outlook for 2020,” said the Bermuda-based insurer in a statement.
“[W]ith the support of our regulators, the Hiscox Ltd. board has decided that the resolution to approve the 2019 final dividend of 29.6 cents per share, which was scheduled for payment on 10 June 2020, will no longer be put to shareholders at the annual general meeting…,” said the company.
Regulators, such as the European Insurance and Occupational Pensions Authority (EIOPA) and the UK Prudential Regulation Authority, have urged insurers to show restraint on dividends so their capital levels and financial strength are preserved to pay policyholders’ claims from pandemic-related exposures.
Hiscox explained these moves were made in order to help the company “serve the needs of businesses and households through the extraordinary challenges presented by COVID-19.”
“Hiscox’s capital, liquidity and funding positions remain strong. Trading across the group for the first two months of the year was ahead of expectations,” said the insurer in a statement. “We remain confident in our ability to return to our normal 90-95% combined ratio target range for the retail business in 2022.”
Source: Hiscox
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