Feb. 24 (Bloomberg) -- Hiscox Ltd., the largest Lloyd’s of London insurer by market value, announced 178 million pounds ($296.4 million) in dividends and indicated a similar payout may not follow next year after it raised reserves for U.K. floods.
Hiscox will pay shareholders a 36-pence special dividend in addition to its 14 pence-a-share final dividend, the Hamilton, Bermuda-based insurer said today in a statement as it released full-year results.
The insurer said it expects to reserve an extra 5 million pounds to cover U.K. flood claims, taking the total since December to 16 million pounds. Britain is reeling from storms that have saturated the ground and battered coastlines since December. Insured costs from the storms may reach as much as 1 billion pounds by April, according to Deloitte LLP.
Hiscox had “two successive years where we have been able to share our success with shareholders with an additional capital return,” Chairman Robert Childs said in the statement. “We do not promise a third.”
The company also reported a 12 percent increase in profit today, boosted by a “benign hurricane season.” It’s the second Lloyd’s insurer to pay a special dividend this month after a year that was relatively free of costly damage from national disasters.
Hiscox’s pretax profit for the year was 244.5 million pounds. The combined ratio, or claims and expenses as a percentage of premiums, improved to 83 percent from 85.5 percent in 2012.
Beazley Plc said on Feb. 6 that it will pay shareholders an extra dividend worth 16.1 pence per share after increasing full- year profit 25 percent.
--Editors: Keith Campbell, Jon Menon