Hiscox Re Retains Less as Rates Fall 14% but Stay 55% Above 2018

Hiscox Re, the reinsurance and ILS segment of Hiscox Ltd, wrote $1,133.4 million of gross premium in the nine months to 30 September, up 4.5%, and kept $486.1 million of it net, down 7.5%, the group said in its trading statement on 3 November. Rates in the segment fell 14% over the nine months and stand 55% above their 2018 level.

Group insurance contract written premium rose 9.5% to $4,437.2 million, or 8.1% in constant currency. Loss experience in the third quarter "was within expectations for the Group," the statement said, as benign natural catastrophe losses in the big-ticket businesses more than offset marine losses from the Middle East conflict. Aki Hussain, Chief Executive Officer, said the group remains "on track to deliver 9% constant currency growth for the full-year."

Hiscox reports a week after RenaissanceRe reported a 14.3% fall in Property gross premiums written, "driven by rate reductions across both the catastrophe and other property classes," and five days after Aon put insured natural catastrophe losses for the first nine months at $91 billion, the lowest for the period since 2019.

Key Takeaways

Hiscox Re ceded more of a softer book: gross premium rose 4.5% to $1,133.4 million while net fell 7.5% to $486.1 million, a 42.9% retained share against 48.5% last year.
Reinsurance rates fell 14% over nine months and sit 55% above 2018; down from 83% a year earlier.
Retro exposure is now 36% below peak hard-market levels, and ILS assets under management reached a record $3.1 billion at 1 October, from $2.9 billion at 1 July.
London Market rates fell 5% but remain 59% above 2018, and underlying growth excluding prior-period premium adjustments was 3.9% against the 9.9% headline.

Gross up, net down

At the half-year Hiscox Re had written $944.5 million gross, up 6.4%, and $381.1 million net, down 7.4%, according to the interim statement of 4 August. By subtraction, the third quarter alone brought in $188.9 million gross against $196.9 million a year earlier, a 4.1% fall, and $105.0 million net against $114.2 million, down 8.1%.

Hiscox attributed the net reduction to "deliberate cycle management." "We have actively reduced net natural catastrophe exposure, particularly in retro, which is now 36% below peak hard-market levels," the statement said. It "continued to support core cedants and selectively written new business in pro-rata property and specialty lines," which the interim statement named as significant risk transfer and mortgage reinsurance.

Third-party capital took the ceded share. Hiscox Re "deployed additional third-party capital at mid-year renewals," the statement said, and ILS assets under management reached $3.1 billion at 1 October from $2.9 billion at 1 July, around two-thirds in private ILS and the rest in the group's catastrophe bond funds. Growth in the quarter came from retained earnings "following benign loss experience," and demand from third-party capital providers was "most notably from quota share partners."

Ceding more also moves the expense line: the interim statement attributed a 150 basis point rise in the group acquisition cost ratio to business growth and mix, more competitive trading conditions in London Market and Hiscox Re, and "the accounting geography of higher ceded premium in Hiscox Re."

Rates against the 2018 base

At the half-year Hiscox had reported rates down 16%, with the cumulative figure at 54% above 2018 and 83% of the portfolio rated adequate or better. A year earlier, the Q3 2025 trading statement reported rates down 5% over nine months, with "cumulative rate increases of 83% since 2018." Over twelve months the index has given back 28 points of its 2018-based gain.

Segment	Rates, 9M 2025	Above 2018, Nov 2025	Rates, 9M 2026	Above 2018, Nov 2026	Rate adequate or better, HY 2026
Hiscox Re	down 5%	83%	down 14%	55%	83%
London Market	down 4%	67%	down 5%	59%	76%
Retail	up 2%		up 1%

Sources: Hiscox Q3 2025 trading statement (6 November 2025), interim statement 2026 (4 August 2026), Q3 2026 trading statement (3 November 2026). Retail reports an aggregate rate change without a 2018 base.

A 55% cumulative increase over the eight years from 2018 compounds to about 5.6% a year, which is the loss-cost trend the retained book has to have run below for the 2018 price to have gained adequacy. Hiscox's own measure of that test is the share of the portfolio rated adequate or better: 83% in Hiscox Re and 76% in London Market at the half-year. Attachment points also moved up at the 2023 renewal, so the rate index and the expected loss to a layer have moved separately, which is the case cedants made at Baden-Baden last month.

Peers reporting in the same fortnight printed the same direction. RenaissanceRe's Property gross premiums written fell $104.5 million, or 14.3%, to $628.8 million in the quarter, and David Marra, its Group Chief Underwriting Officer, said property catastrophe rates were down "mid teens" so far this year (the RenRe quarter). Munich Re wrote 9.1% less at the July renewals at risk-adjusted prices 5.5% lower (the Munich Re guidance raise). KBW's read of the Monte Carlo consensus for 1 January 2027 is a property catastrophe cut of about 10%, steeper on higher layers (the Monte Carlo round).

Aon's Global Catastrophe Recap, reported by Reinsurance News on 29 October, put insured natural catastrophe losses for the first nine months at $91 billion, slightly above the 21st-century average of $88 billion and well below the five-year average of $135 billion. A European drought was the costliest insured event of the year to date at more than $8.5 billion.

Retail and London Market carry the group number

Retail wrote $2,253.3 million, up 11.9% in dollars and 9.1% in constant currency. Growth "was driven by volume, with rates up 1%," the statement said. Hiscox UK grew 11.1% in constant currency to $811.1 million, Europe 7.4% to $650.6 million and the USA 8.4% to $791.6 million.

London Market wrote $1,050.5 million, up 9.9%, and "underlying growth excluding prior-period premium adjustments slowed to 3.9%." Cycle management in major property, upstream energy, power and renewables "reduced growth by nine percentage points," offset by adjacent classes, the build-out of Hiscox Portfolio Solutions and selective expansion in the existing book. Rates fell 5% in aggregate, consistent with the half-year, and 76% of the portfolio was rated adequate or better. In D&O, "US rate declines have moderated," the statement said.

On claims, benign natural catastrophe experience in the big-ticket businesses "more than offset marine losses from the ongoing Middle East conflict," the statement said. Hiscox had reserved a net $60 million for the conflict at the half-year, $40 million in London Market and $20 million in Hiscox Re.

Investments, buyback and the February date

Hiscox's investment result was $104.2 million for the nine months against $350.8 million a year earlier, a 1.2% return against 4.2%, after a $192.2 million unrealised fair value loss on debt and fixed income holdings that the group expects to unwind as the bonds mature. Reinvestment yield rose to 5.1% from 4.4% at the half-year.

Its change programme remains on track for a $75 million P&L benefit in 2026 at a cost to achieve of $75 million, with Retail the largest beneficiary. On 1 October the group issued £300.0 million of 5.875% senior notes due 2031 to refinance its 6.0% notes due 2027, and its $300 million share buyback was 81% complete at 30 October, with 10.3 million shares repurchased for about $241.9 million.

Hiscox will report full-year 2026 preliminary results on Wednesday, 24 February 2027.