Insurer Hiscox Ltd reported a 31 percent fall in first-half profit as reinsurance rates dropped and it incurred a foreign exchange loss, compared with a year-earlier gain.
Hiscox, which offers insurance on everything from fine art to oil rigs, said pretax profit fell to 124.6 million pounds ($211.6 million) in the six months ended June 30 from 180.7 million pounds a year earlier.
The company recorded a foreign exchange loss of 16.4 million pounds - a sharp reversal from the same period of 2013, when it recorded a currency gain of 34.9 million pounds.
Hiscox said it would pay an interim dividend of 7.5 pence per share, less than many analysts had expected. The company paid an interim dividend 7 pence last year.
Berenberg analyst Tom Carstairs said the market consensus had called for a dividend of 7.86 pence per share.
Hiscox shares fell as much as 1.8 percent.
The Lloyds of London insurer said it would pay out $1 million to $2 million in claims related to the crash of the Malaysia Airlines flight in Ukraine this month.
"Given the recent escalation in tensions in Ukraine, Libya and Nigeria, it is likely that premium rates for conflict or war-related insurance in the market will rise," Hiscox Chief Executive Bronek Masojada told Reuters.
Reinsurance rates continue to decline, mainly reflecting increased competition and fewer catastrophe claims, the company said. Insurance rates are either broadly stable or softening.
Hiscox shares were down 1.14 percent at 694.5 pence at 1035 GMT on the London Stock Exchange. ($1 = 0.5890 British pounds) (Reporting by Richa Naidu and Roshni Menon; Editing by Gopakumar Warrier and Ted Kerr)
Source Reuters
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