HIscox PLC (LON:HSX) said it has decided not to pay a final dividend and expressed regret about the COVID-19 dispute over the wording of its business interruption policies.
The FTSE 250 insurer posted a loss for the year to end-December of US$268mln after US$475mln of pandemic-related claims, without which it said it would have posted a profit of US$207mln.
Hiscox said the COVID-19 costs were net of reinsurance with the majority for event cancellation and the remainder for business interruption and other claims.
Robert Childs, chairman, said that due to the business interruption issue: "For the first time, our reputation for paying claims quickly and without fuss came under intense scrutiny’.
“We regret any dispute with a customer, but particularly where the policy wording was not as clear as it should have been.
“That is why we willingly agreed to be one of the group of insurers that assisted the FCA with the test case and we welcome the finality and certainty the Supreme Court Judgment has brought. We are now paying covered claims as quickly as possible.”
Childs added that the decision about the dividend was not taken lightly, with executive directors not taking any cash bonuses until the dividend is reinstated.
The current plan is to resume paying dividends with the 2021 interim results, he added.
Hiscox said premiums written were maintained at US$4bn.
Bronek Masojada, chief executive, added: "Our long-held strategy of balancing big-ticket lines and retail earnings has provided resilience in 2020.
“In 2021, our priorities will switch from resilience to opportunity as we are well-placed to make the most of the best conditions in the London Market in many years and the structural shift to digital across all our lines.”