Hiscox ILS fees rise on improved fund performance in 2020

Hiscox ILS fees rise on improved fund performance in 2020

Hiscox ILS, the insurance-linked securities (ILS) and collateralised reinsurance underwriting unit of specialist underwriter Hiscox Group, has reported an increase in charge income made from its ILS financial investment management service in 2020. Hiscoxs ILS funds saw their properties under management decrease a little to $1.4 billion at the end of 2020, down from $1.5 billion at the end of 2019 after a variety of redemptions.
But the ILS funds seemingly performed better in 2020 and as a result Hiscox earned a bit more income from them.
The company has reported that its other underwriting earnings, which represents the arise from the insurance-linked securities (ILS) managed by Hiscox ILS, increased to $2.5 million for 2020, a significant boost from the $900,000 of other earnings reported for 2019.
At the same time, Hiscox ILS activities earned the group higher management charges too, with Hiscox reporting $24.1 million of management fee earnings across its various insurance coverage, reinsurance and ILS activities during 2020, up from $19.7 million in 2019, which as this figure is largely ILS associated suggests the investment management fee earnings made from ILS has actually most likely increased in line with the outcomes of the ILS funds.
At the exact same time, profit-commissions really decreased, coming out at $1.5 million for 2020, below $3.9 million in the previous year. But this consists of Lloyds handling agent commissions as well, we comprehend, and offered the effects of the COVID-19 pandemic it is possible that here too the ILS commission saw a small improvement year-on-year.
As ever, its tough to derive the precise figures from this, but in general it suggests a better year of ILS fund efficiency for Hiscox ILS, which drove a slightly increased amount of fee income from its insurance-linked securities (ILS) and collateralised reinsurance management activities.
Also of note, while having actually reported its AuM as slightly down at the end of 2020, Hiscox ILS flagship commingled ILS funds (the Kiskadee Diversified Fund, Kiskadee Select Fund, Kiskadee Latitude Fund and Kiskadee Cadence Fund) were actually slightly up for the year as a group.
Hiscox said that the overall size of the Hiscox ILS funds sat at $899 million at the end of December 2020, somewhat higher than the $888 million seen at the end of 2019.
Hiscoxs own financial investment stake in the ILS funds rose really slightly to $63.2 million at the end of 2020, up from $61.2 million at Dec 31st 2019.
The rest of the $1.4 billion of ILS possessions managed by Hiscox ILS sits in private mandates, we comprehend.

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