Joanne Musselle, group chief underwriting officer (CUO) of specialist insurer Hiscox, said earlier today that the company’s underwriting strength in reinsurance was driven by a number of factors.
Hiscox executives answered analyst questions on a range of topics after posting a strong set of results for 2025, including strong results from the company’s reinsurance business and its third-party capital platform Hiscox Re.
One of the questions focused on the company’s underwriting advantage in reinsurance and what’s driving it, as Hiscox Re posted full-year profit of $286.7 million, up 7% from 2024, and a combined ratio of 67.4% again, despite a soft environment and another $100 billion in natural losses.
The company’s underwriting advantage in reinsurance “is a combination,” Musselle explained. “So, in the reinsurance space, what we rely on are the best external models. For example, we take existing models and then we blend and overlay them with what we call the Hiscox view of risk, which we do in reinsurance and indeed in all other insurances. That’s very important and proprietary, and we leverage our own proprietary information, our own custom data sets, to build things like forward-looking inflation views. It’s very important to us to be ahead of some of these sub-trends and price outlooks.”
In addition to the fusion of external and internal data, CUO also emphasized the use of technology in the underwriting process to accomplish many things, including making it easier for Hiscox Re to do business.
“So, taking reinsurance as an example, how can we consume submissions faster? Obviously, advancements in technology allow us to consume more submissions in a shorter period of time. So the response time to brokers or to the wider clientele in this case is much better. We’re leveraging that there,” she said.
Adding: “Definitely leveraging it to make better decisions. So, whether it’s getting third-party data to make better underwriting decisions, pricing decisions. That’s the second area where we’re leveraging it that will obviously make us more efficient. So, I would say it’s a combination. It’s definitely looking outside and getting the best external information that’s out there and then integrating that into our own proprietary data sets.”
Reinsurance renewals, increased competition from existing reinsurers and alternative capital have led to a 13% decline in Hiscox Re’s rates as of January 1, 2026, but despite the soft conditions, the company still considers 83% of its portfolio to be sufficient or adequate, while lower outbound reinsurance costs also provide a positive tailwind for the business.
Additionally, in 2025, Hiscox Re’s rates fell by 5% due to increased competition, but by the end of the year, the business’s cumulative rates since 2018 were up 83%. Importantly, the terms and conditions as of January 1, 2025 and 2026 remain largely stable, following significant adjustments in 2022 and 2023.
