Insurer Hiscox rewards shareholders after stellar 2012

Specialist insurer Hiscox outlined details on Tuesday of its proposed special dividend of 38.0p per share and share consolidation - a day after reporting a rise in annual profits.

The Bermuda-based firm, which insures fine art, property, vintage cars and the assets of individuals, will reward shareholders with a special distribution of £150m on top of a 12p-per-share payment in lieu of a final dividend for 2012.

The amount combined with an interim dividend of 6.0p per share paid in September, takes the total dividend for 2012 up to 18p per share, a 6.0% year-on-year increase.

Hiscox plans to return capital by way of an issue of B shares, allowing shareholders to receive proceeds as capital and/or income. That will be subject to overseas restrictions and tax laws.

Each shareholder will receive one B Share for every existing ordinary share held on March 28th.

Meanwhile, the company announced a 89-for-100 share capital consolidation to reduce the number of issued ordinary shares to reflect the reduction in the company's net tangible asset value.

On Monday, the company posted a jump in profits before tax to £217.1m for 2012, up from £17.3m in the previous year.

During the year the company dealt with record floods in the UK, Hurricane Sandy in the US, fine art thefts in Europe, fires across the world and the sinking of Costa Concordia.

However, Hiscox flew in the face of such tragedies, delivering solid results which were driven by strong underwriting performance and return on investments.

Shares fell 0.78% to 510.50p at 09:50 Tuesday.

RD