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(Reuters) - British insurer Hiscox said on Thursday it has set aside $40 million for expected losses due to possible claims arising from Russia's invasion of Ukraine, joining peers in quantifying the hit from the conflict.
The Lloyd's of London insurer said the provisions were for expected losses mainly through its political violence, war and terror portfolio, adding that sanctions against Moscow had minimal impact on the London-listed group.
Rising premium rates have helped the British insurance industry gradually recover from hefty claims during the pandemic, but Russia sanctions and the devastation in Ukraine could upend the momentum as businesses file claims to cover losses from the crisis.
Hiscox in its first-quarter trading update said on Thursday losses incurred in the period were minimal, while reporting a 10.3% rise in overall gross premiums written to $1.39 billion for the three months ended March 31.
Chief Executive Officer Aki Hussain said the company was supporting customers affected by the crisis.
Hiscox, which underwrites a range of risks from natural catastrophes to cyber attacks to kidnappings and art theft, also said its direct investment exposure to Russia and Ukraine was now down to about $3 million in Ukrainian bonds.
Ratings agency S&P Global said in late March it expected losses in the speciality insurance market of $16 billion to $35 billion from the geopolitical conflict, including from claims in aviation, cyber, political risk and marine war insurance.
Last month, Hiscox rival Lancashire estimated net losses in Ukraine at about $20 million to $30 million.
(This story corrects CEO's name to Aki Hussain, from Bronek Masojada, in fifth paragraph)
(Reporting by Pushkala Aripaka in Bengaluru; Editing by Vinay Dwivedi and Sherry Jacob-Phillips)