Fitch Ratings has affirmed the core entities of the Bermuda-based Hiscox Group's insurer financial strength (IFS) ratings at A, with a stable outlook.

Fitch said the affirmation reflects Hiscox's “strong financial profile, underpinned by a stable level of capitalisation that remains supportive of the rating level.

“The relatively consistent level of profitable earnings generated by Hiscox in recent years,strong franchise and modest debt leverage are also viewed positively,” Fitch commented.

The insurer's developing operating profile remains an offsetting factor. The agency believes that the US and European businesses “have yet to reach the operational scale required to achieve a stable level of profitability, although this is mitigated by Hiscox's cautious approach to developing new markets and territories”.