Qatar Insurance Company (QIC) has recorded a 5% growth in Gross Written Premium (GWP) to reach QR6.6bn in the first half of 2018, reflecting the “steady and systematic” expansion of QIC Group’s international operations, which has further expanded in select low volatility classes.
The Mena markets continued to generate stable premiums and underwriting profitability, weathering unabated geopolitical headwinds. Against this backdrop, the Group reported profits amounting to QR384mn, representing 91% of the full year 2017 profits. 
The group’s international carriers, namely Qatar Re, Antares, and QIC Europe Limited (QEL) posted GWP growth of 9% to reach QR4.9bn vis-à-vis QR4.4bn in H1 2017. QIC’s domestic and Mena operations driven by the company’s Life and Medical insurance subsidiary, QLM, headquartered in Doha, remained stable. The group’s international subsidiaries in Bermuda, the UK, and Malta accounted for approximately 74% of QIC’s total GWP, compared with 71% in the first half of 2017.
Investment income has dropped from QR563mn in H1 2017 to QR408mn in H1 2018. The 27% y-o-y drop in investments income can be mainly attributed to certain one off investment gains booked in H1 2017. Further reclassification of certain types of investment securities post adopting IFRS 9 from Jan 1, 2018 resulted in increased mark to market losses in H1 2018.
The group’s net underwriting result increased by 26% y-o-y amounting to QR330mn compared with the QR263mn recorded in the same period last year. QIC, in the previous quarter, recorded negative reserve developments on some older contracts in areas of business that are no longer within the company’s risk appetite and have been discontinued accordingly.
In addition, QIC continued to apply its recently adopted strengthened reserving governance and philosophy, resulting in a more cautious view of ultimate loss projections and a slower release of prior-year IBNR reserves. Low-severity high frequency business now accounts for about 43% of QIC’s total underwriting portfolio. 
During the reporting period, QIC further improved its already exceptional operational efficiency. In the first half of 2018, the administrative expense ratio for its core operations came in at 6.3%, down from 7.9% in the same period of the previous year. The group continues to reap the benefits from its ongoing endeavour towards process efficiencies and automation.
In the same context of operational streamlining in June 2018, the group announced its intention to suspend the writing of all new and renewing facultative business from Qatar Re’s branch office in the Dubai International Financial Centre. Distribution throughout the Mena region will continue to be provided by the QIC Group’s existing operations in Doha, Dubai, Oman, and Kuwait.
Group president and QIC Group CEO Khalifa Abdulla Turki al-Subaey said, “QIC is making excellent progress in repositioning its international book towards areas of lower volatility. The most recent global treaty renewals in April, June, and July, and the softer rate developments have confirmed our bearish view on the prospects of traditional low-frequency high-severity business. Our earlier decision to de-emphasise volatility has proven right.
“The group’s outlook for the remainder of the year is cautiously optimistic. Our exposure to the geopolitical situation in the Middle East and the vagaries of global (re)insurance pricing is relatively moderate. QIC’s very strong risk-based capital adequacy, in combination with the scale and diversification of our business portfolio, will underpin the Group’s resilience going forward.”   
Earlier this month, Standard & Poor’s affirmed QIC’s financial strength rating of A/Stable, referring to the company’s “strong business and financial risk profiles, its scale, diversified premium base (by geography and product), and ability to post good results.”