*Gross written premiums rise to QR9.5bn during January-September 2018
Qatar Insurance Group, the leading insurer in Qatar as well as the Middle East North African (Mena) region, reported a 6% year-on-year growth in gross written premiums (GWP) to QR9.5bn during the first nine months of this year.
Overall, the group’s net profit reported a 54% annual growth to QR474mn during January-September 2018.
The Mena markets continued to produce stable premiums with underwriting profitability, weathering geopolitical headwinds in the region. Consistent with previous quarters, QIC Group’s international operations further expanded in select low volatility classes whilst shedding underpriced (severity) business, it said.
The group’s global carriers namely Qatar Re, Antares and QIC Europe (QEL), posted GWP growth of 11% to QR7.3bn and its domestic and Mena operations growth remained stable, while the company’s life and medical insurance subsidiary, QLM, headquartered in Doha, and OQIC, the group’s listed subsidiary in Oman, continued to expand.
Further impetus for growth arose from the ongoing digitalisation of the group’s Mena retail pillar. QIC Group’s international subsidiaries in Bermuda, the UK and Malta accounted for about 76% of the group’s total GWP.
The group’s net underwriting result increased to QR378mn, compared with (-) QR103mn for the same period last year, the third quarter of which saw the devastating series of major hurricanes (Harvey, Irma, Maria).
“The third quarter of 2018 saw a string of major catastrophes losses, especially in the US and Japan. Still, rate increases remain elusive as the growth of alternative capital with lower return hurdles places secular and not just cyclical pressure on (re)insurance margins in the low frequency high severity space," said Khalifa Abdulla Turki al-Subaey, group president and chief executive of QIC Group.
QIC Group diligently applies its recently adopted strengthened reserving governance and philosophy, resulting in a more cautious view on market projections. The group is constantly expanding its low severity high frequency business which now constitutes a significant portion of the total portfolio.
Investment income stood at QR615mn for the first nine months of 2018 against QR798mn in the year-ago period.
QIC Group improved its already exceptional operational efficiency as its administrative expense ratio for its core operations stood at 6.5%, down from 6.6% in the same period of the previous year.
The group continues to reap the benefits from its ongoing endeavour towards process efficiencies and automation. Further, cost-efficiency gains are expected from the envisaged integration of back office operations across the group’s international entities.
In addition, a concerted approach to retrocession buying will benefit the group’s underwriting result.
“Through our direction to achieve the group’s growth strategy we have to deal with challenges beyond our control such as the geopolitical situation in the Middle East and the vagaries of global re/insurance loss and pricing cycles. Therefore, QIC Group is redoubling its efforts to excel in an area which counts among our historical strengths: Cost-efficiency," al-Subaey said.
Through the acquisition of Markerstudy Group Insurance companies (announced in January) by its subsidiary Qatar Re, this transaction marked a milestone in the group’s shift towards low volatility business.