Qatar Insurance Company (QIC), the leading insurer in Qatar and the Middle East North African (MENA) region reports a net profit of QAR 272 million for the first quarter of 2019. The MENA markets continued to produce stable premiums with underwriting profitability, weathering geopolitical headwinds in the region. QIC’s international operations grew in select low-volatility segments and now account for 76% of its total portfolio.
In Q1 2019 QIC adopted a more restrictive and selective approach to new business generation, reflecting the company’s continued focus on de-risking its book and placing more emphasis on low-volatility segments. Gross written premiums (GWP) remained stable at QAR 3.5 billion.
The Group’s international carriers, namely Qatar Re, Antares, QIC Europe Limited (QEL) and its Gibraltar based carriers continued to expand in select low-volatility areas and now account for approximately 76% of QIC’s total GWP, compared to 73% in the first quarter of 2018.
The Group’s net underwriting result improved by 45% to QAR 166 million compared to QAR 115 million for the same period last year. This positive development reflects the Group’s successful shift towards lower-volatility business which provides a predictable long-term stream of profits. In addition, the improved technical performance is a result of the de-risking of non-profitable business across QIC’s international units in 2018.
Overall, the Group’s net profit for Q1 2019 increased year-on-year by 15% to QAR 272 million, driven by both improving underwriting results and resilient investment income.
The Group recorded stable investment income of QAR 275 million for the period. QIC’s total investment return, including capital gains and losses, amounted to an annualized 6.2%.
QIC’s investment prowess continues to draw accolades from industry professionals, as most recently at the MENA Fund Manager Performance Awards 2019 where the company’s investment teams were awarded for the best fund performance in two categories: Qatar Equity Fund and QIC GCC Equity Fund.
During the reporting period, QIC has vigorously maintained its focus on streamlining operations in order to further improve its operational efficiency. At Q1 2019, the administrative expense ratio for its core operations came in at 6.1%. The Group’s ongoing endeavor towards process efficiencies and automation continued to yield fruit.
Commenting on the financial performance for Q1 2019, Mr. Khalifa Abdulla Turki Al Subaey, Group President & CEO of QIC Group stated, “For QIC, the first quarter was a period of stability and consolidation. As part of our de-risking effort, we have adopted a more selective approach to writing new business, rewarded by an improving technical performance. QIC remains firmly committed to shifting to lines of business with lower volatility where we see a more attractive risk-return potential.”
He continued, “In addition to underwriting, QIC’s investment prowess and commitment to operating efficiency continue to bear fruit and are essential to sustaining the Group’s overall profitability. Based on the strength and diversity of our performance engines, I remain confident in QIC’s future growth and profitability prospects, which should further benefit from what appears to be a slightly firming global re/insurance trading environment.“