Qatar Insurance Company’s net profit jumps 181% to QAR325m in H1

Qatar Insurance Company’s net profit jumps 181% to QAR325m in H1

QLNews
By QLNews

Qatar Insurance Company (QIC), the leading insurer in Qatar and the Middle East North Africa (MENA) region, reported net profits of QAR325m for the first half of 2023, rising 181% from the same period in 2022.

The Board approved the financial results following a meeting of the Board of Directors yesterday, which was presided over by QIC Chairman Sheikh Hamad bin Faisal bin Thani Jasim Al Thani.

Sheikh Hamad said: “QIC’s bottom-line results demonstrate the success with which the company has navigated a challenging macroeconomic environment in the first half of 2023. In addition to broad increases in net profitability, we’ve seen double digit growth in our core MENA business activities.

“Though market challenges persist due to inflation and geopolitical unrest, the company has taken decisive steps to minimise its exposure to high severity and volatile international risks. We’re proud of QIC’s distinguishing brand attributes, including its exceptional digital capabilities and operational efficiency.

“As we look forward to the rest of the year, we’re committed to providing market-leading levels of customer service and innovative, reliable insurance products across the Middle East, Europe, and international insurance markets.”

“Throughout the first half of this year, QIC has maintained its strategic focus on expanding its primary insurance business, mainly the profitable direct-line insurance markets throughout the GCC,” said Salem Khalaf Al Mannai, Group Chief Executive Officer.

“Meanwhile, the company has mitigated risks by exiting high severity, low margin, and loss-making international markets. This strategy’s success has been demonstrated by 14% growth in Domestic and MENA Operations Gross Written Premiums to QAR1.9bn in the first half of 2023, compared to QAR1.7bn for the same period in 2022. As we look ahead to the rest of the year and beyond, we remain committed to growing our direct insurance vertical in the region,” said Al Mannai. 

“QIC’s operating priorities have underpinned the strength of its performance. By focusing on process efficiencies and automation, the company has further improved its already outstanding operational efficiency in the first half of this year. Our emphasis on digital acceleration led to the recent roll out of the fastest online solution for mandatory visitors’ insurance in Qatar, as well as a multitude of new features on QIC’s award-winning car insurance website.

“We’ve also established our position as a leader in the region’s burgeoning insurtech industry, as illustrated by the success of the second edition of our annual insurtech summit, ‘MENA Insurtech Rising’ – which brought together 88 C-level executives to share insights and explore partnerships. QIC is committed to supporting Qatar’s endeavour to reduce the country’s greenhouse gas emissions by 25 percent by 2030. This year we became the first insurer in the Middle East to sign the UN’s Principles for Sustainable Insurance, which builds upon our Board-approved ESG framework,” Al Mannai added.

Financial Overview

The macroeconomic and geopolitical landscapes have remained challenging in H1 2023 but show recent signs of improvement.

Interest rate hikes have slowed as inflationary trajectories ease, global labour markets have begun to normalise, and global shipping costs have decreased to reach almost pre-pandemic levels.

Insurance markets also continued to harden in select lines of business. However, inflation in the UK and the effects of Brexit have had some effect on the UK motor insurance market.

In these market conditions, QIC reported Gross written premiums of QAR5.5bn for H1 in 2023, compared to QAR6.3bn in H1 of 2022. QIC also continued its strategic path of focusing on less volatile and low-severity international commercial risks, at a time of rising capital costs.

The company has stopped underwriting its loss-making insurance business and has exited its low-margin business lines.

In addition, the Group’s international operations, Antares Global – which includes the brands Antares Re, Antares Lloyds Syndicate and QIC Europe Ltd – has performed exceptionally well, delivering a premium volume of QAR3.6bn, amid rate hardening and tightening market conditions.

 Investment performance

Global financial markets faced significant headwinds in H1 2023 – including volatility due to concerns over the global banking crisis – while government bond markets have moved from pricing in rate hikes to discounting sizeable rate cuts in some markets. Inflation is persistent – though slowing – in mature markets, meaning that interest rate hikes by central banks have continued, albeit at a gentler pace.

Despite this volatile market environment, QIC reported net investment results of QAR460m for H1 2023, compared to QAR475m for H1 2022. The annualized return on investment came in at 5.4% compared to 4.8% last year.

Digital acceleration drive

One of QIC’s key priorities this year has been to enhance its digital offerings and consolidate its position as a leader in the digitalization of personal lines insurance.

This has enabled customers to manage their insurance requirements with unprecedented speed – resulting in record levels of online services penetration and customer reliance on digital channels, from onboarding to claims.

The company recently introduced a fully digital Mandatory Visitors’ Health Insurance product. This is the fastest and most convenient product of its kind in Qatar, enabling thousands of international visitors to obtain insurance policies in less than two minutes.

Several new features have also been launched on QIC’s award-winning car insurance website – including an Online Claims Management Service for customers to file and manage their motor claims, an Online Policy Upgrade service, and a Market Value Calculator to help customers better determine the market value of their vehicles.

QIC’s MENA InsurTech Summit shapes the region’s InsurTech Ecosystem

Over a three-day event in May, QIC held the second edition of its annual MENA InsurTech Summit, under the theme “MENA Insurtech Rising”.

Bringing together 88 C-level insurers, startup founders, investors, and other key figures in the industry, the summit was held to foster learning and explore new partnerships – with a focus on sharing insights on the latest industry trends, innovation, investment, and digital transformation.

The scope of the summit has expanded significantly, attracting more than 300 representatives from industry this year, as well as 1,100 virtual attendees. Through its recently launched Digital Venture Partners unit, QIC has also led the establishment of the MENA Insurtech Association, a membership-based association founded to build the region’s InsurTech Ecosystem.

Sustainability and ESG: the Middle East’s first UNEP-FI PSI signatory

ESG has been integrated into QIC Group’s operations along its full value chain. This year, QIC signed the United Nations Environment Programme-Finance Initiative’s ‘Principles for Sustainable Insurance’ (UNEP-FI PSI), becoming the first insurer in the Middle East to sign the global agreement.

By becoming a signatory, QIC became part of a global network of insurance stakeholders committed to integrating ESG along their value chain, adopting Principles which are more comprehensive than financial metrics typically used in the industry.  

More broadly, QIC is committed to supporting Qatar’s endeavour to reduce the country’s greenhouse gas emissions by 25% by 2030. Recent initiatives include:

* The development of an ESG framework, which has been approved by the Board. 

* Setting out a long-term ESG strategy to support Qatar’s ESG commitments and aiming to adopt ESG policies into its underwriting and asset management philosophy. 

* Establishing an ESG & Sustainability Committee to ensure that group-wide efforts are focused and channelled to achieve set goals.

Industry awards

QIC’s services continue to be recognised through respected industry awards. In January, QIC was named “Insurer of The Year in Qatar” at The MENA IR Awards 2023 – for the second consecutive year – reflecting the company’s exceptional performance in product digitization and customer service.

In March, at the InsureTek Golden Shield Excellence Awards 2023, QIC was named “Motor Insurer of The Year” for the second year running. World Business Outlook also selected QIC as the ‘Most Trusted Insurance Company’ and the ‘Most Sustainable Insurance Company’ in Qatar in 2023.

QIC was honoured at the graduation ceremony of the eighth cohort of the “Kawader Malia” program, for its outstanding contribution towards supporting the development of young Qataris and its commitment to shaping the country’s future workforce.

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