QIC profit surges on turnaround; predicts ‘softer’ market ahead
Doha-based Qatar Insurance Company (QIC), the parent company of Antares, reported robust growth in gross written premiums, leveraging on its strategy of increasing the proportion of premiums generated in domestic and Middle East and North Africa (MENA) markets. The company suggested that while the global macroeconomic environment remains volatile, there are signs that the insurance market maybe entering a “softer phase”.
The insurer's net profit grew to QAR 194 million ($53 million) for the first quarter of 2024, rising from QAR 175 million over the same period in 2023.
Gross written premiums for the period stood at QAR 2.75 billion, which management attributed to the premiums generated in domestic and MENA markets. MENA region contributed 52% to the overall GWP.
QIC said it is expanding its focus on health & life insurance line, which it claims "almost trebled" as a percentage of GWP (from 5% of GWP in 2022 to 14% in 2023), as well as marine & aviation insurance (from 10% of GWP in 2022 to 14% in 2023).
Meanwhile, the company has reduced its exposure to the motor insurance market (from 45% of GWP in 2022 to 32% in 2023), particularly in the UK – which management claimed has been "adversely affected" by supply chain challenges influenced by Brexit, resulting in greater volatility and risk. But, noted that it will continue to focus on its motor insurance business in the MENA region.
QIC credited "slimmed down international operations" for its "healthy" combined ratios and turnaround, driven largely by its London market unit Antares Global.
Antares Lloyd's Syndicate reported a premium volume of QAR 1.3 billion in Q1 2024, compared with QAR 1.8 billion in the same period last year.
QIC’s group chairman Sheikh Hamad bin Faisal Al Thani, said: “QIC begins 2024 in excellent financial health. The first quarter of the year saw the company consolidate and build upon the progress it made over the previous year – with a renewed focus on strengthening profitable domestic and regional businesses, extending its exceptional digital offering, and strategically improving its international operations while reducing exposure to underperforming markets.
“In spite of a global macroeconomic environment that remains uncertain in the near term and geopolitical challenges, QIC continues to enjoy robust growth through its core business lines, strong financials, and stable sources of income.”
QIC noted that although interest rates have stabilised and likely peaked, there are indications that central banks such as the Federal Reserve and the Bank of England may not lower rates until later this year, or into 2025.
"There are few signs yet that the hard insurance market we have seen over the past five years – characterised by higher premiums and stricter policy terms – is entering a softer phase, though according to historical fluctuations, a shift may be forthcoming," management said.
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