Saacke sets sights on top 10 for Qatar Re
Qatar Re has targeted growth in the North American casualty market as the driver that will continue to propel it towards its ambition of becoming a global top 10 “modern reinsurer”.
The company currently has no exposure in US casualty and only a small book of casualty business elsewhere. But this is set to change and the recently announced decision to domicile Qatar Re in Bermuda, with its close nearness to the US, will help make this a deliverable strategy.
Gunther Saacke, Qatar Re’s chief executive officer, said Bermuda’s proximity to the US was a big factor in its decision to move its headquarters to the Island from the Qatar Financial Centre.
“The closeness of the US market—the biggest and most important in the world—was most important for us. It will help us attract key personnel,” he said.
Qatar Re will extend its underwriting capacity on the Island by utilising existing Lloyd’s managing agent Antares, which is Bermuda-based and was bought by parent company QIC Group last year.
A refusal to compromise on price coupled with a strong underwriting base has been the driving factor behind the strong growth of Qatar Re, Saacke said.
It has meant that, despite overcapacity in many markets and subsequent rate reductions, Qatar Re has posted healthy figures for the first half of 2015, which show its gross written premium income rocketed by 42 percent to $463.6 million from $326.7 million in the same period last year.
Gross underwriting income over the same period was $40.4 million compared with $28.1 million for the same period in 2014.
A combination of “class intimacy, proximity to our business partners and an uncompromised focus on the disciplines of managing and controlling risk forms the bedrock of our successful development,” said Saacke.
“We are probably the shape of things to come in terms of our portfolio and what a ‘normal’ insurance company will look like in the future.”
That means building a disciplined portfolio with a focus on offering technical expertise and building relationships with “insurance entrepreneurs” and working constructively with their broker partners, he said.
By adopting this strategy, Qatar Re hopes a path to growth will follow that will “effectively defy the adverse trends in what has become a notoriously deteriorating soft market”.
Saacke has struggled to see the rationale behind the recent merger mania.
“In a very difficult environment we have struggled to see the clear rationale behind the market tacking portfolio. Sometimes one fails to see the efficiencies of scale being translated into positive profit and loss figures,” he said.
“Anticipating the challenges of the future, we have abstained from moving into those areas where the future curve is taking the industry—we have a different space. We have chosen to grow the company in a different way and we don’t see the value for a reinsurer to amalgamate with another existing portfolio.
“The vision is to grow ourselves to become a meaningful operation of some size. We want to be a very successful reinsurer for our clients—that is the strongest indication of security.
“We want to be a very profitable organisation. We want to be top 10 and we have made some good progress towards that so far.”
To help realise that ambition, the company is about to move into a new branch office in Dubai to complement its Singapore operation, and has plans to open a London office in the near future. Through the parent, QIC Group, Qatar Re has access to a primary licence in Malta. “We are now a truly global player,” said Saacke.
