Qatar Insurance Company (QIC) has posted a 400 percent rise in its net profit of QR630 million for 2021, translating to earnings per share of QR0.143. This has prompted the Board of Directors to propose a cash dividend distribution of 10 percent for the year.
The COVID-19 pandemic has confronted the global insurance industry with enormous challenges that resulted in a global economic slowdown, shortages in supply and price volatility as well as a continued low negative interest rate environment, while inflation has been creeping up. Besides the organisational challenges caused by lockdown measures and movement restrictions, insurers have seen increased pricing and reduced capacity in many lines.
Khalifa Abdulla Turki Al Subaey, Chairman and Managing Director of QIC Group, said “Within this challenging environment, QIC Group further progressed on its path of cementing its leadership in its domestic markets in Qatar and the MENA region, while reducing its exposure to volatile severity risks. This strategy continued to bear fruit and enhanced our profitability.
“We are pleased with these results, which were achieved through the successful implementation of the group’s strategic plan that aims to de-risk its international operations, expand its low-volatility activities, diversify its business portfolio and drive forward full fledge digitization of QIC’s domestic and MENA operations. This achievement is a testament to the strength of our brand.”
QIC, as one of the oldest and well-recognised direct insurance brand in the MENA region, in a post Covid era of consolidations and efficiency, will have a renewed focus to further develop and grow the direct insurance vertical in the region by leveraging its position as a leader in digitalization of personal lines and other select line of business, he said.
Salem Khalaf Al Mannai, Group Chief Executive Officer, said the Group’s gross written premiums remained stable at QR12.6 billion, compared to QR12.2 billion in 2020. By now, over half of the Group’s gross written premiums emanate from personal lines insurance written in the Middle East, U.K. and Continental Europe. In 2021, QIC’s international operations – Qatar Re, Antares, QIC Europe Limited (QEL) and our Gibraltar- based carriers – accounted for approximately 81 percent of the Group’s total gross written premiums.
QIC once again witnessed a strong performance from its primary insurance business in its domestic and MENA operations, which continued to grow to GWP of QR2.4 billion, an increase of 5 percent from 2020. The domestic business remains highly attractive, providing strong top- and bottom-line results to the Group’s performance. QIC’s positioning as the region’s most advanced digital insurers once again proved its merits, as the domestic companies continued to attract new business during the pandemic – overcoming the hurdles posed by physical movement restrictions. The domestic business remains highly attractive, providing strong top- and bottom-line results to the Group’s performance.
In 2021, QIC’s investment team once again proved its mettle as the MENA region’s leading investment house, focusing on both sector balance and security of investments. The Group’s net investment and other income amounted to QR1,125 million for 2021, as compared to QR748 million, excluding any one-off gains in 2020. On a year-to-year basis, the investment yield, excluding any one-off gains, came at a healthy 5.1 percent, as compared to 3.5 percent for the previous year.
In 2021, Anoud Technologies (Anoud Tech), a subsidiary of QIC Group and a leading international insurance software solutions provider became the first Qatari company to export internally developed IT solutions to insurance companies across the world. QIC Group entered into a strategic alliance with Swiss Re, one of the world’s leading global reinsurance companies and are jointly marketing (Anoud+) to third-party insurers in both developed and emerging markets.
Continued efforts towards process efficiency and automation
QIC is committed to operate as efficiently as possible for the benefit of both its policy- and shareholders. Throughout the past years we managed to further trim our expense ratio, making QIC one of the most competitive insurers in the market. 2021 was no exception to this rule as we continued our endeavour towards process efficiency and automation, resulting in exceptionally low administrative expense ratio for our core operations of 5.9 percent in 2021.
S&P and AM Best rating confirmed
Both global credit rating agencies, Standard & Poor’s and AM Best, reaffirmed the Group’s “A” rating with a negative outlook during the year. In December 2021, AM Best affirmed the A (Excellent) financial strength rating and ‘a’ (Excellent) long-term issuer rating of QIC and its subsidiary. The ratings reflect QIC’s balance sheet strength, which AM Best considers very strong, and its strong operational performance, neutral business profile and adequate enterprise risk management (ERM).