Doha, 20 April 2015 - In 2014 Qatar Re continued to post significant business growth at improving profitability. Two years after the Company's strategic repositioning as a global reinsurer, gross written premiums increased by 60% to USD 536 million, net income came in at USD 16 million, up from USD 0.5 million, and investment income grew by 40% to USD 27 million.
Gunther Saacke, Qatar Re's Chief Executive Officer, says: "In 2014 we firmly established ourselves as a Top 50 global reinsurer. Our strong financial performance testifies to our accomplishments in building a resilient book of business, growing our client franchise, improving our systems and establishing a powerful team of acknowledged reinsurance professionals. After significant upfront investments in staffing and infrastructure, we are now starting to see attractive earnings coming through."
Gunther Saacke adds: "In 2015 we will maintain our momentum. The January renewals generated premium growth of 25% on our renewable book. Qatar Re will further grow and diversify, both in terms of geographies and in lines of business."
Building on a diversified book of business
In 2014 Qatar Re grew its portfolio to gross written premiums of USD 536 million, an increase by almost 60% from USD 337 million in 2013, already benefiting from its broad diversification which it had sought since its repositioning as a global reinsurer. Qatar Re focuses on knowledge-intensive specialty business, which it pursues through strong teams with acknowledged technical expertise and longstanding experience in the industry. As a result, the Company already assumes lead positions on select panels.
The net underwriting result came in at USD 27 million, compared with USD 11 million in the previous year. The technical margin on its net premiums written, after significant intra-group cessions, increased from 8% in 2013 to 15% during the reporting period. Furthermore the portfolio's diversification continued to improve. The combined share of the three largest classes - motor/casualty, property and agriculture - decreased from 75% to 61%.
In the past year, Qatar Re's North American business has grown considerably as the Company's Bermuda branch became fully operational. The Americas now account for 24% of the total portfolio, up from 14%. By contrast European business decreased in share from 52% to 48%.
The investment result of USD 27million, representing an excellent return on investment of 6.9%, contributed favourably to Qatar Re's results. Total investments and cash amounted to USD 415 million, as compared to USD 385 million in 2013. Total available for sale financial assets increased from USD 179 million in 2013 to USD 285 million in 2014. This includes Qatari public shareholding companies, quoted shares, and bonds, minus margin collateral. Overall, Qatar Re's asset allocation, with almost 70% held in fixed income securities, cash and deposits, is commensurate with its A-rated financial strength rating and established Enterprise Risk Management framework.
In line with the Company's expansion plans, Qatar Re's headcount grew to 107 as per December 31, 2014. With additional scale and cost-efficiency also improved. Measured against gross written premiums, the administrative expense ratio reduced from 8.8% to 7.1%. The Company expects this trend to continue in 2015.
Net income amounted to USD 16 million, up from USD 0.5 million in the previous year. This improvement needs to be set against a backdrop of investments in staff and infrastructure as well as prior-year underwriting losses unrelated to Qatar Re's current portfolio. As in the previous year, Qatar Re will retain its 2014 earnings, further bolstering its capitalization.
Momentum to be maintained in 2015
Qatar Re expects to generate further profitable growth in 2015. The Company is convinced that reinsurance buyers will continue to welcome a well-diversified and technically versatile reinsurer backed by long-term capital.
Qatar Re recently received approval from the Monetary Authority of Singapore to establish a representative office in Singapore that will initially focus on exploring business opportunities in the Asian region. Micky Lee, a renowned industry veteran, has been appointed to act as the Singapore office's representative. Mr. Lee joins from Asia Capital Re (ACR) where he last served as Chief Underwriting Officer Treaty. Previously he was ACR's Head of Property. Prior, Micky Lee was a Property and Engineering Underwriter for Swiss Re's South East Asian markets.
About Qatar Re
Established in 2009, Qatar Reinsurance Company LLC (Qatar Re) is the reinsurance affiliate of Qatar Insurance Company (QIC), the largest composite insurer in the Middle East, based in Doha, Qatar. Qatar Re, also headquartered in Doha, has branch offices in Zurich and Bermuda as well as representative offices in London and Singapore. The Company is authorized and regulated by the Qatar Financial Centre Regulatory Authority (QFCRA), being a registered company at the Qatar Financial Centre (QFC Registration Code 0117). Qatar Re is backed by a full parental guarantee by QIC Group which is capitalized at USD 1.6 billion with a market capitalization of USD 4 billion as of 31 December 2014. Qatar Re is rated "A/Stable" by Standard and Poor's and A (Excellent) by A. M. Best and benefits from QIC's strong and growing capital base. Qatar Re writes all major property, casualty and specialty lines of business. For further information on Qatar Re please visit www.qatarreinsurance.com.
About Qatar Insurance Company
Qatar Insurance Company (QIC) is a publicly listed composite insurer with a consistent performance history of 50 years and an underwriting footprint across the Middle East, Africa and Asia. Founded in 1964, QIC was the first domestic insurance company in the State of Qatar. Today, QIC is the market leader in Qatar and a dominant insurer in the GCC and MENA region. QIC is one of the highest rated insurers in the Gulf region with a rating of "A/Stable" from Standard & Poor's and "A/Excellent" by A.M. Best. In terms of profitability, market capitalization and gross premiums written, QIC is the largest insurance company in the MENA region. It is listed on the Qatar Exchange, with a market capitalization of USD 4.0 billion as of December 31, 2014. For further information on QIC, please visit www.qatarinsurance.com.
Contact
Dr. Schanz, Alms & Company AG
Henner Alms, P: +41 44 256 1082,
E: henner.alms@schanz-alms.com
P: +41 44 256 1081,
E: kai-uwe.schanz@schanz-alms.com
© Press Release 2015
