Qatar Insurance Company Q.S.P.C. (QATI) Earnings Call Transcript & Summary

Good morning or good afternoon. Welcome to the Qatar Insurance Company Q3 2024 Earnings Call. My name is Adam, and I'll be your operator for today. [Operator Instructions] I will now hand the floor to Karim Kekhia to begin. So Karim, please go ahead when you're ready.

Good afternoon, ladies and gentlemen. Welcome to QIC Group's Third Quarter 2024 Earnings Conference Call. I was hosted by Arqaam Capital and QNB. I would like to introduce our speaker for today, Mr. Chirag Doshi, Group Chief Investment Officer; Mr. Varghese David, Group Chief Financial Officer. And I would like to hand over to Mr. Varghese, now. Mr. Varghese, please go ahead.

Good afternoon, everyone. Once again, welcome all to QIC's quarterly earnings call. We are pleased to report the financial highlights of QIC Group for the first 9 months of 2024. The key highlights are: QIC Group has reported a net profit of QAR 525 million against a net profit of QAR 453 million for last year, which is a 16% growth in net profit quarter-to-quarter. The gross written premium for the period stood at QAR 7.2 billion. The insurance revenue for the quarter was QAR 6.424 billion, and the insurance service results for the group for Q3 was QAR 414 million compared to QAR 255 million for the same period with a 62% increase in net insurance operating results. The group reported a net investment and other income of QAR 712 million for the period with an investment yield of 5% on an annualized basis. The regulatory solvency ratio for the group stands at 182% currently. QIC's Q3 results are in line with our forecast for the year and reflects the robust momentum of a stable and consistent bottom line-driven growth the company has delivered over the past several quarters since Q1 of 2023. QIC has focused intensively on strengthening its market position in domestic and the MENA markets, where the gross written premium has increased 43% compared to the same period in 2023. This is evident in the growth coming from our direct GCC business, primarily arising from health and personal lines segments of business. We are now seeing positive results from our international operations where the set strategy for existing from underperforming high volatile and low-margin international markets have been successfully completed and which has been further augmented recently by the strategic restructuring, which we did of our U.K. business portfolio, which -- by which we have substantially reduced our exposure to the direct U.K. Motor business. QIC is currently well diversified and has a balanced portfolio between MENA and its international business, which is primarily written -- our international business is primarily written to our U.K. Lloyd's Syndicate arm, which is called the Antares Lloyd's Syndicate. And now -- the group is now positioned for a greater stability and profitability in the underwriting income as we move on. While the continuing catastrophic events during the year 2024 has impacted the global insurance market, QIC with this well-balanced and diversified risk portfolio mix has been able to successfully weather the challenges. Within the region, as you are all aware, UAE witnessed one of the most unprecedented multiple floods during the year, highlighting the increasing frequency and severity of extreme weather events, which led to a multibillion dollar loss arising primarily from motor and property losses. The recent catastrophe losses in the region has, in fact, led the market for a rate hardening in the motor segment of business. While on the international front, the losses arising from the U.S. Baltimore bridge loss, which is again an industry event. Also the recent Hurricane -- U.S. Hurricane Helene and Milton had impacts to the insurance industry, whereas QIC has been able to successfully weather the storm and able to show a 16% growth on the insurance net results. And moving on to the gross written premium and the insurance income. The gross written premium for the period stood at QAR 7.2 billion, which constitutes a balanced regional and international portfolio and is aligned to the company's deliberate shift towards increasing the proportion of business generated from the MENA region. This is reflected in the current quarter, where the domestic and the MENA gross written premium increased by 43% on a year-on-year basis to stand at QAR 3.8 billion. As of Q3, the MENA region constitutes almost 54% of the overall gross written premium and the international segment constitutes 46%. So this is compared to in the early -- in 2020, the previous years, where we had 80% of our business coming from international and MENA and the region used to be only 19%. So this is a major shift in our product mix from an international and the MENA domestic point of view. In terms of lines of business, QIC is expanding and is focused to develop this business in the short tail and the personal lines and health segment of business from where we've seen the growth coming primarily from the UAE and Oman operations. QIC continues to be the GCC leader in the digital transformation area. And that has been one of the differentiators for QIC within the GCC region, where, I mean, we have been in the forefront to extract the benefits of the AI -- new emerging AI technologies in business decision-making, process efficiencies, automations. And that has also been -- that's also seen in some of the awards which have been awarded to QIC. The recent one has been -- we have been named as the Insurer of the Year from the MENA IR awards in the third year in a row. So currently, for information, almost 65% of the business we write in Doha for motor is written through our B2B and B2C channels. So this shows the strength of our internally developed online personal line digital channels, which are currently developed. Overall, the group's net profit for the first 9 months stands at QAR 525 million, which is compared to QAR 453 million for last year. Above is a brief summary of our Q3 results. And if you have any further queries and clarifications, we are happy to answer them.

[Operator Instructions] No questions at this time. I'll hand the call back to the management team.

Thank you, everyone. Thank you for participating in the call. And if you have any questions, you can reach out to our IR team in the future. Thanks a lot.

Thank you.

This concludes today's call. Thank you very much for your attendance. You may now disconnect your lines.