Qatar Insurance Group Domestic dominance Regional leadership Global ambitions

Transcription

1 Qatar Insurance Group Domestic dominance Regional leadership Global ambitions April 2015

2 At a glance Doha 2

3 50 YEARS OF OPERATIONAL EXCELLENCE En route to establishing a global footprint based on domestic dominance and regional leadership MENA: QIC No 1 of 116 companies Asia Pacific: QIC No 12 of 264 excl. L&H World: QIC No 140 of 737 companies QIC established Current Senior Management appointed KQIC (Kuwait) and OQIC (Oman) established Qatar Re established 50 th Anniversary and acquisition of Antares Dubai branch Abu Dhabi branch QIC International established Q-Life & Medical established QIC Europe Ltd established in Malta 3

4 SUSTAINED GROWTH FROM DIVERSIFIED SOURCES Net income in USD million Return on Equity in % 18.4 Earnings per share in USD 1.71 Market Capitalization in USD million 3, , , ,588 1,705 QIC Group: Well diversified multi-pillar business set-up Direct Insurance QIC Specialty Insurance Antares Life & Medical Qatar Life & Medical Reinsurance Qatar Re Asset Management QIC Asset Management Real Estate QIC Real Estate July 2014: Financial strength rating A (strong), outlook stable Qatar Re Dec 2014: Financial strength rating of A (excellent) 4

5 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix 2014 A SET OF RECORD FINANCIAL PERFORMANCE FIGURES* Gross written premiums in USD million Underwriting results in USD million , Investment results and yield in USD million Net profit in USD million % 9.6% 10.0% 8.7% 10.7% 12.0% 8.0% % *2014 figures include Antares 0.0%

6 Strategy London 6

7 EXPANDING GLOBALLY WHILST CONSOLIDATING OUR REGIONAL LEADERSHIP Bermuda London Zurich Malta Singapore Antares Re Qatar Re US & NatCat Antares Lloyd s Qatar Re 1274 Syndicate Continental Qatar Re Rep. Office Europe and global operations QIC Europe Ltd Qatar Re Rep. Office for Asia Doha Dubai Abu Dhabi Muscat Kuwait QIC Group s HQ and domestic operations Qatar Re s HQ QIC direct insurance operations (UAE) QIC direct insurance operations (UAE) Oman QIC Kuwait QIC 7

8 BROAD SPECTRUM OF CAPABILITIES QIC Domestic Reinsurance Specialty Life & Medical Asset Management Personal lines o Motor Agriculture Credit & Surety Aviation Financial Institutions E ARE COM M I TTED TO BUI LDI N G TH E FI RST ABOUT US PRODUCTS QATAR RE HUBS NEWS & MEDIA CONTACT US o Home Care o Travelcare Commercial lines o Energy o Marine & Aviation o Medical o Motor o Property & Commercial Energy Engineering Facultative Marine & Aviation GUNTHER SAACKE Motor Property Structured Finance Marine Political and OBAL REI N SURANCE FRANCH I SE, BASED ON EM ERGI NG M ARKET CAPI TAL Chief Executive Of cer Financial Risk Professional indemnity Property Excess of Loss Terrorism LOG IN Group Life Credit Life Mortgage Life Group Medical JOIN Asset Management Proprietary asset management Third party asset management Collateralized reinsurance (CATCO) 8

9 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix EXECUTION: ANTARES ACQUISITION PUTS QIC ON GLOBAL MAP Strategic rationale Key figures in USD million o Acquisition of Antares in February 2014 for a purchase consideration of USD 325 million o Access to Antares Lloyd s Syndicate 1274 and Bermuda Class 3 reinsurer o Build a significant Property & Casualty and Specialty footprint o Establish international recognition for QIC GWP Net Income Combined Ratio Geographic mix, 2014 Business mix, N. America, CAN Far East, AUS Europe UK LatAM RoW Africa 31% 3% 2% 28% 15% 2% 10% 11% 10% 5% 32% Marine Energy Aviation Terrorism PI FI Pol. Risk Prop. XL ME 5% 11% 11% 7% 12% 11% Misc. 9

10 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix EXECUTION: GROWING QATAR RE INTO A GLOBAL LEADER Achievements to date o Built an efficient, well diversified portfolio, GWP grew 6-fold since repositioning in 2013 o Ability to offer lead quotations and capacity based on superior technical and product expertise o Offer highly rated security and instant diversification to reinsurance panels o Based on 2014 GWP, Qatar Re is among the global Top 50 reinsurers Europe Americas Asia Africa 20% 3% 4% 48% Key figures 7% 21% Geographic mix, 2014 Business mix, % in USD million GWP Net Income Gross Combined Ratio Motor / Casualty Marine & Aviation Property Energy Agriculture Oceania 25% 15% 7% 17% 4% Credit & Surety Others / 10 Multi Lines

11 Competitive Position Zurich 11

12 (133) (51) (10) (21) 3,187 2, , ,491 1, , , , ,490 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix DOMINANT POSITION IN THE MENA REGION Regional comparison (FY 2013) in USD million QIC Tawuniya Orient Oman Ins. Co Med Gulf ADNIC Bupa Arabia Gulf Ins. Co Salama United Total Assets Gross premiums Net profit QIC consistently outperforms major regional insurance and reinsurance groups due to its focus on Technical excellence in underwriting and asset management Diversified growth across business segments and geographies 12

13 SIGNIFICANT POTENTIAL FOR ADDITIONAL GLOBAL AND REGIONAL GROWTH QIC Domestic and regional o Dominant market share in Qatar and ahead of its peers in MENA o Significant further growth potential in rapidly growing MENA insurance markets Qatar Re o Already among top 50 reinsurers worldwide o Aspires to become a Top 10 reinsurer by QIC domestic/regional GWP USD 920 million Qatar Re GWP MENA Life & Non-Life USD 50 billion GWP Top 10 reinsurer 2025 LOG IN JOIN o Continues to expand geographically and by line of business USD 536 million USD 6 billion QATAR RE HUBS NEWS & MEDIA CONTACT US Antares o Established as independent Managing Agent at Lloyd s, the world s global insurance and reinsurance market of choice o Ranks no. 35 within Lloyd s by GWP o Synergies with QIC have potential to enhance growth ED TO BUI LDI N G TH E FI RST NCE FRANCH I SE, BASED ON M ARKET CAPI TAL GUNTHER SAACKE Chief Executive Of cer QIC Group o Aspires to become a Top 50 international composite insurance group o Well diversified by geography, lines of business and sectors o No. 140 worldwide by market cap Antares GWP USD 380 million QIC Group GWP USD 1.54 billion GWP Lloyd s USD 40 billion Global Non-Life GWP USD 1.4 trillion 13

14 Performance Hamilton 14

15 STRONG TRACK RECORD OF TOP AND BOTTOM-LINE GROWTH Key Highlights (USD million) Gross premium Underwriting results Net profit Investment and other income Earnings per share (restated) Cash dividend per share Bonus share -- 20% 20% 25% 15% Share price at 31 December Operating Free Cash Flow growth in USD million Total Assets in USD million CAGR 21% 207 CAGR 17% 4,422 3, ,988 2,135 2,

16 31-Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec-14 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix AND SHAREHOLDER VALUE CREATION Dividends in USD Return on Equity % Pay-out ratio 87% 70% 82% 75% 66% 85% 64% Dividend per share Bonus per share QIC shares outperformed QE Index and QE Insurance index Market Value in USD million 3,996 2,007 1,326 1,059 1,268 1,705 2,346 1,588 1, , , QATI QD Equity DSM Index QINS Index Market Cap Book Value 16

17 CONSISTENT UNDERWRITING PERFORMANCE Gross Premiums In USD million Net Underwriting Results In USD million CAGR 21% CAGR 9% 1, Combined ratio % 65% 17% 16% 78% 90% 92% 93% 98% % % 65% 58% 9% 10% 10% 18% 15% % 51% 9% 14% 15% % 52% 10% 17% Loss ratio Acquisition cost Combined ratio Net Cat Losses Expense Ratio 17

18 WELL DIVERSIFIED PORTFOLIO ENHANCES CAPITAL EFFICIENCY Gross premiums, split by region 2014 Gross premiums, split by line of business 2014 International, 59% Domestic, 24% Agriculture 5% Liablity 5% Others 9% Motor 25% Regional, 17% Marine & Hull 17% Energy 12% Property 15% Health & Life 12% Superior geographical and product diversification translates into high capital efficiency QIC is the only MENA composite insurer with a sizeable international footprint: Qatar Re and Antares account for 59% of QIC s total GWP IN 2014 No single line of business generates more than 25% of the total European and Asian business poised for particularly strong growth (based on newly established QIC Europe and Qatar Re s Singapore office) 18

19 STRONG TECHNICAL PERFORMANCE IN A HIGHLY COMPETITIVE ENVIRONMENT in USD million Marine and Aviation Gross premium Underwriting Results Loss ratio 61% 54% Operating profit 15.3% 15.6% 189% Gross premium 193% Underwriting results in USD million Property & Casualty Gross premium 699 1'096 57% 18% Underwriting Results Loss ratio 59% 64% Operating profit 14.6% 10.1% in USD million Life & Medical Gross premium Gross premium Underwriting results 5% 13% Underwriting Results Loss ratio 79% 79% Operating profit 9.4% 10% Gross premium Underwriting results 19

20 , ,460 1,529 2,276 2,628 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix EXCELLENT INVESTMENT YIELD DESPITE LOW INTEREST RATE ENVIRONMENT Return on Investments 3,000 2,500 2,000 1,500 1, % 9.6% 10.0% 8.7% 8.1% Invested Assets Investment income Investment portfolio composition % 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Investment versus underwriting income 49% 51% 60% 62% 60% 61% 40% 38% 40% 39% Underwriting income Investment income composition 2014 Equities 24% Real Estate 3% Private Equity & Funds 4% Cash 23% Bonds 46% Advisory fees 11% Interest income 19% Dividend income 11% Rental income 5% Others 6% Profit on sale of investments 48% 20

21 FOCUS ON SECTOR BALANCE AND SECURITY OF INVESTMENTS Equity: Industry exposure 4% 3% 2% 2% Financial 4% 8% 10% 10% 57% Basic Materials Industrial Utilities Consumer, Cyclical Consumer, Non-cyclical Communications Diversified Energy Equity: Currency exposure 3% 2% 0.2% 0.1% 4.7% 9% 81% QAR SAR AED OMR KWD GBP USD Fixed income: Rating Fixed income: Geographic mix Fixed income: Mix by sector 28% 3% 1% 13% 3% 1% 1% 31% 4% 9% 2% 2% 2% 68% 21% 30% 23% 58% A- or Better BBB- & Above NR Below BBB- Qatar Asia Africa ME-ex Qatar Europe LATAM Financials Sovereign Exploration Refining Energy Life Insurances Others 21

22 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix HEALTHY INCOME CONTRIBUTION FROM QIC ASSET MANAGEMENT Asset Management Contribution of investment income in % and USD million Advisory fee income in USD million % 59.6% 61.1% 59.2% 61.2% 80.0% 60.0% 40.0% % % Total income Investment income QIC Asset Management consistently contributes 50-60% to the Group s total income Third party asset management has become a growing and sizable source of income Efficient treasury function managing the liquidity and balance sheet assets and liabilities Function provides efficient asset and risk diversification to the Group s balance sheet 22

23 EXCELLENT FINANCIAL STRENGTH RATIOS Assets % Invested assets to total assets 68% 67% 71% 59% Invested assets to net technical reserves 366% 329% 339% 188% Cash and bank deposits to net technical reserves 143% 126% 137% 52% 163% Solvency: Increased capital utilization, ratio remains strong Eligible Capital 3,413 3,479 4,015 5,026 Solvency Ratio 163% 156% 148% 146% 156% 148% 146% Solvency ratio 23

24 STRONG FINANCIAL STRENGTH RATINGS Financial strength rating for QIC Rating: A strong stable Outlook: o We view QIC as an increasingly diversified insurance group with relatively mature operations in the still-growing Gulf Cooperation Council region, and with rapidly expanding reinsurance operations in Europe. Rating: A excellent stable Outlook: o The ratings for Qatar Insurance Company S.A.Q. (QIC) reflect its very strong risk-adjusted capitalisation, robust underwriting performance and global business diversification. QIC Group equity in USD million Share capital Legal reserve General reserve Catastrophe special reserve Fair value reserve Retained earnings Equity attributable to parent , , Non-controlling interest Total equity 1, , ,627.34

25 Organisation Dubai 25

26 STRONG GEOGRAPHIC AND SECTOR DIVERSIFICATION Group level Operations LOG IN JOIN Asset Management HOME ABOUT US PRODUCTS QATAR RE HUBS NEWS & MEDIA CONTACT US Sector Direct Insurance: Personal Lines Reinsurance: Property & Specialty Re/insurance: Direct Insurance: Medical Lines Life Lines W E ARE Commercial COM M I TTED Casualty TO BUI LDI Commercial N G TH E FI RST GLOBAL Lines REI N SURANCE Facultative FRANCHLines I SE, BASED ON Lines EM ERGI NG M ARKET CAPI TAL Direct Insurance: Asset Management Geography Qatar GCC Europe GUNTHER SAACKE Chief Executive Of cer Global Global Qatar GCC Global 26

27 Risk Management Abu Dhabi 27

28 6. Communicating and Consulting Group Risk Steering Committees, Entity Board, Entity Risk Committee, Audit Risk Committee 7. Monitoring and Reviewing Ongoing Process At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix STRICT ADHERANCE TO CLEARLY DEFINED ERM PROCEDURES Risk Management at QIC Enterprise risk management cycle o ERM is broken down into Risk Management, Capital Management and Exposure monitoring o o o o o o o Governance structure follows the three lines of defence model with dedicated Risk Committees in each entity of the company Each entity committee reports into the group s risk steering committee, which reports to the Group s Board and Audit committee Risks are monitored and maintained according to risk categories such as insurance, market, credit, operational and group Each risk is assessed for impact and probability along with the controls in place to mitigate Risk are reviewed quarterly QIC has in place a full-blown stress and scenario framework QIC conducts analysis into emerging risks 1. Establishing Goals: Risk Appetite & Tolerance statement, Strategy & Business Plan for the year 2. Identifying Risks: Risk Registers 3. Analyzing Risks: Risk Score 4. Prioritizing Risks: Risk Prioritization Matrix 5. Risk Mitigation: Control Analysis o Risk appetite and tolerance set at the group and entity level with the position against these metrics being monitored on an on-going basis 28

29 Outlook Muscat 29

30 ASPIRING TO BECOME A GLOBAL TOP 50 COMPOSITE INSURER Well-diversified business mix Agriculture 5% Liablity 5% Marine 17% Energy 12% Others 9% Motor 25% Property 15% Health / Life 12% A portfolio of powerful franchises Balanced geographical mix International 59% Domestic 24% Regional 17% Distinct sources of income Third Party Asset Management, 7% Investments, 54% Re/Insurance, 39% SEARCH Continue to capitalize on transactional opportunities Grow QIC Europe Expand into Asia / Pacific on the back of Qatar and Antares Further grow medical and life lines in the domestic and regional market HOME ABOUT US PRODUCTS QATAR RE HUBS NEWS & MEDIA CONTACT US QIC Europe Ltd: Become a common platform for QIC s entrée into the European insurance markets Use synergies with Qatar Re in reinsurance and Antares in specialty insurance Qatar Re: Leverage acknowledged market and product expertise to expand on a global scale, broaden product offering Antares: Capitalize on Lloyd s expansion and leverage synergies with Qatar Re W E ARE COM M I TTED TO BUI LDI N G TH E FI RST GLOBAL REI N SURANCE FRANCH I SE, BASED ON EM ERGI NG M ARKET CAPI TAL GUNTHER SAACKE Chief Executive Of cer LOG IN Asset Management JOIN Further build 3 rd party investment capabilities Continue to generate investment income above index and peers 30

31 Appendix Kuwait 31

32 PROFIT AND LOSS ACCOUNTS, Income Statements (QAR 000) Growth (YOY) CAGR Gross Written Premium 2,153,082 2,383,050 2,558,597 3,531,707 5,613,767 59% 21% Net earned premium 1,117,869 1,320,898 1,494,639 1,974,085 3,678,344 86% 27% Net claims incurred (584,857) (859,397) (1,021,337) (1,280,266) (2,394,403) 87% 33% Net commission (107,274) (123,072) (130,079) (211,301) (620,093) 193% 42% Net underwriting income 425, , , , ,848 38% 9% Investment and Other Income 410, , , ,622 1,027,488 43% 20% G&A Expenses (213,799) (243,916) (278,935) (423,783) (665,926) 57% 26% Net profit 622, , , ,357 1,025,410 32% 10% 32

33 BALANCE SHEETS, Balance Sheets (QAR 000) ASSETS Cash and cash equivalents 1,736,116 2,080,719 2,123,876 3,351,905 2,646,907 Insurance and other receivables 549, , ,395 1,164,615 2,820,028 Reinsurance contract assets 1,616,287 1,805,429 1,950,278 2,151,318 3,251,457 Investments 2,922,210 2,781,968 3,003,506 4,543,881 6,545,147 Investment properties 384, , , , ,070 Property and equipment 28,592 26,142 31,890 33,592 38,665 Intangible assets ,895 Goodwill ,111 TOTAL ASSETS 7,237,146 7,777,220 8,251,581 11,632,508 16,097,280 Liabilities Short term borrowings 229, , , ,000 Insurance contract liabilities 2,739,803 3,259,700 3,640,986 4,594,615 8,331,014 Provisions, reinsurance and other payables 746, , , ,005 1,660,759 Total liabilities 3,715,002 4,248,357 4,458,968 6,250,820 10,173,773 Equity Share capital 743, , ,891 1,284,323 1,605,404 Reserves & Surplus 2,595,375 2,596,117 2,728,463 3,903,131 4,099,379 Minority interest 183, , , , ,724 Total equity 3,522,151 3,528,864 3,792,613 5,381,688 5,923,507 TOTAL LIABILITIES & EQUITY 7,237,154 7,777,220 8,251,581 11,632,508 16,097,280

34 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix QATAR: A THRIVING ECONOMY GDP and real GDP growth 16.70% 13.00% 18.00% 14.00% 10.00% 6.00% 6.10% 6.50% 6.50% 2.00% ** *Source: IMF 2014, ** Projections GDP Growth rate in USD billion* Hydrocarbon vs. Non-hydrocarbon sectors in GDP* 98 55% *Source: QSA 45% 53% % 43% 46% 47% 58% 57% 54% Hydrocarbon Non-Hydrocarbon Strong fundamentals Diversifying the economy Budget surplus Highest credit rating in the GCC 9.1% per annum over the past 5 years S&P: AA; Moody s: Aa2 Strong population growth Tripled since 2003, 2.6 million by 2016 World s highest GDP per capita USD in 2013 Hydrocarbon reserves World largest exporter of LNG Investments into infrastructure National Rail Project USD 25 trillion 77 million tonnes per annum USD 150 billion by 2020 USD 35 billion 34

35 Premiums as % of GDP At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix QATAR S GROWING INSURANCE SECTOR Total premiums in USD million* Insurance Penetration ,994 1,516 1, *Source: Swiss Re SIGMA Insurance regulation UK Japan USA Germany India China Bahrain UAE Oman Qatar KSA Kuwait 12% 10% 8% 6% 4% 2% 0% 1,000 10, ,000 GDP per Capita (Log scale) in USD Source: Swiss Re, Central Bank of Bahrain, EIU Country Data via BVDep Qatar Central Bank (QCB) was established as Qatar s competent supreme authority in 2012 QCB has responsibility for the design and implementation of policies relating to the regulation, control and supervision of financial services and financial markets in Qatar QCB pursues a consistent risk-based micro-prudential framework in line with global regulatory standards under development QIC International and Qatar Re are regulated by the Qatar Financial Centre Regulatory Authority, which is in charge of the insurance sector regulation, reporting to the QCB 35

36 Source: Swiss Re sigma, 2014 At a Glance Strategy Competitive Position Performance Organisation Risk Management Outlook Appendix GLOBAL INSURANCE: POTENTIAL INTACT, THOUGH GROWTH IS SUBDUED Global Insurers solvency change in % Insurance Penetration in% Source: Swiss Re sigma, 2014 Premium growth in % Insurers underwriting results and RoE in% Source: Swiss Re sigma, 2014 Source: Swiss Re sigma,

37 THE QIC MANAGEMENT TEAM Khalifa A. Al Subaey Group President & CEO Ali Saleh Al Fadala Sr. Deputy Group CEO Sunil Talwar Deputy Group CEO P.E. Alexander Qatar Operations Varghese David Finance & Operations Gunther Saacke Qatar Re Sandeep Nanda Investments & Strategy Stephen Redmond Antares Nasser Al-Misnad Damaan Islamic Insurance Salem Al-Mannai Q-Life & Medical Insurance Fahad Al Mana QICI KG Venkat UAE Operations Ewen McRobbie Oman QIC Darren Collinson Kuwait QIC Andy Ross QIC Europe 37

38 THE QIC BOARD OF DIRECTORS AND MAJOR SHAREHOLDERS QIC shareholders in % Sheik Khalid bin Mohammed bin Ali Al-Thani Chairman & Managing Director Abdullah bin Khalifa Al-Attiya Deputy Chairman Khalifa A. Al Subaey Group President & CEO o Government of 13.5% Qatar Hussain Ibrahim Al- Fardan Board Member Jassim Mohammed Al-Jaidah Board Member Sheik Hamad bin Faisal bin Thani Al Thani Board Member o Qatari Royal 10-15% Family and Associates o Foreign 5% Institutional Investors Sheik Jassim bin Hamad bin Jassim bin Jabor Al Thani Board Member Sheik Khalid bin Hamad bin Khalifa Al-Thani Board Member Saoud bin Khalid bin Hamad Al Thani Board Member Khalaf Ahmed Al-Mannal Board Member o Free Float Remainder 38