Qatar Re said it expects to write about US$432 million of property, casualty and specialty lines premiums from the 1 January renewals, representing an increase of 25% from the 2014 expiring renewable base of business of $344 million.
For the full year 2015, Qatar Re expects to maintain momentum for further growth on the back of improved geographical and product diversification. Qatar Re renews roughly 55% of its total portfolio in January, it said in a statement.
Mr Gunther Saacke, Qatar Re’s CEO, commented: “Qatar Re remains on track to building a strong global reinsurance franchise. To the largest possible extent, we have weathered the severe headwinds from a rapidly deteriorating global reinsurance market environment. Our active cycle management, in combination with in-depth technical know-how and specialty lines expertise, has enabled us to grow the book without compromising on overall technical profitability.”
During the year-end renewals, Qatar Re continued to build its portfolio in a global reinsurance market which is still characterised by declining rates and weakening terms and conditions. The company further expanded in still attractive segments such as US catastrophe reinsurance, while cancelling the most rapidly deteriorating pieces of business (about 15% of the total renewal base).
The reinsurer’s renewed portfolio displays an almost unchanged technical ratio and even a marginally positive price change year-over-year, owing to active portfolio rebalancing.
Portfolio
The company’s 2014 year-end portfolio consists of 32% casualty including motor pro rata and excess of loss business, 31% specialty, 21% property (including engineering, energy and catastrophe) and 16% Lloyd’s quota share business. The main change in the renewed portfolio affects the Lloyd’s segment which was cut back by about one third to $65 million due to declining returns expectations. This reduction was more than offset by strong growth in more attractive catastrophe and specialty lines of business. The motor segment, on average, displayed unchanged price levels and grew to $132 million. The property business expanded only marginally.
Qatar Re also recorded strong renewal results in its important agriculture line of business which accounts for more than a fifth of the renewed book ($95 million). The portfolio grew by more than 40%, driven by US crop covers, including lead participations on tailor-made programmes.
The marine & aviation business saw typical rate reductions of 0-5% over all sub-lines (including offshore energy and aerospace), making it one of the more stable specialist classes. The renewed marine & aviation portfolio amounts to $49 million.
Going forward, Mr Saacke said: “We expect to generate further profitable growth over the remainder of the year. Particular momentum is arising from project-based opportunities and structured solutions, from our improved access to and traction in the European markets and from our expanded, globally operating facultative practice.”