Qatar Insurance Co (QIC) is projected to see modest top-line growth of about 3% per year in 2025 and 2026 as the company continues to consolidate its business, says S&P Global Ratings (S&P).
At the same time, S&P expects the group to report net earnings of about QAR700m ($192m) to QAR800m and a combined ratio of about 93%-95% per year in 2025 and 2026.
2024
QIC reported a 15% decline in insurance revenue to about QAR8.6bn in 2024 from about QAR10.1bn in 2023, since it exited some underperforming international business. Despite this decline in the top line, the company achieved a net profit of about QAR735m in 2024, 19% up from about QAR615m in 2023. At the same time, QIC reported an improvement in the net combined (loss and expense) ratio to about 93%, compared with 96% in 2023.
The improvement in underwriting results was driven by QIC's strategic shift toward more profitable business in the GCC region, which now contributes slightly more than 50% of its total business as opposed to about 20% in 2020.
As of year-end 2024, QIC's total shareholders' equity stood at about QAR9.0bn compared with QAR8.8bn at the end of 2023. QIC's capital adequacy remained above the 99.99% confidence level in S&P’s model. The global credit rating agency does not expect any changes to its assessment over the next two years, since it expects the group to continuously retain a material share of its earnings.
The group has two subordinated debt instruments outstanding, both of which S&P assesses as having intermediate equity content and are perpetual in nature. In S&P's base-case scenario, the agency assumes the group's financial leverage ratio will continue to comfortably exceed 24% and its fixed-charge coverage higher than 7x over 2025-2027.
QIC has maintained its position as the largest insurer in Qatar and is also among the top insurers in Oman and the UAE, measured by insurance revenue.
Ratings affirmed
S&P affirmed its 'A-' long-term issuer credit and financial strength ratings on QIC and QIC Europe (QEL). The credit rating agency also affirmed its 'A-' financial strength rating on the group's guaranteed subsidiaries. The outlooks on all ratings are stable.
At the same time, S&P affirmed its 'BBB' issue ratings on two outstanding subordinated debt instruments issued by QIC (Cayman) and guaranteed by QIC.
The stable outlooks reflect S&P’s view that QIC can maintain its leading position in Qatar and across the GCC, while keeping its capital adequacy above the 99.99% benchmark in the S&P model over the next two years.