By Pratap John/Chief Business Reporter
A significant increase in gross premium and higher underwriting income earned in the first quarter of this year has helped Doha Insurance triple its Q1 net profit to QR18.4mn.
Doha Insurance chairman Sheikh Nawaf Nasser bin Khaled al-Thani said after a meeting of the company’s board of directors the QE-listed firm earned a net profit of QR18.3mn in the first quarter of this year compared with QR6.4mn in Q1, 2009.
Doha Insurance, currently Qatar’s third largest national insurance company, had written gross premium worth QR110.5mn in Q1, up 36% on QR81mn earned in the same period last year.
The first quarter saw Doha Insurance registering a faster growth in net underwriting earnings, to QR17.8mn from QR15.6mn in the same period last year, Sheikh Nawaf said.
Earnings per share (EPS) stood at QR1.02 in Q1 compared with Dh36 in the same period last year.
Doha Insurance general manager Bassam Hussein said the higher gross premium earned by the company in the first quarter was a result of its ‘successful marketing initiatives’.
“We met a lot of our clients and our efforts have borne fruits,” Hussein said.
He said the market was gradually recovering, although Qatar was the least affected in the region because of the global economic turbulence.
“In the last quarter we don’t have to make provisions for impairment of investments whereas in the same period last year we have to do that,” Hussein pointed out.
He said Qatar’s insurance sector could gain from the significant life and medical coverage potential in the country, which had not been tapped heavily.
While it is true that premium income from construction activities related to many major projects on completion will diminish in the months ahead, new avenues are opening in terms of maintenance and operation.
“We are entering a new phase. Coverage is only getting shifted to other areas. There ought to be significant premium income in such areas,” Hussein said.
Some of the major projects that may provide good opportunities to Qatari underwriters will be Dohaland and the Qatar-Bahrain Causeway, he said.
“Many projects have taken shape, but many more are getting implemented,” Hussein said.
He said Doha Takaful, the Shariah-arm of the Qatari underwriter, had also posted good business in the first quarter of this year.
“By the year-end, I hope Doha Takaful will emerge as a strong player in Islamic insurance,” Hussein said.
Doha Insurance is developing takaful business as there are ‘tremendous prospects’ for Shariah-based products in the market. A Shariah supervisory board for Doha Takaful has already been set up.
Hussein said ‘BBB+’ (counterparty credit and insurer financial strength ratings) awarded to Doha Insurance by S&P with a stable outlook had a lot to do with the Qatar’s economic strength and stability.
“We have definitely benefited from the high sovereign ratings. In a country, which is not reasonably rated, we are not going to get that kind of rating in a relatively short period of time. We are very fortunate to be in a country like Qatar, especially at this time of post-economic crisis,” Hussein added.
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