NEWS
Happy to be under the radar: IGI CEO remains bullish
IGI’s Waleed Jabsheh expects tailwinds of property and construction underwriting to power results.
Bermuda-based International General Insurance (IGI) likes to fly below the radar—but that does not mean it does not take pride in outperforming many of its peers, its chief executive Waleed Jabsheh told Monte Carlo Today.
Speaking in the context of the company’s half-year results, Jabsheh, who took over the reins at the company just months ago, argues the results compare with those of the best in the market.
Admitting that the company, which celebrated its 20th anniversary last year, has benefited from the hard market, he said the results were a reflection of prudent underwriting and the ability to nimbly take advantage of new opportunities.
“The results we’ve been able to achieve in recent quarters, especially in the first half of this year, have been pleasantly ahead of expectations,” he said. “By no means am I saying that this is the norm going forward, but I think it’s a reflection of who we are as a company and how we operate.
“We’ve always been able to achieve results that compete with those of the best in the market. Throughout a cycle, we normally average anywhere between the mid to high 80s combined ratio, and now we’re coming in at the mid-70s.
“Even with the tailwinds we fortunately are experiencing as a market, we are extremely pleased to generate the results, the profitability, the combined ratios, and the return on equity. The interest rate environment is helping our investment income as well. It’s been a fantastic first six months of the year.”
“The interest rate environment is helping our investment income.”
Waleed Jabsheh, IGI
In the second quarter, IGI had net income of $40.5 million along with a 73.5 percent combined ratio and a 36.1 percent return on average equity. That was largely powered by a surge in short-tail underwriting income, which rose 63 percent to $30 million, and reinsurance which almost tripled to $4 million from $1.4 million. Only long-tail insurance declined, falling 22 percent to $16 million.
We know where we’re going
On his ambitions for the company Jabsheh said: “We know who we are, we know what we’re able to achieve and as long as we achieve it, this is the biggest gratification.
“We’re a company that’s always coming under the radar and that is exactly how we like to be. We just focus on what we’re doing, and doing the right thing. We are happy with that.”
He now sees further opportunities. “We think the market will provide more opportunities for us to continue growing, and to grow profitably.” He noted that short-tail property, construction and political violence were all performing well, as was marine cargo, a new area for IGI.
“There are plenty of opportunities and also by geographical territory. The US has a strong tailwind for us. From a property perspective, we’re getting the highest rate increases from the US market. Energy continues to be strong for us.
“The reinsurance treaty book has been a very successful six months. We are seeing conditions we’ve never seen as a company in our entire history and we have been able to capitalise on that. It has come in very much ahead of our expectations. That book has grown by more than 130 percent in the first six months of the year.”
“The risks we face are what they’ve always been.”
Jabsheh admitted there was pressure on directors and officers liability rates, especially for financial institutions, and on professional indemnity (PI), although he said this was less pronounced—for now.
“Unfortunately, I am expecting PI to follow suit,” he said. “We will focus on where we think the best returns are. We took advantage of the long-tail segments’ hardening for the last four or five years.
“We all know we operate in a cycle and it was going to stop at some point. So we’ll shift and head in the direction of where the best opportunities are.”
Jabsheh said IGI was not going to exit those segments, but that it would direct resources into areas with the highest returns.
As to new threats, Jabsheh said: “Nothing has dawned on us that hasn’t been around forever.
“The risks we face are what they’ve always been. They change and shift over time, and you just have to adapt to them.
“But in terms of the future, the first six months were way ahead of expectations. There’s been a fantastic start to the year and we’re very excited about the rest of the year and what’s to come.
“We strongly believe in our philosophy; we’ve been consistent in our approach. And we will continue to do exactly what we’ve been doing,” he concluded.
Main image: Shutterstock / zieusin