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Khalifa Al Subaey

QATAR - Finance

Where the Market Is

Group President & CEO, Qatar Insurance Company (QIC)

Bio

Born in 1956, Khalifa Al Subaey has a degree in Economics and Political Science from Central Michigan University and is currently the Group President and CEO of Qatar Insurance Company. Prior to joining his present company, he was General Insurance Coordinator in the general Qatari Petroleum Association (now Qatar Petroleum) from 1982 until 1986.

What are your views on the recent changes to the regulatory environment? The regulation change has been in the making since 2007, so it was bound to happen. Most of […]

What are your views on the recent changes to the regulatory environment?

The regulation change has been in the making since 2007, so it was bound to happen. Most of the companies will be very much prepared to handle the regulations, and it is necessary in this regulatory environment. Not having an insurance regulator causes many problems for the insurance companies operating in a country. Insurance is a business in which you are constantly dealing in international markets. When you are dealing as counterparties not just locally, but internationally, most of the time the international insurance company needs to know who the regulators are.

How would you assess the success of Qatar Insurance Company (QIC) in its first 50 years of business in the country?

QIC has never had a year when it recorded a loss, and that is a testament to our success. QIC has good systems in place, and everything is sustainable. It has grown significantly over the last 10 years. We have a reasonably competitive environment in the country, and there are six other national insurers. QIC has competition coming in both the local market as well as from international insurance houses. In terms of competiveness, QIC is in the top quartile of companies in the region. QIC operates across the region, meaning our business is not just focused on Qatar. QIC has a diversified business plan. Being able to develop a very diversified business in a small country is a huge success. QIC has been rated A by Standard & Poor’s since 2008, and with no blip during the global financial crisis.

What is your target market comprised of?

QIC’s business is 85% comprised of corporates, both local and foreign. According to Qatari law, every company with a presence here needs to be insured locally. For our corporate clients, we mainly work in property and casualty. We also offer personal lines, and we provide medical, household, and hard asset cover.

To what extent do you work within the oil and gas sector?

Oil and gas is big, but it is risky. A company like Qatar Petroleum (QP) insures up to $1 billion. QIC’s total balance sheet is $1.2 billion, so we can’t carry that risk. The amount of business coming from non-oil and gas sector businesses will increase as the asset base of the country develops. QIC is an asset-based insurer. The oil and gas assets are significant in size and they are very complicated. One can’t take that risk. There are only two companies in the world that literally absorb 40% of the world’s reinsurance. Every risk you see that is large ultimately flows into those balance sheets. The impact on our business from the oil and gas industry is related to the oil and gas industry rather than the oil and gas itself. Around 75% of QIC’s business is non-energy related, of which 75% is for motor vehicles.

Given the importance of reinsurance in this market, what about the future of Q-Re?

That is one of our growth vehicles because we are expanding internationally. Instead of starting and trying to establish direct operations all over the world, we are using a reinsurance platform to grow. That is very critical for us, and we have now an operational base in Zurich, Bermuda, and a representative office in London. To divide your insurance base internationally you have to be based out of the reinsurance centers. You cannot sit so far away and expect the business to walk through your door. We have to be where the market is.

What is your outlook for the insurance sector as a whole for the short term?

I have a positive outlook for the short term; the insurance industry here is stable and is growing in line with the economy. Competition is strong; however, new products are coming into the market and this spurs demand.

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