Qatar minister reveals plans to create a new national reinsurer

A leading government official told over 500 delegates from local and international markets that the new company would help ‘raise awareness’ of insurance and foster a mature domestic market in the fast developing Arab state. His Excellency Yousef Hussain Kamal, Minister of Finance and Economy of the State of Qatar, said during his opening remarks at the annual event that people in the region do not really understand insurance and there is a need to raise awareness of its benefits. For this reason the government has decided to set up a new reinsurance company via Mr Al Koot that will be open to both local and international insurance investors and act as a ‘catalyst’ for the business in Qatar.hide“People don’t really appreciate insurance is important here and also there is a need raise awareness and sell the culture,” said the minister. “People need to understand insurance and therefore we have decided to establish a reinsurance company in Qatar,” he added. The minister said that the new company will have ‘huge’ capital. He suggested that all local insurers would take a stake in the company but did not suggest that cessions would be mandatory. “Al Koot will be turned into a reinsurance company and all insurance companies will be shareholders in the new company. Each institution will have a stake in the new reinsurance company. I sense the opportunity to call on Qatari insurance companies to have a share in the company,” said the minister. For now, however, the Qatari government would be happy to act as a ‘catalyst’ for the company as a ‘first step’, he added. The minister also said that the new company would be open to investment from foreign insurance and reinsurance companies. Investors may, however, wish to wait for more details before diving in. The minister’s announcement was not accompanied by any official information and local and international delegates at the event claimed to be unaware of the news. News agency Bloomberg reported last September that the Qatari government had initiated an ‘official plan’ to set up a national reinsurance company that would be majority-owned by the government with the ‘participation’ of local insurance companies. The company would be large enough to cover the domestic market, it quoted local newspaper Al Shariq as stating. If the company was to be created, Al Koot would seem to be a natural base. The captive operates as the risk manager for Qatar Petroleum, and through that the oil and gas industry in the region. The captive is responsible for providing guidance on risk management, review of contracts and the provision of insurance advice to the group companies. Questions were asked at the Multaqa event following the rather vague announcement, however, about how the proposed new national reinsurer would sit alongside Q-Re, the reinsurance company launched at the end of 2009 by state backed Qatar Insurance Company (QIC) to do just the same thing as the new company. Q-Re has an ambitious plan and recently announced the appointment of Gunther Saacke as Chief Executive Officer of Q-Re. It was said last month that Mr Saacke would lead a team of ‘senior and well-known’ reinsurance professionals to transform Q-Re into a global multi-line reinsurer with a focus on specialty lines. Mr Saacke said last month: “I am excited about the opportunity to help build the first truly global reinsurer which originates from the emerging markets. Q-Re will have a global presence, underwrite risks across all major lines and territories and issue lead quotations based on our proprietary pricing and analytical capabilities. “In combination with our strong and distinct capital base, we aim for nothing less than a position among the top 10 players of the global reinsurance industry by 2025.” Exactly how the new plan announced by the minister will be achieved alongside, or in competition with, Q-Re is currently not clear.

Qatar minister reveals plans to create a new national reinsurer

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