According to IGI President Waleed Jabsheh, the company has been largely insulated from the worst effects of the pandemic and is ready to take capitalise on the market opportunities COVID-19 has presented.
Speaking in an interview with Reinsurance News, Jabsheh noted that IGI has little exposure to the areas that have been hardest hit by the pandemic, including event cancellation, travel, health, and SME property business.
“These are all areas that we’re not involved in, so it puts us in a comfortable position where we can take advantage of the opportunities that market dislocation inevitably provides,” he said. “We anticipate that these conditions will continue for the foreseeable future.”
Like most other re/insurers, IGI suffered in the first quarter of the year due to COVID-induced volatility in the investment markets, but largely recovered in Q2.
But with few losses on the claims side, the company has benefitted from the added pricing momentum the pandemic has brought.
“The market conditions are quite positive at the moment, and we’ve seen rate increases across virtually our entire portfolio,” Jabsheh told Reinsurance News.
“After being in a soft market for so long, we started seeing rates move towards the middle of 2018 for certain classes of business and across most classes towards the second half of 2019.”
IGI averaged rate increases of around 30% in its long-tail segment in the first half of the year and just under 20% average rate increases across its short tail segment.
The firm’s reinsurance portfolio is also experiencing modest increases, although it’s anticipated that these may ramp up towards the end of the year as the market heads into the 1/1 renewals.
“These are conditions we haven’t seen for the better part of 10 years now, if not more,” Jabsheh remarked.
And with so much uncertainty remaining about the full scale of the industry’s pandemic losses, combined with active year for catastrophe events, IGI sees this trend of pricing increases as set to continue for some time.
“We believe the pandemic and its impact on the market is going to further intensify the hardening that we’ve been seeing and prolong the length we thought this market was going to last for,” Jabsheh said.
“I think it’s a bit early for people to start thinking about the market changing from where it is,” he added. “I personally do not see any let down in this environment well into 2021 and potentially into 2022.”
IGI plans to grow its premium base to take advantage of the improved pricing conditions, and the company’s capital position remains strong following its business combination deal with Tiberius back in March, through which it raised just over $40 million of capital on its balance sheet.
“The hard market and the improving rate environment inevitably gives us the opportunity to grow but it’s just as important to refine our book and ensure we have the best possible quality business in our portfolios,” Jabsheh concluded.
“Market dislocation will present more opportunities for players like us,” he reiterated, “so we are continuing to explore and evaluate all the opportunities that come across our desks.”