Good morning, everybody. As John said, I mean, this is a presentation for IGIC, International General Insurance. My name is Waleed Japshay. I'm the President and CEO. I've been with the business from the day we started it back in 2002. Specialty insurer built essentially for long-term success and long-term value creation. It's a history built on a model of consistency, being consistent in the way we do business, being disciplined and managing what is a very cyclical environment or industry. Just to give you a few points, a few minutes on the history, the executive chairman of the business, Wasif Japshi, who happens to be my father, this is a family-started business, has been in the business for almost 60 years now in the insurance and reinsurance sector, predominantly out of the Middle East. He has built companies throughout his career and decided to set IG up almost a quarter of a century ago. At that point, I had been in the industry for a few years. I was working in Boston, and then when he decided to set up IGI, I moved back to Jordan, which is where we started the operation. Very modest beginnings, initially $25 million of capital, focused on a handful of lines of business commercial lines what we call facultative lines individually underwritten business very big focus on energy to begin with and all types of energy business offshore energy onshore energy power and renewables as well in addition we started off with construction engineering we started off with commercial property and we also were writing marine war a marine cargo and hull business as well I don't want to bore you with the gory details but fast forward now 24 years we're a global specialty insurer and reinsurer as I said we started with 25 million dollars of capital where our equity base is now just under 700 million that's without any of the returns to shareholders that we've distributed through various means We started off with a handful of lines of business. We now write almost 25 different lines and sub lines. I'll get onto that in a second. We started with one office. We now have eight offices, soon to be nine, all over the world, situated, positioned in the geographical markets and the regional hubs that we are interested in. So we've got offices in Asia. Our next office is going to be in India. We made an announcement earlier this week. We've got a couple of offices in the Middle East, one in Dubai, one in Jordan, an office in Africa, in Morocco, and then you've got London as your underwriting hub and underwriting centre. Europe is tackled with offices in Malta and Norway for their respective regions. And finally, we're a Bermudan entity, domiciled in Bermuda. the holding company and the main risk bearing parent are Bermudian so we've got the office over there we're 500 group employees group wide we started with a handful and and if we just go back to the products we dissect we categorize our products into three different segments long tail short tail and reinsurance. Now, the history of the business has been on belief in diversification. You're going to hear me use that word a lot in the next 20-25 minutes. Diversification is key. What we've done is we've gone from a handful of lines to 25 different lines from a mainly sort of middle east africa asia focused portfolio to a truly global portfolio if we just if i mentioned the product lines quickly within the long tail segment one thing i have to make sure be clear on is we don't write any u.s liability business we stay away from that out of appetite out of not in focus whatsoever so within that it's more of a european middle east and african book of business that is focused predominantly on professional indemnity, which is what over here is better known as errors and emissions insurance, followed by directors and officers, financial institutions, business, and a bit of legal expenses and warranty indemnity. Long tail book is about 25%, but that shifts depending on where we see the cycle. Short tail lines, energy is still one of the biggest, especially combined. I mentioned the variations of energy property as well is about a hundred million dollar book for us construction engineering is a big line but what we've done over the years obviously is add lines of business you know we added we've added throughout the history a line of business on average every sort of 12 to 18 months so other lines within short tail include political violence general aviation contingency marine lines, within that is ports and terminals, marine liability, marine cargo, and then finally it's your reinsurance, which is your portfolio driven, what do you call it, portfolio driven coverages and protections. We transitioned to a public company back in 2020, but the story has been one of, if I can summarize it, the story has been one of very, you know, patient, methodical, step-by-step, disciplined, and 99% organic growth, which is essentially what the model is built on. The growth achieved the liberty without compromising any underwriting profitability, without compromising the bottom line and the strength of the bottom line and it's just been and that strength comes through the diversification which I'll demonstrate as we as we go through some of the intricacies of a cycle so it's been a consistent execution story and a consistent value creation story throughout the company's 24 year history which has allowed us to position ourselves in in terms of performance, easily in the top quartile of the industry and arguably in the top 10-15%. And that is where I personally expect us to continue to be, regardless of where we are in the cycle. Now, if we talk about the cycle, I'll just briefly go through what happens. The industry is inherently very cyclical and is predominantly the cycle and where we are throughout the cycle is driven by supply and demand. Obviously, loss activity is what also drives that. But you see, within the cycle, the rating environment and adequacy of the rates move up and down. So when you're in your euphoria stage, you're at the peak. you're exactly where you would love to be and continue to be at all times but the reality is not that because the way the cycle works is when you are at the peak everybody sees how well you're doing everybody sees how much the returns and everybody starts piling in and when they pile in the way to build up a portfolio for themselves is to start undercutting and competing So more capital flows into the industry, prices start coming down, down, down, down, bit by bit until you get to a level where it becomes inadequate. Now, unfortunately, the nature of our business is the decisions that you make today are not felt. The ramifications of those decisions are not felt for at least a couple of years, and in some cases a lot more than that, right? So it takes time for markets to react unless there is some sort of big event that has occurred. But by the time you do, that capital starts pulling out and there's less supply of capacity. Normally demand increases and as a result you're able to start pushing up your prices. There's less competition and it just goes round and round and round. And ultimately what drives it is results. When people are losing money, they start pulling out, they realize the mistakes that they've done, but then by the time they get to euphoria and experience euphoria for a little bit, they forget the pain that happened in the crunch stage and revert to the same old mistakes that they've always done in the past. And this is why that history, as I mentioned, of discipline focus just protect protecting the the quality and the bottom line comes in so how how do we manage the cycle I mean IGI and I say this proudly and I say this in front of everybody and all investors that we would recall if you if your measure of success of an insurance business is by its ability to grow top line year after year after year then we are not your investment. Our focus and our priority is protecting the bottom line, underwriting to quality, understanding the cycle. If you understand the cycle, then you understand the competitive pressures and volatility that is inherent in our industry and in the cycle. And then you're able to react and mitigate and manage it. So we maintain underwriting discipline throughout market conditions regardless of where we are in the cycle. Focus on portfolio quality over portfolio growth. The opportunities will come as we go through the cycle. The opportunities will present themselves and will come. You just got to be patient and not follow the market and let the competition pressure you to start doing things that you know are not right so active portfolio management active and continued diversification you have to be cycle aware not cycle driven you've got to manage the cycle you can't have the cycle manage you and and and at the end of the day discipline consistency pulling the right level right levers at the right time that's where your diversification helps you and shifting focus always to those areas that uh um uh what do you call it uh that are are are perceived to be doing better know when to take you put your foot on the gas know when to take it off and um and it's essentially growing at the right times right and my one of my uh favorite slides actually that that we have in our quarterly investor decks and we mention in all our presentations and our sort of meetings is this one this one specifically if you just just look at this to go back to the history of 2013 so the last sort of 10 10 12 years where you've been through a cycle and you've been and you you've what do you call it you've gone through the good times and and the bad and the tougher times. So if we just go back, I don't want to spend too much time because I can go on forever talking about this. But if you go, if you just go back to 2014 to 2016, you see, and 17, very, very tough market conditions back then. Extremely difficult, extremely tough. And you've got to keep in mind that IGI was a fraction, probably a third, maybe max 40% of the size that it is today when it had to tackle this soft market, right? So at 14 to 16, you saw some contraction in the portfolio. You have to be okay with that. As an insurance, as a reinsurance player, the reinsurance business, you have to be okay with it. It's not, honestly, it's not rocket science what we do, and I'll get into that in a minute. But so 14, 15, 16, we bought our time. 2017, you know, was the growth for us more on the long tail side when we started seeing the business and the market develop. But you see there was a big, there was a spike in the combined ratio back in 2017 because those were very heavy cat years. Hurricanes, you know, Harvey, Irma, Maria and other cat losses globally. Market average combined ratio of about 130% that year. we came in 105 just going back to the top quartile what do you call it comment I made earlier now in 2017-18 that's when you started to see the market harden okay now 25 different lines of business global portfolio not everything is going to move in the same direction at the same time and that's where your diversification is is is so advantageous so you notice the the light blue is the long tail segment the dark blue is a short tail and the purple is the reinsurance the hardening in 2018 and 2019 started in in in long tail so that's where we what we that's what we leaned on right we we pushed hard in long tail we were seeing rate increases you know improving conditions narrowing coverage the likes of we haven't seen in 30 years or so. So we pushed hard and you can see that the how from 18 19 up to 21 22 how much the the bar the light blue bar increased. Again shifting focus to those areas where we think there's gonna be the best opportunities and taking advantage that's how you manage the cycle. Although you're in a hard market here you're still managing the cycle management is not about soft market it's about the entire cycle and then around 2021 it's the short tail lines that you started seeing you know uh improving conditions on you started seeing stability in the in the uh in the long tail so it flattened out for the next couple of years but then you see the dark blue lines uh bars increasing increasing increasing again shifting focused we saw the the new opportunity is here move into it we also added new business lines after covet we added contingency contingency is your event cancellation uh uh cover we added and and a covet was your global cat loss for contingency completely obliterated the market so you knew there was going to be an opportunity within a year we had an underwriter a team being built out and now it's a 35 million dollar book that performs extremely well for us then we come to 2023 the you'll see that the the long tail market started softening so you see a shrinkage in the light blue bars stability in the short tail so not much difference in the dark blue but in 2023 the reinsurance market was turned topsy-turvy upside down because of the poor results they've had for many years before that and you can see how much the purple bars grew for us so again it's just shifting completely always you know it's not it's not about what when we look at how we want to grow what our portfolio looks like what it's going to look like it's not about you know what you want it to look like what the market dictates what you want it to look like depends on how you react you go after the business the best business where it is and that's what 25 different lines of business and a global portfolio give you the ability to do is pull the right levers at the right time know when to put your foot on the gas know when to take it off some of the differentiating factors of igi also include obviously we're bottom line focused we're not a top line company i'll scream it off the of the highest mountain so everybody is clear about that we have a single pnl across the group eight offices nine offices it's it's all on the same balance sheet it's all the same capacity it's all the same capital but use our network to the group individuals within the company are rewarded based on group performance first and foremost so we do we work together as one team one unit to make sure what we carry out and make decisions that are best for the group it's a very flat management structure very flat structure completely enabling access to people quick decision-making I mean instant instant My office is an example. It sits right in the middle of the underwriting floor. Everybody can walk in and out. There's no egos or anything like that. It's an open, open, and our offices are all open floor plans. So it's a very collaborative, very communicative culture and environment. As a family member, you know, there's significant family ownership remains. I mean, we still are the biggest shareholders in the business, upwards of 35%. And the insider ownership is even, you know, decently, reasonably higher. And that gives strong alignment with all shareholders as well. And the one thing I want to emphasize is we are a long-term focused business. We never look at it as what we can achieve now, this quarter, next quarter, this year, or next year. The fact that the cycle is there tells you that your performance, and you should expect your performance to change based on where you are in the cycle. If you understand the business, you understand that comment. So what we do, we don't give guidance. We say this is what we think we can achieve over a cycle, and that's based on what we have achieved in the past. you know so you know overall we say we can deliver over a cycle good and bad combined ratios in the average combined ratios in the mid to high 80s average ROEs in the low to mid teens now the last few years have been phenomenal for us so our combined ratios have been in the high 70s low 80s and our ROEs have been in the low to mid 20s but that is not the new normal or I mean and that's where the understanding of the cycle comes and then it's active capital management as well you know we've always said if a capital management we have a buyback program we have a dividend policy about we've always said it's a you know headlined with the what do you call it heading of underwriting first that's our management policy capital management policy first and foremost when the when the opportunities are there we will deploy the money into the business capitalise on the opportunities. When the opportunities are not there to the extent that we need them with our current capital base, we've always said and we always will, we'll give the capital back to shareholders and that could be in the form of dividends or what do you call it, buybacks, share buybacks. So far since we announced the capital management strategy we've executed 700 million share buyback program already we're currently in the process of another five million share authorization out of which we've we've completed about 20% we've got ordinary dividends and special dividends and special dividends are normally assessed at the end of the year following you know the results but we just earlier this year distributed dollar 15 cents which was an increase in the 85 cents we did last year so all of these things have helped us build the track record that we have built have helped us achieve what we have achieved and will continue and to help us you know deliver I think our global footprint is a competitive advantage competitive strength especially the way we do it we combine local knowledge with technical expertise and I think that's a trick that some people get it wrong our people are our biggest asset and it's it our business is still a very much a personal business and so people in terms of relationships and people in terms of expertise the diversification again I continue to harp on it because it's key that diversification is strength diversification in our business lines our diversification in our geographical exposures and diversity in our people having a global essentially network of offices and i say this every opportunity we get to continue and further that diversification in the right way of course we will take um and and it's a very disciplined capital management strategy as we said and on the investment side it's um plain vanilla our Our approach to investment is we take risk on the underwriting side every day. We don't take risk on the investment side. So it's a very plain vanilla, conservative, mainly fixed income, cash, term deposit portfolio. In terms of the future, again, we're driven by the cycle. So, you know, we can only influence maybe niche markets within certain countries. We're not big enough to be influencers. We're a rounding error to our larger competitors, you know, wherever they may be. But that, for us, is an advantage. So we continue discipline, continue growth. We're as ambitious as any other company to grow. So we're out there fighting, looking, trying to capitalize on the opportunities that are out there. India is one. It's a new venture for us, and we're working on a couple of other things that hopefully would come to fruition. But ultimately, we'll make the right decisions, we'll maintain that discipline, and write the business only when it makes sense to us. And then you leverage wherever you see the opportunities. One of our advantages is our nimbleness, is the levers that we have to pull, and our ability to go and access and pounce on business when we see fit. So in closing, I mean, IGI was built as a business to perform across the cycle, not just in one stage of the cycle. We're long-term focused. We're not top-line driven. um we're not in a rush it's been a story you know of of you know step by step gradual methodical growth um you know it's taken us 24 years to build a 700 million dollar business some of these new startups build that in their first year um so but that's the model that's the appetite that's the focus um it's not about size it's not about speed it's not it's not a race It's about building it and building it within your capabilities. And that's one thing we always tell our people. Understand who we are as a business. Understand what our capabilities are. Set your risk appetite. Set your risk tolerances. And be disciplined and you stick within them. Nobody is under pressure for top line. It's when you don't achieve bottom line that questions are asked. So, ultimately, our goal is to create value, continue to create value, and that's a promise I give to you as long as I stand where I do. And that's IGIC. Thank you very much. I'm happy to take any questions. Okay. In terms of where we are in the cycle, it varies by segment, it varies by line of business, right? And that's what that diversity gives you. When some lines are not doing great, conditions are not cohesive, you know, for profitability, then you've got the optionality with other lines. So what I would say is probably the long tail segment is probably in crunch. It's been, and you've seen our book reduced for the last three years. And that's by design, of course. whereas some of our long-tail lines are probably, and some of them are, it's a mixed bag in short-tail lines. In terms of reinsurance, you're probably in the middle of the green bit, the light green bit, but you're still at very adequate levels. The reinsurance market implemented a lot of significant and positive change back in 23, 24. and you're still seeing that it's more competitive on pricing now but not so not so much in terms of structural changes they've they've kept them which is more important than the price now in terms of AI I think for us as a business in terms of the lines of business that we we're involved in you're talking about large commercial business you know portfolios ai is a is an efficiency drive for us it's not a it's not something that's going to stop making underwriting decisions for you is it disruptive to us not as much i would say as it is for personal lines small sme commercial straightforward business i think that's where the the the threat is is more directed towards but in the future it's what do you call it it's obviously anything can go in any direction but for us it's about AI and how we're using it and I'll be clear we're not pioneers in AI or driving AI in the industry or anything like that we're happy for the others to spend the tens and hundreds of millions of dollars and we'll piggyback on some of the stuff that they do But it's efficiency. It's underwriting efficiency, operational efficiency, actuarial efficiency, finance, et cetera, et cetera. Yes, sir.
