Confidence. In Tomorrow. Annual Report

Transcription

1 Confidence In Tomorrow Annual Report 2017

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3 Confidence In Tomorrow

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5 His Highness Sheikh Tamim bin Hamad AlThani Emir of the State of Qatar

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7 Contents Strategic report Financial highlights Key Indicators Credit rating The Board of Director s report Chairman s Statement Group Chied Executive Officer Performance review Our Group Qatar General Insurance & Reinsurance Company Q.P.S.C. General Takaful Company P.Q.S.C. Qatar General Holding Company W.L.L. Project Management and Contracts Department General Real Estate Company W.L.L. Real Estate Projects in the Pipeline General Company for Water and Beverages W.L.L. World Trade Center Qatar W.L.L. Orientals Enterprises W.L.L. Human Resources Corporate Social Responsibility Governance Risk Management Report Board of Directors Corporate Governance Fatwa and Shari a Supervisory Board Report Consolidated financial statements Independent Auditor s report Consolidated Statement of Financial Position Consolidated Statement of Profit or Loss Consolidated Statement of Comprehensive Income Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows

8 8 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Financial Highlights Consolidated Statement of Profit or Loss Gross Written Premiums Net Written Premiums Net Earned Premiums Investment Income Profit for the year 566, , , , , , , , , ,254 Consolidated Statement of Financial Position Liquid assets Total investments Total assets Total gross technical reserves Net technical reserves Equity attributable to equity holders of the Parent Total liabilities 1,294,560 7,615,476 9,514,816 1,037, ,014 6,196,491 3,323,671 1,481,482 7,590,507 9,514,428 1,038, ,034 6,367,937 3,105,369 Consolidated Statement of Cash Flows Net cash flows from operating activities Net cash flows used in investing activities Net cash flows used in financing activities Cash and cash equivalents at 31 December 124,193 (236,533) 71, , ,652 (78,909) (72,417) 300,576

9 9 Key Indicators * 2016 EARNINGS PER SHARE DIVIDEND PER SHARE 2.74% 2.72% 4.14% 4.07% RETURN ON AVERAGE ASSETS RETURN ON AVERAGE EQUITY 53.68% 48.45% % % TOTAL LIABILITIES TO TOTAL EQUITY LIQUID ASSETS TO NET TECHNICAL RESERVES 56.70% 56.41% 94.57% 88.67% NET LOSS RATIO NET COMBINED RATIO *The proposed dividends are subject to the approval of the general assembly.

10 10 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Credit Rating For the fifth consecutive year, QGIRCO has maintained its strength rating and issuer credit rating. Product diversification, strong riskadjusted capitalisation, and enhanced risk management capabilities have underpinned the company s stable performance. FINANCIAL STRENGTH RATING A (Excellent) Capital Strength ISSUER CREDIT RATING a OUTLOOK FOR BOTH RATINGS STABLE Our Group maintains a very strong capital position that continues to support our excellent financial strength rating (A, A.M. Best). Our balance sheet strength remains at the strongest level, supported by robust operating performance and appropriate enterprise risk management. Our attention to risk exposure and frequent analysis of our situation has been enhanced with improved systems spanning across the Group, ensuring we maintain sufficient liquidity to meet our insurance and noninsurance liabilities.

11 11 The Board of Director s Report Dear Esteemed Shareholders, May peace, mercy and blessings Be Upon You With great honour, we present to you our Company s Annual Report for the financial year ended 31 December This Report sets out a general overview of the Group s Companies performance, objectives and goals for the forthcoming year. Our performance While many companies are still suffering the impact of the prevailing unfavourable market conditions of the past year, 2017 year also came burdened with its own challenges to many companies in the State of Qatar. Nevertheless, and despite of these exceptional times, we have succeeded through our robust capital base and diversified investments portfolio, to support our Group in meeting its strategy and consequently performing well during such a year. I am pleased to report that QGIRCO has achieved a net profit of QR 261 million for the year ended 31 December 2017 (compared to QR 258 million for the year ended 31 December 2016). We take pride in our ability to retain and strengthen our notable and strong position in the insurance industry and marketplace in the State of Qatar with gross written premiums of QR 796 million (including Takaful businesses) at the end of the year, (compared to QR 838 million for the year 2016), which is regarded as a good achievement, given the severe impact of the competitive international prices on insurance premiums. In terms of Investment returns, the Group has achieved QR 200 million for the year ended 31 December 2017 (compared to QR 237 million for the year 2016). As for the total assets it amounted to QR 9.5 billion and a total equity of QR 6.2 billion as at 31 December The Board of Directors proposes distributing cash dividends to the shareholders at the rate of 22% of the nominal value of the share (equivalent to QR 2.2 per share), and adopting the Company s balance sheet and Profit & Loss account for the financial year ended 31 December We are honoured to reveal that the Company s financial strength and credit rating remains stable, as affirmed by A.M. Best Credit Rating Agency by granting the Company a Financial Strength Rating (FSR) of A (Excellent) and a LongTerm Issuer Credit Rating (LongTerm ICR) of a, with stable outlook for both ratings. Diversification towards Group s prosperity Within the Company s strategic approach of business diversification, arrangements are in place to enter the medical insurance industry

12 12 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 being a milestone of the insurance industry, and are currently engaged in finalising the related platform and relevant procedures. Resolutions promoting growth Driven by the Company s best interests, the Board of Directors has adopted many significant resolutions designed to promote the aspired vigorous growth and development of our Group through developing the Company owned plots of land while taking into consideration the development priorities of these lands. It is worth noting that the Company has acquired a number of plots in the Manateq area, and currently work is under way on its development in the near future, God willing, to the benefit of the Company, thereby emphasising the Company s contribution in advancing the robust national economy in the State of Qatar. On the other hand, the Water and Beverages factory construction has been completed and is expected to start operation and production by the month of April Nurturing and developing our staff to sustain progress Training and developing our staff has been our investment throughout the year 2017, whilst working on enhancing their professional expertise aiming to offer them a better professional career development prospects. During 2017, our Program known as NEXTGEN which is specifically designed for new graduates has marked the appointment of a number of young graduates to join our technical teams across the various departments of the Company. As to Qatarisation, we were keen to align our strategy along with Qatar s National Vision 2030, and we dedicated considerable

13 13 efforts towards developing and creating a distinctive and competent workforce. The Company supports the career development of Qatari youth by encouraging them to pursue the completion of all levels of education whether inside or outside the State of Qatar, in addition to providing a vital internal training, and training courses such as Business English Language and Personal Skills Services for insurance, Sales and Customer Services, and training on the Information and Communication Systems. Besides, the Upper Management of the Company is committed towards implementing and monitoring its Qatarisation Strategy, and increasing the Qatari cadres in the Company, in order to be among the top ranked Companies as to Qatarisation ratios across the State of Qatar. Focus remains on risks Our team has been keen to implement the requirements stipulated in the Executive Instructions for Insurance and the Principles of Corporate Governance issued by Qatar Central Bank. As well, they ensured complying with the national and international regulations. Yet, we remain ready to comply with all regulatory framework amendments, whilst our team strives to take the lead in adopting upcoming improvements to the best interest of our client base. We pursue by our strong Governance Framework to maintain an ongoing performance development, while keenly working to meet all local and international regulatory and statutory requirements. with the related parties, such as AlSari Trading Company, Group of Nest Investments (Holding) Limited, Group of Trust International Companies, North Africa Energy Company and Falcon Ready Mix Company. In this respect, we would like to note that all such transactions with related parties in the region that were conducted under the Board s guidance for the ultimate benefit of the Company have yielded rewarding proceeds to our Company. The Company was able to establish a strong presence in the region led by its investments in Algeria that resulted in a productive outcome to the Company s benefit. Dear valued Shareholders We extend our thanks and gratitude to the valued Shareholders and to our loyal customers for their great support and confidence. We would like to specially express our appreciation to the Group s staff and to Senior Management for their efforts and dedication towards the prosperity and vision realising of the Group. Finally, and on behalf of the Board of Directors I am honoured to raise our sincere appreciation and gratitude to His Highness the Emir Sheikh Tamim Bin Hamad Bin Khalifa AlThani, may God protect him, and his wise government for the continuous support and patronage and sincere endeavours towards building a solid and robust economy for the State of Qatar. Nasser Bin Ali Bin Saud AlThani Chairman of the Board As a part of the solid Governance Framework, we continue complying with the Group s adopted manual with respect to transacting with related parties. Such a relation is built upon the principles of transparency and full disclosure for all transactions and partnerships

14 14 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017

15 15 Chairman s Statement A year of new opportunities We are proud to be an established Qatari company, remaining steadfast and strong. We continue to contribute to Qatar National Vision 2030, remaining robust and relevant to the growing needs of our country. Nasser Bin Ali Bin Saud AlThani Chairman and Managing Director We are a strong and confident nation. It is this powerful strategic leadership that has shown us, throughout our history, that with every challenge comes an even stronger opportunity presented our Group, like many others, with challenges that needed to be assessed, considered and consequently overcome; and as a Group we certainly achieved this. However it is pertinent to remind ourselves that it is our years of strong governance, our confident approach to investment, and our proven ability to adapt and change to the growing needs of our country, that has supported us once again in delivering results that are strong and steady, all things considered. Made in Qatar Throughout the year our Government continued to initiate projects to support the realisation of the Qatar National Vision 2030 including the Single Window initiative for industrial investment. This focus and development of local products and services, along with a rising trend of Made in Qatar products have seen the domestic industry grow, having an overall positive effect on businesses such as ourselves. As such, and as part of our overall longterm strategy, we continue to develop our Group of companies to produce their own Made in Qatar products, such as our soon to launch, Al Rawda water, from our General Company For Water & Beverages.

16 16 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Our people Qatarisation remains an integral part of our Group s human resources strategy and we continually look for opportunities to nurture the distinctive talent of our Qatari colleagues as they strive towards leadership positions across our Group. We aim to support them grow throughout our organisation and beyond, becoming strong corporate figures within the business community. Outlook We remain optimistic for the future. Our strategic approach, which is translated into our everyday business, is aligned across the Group to support overall strength and growth. Economic outlook still indicates a strong economy and we are committed to developing all areas of our businesses to support the growth aspirations of our Group and our Country. I would like to express my gratitude and appreciation to all of our stakeholders for their continued support. We will remain true to our strategy and strive to achieve our longterm aspirations. To the Board of Directors, I thank you for your commitment, stewardship and strategic direction. To our loyal team, your commitment, focus and energy is appreciated by all. Finally, for our strong guidance and leadership I thank Qatar Central Bank. Your unwavering support for our Group within our Country is treasured. Finally, and on behalf of the Board of Directors I am honored to raise our sincere appreciation and gratitude to His Highness the Emir Sheikh Tamim Bin Hamad Bin Khalifa Al Thani, may God protect him, and his wise government for the continuous support and patronage and sincere endeavors towards building a solid and robust economy for the State of Qatar.

17 17 Group Chief Executive Officer Review of the year 2017 saw a series of unprecedented events that substantiates our attitude to risk and the Group s strategy to diversify products and services while working in synergy with each other. Although a challenging year, our performance was stable. The cash dividend per share of QR 2.2 for 2017 recommended by the Board demonstrates our strong financial health. Changing landscape This year proved challenging for many businesses in Qatar. We overcame many extraordinary circumstances, yet utilised our strength in the marketplace to seek new opportunities for sustainable growth Ghazi Abu Nahl Group Chief Executive Officer Large infrastructure projects continued, and as a Group with strong insurance products (Qatar General Insurance and Reinsurance and General Takaful) and construction expertise (Orientals Enterprises), we are blessed to be able to contribute to these significant developments at many levels. General Tower is one such iconic development, which signifies our commitment to Qatar s evolution, creating modern, stateoftheart offices for business lease. Additionally, we saw the completion of General Takaful s new head office on C Ring Road by Orientals Enterprises. An iconic building that showcases our commitment to providing best in class Takaful products and services to our growing customer base.

18 18 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Greater efficiency for greater growth During the year, we focused on improving customer experiences which is vital to enabling us to distinguish our services from our competitors. Improving our communication and processes enables our Group to grow customer loyalty, increase positive referrals and enjoy a higher success rate at crossselling. We constantly remind ourselves and all of our team that we are one Group and it is our duty to provide an excellent level of care and attention to details to all our customers across all channels. I am proud to share with you that A.M. Best has reaffirmed to Qatar General Insurance and Reinsurance Company (Q.P.S.C) its Financial Strength Rating (FSR) of A (Excellent) and the LongTerm Issuer Credit Rating (Long Term ICR) of a with stable outlook for both ratings. These ratings reflect QGIRCO s strong riskadjusted capitalisation, improving risk management capabilities and track record of solid operating performance. Outlook We are a legacy in Qatar; a Group of companies that has grown with the country and its people. Despite a challenging year, we are confident that we and our country are at the beginning of a new journey of growth. Our country and government have worked incredibly hard to drive forward our nation s ability to become selfsufficient. Government initiatives are promoting Made in Qatar products and services over imports and supporting entrepreneurs to establish strong and sustainable businesses at home. We will continue to seek out new opportunities across our Group, working hard to develop our companies range of products positive achievements

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20 20 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Our Group QATAR GENERAL HOLDING COMPANY W.L.L. GENERAL TOWER FOR REAL ESTATE INVESTMENTS W.L.L. GENERAL TAKAFUL COMPANY P.Q.S.C. ORIENTALS ENTERPRISES W.L.L. GENERAL REAL ESTATE COMPANY W.L.L. GENERAL COMPANY FOR WATER AND BEVERAGES W.L.L. WORLD TRADE CENTER QATAR W.L.L. MOZOON REAL ESTATE COMPANY W.L.L. MOZOON INSURANCE MARKETING SERVICES W.L.L.

21 21 Qatar General Insurance & Reinsurance Company Q.P.S.C. Proud of our longstanding reputation as a trusted provider, Qatar General Insurance & Reinsurance Company (QGIRCO) provides individuals, families and businesses with innovative insurance solutions. Overview Our insurance strategy this year has been focused on sustainable and profitable growth, retaining loyal customers and at the same time developing products that cater to the needs of the growing local business community. Jamal Abu Nahl Chief executive officer Insurance 2017 s growth strategy has been strong and steady, as we continued to focus our efforts on writing profitable business. We have sought to achieve this through diversifying our channels of distribution, enhancing our existing products, and implementing strong processes targeted at improving our business retention ratios which is the main driver to the growth strategy. Putting the customer first Our customers are our priority and it is the method through which we service them that encourages them to remain true and loyal to our company. We have worked hard to create a stronger omnichannel experience for our customers, ensuring that, whichever method they choose to engage with us, they receive the same level of care and dedication. To support this customerfirst approach, we welcomed local graduates from our NEXTGEN programme to be part of our dedicated Customer Service Unit (CSU). Led by a team of experienced managers, our newlyexpanded team enables us to improve communication with our valued customers in order to be ready for the upcoming changes, especially in the medical insurance..

22 22 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Furthermore, the new dedicated CSU supports customer retention through better notification and awareness of policy renewal dates. As well as being contacted through SMS and , customers are now contacted by personal phone call from our dedicated CSU team and able to renew their policy instantly over the phone. This marks a huge removal of a barrier to renewal for our customers and provides them with the additional, hands on service they desire from a leading insurance provider. This new service has had a significantly positive effect on our retention rate we want our customers to come to us and stay with us, and now we re making that even easier. In collaboration with our Human Resources department, we have also invested in training and development of our brokers and branch staff, upskilling them to be able to offer knowledgeable and internationally qualified support and guidance to our customers. Boosting business through partnerships and rewards Enhancing efficiency and improving margins Customers expect fast service, with enquiries and claims to be dealt with swiftly. Internal digital transformation has enabled us to provide breakthrough performance via improved efficiency and backoffice processes to enhance the speed that claims are dealt with. Outlook Despite unusual market conditions the near to mediumterm outlook remains positive. We will continue to target profitable local business for positive growth. Additionally, we remain focused on further strengthening internal processes to build on the strong claims handing and customer retention success we have seen in Above all, we will continue to develop and grow with our country, concentrating our efforts on the Qatar National Vision 2030 and supporting the realisation of a strong, sustainable, diversified economy. This year, we launched our motor, travel, personal accident and household insurance through the Ahlibank branch network. These products, now available in 16 branches across Qatar vastly increases our reach. Growing and promoting Personal and SME The rise of factories and local SMEs due to the single window initiatives supported by ministries and government agencies has opened a new window of opportunity for our insurance business. Our products, services and overarching knowledge help provide the trusted financial protection these businesses need in their early stage establishment and as they move forward to operating safe, efficient and productive businesses Qatar National Vision

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24 24 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 General Takaful Company P.Q.S.C. Established in 2008, General Takaful Company became one of the leading providers of Takaful products and major player in Takaful market in Qatar. Our mission is to enable individuals and corporations to manage financial risk. We provide Islamic insurance products and services tailored to fit with the frequently changing risk exposures faced by our customers. We build value for our investors and partners through the strength of cooperation based on Takaful principles. Overview Service excellence is our specialty and concern while achieving our targets of expansion and diversification. Majed Akel General Manager Keeping in mind our longterm strategy, we continue to realign our products to suit today s challenging markets and taking into considerations the requirements of Shari a principles. Overall business performance has shown improvement despite the challenging geopolitical situation. We witnessed a 10% increase in gross written premiums comparing to last year Gross Written Premium for year ending 31 December 2017 was QR 229 million. During 2017, we invested heavily in human capital, expanding our team to ensure we are fully equipped to grow nonmotor business and improve claim controls. We expect to see returns on this investment throughout 2018 and beyond, as well as achieve our objective of diversifying our product portfolio and continuing to reduce our exposure to Third Party Motor Insurance. Bringing innovation into our services An efficient claims management process delivers happy customers as well as reducing overall costs of settlement. During the year we worked

25 25 towards more effective use of technology to manage claims through phone applications and our website, as well as reengineering the back office process. We are currently working to open a new payment gateway and obtain online premiums for personal products which will definitely boost our sales. This is in addition to enhancement of current mobile application and services through our website. Additionally, the claims department was restructured for swifter processing and better control, with strong governance and oversight at the centre of this initiative. Overall a tangible difference has been recognised internally as well as by our expanding customer base. Enhanced product portfolio General Takaful has experienced growth over the past few years and is recognised as a key player in the domestic market, with Motor as the main driver. We have strived to develop our motor products to better suit our customers needs through improved addon services for individual and corporate customers. Continuing from 2016, we have expedited our sales diversification strategy, focusing more on nonmotor insurance. Our branch network now offers nonmotor products, with our employees well training to manage individual and corporate customer enquiries on our full range of products, with a particular focus on life and engineering business. As part of this direction we have increased our engineering portfolio due to the longterm relationships we have forged with local construction and engineering companies since our establishment. Expanding our reach across Qatar This year, work completed on the iconic General Takaful Head Office located on the CRing, in the heart of downtown Doha. This strategic location and sizeable development, close to business and many residential areas raises our profile and offers customers further convenience. Relocation to the new Head Office is planned for early The new modern threestory building provides the company with more room for its expanded workforce while enabling us to promote our ambitious and enhancing convenience to our customers. General Takaful Company will occupy around one third of the building and the other two thirds will be rented out which supports the diversification of investment income of the Company. This relocation will also enable us to expand our branch network, with our vacated head office set to be transformed into a new branch occupied by our Family Takaful department. This expansion allows us to focus on the mandatory medical insurance that will be implemented soon in Qatar. Outlook 2017 brought positive achievements to the company, and we will continue to build upon this momentum and focus our efforts on growth. The foundations that have been laid over the past few years to diversify our portfolio have enabled us to deepen our corporate customer relationships across our product range. Motor insurance remains a key part of our business and we will continue to develop and diversify these products and processes to fulfil the needs of our customers. We expect 2018 to be a positive year for General Takaful. Our aim is to continuously be one of the preferred provider of Islamic Insurance and the best Takaful risk carrier in Qatar.

26 26 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017

27 27 Qatar General Holding Company W.L.L As to what we do at Qatar General Holding Company level, we manage the Group s investment portfolio, providing a strong and stable financial foundation aiming to best serve our client needs and meet our shareholders expectations. The company holds major participations in a number of key companies which contribute significantly to Qatar s economic growth and employment creation. Qatar General Holding is proud of its role and involvement in the development of a number of land mark projects in Qatar. To the surprise of the whole world, The State of Qatar was able (thanks to its Rational Leadership) to bypass with high merits, the negative impacts resulting from the unjust blockade imposed since June This was possible due to its enlightened Leadership, the flexibility of applied policies, and the steadfastness and readiness of its economic structure. We remain confident and trust our readiness to overcome these extraordinary circumstances. We are optimistic about the future being prosperous, both at our company and the State of Qatar levels. Abdallah Barrage Deputy Chief Executive Officer investments The politically imposed crisis since June 2017 significantly impacted Qatar s economy at its inception, as foreign capital panicked and started exiting the domestic economy. Many of the country s businesses were affected by this uncertainty and drop of confidence and capital outflow. However, the initial shock was easily absorbed thanks to the smart moves taken by the Government to step in and fill this created gap. Liquidity was quickly reinjected in the economy, and Government incentives introduced to encourage entrepreneurs to set up new businesses to replace imports and create a more or less self sufficient economy. Following the embargo against the State of Qatar, the Company embarked on a plan to radically reduce its exposure to the governments and private entities of the boycotting countries. Also, additional actions were taken to increase: (1) fixed deposits in Qatari Riyals and (2) investments in USD fixed income securities within the developing countries of South East Asia due to the strong economic fundamentals of such countries and the encouraging yields.

28 28 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Furthermore, strategic investments in local companies listed on the Qatar Stock Exchange (QSE) were maintained, as the decline in the QSE Index was considered to be a kneejerk reaction to the crisis. The fundamentals of the economy in Qatar are solid, resilient and capable to offset the shortterm negative implications of the crisis. Finally, even though the reduction in rental rates have affected the yield on our property portfolio, real estate developments pertaining to the construction of four hotels in Doha were kept on track, to be ready for FIFA Also, the aim of turning our other strategically located land plots in and around Doha into income producing properties remained intact. Outlook Our endeavors remain driven by Qatar National Vision 2030, which aims at supporting and diversifying the Local economic base while contributing towards overall economic growth and employment creation. Our commitment to Qatar remains strong as this is our base and the market that we know best, with the most expected rewards in the medium term without running any currency risks.

29 29 Project Management and Contracts Department The Group witnessed over recent years, major diversification in its business activity by venturing into the field of Real Estate Development. One of the Group s most prestigious projects is the Mozoon Towers in the West Bay Area in Doha, a hospitality project consisting of Marriott, Oberoi and Retaj branded hotel rooms and serviced apartments considered an added landmark to the Country and coming on the heels of an earlier development The World Trade Center another landmark in the corniche area. Great achievements are realised with proper planning and good management, and this is what the Project Management Department is targeting. Hani Akkawi General Manager To keep pace with the positive development in Real Estate Market and recognising the critical need to communicate and coordinate work across departments and outsourced consultancy and contracting services it was decided to establish under the Qatar General Holding a Project Management and Contracts Department to manage the consultancy and construction contracts of the Projects being developed by the Group with a futuristic vision to transform the PMC Department to an engineering office specialised in engineering contracts and project management. At its core, Project Management focuses on the planning and control of all activities involved in delivering the desired end result of any Project under development. It uses various tools to measure accomplishments, cost and time control, track project tasks, reduce risks and increase the chances of success. Often, a triangle, commonly called the triple constraint, is used to summarize project management. The three most important factors are time, cost and scope. These form the vertices with quality as the central theme.

30 30 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 General Real Estate Company W.L.L. Established in 2008 as a whollyowned subsidiary of Qatar General Holding Company, General Real Estate Company (GRECO) includes a diversified mix of major projects, residential, offices, commercial, leisure and lifestyle and industrial developments. GRECO provides a fullrange of services for inhouse and third parties which include project, facilities, property and hospitality management. Overview Infrastructure, master developments, property and sports and leisure venues continue to be a focus of our Country in line with the Qatar National Vision 2030: this investment into our country s future has been extremely beneficial for our company. Emad eldin Mousa Qenibi Acting General Manager Our real estate portfolio is aligned to our investment strategy with strong attention to our local market: our market value is QR million with a focus on real estate investment within the State of Qatar. Throughout 2017 our focus has been on Mozoon Towers which will be followed by Salwa road project in 2018 and Al Wakra project in During the year, Lusail Waterfront project successfully received building approval and construction is expected to start in Q Development of Mozoon Towers is making good progress, with skeleton construction underway with our own sister company, Orientals Enterprises W.L.L. We are pleased to report that that we are set to reach our estimated completion date, Q4 2020, which increases Qatar s ability to accommodate the anticipated rise in visitor numbers the country is expecting to see over the next 5 years.

31 31 Managing these towers and welcoming overseas guests to Qatar will be Oberoi (Tower A, Hotel). Marriott (Tower B, Hotel and Tower D, serviced apartments) and Retaj (Tower C, serviced apartments. Outlook We are positive about our country s and our company s longterm outlook and growth. Qatar continues to seek new avenues to diversify its economy, with tourism and sporting events playing major roles in this overall strategy. As such, there continues to be a strong demand for property development throughout the country. Our mission remain to convert more nonincome producing holdings to incomeproducing property, when the opportunity arises for a greater return of investment. We seek to achieve a reasonable return on investment while maintaining a diversified portfolio and balanced capital investment is also the year we seek to invest more resources and capital into Facility Management, which is growing in demand as new offices and event spaces continue to open in Qatar. We currently undertake this role for the World Trade Centre and are eager to enhance our service offering.

32 32 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Real Estate Projects in the Pipeline FOXHILLS MU/C07 COMMERCIAL DEVELOPMENT LUSAIL The Project Development has a Plot Area of 2, sq.m. and total B.U.A of 14, M2 and is situated at Foxhills District, Lusail Area and shall be built into RETAIL (864m2)+RESIDENTIAL(1/14BR and 2/34BR), services, parking spaces (93 Carparks) and landscape as per land use. FOX HILLS ZONE H DEVELOPMENT LUSAIL The Project will be located at 22 Plots at Fox Hills District in Lusail. The 22 plots shall be designed as offices with retail areas at the ground floor / residential units/ hotels as per the usage regulations of Lusail with complete amenities, services, parking spaces and landscape areas. With a Total Plot area of 62,909 sq.m. MOZOON TOWERS WEST BAY The project comprises of 4 Towers, with 5 basements floors, podium on ground, 1st and 2nd floor (varies for each tower). All carparks are in the ground and basements with a total of 2,252 carparks. This one of a kind building complex will showcase terraces in the sky, with variable steppedheight 4towers. The fourtower complex includes boutiques, cafe, restaurants, ballrooms, laundry, spa, club house and external pool. Mozoon Towers is set to introduce an innovative contemporary concept in highrise residential developments. Good quality daylight, as well as various views to the surroundings can be enjoyed from the inside.

33 33 LUSAIL WATER FRONT RES 27 W ATER FRONT DISTRICT, LUSAIL The Project will be located at Waterfront District RES/27 in Lusail and shall comprice Residential Tower of 148 luxury apartments of 8 different types, with relevant amenities for the residents like private Gym, Spa and Recreation Areas, building services and 223. underground parking spaces at four (4) basement levels and landscape. The Project will be built on a plot of 6,072 sq.m. area, with approximate total builtup area of 56,787 sq.m. The total height is of m. FOXHILLS RES/A08 RESIDENTIAL DEVELOPMENT LUSAIL The Project Development has a Plot Area of 2, sq.m. and total B.U.A of M2 and is situated at Foxhills District, Lusail Area and shall be built into residential (1/8BR and 2/27 BR) with building services, parking spaces (53 Carparks) and landscape as per land use. TRUST REAL ESTATE TRUST COMPLEX PROJECT BAB EZZOUAR, CAPITAL OF ALGERIA A Multidisciplinary property under development in the capital of Algeria, fully owned by one of the subsidiaries of our associate, Trust investment holding Algeria, comprises of Marriott MIHR 5 Stars Hotel, Marriott Courtyard 4 Stars, Marriott 5 Stars Executive Apartments and Marriott Residence In 4 Stars Apartments, total of approx keys, Business Centers, Shopping Centers in the middle of the compound and 3 basements floors integrated Carparking covering the underside of the whole compound with a total enclosed area of 100,000 sq.m.

34 34 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 General Company for Water and Beverages W.L.L. Over the past three years, we endeavoured to complete the build of our mineral water factory. We have managed to achieve this, despite the blockade which began in June, installing the latest machinery equipped to the highest technological level, and ensuring that we have the best raw materials, bottling and packaging materials to go to market. We have also worked hard to meet the conditions and specifications stipulated by the civil defence and other government authorities. All the necessary licenses have been obtained to launch production at the beginning of Our strategy is to succeed in the current competitive economic environment and meet local demand by utilising high quality materials and the latest stateoftheart technology. Maher Akel General Manager During the second quarter of 2018, we shall start the testing phase for 30 (thirty) days to ensure we attain the laboratory results needed to provide safe, great tasting water. Al Rawda Water products will contain a balanced combination of minerals and salts necessary for human body, and contain a low percentage of Sodium of no more than 0.4%. Alternatively, we have finalised our sales and marketing plan in order to cover the whole footprint of the country, where Al Rawda Water will be made available through various distribution channels

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36 36 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 World Trade Center Qatar W.L.L. The World Trade Center Qatar W.L.L. (WTC Qatar) is part of the World Trade Center Association which consists of 332 centres in 116 countries around the world that promotes and facilitates trade and investment between Qatari and international companies. Our mission is to introduce trading partners to the Qatari market through events and exhibitions. Overview We continue to work as a cooperative chain, linking Qatari businesses to international traders saw us forging mutually beneficial relationships with countries through their local embassies, and attending events that raised our country s profile around the world. Eng. Sadallah Elsaid General Manager In 2017, our focus remained on reaching out to other nations to create and build upon trading and investment partnerships. Part of this work included collaborating with 18 African embassies to ensure that the African Fair will be successful event for all parties involved. WTC Qatar were also proud to attend the 48th World Trade Center Association General Assembly 2017 held in Las Vegas, USA, connecting and strengthening our relationships with hundreds of people from around the globe. During the year we worked in close collaboration with Qatar s Chamber of Commerce and Industry, and Qatar Development Bank, participating in events alongside local dignitaries and ambassadors to actively promote Qatar s strong economic position. We also attended many business matchmaking events to meet with overseas delegations who visited Qatar to collaborate with businesses here. Outlook During 2017, WTC Qatar made seamless efforts with the embassies of the Association of Southeast Asian Nations (ASEAN) to action

37 37 our plans for a future ASEAN exhibition. This work is gathering pace and we look forward to sharing more news of this event. We also actively participated in events and activities that demonstrated the solutions and opportunities we can offer to new partners. In April 2018 WTC Qatar will be attending the 49th WTCA General Assembly at Leeuwarden, Netherlands, to build business opportunities and strengthen the WTCA network enables us to enhance relationship and demonstrate the progressive nature of our country s initiatives. We look forward to bringing another array of busineslink opportunties to Qatar throughout the coming year that will further support the mission of the World Trade Centers Association, WTC Qatar and the Qatar National Vision 2030.

38 38 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Orientals Enterprises W.L.L. Established in 1999, Oriental Enterprises has become a leading construction company. From providing a wide range of products including rebar and insulation materials to construction management services, deploying a big team of more than 600 professionals across residential, commercial and industrial mediumtolarge scale projects. Overview We have faith in a bright future. We have actively contributed to the Group s success, developing major projects that enable our company to gain recognition and build a positive reputation in the region and around the world while driving the realization of Qatar National Vision. Eng. Raghib Jalabi General Manager Orientals Enterprises has proved to be an added value to the Group. Since its acquisition in 2015, it has enabled the Group to gain substantial savings via reduced construction materials and local transportation costs. These reduced overheads, enabled the Group to improve the cost of projects, and compete within the local and regional markets while increasing future profit margins. Stability and continuous development was the principle adopted by the Company during During the year, we saw completion of the new General Takaful Headquarters, a threestory office building that will be utilized for growth and reach across Qatar. We also managed to expedite the execution of the construction concrete works contract in Mozoon Towers located in West Bay, and completed the expansion of National Rebar Fabrication Factory. We have also heavily invested in human capital, increasing our talent pool by 20% to improve the quality of our services and enables the Group to engage in larger projects. This expansion allows us to reach our goals of raising brand awareness and improve our experience and expertise.

39 39 Outlook Buoyed by government s commitment and investment in major infrastructure and landmark projects, we look forward to the future development of Qatar s architectural landscape, which provides favorable conditions for us to grow. Our longterm vision remains focused on contributing in Qatar National Vision, contributing to mediumtolarge scale developments that enable our country to diversify its economy and improve the prosperity of our society.

40 40 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Human Resources Driving our success Our staff are our most valuable resource, helping us to achieve our goals and growth aspirations as well as gain a competitive advantage through strong customer interactions. We strive to be an employer of choice, providing a collaborative and cooperative environment that nurtures future leaders. Throughout 2017 we invested in training and development, working to enhance our inhouse expertise and enabling our employees to enjoy career development and progression. Promoting Qatarisation We re only as strong as our people. Investment in our talent pool drives our business forward and enables us to remain an employer of choice. Jassim Mohamed Yousef Al Kawari Group Admin and H.R. Manager We have aligned our strategies with Qatar National Vision 2030 and we are dedicated to the development and creation of a strong Qatari workforce. We work closely with the Ministry of Labor to find suitable Qatari recruits and nurture their education for career progression. We provide vital inhouse training, providing courses such as English language for business, insurance, sales and customer service soft skills and ICT training. Succession planning We have a robust HR vision and structure in place to ensure that we provide vital coaching leardership and teambuilding training to managers and future leaders. Our succession planning enables us to identify managers and leaders and help them acquire the technical skills to progress.

41 41 The NEXTGEN Programme This year, our graduate NEXTGEN Programme saw the recruitment of many young professionals into our company where they have joined our team. This customised training programme enables us to find and develop our leaders of the future. We give bright ambitious graduates a structured training plan that helps them to learn specialist insurance skills. Career fairs During 2017 we participated in career fairs across Qatar, promoting our company to graduates while raising awareness of the insurance industry s key contribution to the financial services sector and the overall economic growth of our country. Promoting women and equal opportunities in the workplace We recognise the valuable skills and importance of women in the workplace and implement strategies to bring more female employees onboard. The current percentage of women employees is 31%, which is continuously growing. We are extremely proud of Deepa Chandrashekar QGIRCO s acting Chief Financial Officer who achieved second place at the MENA CFO Excellence Awards 2017 in the category of Woman in Finance Qatar. Developed in partnership with ACCA, this award was given in recognition of Deepa s career achievements, success and leadership. In March 2013, Deepa founded an informal forum in Qatar in association with the Associate of Chartered Certified Accountants, UK. Under her leadership, the forum conducted two successful events during 2014 and The forum represents of over 120 women in Qatar working in the finance sector and has received support from the Big 4 and other professional associations such as ACCA, CMA and IIA. Professional exams and qualifications We offer our employees the chance to further their skill set and gain professional recognition for their expertise. Chartered Insurance Institute (CII) exams We continue to promote and encourage our employees to gain these highly acclaimed internationallyrecognised qualifications, which enable them to gain in depth financial services knowledge. Investing in these qualifications enable us to build competencies and trust in services. Recognised as an approved employer We are an ACCA approved employer and listed on the professional accounting body s website. This recognition and enables us to boost our reputation as an employer of choice and showcases our commitment to high standards. The listing is viewed by people seeking employment opportunities and helps us to attract the very best talent from around the world. Deepa Chandrashekar Acting Chief Financial Officer

42 42 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Corporate Social Responsibility Committed to our country and community We are proud of the progress we have achieved in Qatar thus far, forming strong foundations for a bright future that will boost society, our architectural landscape and our community. The Qatar National Vision 2030 drives our CSR strategy which seeks to have a positive social, cultural, environmental and economic impact. We are aware of the important role that we play as a leading corporation in Qatar in setting a good example for others to follow and adding value to our society. Marwan Azar Group Head of Marketing and Corporate Communication Department As a leading organisation, we are aware of our role in encouraging and promoting corporate social responsibility throughout our country. We are keen to participate in sports and social activities and inspire staff to take part in sports and awareness initiatives that bring people together and support making healthy lifestyle changes. In 2017, QGIRCO organised and hosted the fifth local insurance companies Futsal Tournament. This event was a chance for colleagues across the industry to socialise and compete in a fun atmosphere. This competition received high participation and its organisation was applauded by both the media and the participating delegations. QGIRCO also participated in the National Sports Day by holding sports activities for the staff and their families at Al Arabi Sports Club a healthy and social day enjoyed by all. Recognition for our contribution QGIRCO was honoured to receive the CSR Leadership Award 2017, in recognition of the contribution Qatar General Insurance and Reinsurance Company has made to its community. The Ceremony, hosted by Qatar University, also marked the launch of the CSR

43 43 Report, The National Book Qatar This award was presented by Dr. Hasan Al Derham, President of Qatar University and received by Group Head of Marketing and Corporate Communication Department, Marwan Azar. This award highlighted how large companies are playing an effective role in promoting social awareness.

44 44 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Risk Management Report Actuarial and Risk Management (a) The Governance Framework QGIRCO has implemented, and continues to strengthen a formalised enterprise risk management (ERM). Among the key elements of the ERM framework is the adoption of detailed risk management procedures, and the implementation of a riskbased asset liability matching framework as well as the development of an economic capital model that is used as a tool for strategic decisionmaking. The Group s risk management policies are approved by the Board of Directors and they define the Group s identification of risk and its interpretation. Within its risk management framework, the Group maintains a varied limit structure to ensure the appropriate quality and diversification of assets, and to align underwriting and reinsurance strategy to the corporate goals in a manner consistent with its risk appetite. The following illustrate the Group s commitment to enhancing and improving risk management: The Risk Management and Actuarial Department oversees the ongoing process of identifying, documenting and managing the key risks the organization is facing. The department, in coordination with the various group entities and functions, performs regular risk reviews across the group, in order to maintain an up to date picture of the group s exposure to risk. To manage the business continuity risks arising from the group s key operations, the risk management department is responsible for maintaining an up to date Business Continuity Plan. The department launched a Business Continuity Plan update project in Q which is expected to be completed during Q The Group utilizes a modern risk management platform (GRC) from leading business solutions provider SAP. The platform serves as a repository and reporting tool for the group s risk database. The Group has an active Board Risk Management Committee which oversees the risk management activities of the Group. The committee consists of three board members, abides by the board approved charter, meets regularly and takes an active role in the implementation and embedding of risk management across the organization. Following the company s Annual General Assembly held in March 2017, the Board of Directors appointed new directors and chairman for the Board Risk Management Committee. In addition, the Board of Directors approved the amended committee charter to comply with all applicable laws and regulations, providing additional duties and responsibilities to the committee. The committee held four meetings during 2017 and provided the Board with key information regarding the group s exposure to risk. With the implementation of a Business Intelligence Platform across the insurance operations including its subsidiary General Takaful, the company has enhanced access to critical information related to its exposure to insurance risk.

45 45 The recently introduced (2016) regulatory framework (QCB Executive Instructions) by the Qatar Central Bank introduced riskbased capital requirements for all insurance companies operating in Qatar. Qatar General Insurance & Reinsurance Company continues to maintain a very high solvency ratio at 240% as of Q as per QCB s risk capital model (minimum 150%). In addition, the company has established a committee at the senior management level to manage the compliance and regulatory risks arising from the QCB Executive Instructions related to corporate governance. The Group is committed to maintaining full compliance with all applicable Anti Money Laundering laws and regulations. To strengthen its AML framework, the group plans to implement an AML software within Following the events of June 6, 2017 and the blockade imposed on the state of Qatar by U.A.E., Saudi Arabia, Bahrain and Egypt, the group has taken immediate actions to control its risk exposure to these four countries. The Group went through the rating review process with the rating agency A.M. Best, which reaffirmed its financial strength rating of A (Excellent) with a stable outlook, reflecting the Group s very strong risk adjusted capitalisation, operating performance and enhanced enterprise risk management (ERM) capabilities. (b) Capital management objectives, policies and approach The Group s approach to managing capital involves managing assets, liabilities and risks in a coordinated way, assessing shortfalls between available and required capital levels (by each regulated entity) on a regular basis and taking appropriate actions to enhance the capital position of the Group in the light of changes in economic conditions and risk characteristics. In managing the risks that affect the Group s capital position we have established several capital management objectives, policies and approaches, including the following: Setting target riskadjusted rates of return, which are aligned to performance objectives and ensure that the Group is focused on the creation of value for shareholders To maintain the required level of stability of the Group thereby providing a degree of security to policyholders To retain financial flexibility by maintaining strong liquidity and access to a range of capital markets To align the profile of assets and liabilities taking account of risks inherent in the business To maintain financial strength to support new business growth and to satisfy the requirements of the policyholders, regulators and stakeholders (c) Regulatory Framework Regulators are primarily interested in protecting the rights of policyholders and monitor them closely to ensure that the Group is satisfactorily managing affairs for their benefit. At the same time, regulators are also interested in ensuring that the Group maintains an appropriate solvency position to meet unforeseen liabilities arising from economic shocks or natural disasters.

46 46 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 The operations of the Group are subject to regulatory requirements within the jurisdictions in which it operates and such regulations prescribe approval and monitoring of activities and impose certain restrictive provisions to minimise the risk of default and insolvency of insurance companies. All regulated entities within the Group act in accordance with their regulatory requirements. (d) Asset Liability Management (ALM) Framework Financial risks arise from open positions in interest rate, currency and equity products, all of which are exposed to general and specific market movements. We have been following a few simple premises under our practicing ALM: Match assets to the liabilities arising from insurance contracts by reference to the type of benefits payable to policyholders Ensure in each period sufficient cash flow is available to meet liabilities arising from insurance contracts and any other sources STRONG Corporate Governance

47 47

48 48 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Board of Directors Sheikh Nasser Bin Ali Bin Saud AlThani Chairman of the Board and Managing Director Sheikh Mohammed Bin Ali Bin Saud AlThani Deputy Chairman Sheikh Ali Bin Jassim AlThani Board Member Sheikh Faisal Bin Jassim AlThani Board Member representative of Middle East Business Development Company

49 49 Mr. Hamad Mohammed AlMana Board Member Mr. Abdulaziz Mohammed AlMana Board Member Mr. Rashid Faisal AlNaimi Board Member representative of AlFaisal Trading and Contracting Establishment Mr. Khalifa AlKaabi Board Member representative of Ali Bin Saad AlKaabi Trading & Contracting Company Mr. Abdulla AlKaabi Board Member representative of North Africa Energy Company

50 50 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Corporate Governance Company Profile: Qatar General Insurance and Reinsurance Company Q.P.S.C. (the Company ) is a public jointstock company, founded in 1979 under the provisions of the JointStock Companies Regulation Law of 1961 as amended by Commercial Companies Law No. (5) of 2002 which in turn was amended by the Commercial Companies Law No.11 of 2015, to conduct all types of insurance and reinsurance business (except life insurance) and for capital and property investment. The Company s paid up capital is QR 875,067,030 (Qatari Riyals Eight Hundred Seventy Five Million Sixty Seven Thousand Thirty) divided into 87,506,703 shares (EightySeven Million Five Hundred Six Thousand Seven Hundred and Three shares). Board of Directors: The Company is managed by a Board of Directors composed of nine members, who possess the necessary expertise for the Company s business. Under the Company s Memorandum and Articles of Association, the Board of Directors (the Board ) is collectively responsible for the Company s management and performance, for developing the overall comprehensive strategy of the Company and the required policies and procedures, including credit and investment policies, whether directly or through the Board Committees to implement the key business plans and provide the required administrative and supervisory guidance and the effective control of the Company. The members of the Board are elected through the General Assembly of Shareholders in accordance with the provisions of the Company s Memorandum and Articles of Association, Qatar s Commercial Companies Law, QFMA s regulations and as per the provisions of the law of Qatar Central Bank, in addition to fulfilling any other requirements stipulated in the applicable laws and regulations. It is noteworthy that it is observed to have one third of the Board members as independent and experienced members. The Board of Directors is composed of nine members, serving for a threeyear renewable term. The current Board was elected by the Shareholders for a period of three years ( ) at the Ordinary and Extraordinary General Assembly held on 21 March 2017, in which it was resolved that the number of the Board members to be increased from 8 to 9 members and to amend the Company s Articles of Association accordingly. The Board members have the required experience and knowledge to perform their duties particularly in the financial and economic sectors. The Board s Charter: The Board performs its duties and responsibilities in accordance with the Charter of the Board of Directors, developed as per the form annexed to the Corporate Governance Code, defining the Board s tasks, duties and responsibilities, the duties of its members, the composition of the Board and its Committees. The Charter also defines the voting and decisionmaking mechanism and generally the Board s role in leading the Company in accordance with the requirements of the Company s Memorandum and Articles of Association, QFMA s regulations, the Commercial Companies Law, Qatar Central

51 51 Bank Law and the Executive Instructions issued pursuant to it. The Board Charter is made available to the public through the Company s website, which is one of the key requirements of Corporate Governance principles aimed to develop Corporate functioning. This Charter is in the process of being amended to comply with the provisions of the new Commercial Companies Law No.11 of 2015, the Insurance Executive Instructions and the Governance Principles for Insurance Companies issued by Qatar Central Bank and the new Governance Code. The Board s Tasks and Responsibilities: 1. The Board is responsible for the management of the Company, and the development and supervision of implementation by the Company s Executive Management of the key business plans, comprehensive strategies and main objectives. Subject to the competence of the General Assembly, the Board shall assume all the authorities and powers necessary for the management of the Company and shall discharge its duties as set out in all the applicable laws and regulations and the Company s Articles of Association and bylaws. The Board shall remain responsible for all the Board Committees. 2. The Board shall carry out and perform its duties prudently, in good faith with a view to the best interests of the Company and its resolutions shall be based upon adequate information from the Executive Management or any other reliable source. 3. The Board shall ensure providing its members with a full and prompt access to Company related information, documents and records via the Board Committees. The Company s Executive Management shall provide the Board and its Committees with all requested documents and information. 4. Among Board s functions is to develop and adopt the Company s management and organisational structuring, the policies (financial, accounting, internal audit, etc.), strategies and systems especially the Risk Management system and the Internal Administrative system; the definition of tasks, functions, duties and responsibilities; the formation of the Committees and the definition of their functions; the nomination of the Company s External Auditor based on competency and efficiency; and determining the Auditor s fees for the Company s General Assembly. 5. The Board members shall ensure the attendance of the Nomination and Remuneration Committee members, the Audit Committee members, the Internal Auditors and representatives of the External Auditors the Company s General Assembly Meeting. 6. The Board shall design a training programme for newly appointed Board members to ensure that, members upon election shall have an adequate understanding of the Company s functions and operations and that they are fully aware of their respective responsibilities. 7. The Board members shall assume responsibility for having an appropriate understanding of their functions and duties, and for educating themselves in financial, business and industry practices as well as the Company s operations and functions. In this respect, the Board shall adopt an appropriate formal training to enhance Board members skills and knowledge. 8. The Board shall at all times keep its members aware of the latest developments in the area of Governance and best practices relating thereto. The Board may delegate the same to the Audit Committee or the

52 52 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Governance Committee or any other body as it deems appropriate. 9. The Company s Articles of Association shall include clear procedures for the tasks, authorities and powers of the Board, the terms and conditions of membership and isolation terms in the event of failing to attend the Board meetings, and other Company provisions related to the Board. The Board shall also assume all the other functions, duties and responsibilities prescribed in the relevant laws and regulations. 10. The Board shall prepare an Annual Report that includes a comprehensive assessment of the Company s performance and results of its activities during the year. The Board shall have the broadest powers to manage the Company s affairs; set, develop and adopt future plans and strategic objectives and policies; approve, supervise and regularly review the Internal Control systems. The Board shall approve the appointment, determine the remuneration and review the performance of Executive Managers; and shall review the overall performance of the Company based on the recommendations of the Nomination and Remuneration Committee. The Board shall also bear the overall responsibility for the Company s compliance with the applicable related laws, the Company s Memorandum and Articles of Association. It shall be also responsible for protecting the Company from illegal business or practices, ensuring the Company s adherence to the provisions of the Corporate Governance code and the provisions of Qatar Central Bank s Law, and reviewing all applicable legislations as well as updating the adopted Governance applications regularly. Duties and responsibilities of NonExecutive members: 1. NonExecutive members shall regularly participate in all Board meetings, providing an independent opinion and engaging in decisionmaking with respect to the Company s strategic matters and policy, evaluating the performance of the Executive Management and the overall management of the Company. 2. NonExecutive members shall also assume responsibility for monitoring and developing the Company s Internal Control and Risk Management systems, followingup the Internal Audit and Risk Management Departments activities, investigating any irregularities or violations of the Company s applicable regulations and policies through their active membership in the Audit Committee and Risk Management Committee. 3. The Nomination and Remuneration Committee shall comprise NonExecutive members to evaluate the performance of the Chairman, members of the Board of Directors and the Executive Management of the Company, selecting the nominees for such positions and determining their remunerations, through their membership in the Nomination and Remuneration Committee to ensure impartial and objective decisionmaking in this regard. The Tasks and Functions of the Chairman of the Board: 1. The Chairman of the Board of Directors shall be responsible for calling, chairing and supervising the proper functioning of Board meetings;

53 Overseeing and approving the Board s agenda; providing the Board and Committee members with all relevant and accurate information in a timely manner; 3. Ensuring that all listed issues on the agenda are discussed effectively, including the issues raised by the Board Members. The Chairman shall be responsible for proper and effective discharging of the Board s duties; 4. The Chairman of the Board shall maintain constant communication with the Shareholders and ensure communicating their opinions to the Board and relevant official and regulatory authorities; 5. The Chairman of the Board shall also chair the Ordinary and Extraordinary General Assembly Meetings of the Company; presenting the Board s Annual Report to the General Assembly; following up on the implementation of General Assembly resolutions and the decisions of the Board; and overseeing the annual performance assessment of the Board; 6. The Chairman, in his capacity as the Managing Director, does not perform any executive functions, but rather acts as the focal point between the Company s Board and the Company s Executive Management Committee, for coordinating among them to fully achieve the objectives set by the Board. 7. The Chairman shall not be a member of any of the Board s Committees. Board Meetings: Based on the provisions of the applicable laws in force and the Company s Articles of Association, the Board must convene a minimum of six (6) meetings per year. The Board held seven (7) Board meetings during Board Committees: Pursuant to its relevant resolution, the Board formed three Committees to assist in fulfilling its duties and responsibilities in accordance with the provisions of the Corporate Governance Code for Companies and Legal Entities Listed on the Main Market regulated by the Qatar Financial Markets Authority (QFMA), the Insurance Executive Instructions and Governance Principles for Insurance Companies issued by Qatar Central Bank (QCB). The Committees have been formed to support the Board in carrying out its duties and discharging its responsibilities in management of the Company. 1. Nomination and Remuneration Committee: The Nomination and Remuneration Committee has been formed following a Board s resolution to assist the Board in performing its responsibilities and fulfilling its commitments in relevance to the Corporate Governance and overseeing the Company s Nomination and Remuneration policies and procedures, enabling the Board to attract high calibre Senior Management. The Board has ensured that the Committee has access to all the Company s documents, records and operations, meeting with the Company s employees, etc. Also, it has been observed that the members of the Committee are Nonexecutive and Independent. The Committee has developed its charter which was adopted by the Board, that defines the Committee s authorities and responsibilities. In addition, the Committee shall remain accountable for all the obligations governed by relevant Laws and regulations.

54 54 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 Duties and Responsibilities: 1. To nominate and renominate the members of the Board for election by the General Assembly, assessing the nominees for Board membership, and ensuring the implementation of all nomination requirements in accordance with the regulatory laws and the approved policies and standards. 2. To assess the performance of the Board, its Committees and the Senior Management. 3. To adopt the Company s organisation structure, and define its general policy for wages and remuneration, determining the basis for granting such allowances and incentives, and recommending the remunerations and incentives of the Chairman, members of the Board, the Senior Executive Management and the employees in the Company. 4. To develop the Succession Planning scheme of the Company s Management to ensure a prompt and smooth replacement is appointed to fill the vacant position. 5. Review the Performance Assessment criteria of the Board members and the Senior Executive Management for the purposes of determining their annual remunerations. 6. To submit reports to the Board covering its activities and recommendations. 7. The Committee s Framework shall be determined by a General Assembly s resolution based on the Board s proposal. The Committee held two (2) meetings during The Audit Committee: The Audit Committee was formed by a Board resolution to assist the Board in carrying out its responsibilities and duties related to Corporate Governance and overseeing the Company s Financial Reporting, Internal Control systems, the Audit process, the External Audit, and the Company s procedures to ensure compliance with the statutory requirements, regulations and Laws. One of the key responsibilities of the Committee is to ensure implementation of the Company s Accounting, Financial and Audit systems in accordance with the best practices and procedures. The Committee has been assigned the power to initiate or allow the initiation of conducting investigations in relevance to any matter falling within its respective scope of responsibility. The prerequisites for the Committee s members have been observed, provided that the majority of the members are independent and that its Chairman is not a member of any other Committee. The Committee has developed its charter which was adopted by the Board that defines the Committee s authorities and responsibilities. In addition, the Committee shall remain accountable for all the obligations governed by relevant Laws and regulations. Duties and responsibilities: 1. To set the related criteria and standards for appointing the External Auditors, issuing the necessary recommendation to the Board concerning such appointment. 2. To ooversee and ensure the independence of the External Auditors functions, discuss their reports, and submit the necessary recommendations to the Board with respect to assessing the External Auditors and their fees; 3. To ensure the accuracy of the financial statements and the quarterly, semiannual

55 55 and Annual Reports, while preparing the same in accordance with the International Accounting and Disclosure standards and principles prior to presenting it to the Board; 4. To review, consider and develop the effectiveness of the Company s Internal and Financial Control systems Reports and procedures, business systems and conflicts of interest, and to discuss the relevant reports and provide the necessary decisions to that effect; 5. To consider and deliberate with the Company s Executive Management any observations made by the Internal Audit Department and the External Auditor, and investigate to identify those involved in any violations of the Internal Control Systems; 6. To define the tasks, authorities, and action plans of the Company s Internal Control Department; 7. To ensure the accuracy of the information presented in the Annual General Assembly Meeting; 8. To oversee all the tasks and functions of the Internal Audit Department; 9. To regularly report the Committee s activities to the Board; 10. To comply with the State s applicable laws; and 11. To consider any matters referred to it by the Board. 3. Risk Management Committee: The Risk Management Committee was formed by a Board resolution in accordance with the Insurance Companies Governance principles and the Executive Instructions issued by Qatar Central Bank to assist the Board in performing its responsibilities and obligations in identifying, evaluating, managing and following up all the risks faced by the Company. Duties and Responsibilities: 1. Review deliberate and approve the Company s Financial and Operational Risk Management Policies and Procedures, ensuring that policies are in place to manage all sorts of risks facing the Company, in accordance with the applicable statutory requirements and ascertaining the efficacy of the Internal Control and Risk Management. 2. Assess and develop the Company s Risk Management practices, in line with business requirements, ensuring that the Company takes the necessary measures to achieve balance in matching between risks and returns in the operational processes. 3. Consider and make recommendations to the Board for proper decisionmaking regarding the identified business risks and its potential impact on the Company s reputation and financial position. 4. Oversee the functions of the Risk Management Department in the Company. 5. Review the work of the Independent Actuary with respect to the Financial Position Report, submitted to Qatar Central Bank, that includes Actuary s opinion with respect to the financial performance of the Company, risk assessment policy, technical reserves, and insurance premiums. Since the Independent Actuary is an expert approved by Qatar Central Bank to submit such a detailed report annually, the appointment of Mr. Christos Patsallides

56 56 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 was approved by Qatar Central Bank as the Company s Independent Actuary. 6. Promote the risk awareness culture across the Group. 7. Notify the Board of any matters, within its scope of responsibility, that may require an action or improvement. 8. The committee shall report to, and make recommendations to the Board on any risk related issues periodically or when deemed necessary for areas that an action or improvement is needed. In addition, the Committee submits to the Board a report about its activities at least once a year. The committee held four (4) meetings during Executive Management Committee: Tasks and responsibilities of the Executive Management Committee: 1. Monitor the Company s overall performance across the various divisions and departments, execute business plans and strategies, implement the Board s resolutions in collaboration with the respective Departments Managers and present pertinent reports to the Board. 2. Discuss and make decisions on matters related to its competency, within its scope of financial and administrative authorities that are adopted by the Board. 3. Assist the Board in the development and evaluation of the Company s strategy and business plans. 4. Assist the Board in the preparation and adoption of the Estimated Budget for the Company and its subsidiaries. 5. Assist the Board of Directors in managing the Company s Investment Portfolio. This Committee discharges its duties in accordance with its approved Charter. The Organisational Structure of the Company: The Company s organisational structure has been adopted by the Board which includes all the departments, divisions and subsidiaries aiming at achieving an ongoing performance development and ensuring that all strategies and future action plans are implemented. The Company s amended organisational structure, under which the Company s Management structure has been reorganised, has been adopted by the Board to include four main sectors: 1. Insurance businesses; 2. Real estate investment sector; 3. Investment businesses; 4. Support services. Internal Control: As the Board is fully aware of the substantial importance of the Internal Control systems across all the Company s operational areas, it has adopted the Internal Control system that includes the Internal Regulatory Policies and Procedures covering all the Company s operations within the Company s applicable Corporate Governance framework. The Internal Control system provides the necessary supervisory and regulatory environment for effective management and performance monitoring of the Company in accordance with the policies and controls established by the Board. It also sets clear and distinctive boundaries as to the functional responsibilities and authorities within the

57 57 Company at all levels, as well as accountability in case of any irregularity, vulnerability or default. During 2017, no violations or failures in the implementation of the Internal Control system within the Company were recorded, that would have a significant impact on the Company s financial and management performance. Internal Audit: As the Company is fully aware of the significance of the Internal Control systems throughout all the Company s operational areas, and in order to have in place a robust system in accordance with the international best practices in the area of detecting flaws in the procedures and in the implementation of the Internal Policies and Procedures, the Company has engaged the services of the prominent international financial Audit Firm (M/S Ernst & Young) to handle the Internal Control process as Internal Auditors, developing the Internal Audit Department to a high level of competency. M/S Ernst & Young handles the Internal Control functions in coordination and liaison with Acting Head of Internal Audit in the Company. Since the outsourcing of the Internal Control function is considered as outsourcing, accordingly, this has been observed upon entering into the contract with M/S Ernst & Young to perform the job in accordance with Qatar Central Bank s instructions applicable to outsourcing. The outsourcing process and related agreement has been approved by Qatar Central Bank. The Internal Control process is progressing and reporting to the Company s Audit Committee. The Board is confident that this addition will lead to enhancing the quality of the Company s operations and businesses. External Auditor: In accordance with the applicable laws and regulations, the Company s General Assembly shall appoint an External Auditor for one financial year pursuant to a recommendation submitted by the Board s Audit Committee. The External Auditor shall carry out an independent audit on an annual basis and perform a review on a quarterly basis of the financial statements. He shall submit his report on the financial position and performance of the Company, and his opinion on the consolidated financial statements of the Group prepared by the Board of Directors, and present it to the Ordinary General Shareholders Assembly at their Annual Meeting. He shall also respond to any enquiries by Shareholders. M/s Rodl & Partner was appointed as the Company s External Auditor for the financial year 2017 at the Ordinary General Assembly Meeting of Shareholders held on 21st March This is Rodl s first year with the Company as an External Auditor. The Company shall comply with the relevant rules and regulations stipulating that the External Auditor shall be changed within a maximum of five years. During the year, the Company didn t engage the services of External Auditor in any professional advice or any related services apart from carrying out the External Audit of the Company s accounts. Risk Management: The main objective of the Risk Management Department in the Company is to safeguard the Company s Shareholders from events that could impede the Company from achieving its objectives. The Senior Management is aware of the utmost importance of sustaining an effective Risk Management system. Within this context, the Board s Risk Management Committee is formed to assist the Board in identifying, following up,

58 58 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 assessing and managing risks faced by the Company s business and to take the necessary actions to mitigate them. Accepting and managing risk is an integral part of the Company s business in the insurance industry. However, risk management in this context indicates the financial and operational risks inherent in the Company s business which are generally faced by companies as a result of carrying out their businesses and investment activities. In this regard, the Company has created a separate Risk Management Unit in addition to engaging an External Consultant to undertake Risk Management evaluation. Rating: In 2017, the Company has maintained an A (Excellent) rating and a credit issuance strength rating of a by international Credit Rating Agency, A.M. Best Global specialised in the Credit Rating of Insurance Companies. Once more, these ratings reflect the strength of the riskweighted capital base, the outstanding record of operational performance and the Group s risk management distinguished capabilities. It also reflects the Company s strong financial, technical and credit position and its local and regional solid and competitive position. Compliance: As the Board is aware of the significant role played by the Compliance Officer in completing the components of the Company s Internal Control system and Money Laundering and Financing of Terrorism risks, the Company has established an independent Compliance Unit, under the direct supervision of the Board, to be responsible for the Company s compliance with all the official legal and regulatory requirements governing the Company, in addition to developing Policies and Procedures to combat Money Laundering and and Financing of Terrorism, ensuring strict adherence to the applicable laws, regulations and standards. The Company was one of the first local Insurance Companies in Qatar to establish a Compliance unit. A dedicated Compliance Officer, who is independent of the Executive Management, oversees this responsibility, supervising the implementation of the general legal and regulatory compliance framework within the Company as well as the Corporate Governance Code for JointStock Companies Listed on the Markets regulated by QFMA and QCB, semestrial reporting in detail the Company s compliance with all the relevant laws and regulations, Code of Conduct, the Code and any irregularities if found. Conflict of Interest and Transactions With the Related Parties: Pursuant to the Company s approved Policy and Procedures governing dealing with Related Parties, the Company applies such a Policy and Procedure in all its dealings and transactions to secure full transparency and disclosure. Such transactions are regularly reviewed by the Audit Committee to ensure compliance with the Company s Policy in dealing and transacting with Related Parties. It s the Company s Policy that such dealings and transactions with Related Parties are conducted only on a commercial basis and in accordance with the marketprice, offering equal chances between the Related Party and other competitors under the same terms and conditions in order to achieve the interest of the Company in the first place. This Policy is based on transparency principles in dealing with Related Parties, where the Company must disclose dealings and transactions in the

59 59 Company s Annual Report and to put them at the disposal of the Shareholders at their General Assembly Meeting. The Internal Audit Department and the Board Audit Committee undertake to give utmost importance and care to oversee the Related Parties transactions and its compliance in this respect with the Company s Policy and that they are disclosed in a proper manner and reviewed by the External Auditor. All transactions with Related Parties in Qatar such as AlSari Trading Company, North Africa for Energy Company and Falcon Readymix Company to supply the building materials for the Group Real estate projects, as well as transactions with Related Parties outside Qatar such as Nest Investment (Holding) Limited Company, Group of Trust International Companies, which provides technical assistance to the Company in the field of Insurance and Reinsurance, in particular in the field of Reinsurance Bouquet Administration and Information Technology are conducted in full transparency to achieve the Company s interest. All these transactions with Related Parties are reported in the Company s Financial Statements and presented to the Board and the General Assembly for approval. It is to be noted that with effect from June 30th 2017, the Company has ended all its contracts with Trust ReBahrain. Disclosure: The Company is fully committed to all the disclosure requirements set forth in the Corporate Governance Code for Companies and Legal Entities Listed on the Main Market regulated by the Qatar Financial Markets Authority (QFMA) and by implementing QCB s Executive Instructions. The Board is responsible for disclosing the required disclosures in a complete and accurate manner. The information included in such disclosures shall be true and sufficient ensuring fairness by providing the information on a timely basis. Shareholders Equity: The Company s issued and paid up share capital is (QR 875,067,030) divided into 87,506,703 ordinary shares, with a nominal value of QR 10 for each share. The Company has not issued any preference shares, bonds or other securities other than the ordinary shares issued to the Company s Ordinary Shareholders. The details of the capital structure are clearly disclosed in the Annual Report of the Company. The Rights of Other Stakeholders: The Company s general policy adopted by the Board, to respect and safeguard the rights of the Company s other Stakeholders, including employees, creditors, clients, suppliers, strategic partners and investors, in accordance with the Corporate Governance Code and Professional Code of Conduct. The Company also ensures that the Stakeholders have an access to the relevant information in a transparent manner enabling them to make their decisions based on accurate and sound information. The Company maintains an open and transparent communication channels with the Shareholders, investors and other stakeholders, where it regularly communicates information relating to the Company s financial position and performance and future business plans and investment projects in the Official Newspapers, Press Conferences and also on its website. Distribution of Profits: The profit distribution ratios from cash dividends and/or bonus shares shall be proposed by the Board based on the Company s financial position and performance at the end of its

60 60 Qatar General Insurance and Reinsurance Company Q.P.S.C. Annual Report 2017 financial year and the Company s future business plan. This shall be discussed, approved and adopted by the General Assembly in their Ordinary and ExtraOrdinary Annual Meeting, in the event of the distribution of bonus shares. QGIRCO

61 61 Fatwa and Shari a Supervisory Board Report To the Shareholders Peace and blessings of Allah be upon you, As per the appointment letter, we have drafted the contracts, agreements and policies of General Takaful Company (the Company ) and reviewed its system and articles of associations, and we have reviewed the used principles and contracts related to transactions and application executed during the period. In the Name of Allah, the Most Beneficent, the Most Merciful All praise to Allah, the Lord of all the Worlds, and peace be upon the last messenger and prophet, sent as a mercy to all mankind, and his family, companions and followers till the Day of Judgement. Prof. Dr. Ali M. Al Quradaghi Chairman of Fatwa and Shari a Supervisory Board We conducted our review to form an opinion as to whether the Company has complied with Shari a rules and principles as well as specific fatwa, rulings and guidelines issued by us. The Company s management is responsible for ensuring that the Company conducts its business in accordance with Shari a rules and principles. It is our responsibilities to form an independent opinion based on our review of the operations of the Company, guide the management to comply with Shari a rules and to prepare a report to Shareholders. We planned and performed our review to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the Company has not violated Shari a rules and principles. Our review through Internal Shari a Audit includes examining contracts, applied models and followed procedures.