Following the release of its preliminary results, International General Insurance (IGI) has now announced its financials for the final quarter and the entirety of 2023.
For the quarter ending December 31, 2023, IGI reported a net income leap of 46.7%, totaling $33.0 million, up from $22.5 million in the same period of 2022. This surge was attributed mainly to an $18.8 million rise in underwriting income and a favorable shift of $6.4 million in net investment income.
However, the growth was slightly tempered by a $6.1 million decline in the fair value of derivative financial liabilities and a $5.5 million increase in general and administrative expenses. The annualized return on average equity also saw an uptick to 26.1% in the fourth quarter of 2023 from 22.7% in the corresponding quarter of the previous year.
The company’s core operating income, as per non-GAAP measures, stood at $30.0 million for the quarter ending December 31, 2023, a rise from $13.6 million in the same quarter of 2022. The core operating return on average equity (annualized) improved to 23.7% in the fourth quarter of 2023, up from 13.7% in the final quarter of 2022.
Over the full year, IGI’s net income rose by 32.5% to $118.2 million, from $89.2 million for the year ended December 31, 2022. This increase was largely fueled by a $34.5 million boost in underwriting income and a $35.8 million positive movement in net investment income, though it faced a $31.9 million adverse adjustment in the fair value of derivative financial liabilities and an $11.7 million rise in general and administrative expenses.
The company’s return on average equity for the year was recorded at 24.8%, compared to 22.5% in 2022.
The core operating income for 2023 amounted to $133.8 million, a considerable increase from $93.9 million in 2022, with the core operating return on average equity marking at 28.1% for the year, compared to 23.7% in the previous year.
In terms of underwriting results, the fourth quarter of 2023 saw underwriting income jump by 76.1% to $43.5 million from $24.7 million in the fourth quarter of 2022, largely due to higher net premiums earned from portfolio growth.
Gross written premiums for the quarter ended December 31, 2023, were $164.9 million, marking a 6.5% increase from $154.8 million in the corresponding quarter of 2022, with growth primarily in the short-tail segment. The loss ratio improved to 47.6% in the fourth quarter of 2023, from 55.6% in the same period of 2022, while the combined ratio saw a significant improvement, settling at 81.8% compared to 92.1% in the fourth quarter of 2022.
For the entire year of 2023, underwriting income rose by 23.2% to $183.1 million from $148.6 million in 2022, driven by a substantial $70.8 million increase in net premiums earned due to growth in the short-tail and reinsurance segments, although offset by $31.5 million in higher net loss and loss adjustment expenses.
The gross written premiums for the year totaled $688.7 million, an 18.3% increase from $582.0 million in 2022, spurred by expansion in the reinsurance and short-tail segments. The combined ratio for the year showed improvement, moving to 76.7% from 78.5% in 2022.
“While the world around us has become increasingly polarized and our industry increasingly challenged, IGI, as always, remains focused on consistently executing our strategy, growing our company, and being a reliable and trusted partner to our brokers and clients,” said CEO Waleed Jabseh. “We are committed to our strategic priority of managing the cyclicality and inherent volatility of our business, and focused on maximizing shareholder value through active and efficient capital management.”
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