International General Insurance Holdings Ltd. · NASDAQ:IGIC
International General Insurance — Q3 2020 Earnings Presentation
33 slides from International General Insurance's earnings presentation, November 2020
Slide 1: IGI Investor Presentation Q3 2020
IGI Investor Presentation Q3 2020 November 2020 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED International General Insurance Holdings Ltd.
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the “safe harbour” provisions of the Private Securities Litigation Reform Act of 1995. The expectations, estimates, and projections of the business of IGI may differ from its actual results and,
Slide 3: Company Overview
COMPANY OVERVIEW Section 1
Slide 4: IGI is a Specialty (Re)Insurer with a Proven Track Record
IGI is a Specialty (Re)Insurer with a Proven Track Record “Specialty”: (1) a distinctive mark or quality; (2) a product of a special kind or of special excellence” (1) IGI are specialists with recognized expertise in their lines of businesses Local, specialized knowledge resulting in a 4 point combi
Slide 5: Key Financial Metrics
Key Financial Metrics Market Capitalization / Stock Price (NASDAQ: IGIC) $332.1mm / $7.31(1) Shareholders’ Equity / BVPS $379.7mm / $8.36 LTM Q3 2020 Gross Written Premium $426.7mm YTD Q3 2020 Operating ROAE 11.6% Ordinary Semi-Annual Dividend Payout Ratio 40% of Reported Net After-Tax Profit Financ
Slide 6: IGI - Global Specialty (Re)Insurer Evolution
IGI - Global Specialty (Re)Insurer Evolution 2009 Commenced $50mm underwriting 2007 General Aviation capital raise Established business 2012 Bermudian Commenced subsidiary Commenced underwriting underwriting Ports & 2002 2005 Commenced 2008 Professional Terminals Assigned BBB underwriting Assigned A
Slide 7: Specialty Business Diversified by Line, Geography, and Broker Distribution
Specialty Business Diversified by Line, Geography, and Broker Distribution YTD Q3 2020 GWP by Line of Business YTD Q3 2020 GWP by Geography YTD Q3 2020 GWP by Broker General Aviation Political Marine South 4% Violence Treaty 2% Liability America Australasia Worldwide 1% 3% 3% Reinsurance 1% Caribbea
Slide 8: Market Respected and Recognized Executive Management Team
Market Respected and Recognized Executive Management Team ▪ Highly experienced management team with an average of more than 30 years of industry experience ▪ Strong business culture of recognizing and rewarding achievers ▪ Family owners actively manage business and have closely aligned interests wit
Slide 9: Significant Insider Ownership Creates Strong Alignment of Interest
Significant Insider Ownership Creates Strong Alignment of Interest IGIC Shareholder Base Review of Lock-up Agreements Shares Subject to Restricted Shares % of Lock-up Total Shares O/S(2) 2.5% Wasef Jabsheh(3) 12,327,894 27.1% Tiberius Sponsors, its transferees and certain 1,520,000 3.3% investors(1)
Slide 10: IGI Values Centre Around Integrity, Genuine Approach and Innovation
IGI Values Centre Around Integrity, Genuine Approach and Innovation ▪ The foundation of IGI is built on integrity, prioritizing honesty Innovative Genuine and doing what is right • Entrepreneurial • Collaborative environment approach • Employee • Global team ▪ Genuine culture that promotes responsib
Slide 11: Investment Highlights
INVESTMENT HIGHLIGHTS Section 2
Slide 12: Key Investment Highlights
Key Investment Highlights 1▪ Specialty Individual Risk Underwriter with Strategy to Protect Capital & Optimize Underwriting Profitability 2▪ Superior Underwriting Performance Even in Heavier Loss Years 3▪ Active Cycle Management Balancing Growth and Risk Selection 4▪ Track Record of Delivering Resul
Slide 13: Specialty Individual Risk Underwriter with Strategy to Protect Capital & Optimize Underwriting Profitability
Specialty Individual Risk Underwriter with Strategy to Protect Capital & 1 Optimize Underwriting Profitability Intelligent Risk Selection & Management Significantly Less Volatility from Catastrophes ($ in bn) Industry 2011 2012 2018 IGI Cat Loss Japan, New Hurricane Sandy Hurricane Michael, Combined
Slide 14: Superior Underwriting Performance Even in Heavier Loss Years
2 Superior Underwriting Performance Even in Heavier Loss Years Combined Ratio 120% IGI Combined Ratio higher than peers 100% 80% IGI Combined Ratio lower than peers 60% 40% Peer Average Combined Ratio(1): 94% IGI Average Combined Ratio: 90% 20% IGI Combined Ratio Advantage: 4% 0% 2010 2011 2012 2013
Slide 15: Active Cycle Management Balancing Growth and Risk Selection
3 Active Cycle Management Balancing Growth and Risk Selection GPW by Business Segment ($mm) $427 Accelerating Growth $349 Strong Cycle $302 Management $275 $252 $240 $242 $232 $226 $203 $179 $153 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 LTM Q3 2020 Short-Tail Long-Tail Reinsurance Prud
Slide 16: Track Record of Delivering Results through the Market Cycle
4 Track Record of Delivering Results through the “Market Cycle” Combined Ratio Average: 90% 105% 93% 94% 87% 89% 88% 86% 87% 89% 87% 84% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 YTD Q3 2020 Un-Levered Core Operating ROAE Average: 10% 13% 12% 12% 12% 12% 12% 10% 9% 9% 7% 0% 2010 2011 2012 20
Slide 17: Thoughtful Reserving Philosophy Anchored in Conservatism and Balance Sheet Preservation
Thoughtful Reserving Philosophy Anchored in Conservatism 5 and Balance Sheet Preservation ▪ IBNR reserves reflect growth of specialty long-tail lines − IGI took advantage of the improving market in specialty long-tail lines with 2020 YTD rate increases on average of 30% ▪ History of releasing reserv
Slide 18: Optimized, Cost-Efficient Global Operations with Physical Presence in Key Markets
6 Optimized, Cost-Efficient Global Operations with Physical Presence in Key Markets Non-Underwriting Employees by Location Casablanca Labuan London Dubai 1% 2% Underwriting headquarters 3% Bermuda Amman Group holding company domicile Operational headquarters Underwriting parent company London Amman
Slide 19: High Quality ROAE with Managed Volatility Among Best-in-Class Peers
7 High Quality ROAE with Managed Volatility Among Best-in-Class Peers Bubble size representative of P/BV multiple 18.0% KNSL(1) 15.0% 2010 - Q3 2020 Average Operating ROAE BEZ-LON HSX-LON RLI 12.0% IGI RE ACGL LRE-LON 9.0% High ROAE RNR WRB Avg. P/BV: MKL AXS JRVR 1.56x 6.0% 3.0% ARGO 0.0% 12.0% 10.
Slide 20: Opportunity to Capitalize on Sector Tailwinds in Core Business
8 Opportunity to Capitalize on Sector Tailwinds in Core Business Cumulative Net Rate Movement Specialty Short-Tail Specialty Long-Tail 29.5% 30.2% 29.2% 24.9% 23.1% 20.4% 19.3% 18.2% 17.7% 10.0% 9.6% 7.8% 8.3% 7.2% Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 J
Slide 21: Well-positioned for Future Shareholder Value Creation Opportunities
9 Well-positioned for Future Shareholder Value Creation Opportunities Entry into U.S. market ▪ $15mm of gross written premiums year-to-date Q3 2020 On-going late stage discussions for European platform post-Brexit ▪ Capitalize on European market opportunities Introduction of new lines of business ▪
Slide 22: Disconnect Between IGIC Fundamentals and Stock Price
10 Disconnect Between IGIC Fundamentals and Stock Price YTD Q3 2020 Financials Price Performance Since Operating Return on Price-to-Book Multiple YoY Revenue Growth Combined Ratio IGIC IPO (3/18/20) Average Equity KNSL 122.5% KNSL 10.15x KNSL 43.7% IGIC 86.5% KNSL 13.0% JRVR 68.9% RLI 4.02x IGIC 31.
Slide 23: Financial Performance
FINANCIAL PERFORMANCE Section 3
Slide 24: Selected Financial Data
Selected Financial Data Year ended December 31, Nine months ended September 30, ($ in mm) 2016 2017 2018 2019 2019 2020 Operating Results: Gross Written Premiums $232.2 $275.1 $301.6 $349.2 $260.2 $337.7 Underwriting Income 51.6 23.6 56.1 52.0 41.7 62.5 Core Operating Earnings $29.5 $1.3 $28.6 $21.1
Slide 25: Defensively Positioned, Conservative Investment Portfolio
Defensively Positioned, Conservative Investment Portfolio Total Investment Income, Net ($mm) Investment Portfolio by Asset Class Real Estate Equity Shares 5.6% 6.8% $8.3 $8.1 Short-Term Deposits 32.0% Fixed Income Securities 55.6% $3.0 $2.5 Q3 2020 Total Invested Assets: $603.4 million Fixed Income
Slide 26: COVID-19 Update
COVID-19 UPDATE Section 4
Slide 27: IGI Response to COVID-19 Pandemic
IGI Response to COVID-19 Pandemic IGI’s priority is the health, safety and well-being of our people and their families ▪ Transparent and consistent communication among Board, Management and all departments Clients, Brokers ▪ No significant change in IGI view of pandemic impact: $2 million reserve &
Slide 28: COVID-19 Exposures
COVID-19 Exposures NO event cancellation NO travel protection NO U.S. based business interruption (facultative policies written prior to March 2020) NO U.S. commercial general liability NO U.S. workers compensation Limited D&O (U.K. based) - Subject to reinsurance retention Limited PI covers for Bro
Slide 29: Appendix
Appendix INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED
Slide 30: IFRS Summary Income Statement
IFRS Summary Income Statement Year Ended December 31, Nine Months Ended September 30, ($ in mm) 2016 2017 2018 2019 Q3 2019 Q3 2020 Gross Written Premiums $232.3 $275.1 $301.6 $349.2 $260.2 $337.7 Reinsurance Share of Insurance Premiums (82.7) (114.3) (98.2) (97.1) (70.6) (89.5) Net Written Premiums
Slide 31: IFRS Reconciliation – Core Operating Earnings
IFRS Reconciliation – Core Operating Earnings Year Ended December 31, Nine Months Ended September 30, ($ in mm) 2016 2017 2018 2019 Q3 2019 Q3 2020 Profit For the Period $32.9 $7.0 $25.5 $23.6 $19.2 $20.7 (1) Net Realized Losses (Gains) on investments (2.7) (3.1) (1.3) (1.0) (0.3) (1.3) Net Impairme
Slide 32: Book Value per Common Share and Diluted Book Value per Common Share
Book Value per Common Share and Diluted Book Value per Common Share ($ and share count in mm, except per share values) As of September 30, 2020 Shares Common Book Value Potential Shares Outstanding Equity per Share Basic Book Value per Share 45.4263 $379.7 $8.36 Dilutive Impact of Shares Subject to
Slide 33: For more information:
For more information: Investor Relations Registered and Head Office, Bermuda Robin Sidders (Head of Investor Relations) International General Insurance Holdings Ltd. Email: Robin.Sidders@iginsure.com 44 Church Street, Telephone: +44 2072 200100 Hamilton HM 12, Mobile: +44 7384 514785 Bermuda Telepho
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