Qatar Telecom Sign Deal with SEIB Insurance

Posted on Jun 20, 2011 by Sergio Ulloa (G+)  | Tags: Qatar

Over the weekend, Qatar Telecom (Qtel) signed a major insurance contract with SEIB Insurance Company for Directors and Officers Liability Insurance coverage. The deal will cover an estimated US$600 million in net liabilities and represents one of the largest insurance contracts ever agreed upon for a singular entity. Speaking at the signing ceremony, Sheikh Saud Bin Nasser Al Thani, Chief Executive of Qtel, explained that the company had carefully selected a comprehensive insurance program and partnership with Qatar-based SEIB to ensure that they would be able to meet the needs of their executives during an important time in the company's ambitious expansion strategy. Qtel is looking to build upon its position as Qatar's leading provider of world class telecommunications services and develop a substantial presence in other competitive markets. "Qtel is focused upon delivering sustainable growth and enhanced services for the people of Qatar, and achieving this goal requires us to build firm foundations for our operations. We are pleased and proud to have selected SEIB Insurance Company as our partner for this project, because they have tailored their services to underwrite our strategy for risk management," Sheikh Al Thani told the press. SEIB Insurance & Reinsurance Company CEO, Farid Chedid responded in kind, asserting that the liability insurance policies designed for Qtel would reflect the company's growing international profile and provide ample support with the highest standards of service, value and integrity, across its operations. "We are proud that Qtel has placed its trust in us for this key pillar in its risk management strategy. SEIB aims to deliver the highest standards of service, value and integrity, and it is a major step for us to work with a global giant like Qtel that shares our values so strongly," Mr.Chedid said. Directors and officers liability insurance (commonly referred to as D&O) has become an essential component of corporate insurance worldwide in recent years. Principally D&O will protect directors and officers from all liability arising from actions associated to their corporate positions. As the industry has matured and responded to market pressures and the development of case law, D&O insurance has developed beyond its original basic coverage options and become highly specialized. In high finance, for example, D&O is commonly used to settle all manners of securities fraud between dissatisfied investors and corporate officers. Qtel trust that the procurement of a wide-ranging D&O policy will provide greater peace of mind for all their company stockholders. The agreement follows a busy restructuring period by Qatar's top communications company that has seen a recent series of management changes necessary for driving growth both within the Emirates and internationally. This past week, The Qtel Group also held the first industry innovation symposium of its kind in the region, addressing key initiatives and the growth potential in the dynamic Middle Eastern, North African and South Asian markets, in which the company now operates. Deemed a success by all partners who attended, Qatar Telecom will be hosting a second conference in Indonesia later in 2011. The size of this insurance deal between two promising Qatari entities demonstrates the increasing importance of the country's businesses towards the region's overall economic development. The continued financial progression of countries like the UAE, Qatar and Saudi Arabia is set to drive the insurance sector across the Middle Eastern region. This will lead to intensified competition, with global insurers eager to gain access to new and promising business opportunities. In conjunction with ambitious business ventures, Qatar has unveiled a comprehensive healthcare reform strategy. The six year plan is designed to transform the country's existing medical infrastructure into a comprehensive and integrated world-class healthcare system that will achieve the positive health outcomes set about in the Qatar National Vision 2030 development plan. Central to the health system overhaul will be the implementation of a compulsory national insurance scheme. The system would establish a public-private mix whereby a new federal authority would negotiate closely with private insurers over provision of services. A complimentary basic health service package would be introduced but all those able to pay (including expatriates) would be expected to enter the private insurance market. How this system will affect the local health insurance market is yet to be determined but many multi-national providers remain interested in the region and the emerging middle class customers who may demand their services regardless. The general outlook for the insurance industry in the Middle East and Gulf regions remains difficult to determine. Prior to the civil unrest and political revolutions in Tunisia, Egypt and Libya, the forecast was very positive throughout. The preexisting low insurance penetration levels, high growth rate in population and emerging economies were all conducive to growth. The degree of increased risk now varies much more from country to country. The three most lucrative markets in the region, UAE, Qatar, and Saudi Arabia, have remained strong with renewed commitment to health infrastructure encouraging further demand for insurance services. Areas under more duress are more likely to suffer from disruption to business activities as well as liquidity issues. The degree to which the current political turmoil will spill over into the economy and become a more substantial long term issue in many Middle Eastern countries is still evolving. Companies Mentioned Qatar Telecom Qatar Telecom (Qtel) is a comprehensive telecommunications company operating throughout 17 countries and providing voice and data services for over 60 million customers. Qtel is the largest telecommunications company by number of operations in the MENA region (ten operations as of 2010) and are committed to expanding further SEIB Insurance SEIB Insurance and Reinsurance Company (SEIB) is a national Qatari company, licensed in 2009 by the Qatar Financial Center Regulatory Authority. SEIB provides corporate and retail insurance products, specialized to meet the needs of each and every client.