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2023 Report2 CONTENTS ABOUT IGIH BOARD OF DIRECTORS LETTER FROM THE BOARD OF DIRECTORS FINANCIAL STATEMENTS IGI OFFICES 3 2 5 7 8 52 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 About IGIH International General Insurance Holdings Limited (IGIH) is registered in the Dubai International Financial Centre (DIFC) with operations in Bermuda, Jordan, Malaysia and a wholly owned subsidiary in the U.K. IGI Bermuda is a class 3B (re)insurer regulated by the Bermuda Monetary Authority (BMA). This subsidiary is the principal underwriting entity for the Group. The Group also has a branch in Labuan, Malaysia, registered as a second-tier offshore reinsurer. Both Bermuda and UK subsidiaries are rated A- (Excellent) by A.M. Best Company Inc. IGI Group of companies underwrites a worldwide portfolio of energy, property, marine, engineering, casualty, financial institutions, general aviation, ports & terminals, political violence and non-proportional reinsurance treaty business with the main geographical focus being the Afro-Asian markets. IGIH has assets in excess of US$ 672 million as at 31st December, 2013. 4 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED BOARD OF DIRECTORS 5 Board Of Directors Mr. Mohammed Abu Ghazaleh Chairman ( Chairman and CEO, Fresh Del Monte Produce Inc. - USA) Mr. Wasef Jabsheh CEO & Vice Chairman Mr. Khalifa Al Mulhem Director ( Chairman, National Polypropylene Company Limited - KSA) Mr. Hani Tarazi Director ( Saba IP & Co. - UAE) Mr. Khaled Sifri Director (CEO of Arab Emirates Investment Bank - UAE) Mr. Hani Jabsheh Director (CEO,Al Bawaba.com) Al Sayyida Rawan Al Said Director (Managing Director & Group Chief Executive of ONIC Holding Group) 6 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED LETTER FROM THE BOARD OF DIRECTORS 7 Letter From the Board of Directors It gives us great pleasure to include herewith the full report on our 2013 performance. The past year has proven to be another successful year for IGI, achieving record profits over the Company’s twelve year history. Despite a flood of new capital entering the insurance market in 2013, IGI was able to realize a healthy growth rate. Our top line growth represented a 6.4% increase, with net income growing by 23.8%. 2013 saw the highest income levels in the Company’s career, allowing it to offer investors a 12.7% return on equity. 2013’s figures confirm that IGI’s business strategy, underwriting management and cost efficiency collectively are able to withstand the current competitive environment. 2013 was a year of minimal catastrophes, with hail storms in Germany, flooding in the UK and Europe, and super typhoon Haiyan as the only major incidents to afflict the international insurance market. Estimated costs to the industry were US$ 31 billion which falls well below the average figures of the past 10 years of US$56 billion. The continued civil and political unrest in the Middle East region with its resounding negative effects on global political and economic dynamics has galvanized the Company to integrate and innovate relevant lines of business to counteract market turbulence. In early 2013, we further diversified our overall portfolio in response to such changing market conditions. We introduced political violence as a new class of business, which has gained traction and proven to be a valuable addition. We also continued to grow our Ports and Terminals book profitably. For 2014, we anticipate a greater level of competition, ultimately placing the insurance industry in a softer market. IGI will remain vigilant in seeking out geographical expansion over the coming year, and will continue to be opportunistic, whether through current business line expansion or new product offerings. We expect our casualty book to grow robustly in 2014 and we intend to increase IGI’s presence in leading complex business. We continue to grow our operations in Dubai and the UK. We have boosted our capacity by expanding underwriting resources in both office locations. Alongside seeking out further expansion, we will press on with our strategy of optimizing resources and increasing efficiency of assets deployed to further increase shareholder equity. Finally, one activity which we expect to remain generally unchanged in the financial year of 2014 is investments: last year’s return of 2.11% reflected our management team’s successful hands-on approach, and an improvement on the previous year’s 1.92%. Although we do not expect to see any major changes in the portfolio mix, we will remain vigilant in seeking out investment opportunities which provide the best return for our shareholders whilst keeping our conservative principles intact. Highlights for 2013 include the following: • Gross written premium in 2013 was US$ 240 million, an increase of 6.4% compared to US$ 225 million for 2012. Underwriting profit grew to US $ 43.5 million for 2013, an increase of 18.5% from US$ 36.7 million in 2012. • Investment income for the year stood at $9.4 million, an increase of 27% compared to US$ 7.4 million for 2012. • The Combined Ratio for 2013 was 87.93% compared to 88.01% for 2012. • Net Profit amounted to US$ 31.2 million for 2013 against US$ 25.2 million for 2012, an increase of 24%. • • Total assets were US$ 672 million at the end of 2013, an increase of 10.4% compared to US$ 623 million as of 31st December, 2012. • December, 2012. Shareholders’ equity rose to US$ 246.3 million at the end of 2013, up 7.8% compared to US$ 232.1 million as of 31st As always, we would like to extend a thank you to all our clients and producers for their untiring support throughout 2013. We would also like to express our appreciation to all our employees for their unique efforts and contributions this year. We look forward to working together in 2014 to fulfill the visions and ambitions of the Company and to further raising the bar on industry standards. We plan to replicate our successes while consolidating our position as a leading underwriting operation in the region. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED AUDITORS` REPORT 8 9 Ernst & Young P.O.Box 9267 28th Floor, Al Attar Business Tower Sheikh Zayed Road Dubai, United Arab Emirates Tel: +971 4 332 4000 Fax: +971 4 332 4004 dubai.uae@ae.ey.com ey.com/mena INDEPENDENT AUDITORS’ REPORT TO THE SHAREHOlDERS OF INTERNATIONAl GENERAl INSUrANCE HOLDINGS Ltd. Report on the consolidated financial statements We have audited the accompanying consolidated financial statements of International General Insurance Holdings ltd (“the Company”) and its subsidiaries (together “the Group”), which comprise the consolidated statement of financial position as at 31 December 2013 and the consolidated statements of income, other comprehensive income, changes in equity and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information. Management’s responsibility for the consolidated financial statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial reporting Standards and the applicable provisions of the Companies Law pursuant to DIFC law No. 2 of 2009, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors’ Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audit. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the shareholders of the Company as a body, for our audit work, for this report, or for the opinions we have formed. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as at 31 December 2013 and its financial performance and its cash flows for the year then ended, in accordance with International Financial reporting Standards. Report on other legal and regulatory requirements We also confirm that, in our opinion, the consolidated financial statements include, in all material respects, the applicable requirements of the Companies law pursuant to DIFC law No. 2 of 2009. We have obtained all the information and explanations which we required for the purpose of our audit. To the best of our knowledge and belief, no violations of the companies law pursuant to law No. 2 of 2009 have occurred during the year which would have had a material effect on the business of the Company or on its financial position. 16 March 2014 Dubai , United Arab Emirates INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED FINANCIAL RESULTS 10 FINANCIAL RESULTS 11 12 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 31 DECEMBER 2013 13 Notes 2013 USD 2012 USD 3 4 5 6 7 8 9 10 11 24 13 14 15 16 12 18 19 20 3,849,915 3,525,920 180,389 250,498 11,703,630 12,228,572 28,550,500 29,339,762 202,096,288 151,216,442 27,621,280 30,754,592 95,109,788 97,742,261 73,933 2,705,346 730,618 137,982 2,189,023 820,542 93,727,503 99,989,127 205,658,242 194,500,512 672,007,432 622,695,233 143,375,678 143,375,678 (12,000,000) - (214,298) (230,995) 22,821,709 15,325,027 92,346,727 73,671,131 246,329,816 232,140,841 391,695,955 358,620,524 3,111,273 24,241,201 6,629,187 3,649,283 19,567,472 8,717,113 425,677,616 390,554,392 672,007,432 622,695,233 ASSETS Premises and equipment Intangible assets Investment in associated companies Investment properties Investments Deferred policy acquisition costs Insurance receivables Trade receivables Other assets Deferred tax assets reinsurance assets Cash and bank balances TOTAL ASSETS EQUITY AND LIABILITIES Equity Issued share capital Treasury shares Foreign currency translation reserve Cumulative changes in fair values retained earnings Total equity Liabilities Insurance contracts liabilities Other liabilities Insurance payables Unearned commissions Total liabilities TOTAL EQUITY AND LIABILITIES The consolidated financial statements were authorised for issue in accordance with a resolution of the Board of Directors on 16 March 2014. The attached notes 1 to 27 form part of these consolidated financial statements INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2013 15 2013 USD 2012 USD Profit for the year 31,263,407 25,255,190 Other comprehensive income to be reclassified to profit or loss in subsequent periods: Fair value changes Currency translation differences Other comprehensive income for the year Total comprehensive income for the year 7,496,682 16,697 7,513,379 9,998,748 55,657 10,054,405 38,776,786 35,309,595 14 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2013 Gross written premiums Change in unearned premiums Gross earned premiums Reinsurers’ share of insurance premiums Reinsurers’ share of change in unearned premiums Reinsurers’ share of gross earned premiums Net premiums earned Claims Reinsurers’ share of claims Commissions earned Policy acquisition costs Net underwriting result Net investment income Share of profit from associated companies General and administrative expenses Other income Loss on exchange Profit before tax Notes 12 (a) 12 (a) 12 (a) 12 (a) 12 (b) 12 (b) 20 8 21 5 2013 USD 2012 USD 240,008,259 225,569,256 1,058,400 (19,265,207) 241,066,659 206,304,049 (58,767,697) (49,760,815) (1,649,773) (8,100,260) (60,417,470) (57,861,075) 180,649,189 148,442,974 (123,021,028) (106,735,933) 24,246,187 9,350,877 (47,667,348) 24,299,306 14,361,470 (43,579,118) 43,557,877 36,788,699 9,985,201 408,709 6,937,296 525,655 (21,663,540) (19,739,392) 14,375 (949,291) 50,700 (9,778) 31,353,331 24,553,180 Tax (expense) credit on results of subsidiary 24 (89,924) 702,010 PROFIT FOR THE YEAR 31,263,407 25,255,190 The attached notes 1 to 27 form part of these consolidated financial statements The attached notes 1 to 27 form part of these consolidated financial statements 16 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2013 OPERATING ACTIVITIES Profit before tax Adjustments for: Depreciation and amortization Gain on sale of available-for-sale investments Provision for doubtful debts Impairment of available-for-sale investments Gain on sale of premises and equipment Loss on revaluation of held for trading investments Dividends and interest income Share of profit from associated companies Net foreign exchange differences Cash from operations before working capital changes Working capital adjustments reinsurance assets Insurance contracts liabilities Deferred policy acquisition costs Insurance receivables Trade receivables Other assets Unearned commission Insurance payables Other liabilities Net cash from operating activities INVESTING ACTIVITIES Purchase of premises and equipment Proceeds from sale of premises and equipment Purchase of intangible assets Purchase of available-for-sale investments Proceeds from maturity of held to maturity investments Proceeds from sale of available-for-sale investments Proceeds from redemption of trading securities Purchase of investment properties Dividends received from associated companies Matured time deposits – long term Dividends and interest income Net cash (used in) from investing activities FINANCING ACTIVITIES Dividends paid Purchase of treasury shares Net cash used in financing activities NET CHANGE IN CASH AND CASH EQUIVALENTS Net foreign exchange differences Cash and cash equivalents at the beginning of the year Notes 2013 USD 2012 USD 3,4 21 9 21 21 21 5 3 4 5 21 17 16 31,353,331 24,553,180 961,457 785,420 (1,622,258) 494,000 895,203 (14,375) 3,972 (9,628,530) (366,140) 900,000 1,231,640 (6,127) 63,782 (8,073,959) (408,709) (525,655) 949,291 9,778 22,983,382 18,571,919 6,261,624 33,075,431 3,133,312 2,138,473 64,049 (499,626) (2,087,926) 4,673,729 (538,010) 69,204,438 (432,633) 32,097 (11,170) (64,367,635) 79,972 21,514,036 113,546 - 933,651 - 9,628,530 (32,509,606) 8,154,930 36,272,149 (1,302,646) 1,759,972 98,312 418,766 (497,278) (18,259,540) 763,689 45,980,273 (1,009,428) 8,454 (152,812) (24,705,631) 169,492 16,841,394 - (176,608) - 5,444,160 8,073,959 4,492,980 (12,587,811) (12,000,000) (24,587,811) 12,107,021 (949,291) 194,500,512 205,658,242 (8,602,540) - (8,602,540) 41,870,713 (9,778) 152,639,577 194,500,512 l a t o T D S U D S U i d e n a t e R i s g n n r a e D S U D S U D S U n i e g n a h c e v i t a l u m u C f o e u l a v r i a f s t n e m t s e v n i i n g e r o F y c n e r r u c e v r e s e r n o i t a l s n a r t s e r a h s y r u s a e r T e r a h s d e u s s I l a t i p a c D S U I Y T U Q E N I E G N A H C F O S T N E M E T A T S D E T A D I L O S N O C 3 1 0 2 R E B M E C E D 1 3 D E D N E R A E Y E H T R O F I I D E T M I L S G N D L O H E C N A R U S N I L A R E N E G L A N O T A N R E T N I I , 7 0 4 3 6 2 1 3 , , 7 0 4 3 6 2 1 3 , - , 1 4 8 0 4 1 2 3 2 , , 1 3 1 1 7 6 3 7 , , 7 2 0 5 2 3 5 1 , , 9 7 3 3 1 5 7 , , 6 8 7 6 7 7 8 3 , , ) 1 1 8 7 8 5 2 1 ( , ) , 0 0 0 0 0 0 2 1 ( , - - , 7 0 4 3 6 2 1 3 , , ) 1 1 8 7 8 5 2 1 ( , , 2 8 6 6 9 4 7 , - - , 2 8 6 6 9 4 7 , - - - 7 9 6 6 1 , 7 9 6 6 1 , , ) 5 9 9 0 3 2 ( - - - - - ) , 0 0 0 0 0 0 2 1 ( , , 6 8 7 3 3 4 5 0 2 , , 1 8 4 8 1 0 7 5 , , 0 9 1 5 5 2 5 2 , , 5 0 4 4 5 0 0 1 , , 5 9 5 9 0 3 5 3 , , 0 9 1 5 5 2 5 2 , - , 0 9 1 5 5 2 5 2 , ) , 0 4 5 2 0 6 8 ( , ) , 0 4 5 2 0 6 8 ( , - , 9 7 2 6 2 3 5 , , 8 4 7 8 9 9 9 , - , 8 4 7 8 9 9 9 , , 1 4 8 0 4 1 , 2 3 2 1 3 1 , 1 7 6 3 7 , , 7 2 0 5 2 3 5 1 , - - 7 5 6 5 5 , 7 5 6 5 5 , , ) 2 5 6 6 8 2 ( ) 5 9 9 0 3 2 ( , - - - - - - , 6 1 8 9 2 3 6 4 2 , , 7 2 7 6 4 3 2 9 , 9 0 7 , 1 2 8 2 2 , ) 8 9 2 4 1 2 ( , , ) 0 0 0 0 0 0 2 1 ( , , 8 7 6 5 7 3 3 4 1 , - - - - , 8 7 6 5 7 3 3 4 1 , , 8 7 6 5 7 3 3 4 1 , - - - - ) 7 1 e t o n ( r a e y e h t g n i r u d d a p s d n e d v D i i i ) 6 1 e t o n ( s e r a h s y r u s a e r t f o e s a h c r u P 3 1 0 2 r e b m e c e D 1 3 t A e m o c n i i e v s n e h e r p m o c r e h t O e m o c n i i e v s n e h e r p m o c l a t o T 2 1 0 2 y r a u n a J 1 t A r a e y e h t r o f t fi o r P ) 7 1 e t o n ( r a e y e h t g n i r u d d a p s d n e d v D i i i e m o c n i i e v s n e h e r p m o c r e h t O e m o c n i i e v s n e h e r p m o c l a t o T 3 1 0 2 y r a u n a J 1 t A r a e y e h t r o f t fi o r P , 8 7 6 5 7 3 3 4 1 , 2 1 0 2 r e b m e c e D 1 3 t A s t n e m e t a t s l a i c n a n fi d e t a d i l o s n o c e s e h t f o t r a p m r o f 7 2 o t 1 s e t o n d e h c a t t a e h T CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 14 The attached notes 1 to 27 form part of these consolidated financial statements 7 1 18 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 1 - ACTIvITIES International General Insurance Holdings ltd (“the Company”) is incorporated as a company limited by shares under the Companies law, DIFC law No. 2 of 2009 on 7 May 2006 and is engaged in the business of insurance and re-insurance. The Company’s registered office is at unit 1, Gate village 01, P. O. Box 506646, International Financial Centre, Dubai. The Company and its subsidiaries (together “the Group”) operate in the United Arab Emirates, Bermuda, United Kingdom, Jordan and Malaysia. 2 - BASIS OF PREPARATION INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 19 A change in the ownership interest of a subsidiary, without a change of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it: • • • • • • • Derecognises the assets (including goodwill) and liabilities of the subsidiary; Derecognises the carrying amount of any non-controlling interest; Derecognises the cumulative translation differences, recorded in equity, if any; recognises the fair value of the consideration received; recognises the fair value of any investment retained; Recognises any surplus or deficit in profit or loss; and Reclassifies the parent’s share of components previously recognised in other comprehensive income to profit or loss or retained earnings, as appropriate. The consolidated financial statements have been prepared (IFRS) as issued by the International Accounting Standards Board (IASB) and applicable requirements of UAE laws. in accordance with International Financial Reporting Standards Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. The consolidated financial statements have been presented in United States Dollars “USD” which is the Group’s functional currency. All intra-group balances, transactions, income and expenses and profits and losses, including dividends resulting from intra-group transactions, are eliminated in full. The consolidated financial statements are prepared under the historical cost convention modified to include the measurement at fair value of financial assets available-for-sale, financial assets held for trading and investment properties. The Group has the following subsidiaries Basis of consolidation The financial statements of the subsidiaries are prepared for the same reporting year as the Group, using consistent accounting policies. The consolidated financial statements comprise the financial statements of International General Insurance Holdings ltd. and its subsidiaries as at 31 December. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has: International General Insurance Underwriting Jordan Underwriting agency North Star Underwriting Limited United Kingdom Underwriting agency 2013 100% 100% 2012 100% 100% Country of incorporation Activity Ownership International General Insurance Co. Ltd. Bermuda reinsurance and insurance 100% 100% • • • Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee) Exposure, or rights, to variable returns from its involvement with the investee, and The ability to use its power over the investee to affect its returns The following entities are wholly owned by the subsidiary International General Insurance Company Ltd. Bermuda When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: • • • The contractual arrangement with the other vote holders of the investee rights arising from other contractual arrangements The Group’s voting rights and potential voting rights The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the date the Group gains control until the date the Group ceases to control the subsidiary. Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the parent of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on consolidation. International General Insurance Company Ltd. Labuan Branch International General Insurance Company (UK) Limited International General Insurance Company Dubai Ltd. Specialty Malls Investment Co.* Malaysia reinsurance and insurance 100% 100% United Kingdom reinsurance and insurance 100% 100% United Arab Emirates Jordan Insurance intermediation and insurance management 100% 100% real estate properties development and lease 100% 100% * During 2012, the ownership of %100 of equity shares of Specialty Malls Investments Co. was transferred from the subsidiary International General Insurance Underwriting Company - Jordan to the subsidiary International General Insurance Company Ltd. Bermuda. 20 21 Changes in accounting policies The accounting policies adopted are consistent with those of the previous financial year, except for the adoption of new and amended standards and interpretations. Several other amendments apply for the first time in 2013. However, they do not impact the annual consolidated financial statements of the Group. The nature and the impact of each new standard and amendment is described below: IAS 1 Financial Statement Presentation – Presentation of Items of Other Comprehensive Income The amendments to IAS 1 change the grouping of items presented in other comprehensive income (OCI). Items that could be reclassified (or ‘recycled’) to profit or loss at a future point in time (for example, net gain on hedge of net investment, exchange differences on translation of foreign operations, net movement on cash flow hedges and net loss or gain on available-for-sale financial assets) would be presented separately from items that will never be reclassified (for example, actuarial gains and losses on defined benefit plans and revaluation of land and buildings). The amendment affects presentation only and has no impact on the Group’s financial position or performance. The amendment became effective starting from 1 January 2013. IAS 1 Clarification of the requirement for comparative information (Amendment) These amendments clarify the difference between voluntary additional comparative information and the minimum required comparative information. An entity must include comparative information in the related notes to the consolidated financial statements when it voluntarily provides comparative information beyond the minimum required comparative period. The amendments clarify that the opening statement of financial position (as at 1 January 2012 in the case of the Group), presented as a result of retrospective restatement or reclassification of items in financial statements, does not have to be accompanied by comparative information in the related notes. The amendments affect presentation only and have no impact on the Group’s financial position or performance. IAS 19 Employee Benefits (Revised) The IASB has issued numerous amendments to IAS 19. These range from fundamental changes such as removing the corridor mechanism and the concept of expected returns on plan assets to simple clarifications and re-wording. The amendments did not have any impact on the Group’s financial position or performance. The amendment became effective for annual periods beginning on or after 1 January 2013. IAS 28 Investments in Associates and Joint Ventures (as revised in 2011) As a consequence of the new IFRS 11 and IFRS 12, IAS 28 has been renamed IAS 28 Investments in Associates and Joint ventures, and describes the application of the equity method to investments in joint ventures in addition to associates. The amendment became effective for annual periods beginning on or after 1 January 2013. IFRS 7 Disclosures — Offsetting Financial Assets and Financial liabilities — Amendments to IFRS 7 These amendments require an entity to disclose information about rights to set-off and related arrangements (e.g., collateral agreements). The disclosures would provide users with information that is useful in evaluating the effect of netting arrangements on an entity’s financial position. The new disclosures are required for all recognised financial instruments that are set off in accordance with IAS 32 Financial Instruments: Presentation. The disclosures also apply to recognised financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set off in accordance with IAS 32. These amendments became effective for annual periods beginning on or after 1 January 2013 and did not impact the Group’s financial position or performance. IFRS 10 Consolidated Financial Statements and IAS 27 Separate Financial Statements IFrS 10 establishes a single control model that applies to all entities including special purpose entities. IFrS 10 replaces the parts of previously existing IAS 27 Consolidated and Separate Financial Statements that dealt with consolidated financial statements and SIC-12 Consolidation – Special Purpose Entities. IFRS 10 changes the definition of control such that an investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. To meet the definition of control in IFRS 10, all three criteria must be met, including: (a) an investor has power over an investee; (b) the investor has exposure, or rights, to variable returns from its involvement with the investee; and (c) the investor has the ability to use its power over the investee to affect the amount of the investor’s returns. The application of this new standard did not impact the financial position and performance of the Group. IFrS 11 Joint Arrangements and IAS 28 Investment in Associates and Joint Ventures IFRS 11 replaces IAS 31 Interests in Joint ventures and SIC-13 Jointly-controlled Entities — Non-monetary Contributions by Venturers. IFrS 11 removes the option to account for jointly controlled entities (JCEs) using proportionate consolidation. Instead, JCEs that meet the definition of a joint venture under IFRS 11 must be accounted for using the equity method. The application of this new standard did not impact the accounting of joint ventures held by the Group. IFrS 12 Disclosure of Interests in Other Entities IFRS 12 includes all of the disclosures that were previously in IAS 27 related to financial statements, as well as all of the disclosures that were previously included in IAS 31 and IAS 28. These disclosures relate to an entity’s interests in subsidiaries, joint arrangements, associates and structured entities. A number of new disclosures are also required. The Group does not have subsidiaries with material non-controlling interests which are considered significant at the Group level. There are no unconsolidated structured entities and IFRS 12 disclosures are not considered significant for disclosure in the consolidated financial statements. IFrS 13 Fair Value Measurement IFrS 13 establishes a single source of guidance under IFrS for all fair value measurements. IFrS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. This standard became effective for annual periods starting from 1 January 2013. The application of the new standards did not have a significant impact on the financial position or performance of the Group. Standards issued but not yet effective Standards issued but not yet effective up to the date of issuance of the Group’s financial statements are listed below. This listing of standards and interpretations issued are those that the Group reasonably expects to have an impact on disclosures, financial position or performance when applied at a future date. The Group intends to adopt these standards when they become effective. IAS 32 Offsetting Financial Assets and Financial liabilities — Amendments to IAS 32 These amendments clarify the meaning of “currently has a legally enforceable right to set-off”. The amendments also clarify the application of the IAS 32 offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. These amendments are not expected to impact the Group’s financial position or performance and become effective for annual periods beginning on or after 1 January 2014. Investment entities (Amendments to IFRS 10, IFRS 12 and IAS 27) These amendments are effective for annual periods beginning on or after 1 January 2014 provide an exception to the consolidation requirement for entities that meet the definition of an investment entity under IFRS10. The exception to consolidation requires investment entities to account for subsidiaries at fair value through profit or loss. It is not expected that this amendment would be relevant to the Group, since none of the entities in the Group would qualify to be an investment entity under IFrS 10. IFRS 9 Financial Instruments: Classification and Measurement IFRS 9, as issued, reflects the first phase of the IASB’s work on the replacement of IAS 39 and applies to classification and measurement of financial assets and financial liabilities as defined in IAS 39. The standard was initially effective for annual periods beginning on or after 1 January 2013, but Amendments to IFRS 9 Mandatory Effective Date of IFRS 9 and Transition Disclosures, issued in December 2011, moved the mandatory effective date to 1 January 2015. In November 2013 the IASB amended the Financial Instruments (Hedge accounting and IFRS 9, IFRS7, and IAS39), moved the mandatory date. A new mandatory date for IFRS 9 will be determined by the IASB when IFRS 9 is closer to completion. IFrIC Interpretation 21 Levies (IFrIC 21) IFrIC 21 clarifies that an entity recognises a liability for a levy when the activity that triggers payment, as identified by the relevant legislation, occurs. For a levy that is triggered upon reaching a minimum threshold, the interpretation clarifies that no liability should be anticipated before the specified minimum threshold is reached. IFRIC 21 is effective for annual periods beginning on or after 1 January 2014. The Group does not expect that IFRIC 21 will have material financial impact in future financial statements. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 22 23 IAS 39 Novation of Derivatives and Continuation of Hedge Accounting – Amendments to IAS 39 These amendments provide relief from discontinuing hedge accounting when novation of a derivative designated as a hedging instrument meets certain criteria. These amendments are effective for annual periods beginning on or after 1 January 2014. The Group has not novated its derivatives during the current period. However, these amendments would be considered for future novations. liability adequacy test At each statement of financial position date the Group assesses whether its recognised insurance liabilities are adequate using current estimates of future cash flows under its insurance contracts. If that assessment shows that the carrying amount of its unearned premiums (less related deferred policy acquisition costs) is inadequate in the light of estimated future cash flows, the entire deficiency is immediately recognised in income and an unexpired risk provision created. IAS 36 recoverable Amount Disclosures for Non-Financial Assets – Amendments to IAS 36 Impairment of Assets These amendments remove the unintended consequences of IFRS 13 on the disclosures required under IAS 36. In addition, these amendments require disclosure of the recoverable amounts for the assets or CGUs for which impairment loss has been recognised or reversed during the period. These amendments are effective retrospectively for annual periods beginning on or after 1 January 2014. Summary of significant accounting policies revenue recognition Gross premiums Gross general insurance written premiums comprise the total premiums receivable for the whole period of cover provided by contracts entered into during the accounting period. They are recognised on the date on which the policy commences. Premiums include any adjustments arising in the accounting period for premiums receivable in respect of business written in prior accounting periods. rebates that form part of the premium rate, such as no-claim rebates, are deducted from the gross premium; others are recognised as an expense. Premiums collected by intermediaries, but not yet received, are assessed based on estimates from underwriting or past experience and are included in premiums written. Unearned premiums are those proportions of premiums written in a year that relate to periods of risk after the reporting date. Unearned premiums are calculated on a pro rata basis. The proportion attributable to subsequent periods is deferred as a provision for unearned premiums. reinsurance premiums Gross general reinsurance premiums written comprise the total premiums payable for the whole cover provided by contracts entered into the period and are recognised on the date on which the policy incepts. The Group does not discount its liability for unpaid claims as substantially all claims are expected be paid within one year of the statement of financial position date. reinsurance The Group cedes insurance risk in the normal course of business for all of its businesses. reinsurance assets represent balances due from reinsurance companies. Amounts recoverable from reinsurers are estimated in a manner consistent with the outstanding claims provision or settled claims associated with the reinsurer’s policies and are in accordance with the related reinsurance contract. Reinsurance assets are reviewed for impairment at each reporting date, or more frequently, when an indication of impairment arises during the reporting year. Impairment occurs when there is objective evidence as a result of an event that occurred after initial recognition of the reinsurance asset that the Group may not receive all outstanding amounts due under the terms of the contract and the event has a reliably measurable impact on the amounts that the Group will receive from the reinsurer. The impairment loss is recorded in the consolidated statement of income. Gains or losses on buying reinsurance are recognised in the consolidated statement of income immediately at the date of purchase and are not amortised. Ceded reinsurance arrangements do not relieve the Group from its obligations to policyholders. The Group also assumes reinsurance risk in the normal course of business for life insurance and non-life insurance contracts where applicable. Premiums and claims on assumed reinsurance are recognised as revenue or expenses in the same manner as they would be if the reinsurance were considered direct business, taking into account the product classification of the reinsured business. reinsurance liabilities represent balances due to reinsurance companies. Amounts payable are estimated in a manner consistent with the related reinsurance contract. Premiums include any adjustments arising in the accounting period in respect of reinsurance contracts incepting in prior accounting periods. Premiums and claims are presented on a gross basis for both ceded and assumed reinsurance. Unearned reinsurance premiums are those proportions of premiums written in a year that relate to periods of risk after the reporting date. Unearned reinsurance premiums are deferred over the term of the underlying direct insurance policies for risks-attaching contracts and over the term of the reinsurance contract for losses occurring contracts. Commission income Insurance and investment contract policyholders are charged for policy administration services, investment management services, surrenders and other contract fees. These fees are recognised as revenue over the period in which the related services are performed. If the fees are for services provided in future periods, then they are deferred and recognised over those future periods. Claims Claims, comprising amounts payable to contract holders and third parties and related loss adjustment expenses, net of salvage and other recoveries, are charged to income as incurred. Claims comprise the estimated amounts payable, in respect of claims reported to the Group and those not reported at the consolidated statement of financial position date. The Group generally estimates its claims based on appointed loss adjusters or leading underwriters’ recommendations. In addition a provision based on management’s judgement and the Group’s prior experience is maintained for the cost of settling claims incurred but not reported at the consolidated statement of financial position date. Policy acquisition costs Policy acquisition costs represent commissions paid to intermediaries and other direct costs incurred in relation to the acquisition and renewal of insurance contracts which are deferred and expensed over the terms of the insurance contracts to which they relate as premiums are earned. reinsurance assets or liabilities are derecognised when the contractual rights are extinguished or expire or when the contract is transferred to another party. reinsurance contracts that do not transfer significant insurance risk are accounted for directly through the statement of financial position. These are deposit assets or financial liabilities that are recognised based on the consideration paid or received less any explicit identified premiums or fees to be retained by the reinsured. Investment income on these contracts is accounted for using the effective interest rate method when accrued. Interest income Interest income included in investment income is recognised as the interest accrues using the effective interest method, under which the rate used exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Dividend income Dividend revenue included in investment income is recognised when right to receive the payment is established. Premises and equipment Premises and equipment are stated at cost less accumulated depreciation and any impairment in value. Depreciation is calculated on a straight-line basis over the estimated useful lives using the following are the estimated useful lives (Note 3). INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 24 Office Buildings Office Furniture Computers Equipment Leasehold Improvement Vehicles Years 20 5 3 4 5 5 An item of property, plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated income statement when the asset is derecognised. The assets’ residual values, useful lives and method of depreciation are reviewed and adjusted if appropriate at each financial year-end. Impairment reviews take place when events or changes in circumstances indicate that the carrying value may not be recoverable. Impairment losses are recognised in the consolidated statement of income as an expense. Intangible assets Intangible assets acquired through business combinations are recorded at their fair value on that date. Other intangible assets are measured on initial recognition at cost. Intangible assets with finite lives are amortised over the useful economic lives, while intangible assets with indefinite useful lives are assessed for impairment at each reporting date or when there is an indication that the intangible asset may be impaired. Internally generated intangible assets are not capitalised and are expensed in the consolidated statement of income. Indications of impairment of intangible assets are reviewed and their useful economic lives are reassessed at each reporting date. Adjustments are reflected in the current and subsequent periods. Intangible assets include computer software and software licenses. These intangible assets are amortised on a straight line basis over their estimated economic useful lives of 5 years. Impairment and uncollectibility of financial assets An assessment is made at each consolidated statement of financial position date to determine whether there is objective evidence that a specific financial asset may be impaired. If such evidence exists, any impairment loss is recognised in the consolidated statement of income. Impairment is determined as follows: a) For assets carried at fair value, impairment is the difference between cost and fair value; b) For assets carried at cost, impairment is the difference between cost and the present value of future cash flows discounted at the current market rate of return for a similar financial asset; and c) For assets carried at amortised cost, impairment is based on estimated cash flows discounted at the original effective interest rates. The group treats financial assets available-for-sale as impaired when there has been a significant or prolonged decline in the fair value below cost or where other objective evidence of impairment exists. The determination of what is “significant” or “prolonged” requires considerable judgement. In addition, the Group evaluates other factors, including normal volatility in share prices for quoted equities and the future cash flows and discount factors for unquoted equities. 25 Impairment is recognised in the income statement. If, in a subsequent period, the amount of the impairment loss decreases, the carrying value of the asset is increased to its recoverable amount. The amount of the reversal is recognised in the income statement except for equity instruments classified as available for sale investments for which the reversal is recognized in the statement of other comprehensive income. Derecognition of financial instruments The derecognition of a financial instrument takes place when the Group no longer controls the contractual rights that comprise the financial instrument, which is normally the case when the instrument is sold, or all the cash flows attributable to the instrument are passed through to an independent third party. Investment in associated companies The Group’s investment in its associate is accounted for using the equity method of accounting. An associate is an entity in which the Group has significant influence and which is neither a subsidiary nor a joint venture. Under the equity method, the investment in the associate is carried in the statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the associate. Goodwill relating to an associate is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment. The consolidated statement of income reflects the share of the results of operations of the associate. Where there has been a change recognised directly in the equity of the associate, the Group recognises its share of any changes and discloses this, when applicable, in the consolidated statement of changes in equity. Profits or losses resulting from transactions between the Group and the associate are eliminated to the extent of the interest in the associate. The share of profit of the associate is shown on the face of the consolidated statement of income. This is profit attributable to equity holders of the associate and, therefore, is profit after tax and non-controlling interests in the subsidiaries of the associates. The financial statements of the associate are prepared for the same reporting period as the Group. Where necessary, adjustments are made to bring its accounting policies in line with the Group’s. After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Group’s investment in associates. The Group determines at each reporting date, whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in the ‘share of profit of an associate’ in the consolidated income statement. Upon loss of significant influence over the associate, the Group measures and recognises any remaining investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the remaining investment and proceeds from disposal is recognised in profit or loss. Investment properties Investment properties are measured initially at cost, including transaction costs. The carrying amount includes the cost of replacing part of an existing investment property at the time that cost is incurred if the recognition criteria are met; and excludes the costs of day to day servicing of an investment property. Subsequent to initial recognition, investment properties are stated at fair value, which reflects market conditions at the reporting date. Gains or losses arising from changes in the fair values of investment properties are included in the consolidated statement of income in the period in which they arise. Investment properties are derecognised when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in the consolidated statement of income in the period of derecognition. Transfers are made to or from investment property only when there is a change in use. For a transfer from investment property to owner occupied property, the deemed cost for subsequent accounting is the fair value at the date of change in use. If owner occupied property becomes an investment property, the Group accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 26 27 Financial assets loss, Financial assets within the scope of IAS 39 are classified as financial assets at fair value through profit or held-to-maturity investments or available-for-sale financial assets. The Group determines the classification of its financial assets at initial recognition. All financial assets are recognised initially at fair value plus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell the asset. The subsequent measurement of financial assets depends on their classification as follows: Insurance receivables Insurance companies and intermediaries receivables are recognised when due and measured on initial recognition at the fair value of the consideration received or receivable. Subsequent to initial recognition, insurance receivables are measured at amortised cost, using the effective interest rate method. The carrying value of insurance receivables is reviewed for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable, with the impairment loss recorded in the consolidated income statement. Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Financial assets at fair value through profit and loss are carried in the statement of financial position at fair value with changes in fair value recognised in the consolidated statement of income. The Group has not designated any financial assets upon initial recognition as at fair value through consolidated income statement. Held-to-maturity investments Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as held-to-maturity when the Group has the positive intention and ability to hold it to maturity. After initial measurement held-to-maturity investments are measured at amortised cost using the effective interest rate method, less impairment. Impairment losses are recognised in the consolidated statement of income. Available-for-sale financial investments Available-for-sale financial investments include equity and debt securities. Equity investments classified as available-for sale are those, which are neither classified as held for trading nor designated at fair value through profit or loss. Debt securities in this category are those which are intended to be held for an indefinite period of time and which may be sold in response to needs for liquidity or in response to changes in the market conditions. After initial measurement, available-for-sale financial investments are subsequently measured at fair value with unrealised gains or losses recognised as other comprehensive income in the available-for-sale reserve until the investment is derecognised, at which time the cumulative gain or loss is recognised in other operating income, or determined to be impaired, at which time the cumulative loss is recognised in the consolidated statement of income and removed from the available-for-sale reserve. Cash and cash equivalents For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash in hand, bank balances, and short-term deposits with an original maturity of three months or less. Provisions Provisions are recognised when the Group has an obligation (legal or constructive) as a result of a past event, and the costs to settle the obligation are both probable and able to be reliably measured. Cash settled - Share based payment plan A phantom share option plan linked to the value of an ordinary share of the Group as approved by the Board of directors has been declared during 2011. The scheme is applicable to senior executives with more than 12 months service. The amount of bonus is determined by reference to the increase in the book value of shares covered by the option. No shares are actually issued or transferred to the option holder on the exercise of the option. The options vest equally over a span of 5 years from the grant date. The bonus due amounts to the excess of book value on vesting date over grant date plus an additional 20% on the value of the excess. Treasury shares Own equity instruments that are reacquired (treasury shares) are recognised at cost and deducted from equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying amount and the consideration, if reissued, is recognised in share premium. Offsetting Financial assets and financial liabilities are offset and the net amount reported in the consolidated statement of financial position only when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the assets and settle the liability simultaneously. Income and expense is not offset in the consolidated statement of income unless required or permitted by any accounting standard or interpretation. Foreign currencies The Group’s consolidated financial statements are presented in United States Dollars, which is also the functional currency of the Group. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. Transactions and balances Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency spot rate of exchange ruling at the reporting date. All differences are taken to the consolidated statement of income. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. Group companies The assets and liabilities of foreign operations are translated into United States Dollars at the rate of exchange prevailing at the reporting date and their statements of income are translated at exchange rates prevailing at the date of the transactions. The exchange differences arising on the translation are recognised in consolidated statement of comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognised in the consolidated statement of income. Taxation Current income tax Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date in the countries were the group operates and generates taxable income. Deferred tax Deferred tax is provided using the liability method on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credit and unused tax losses can be utilised. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Leasing The Group has no finance lease arrangements. The determination of whether an arrangement is a lease, or contains a lease, is based on the substance of the arrangement at the inception date and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset, even if that right is not explicitly specified in an arrangement. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 28 29 Group as a lessee Finance leases that transfer to the Group substantially all of the risks and benefits incidental to ownership of the leased item, are capitalised at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognised in finance cost in the consolidated income statement. Leased assets are depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term. leases that do not transfer to the Group substantially all the risks and benefits incidental to ownership of the leased items are operating leases. Operating lease payments are recognised as an expense in the income statement on a straight line basis over the lease term. Contingent rentals are recognised as an expense in the period in which they are incurred. Group as a lessor leases in which the Group does not transfer substantially all of the risks and benefits of ownership of the asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same bases as rental income. rental income from operating leases is recognised on a straight-line basis over the term of lease. Fair values The fair value of financial instruments that are actively traded in organised financial markets is determined by reference to quoted market bid prices for assets and offer prices for liabilities, at the close of business on the consolidated statement of financial position date. If quoted market prices are not available, reference is also be made to broker or dealer price quotations. For financial instruments where there is not an active market, the fair value is determined by using valuation techniques. Such techniques include using recent arm’s length transactions, reference to the current market value of another instrument which is substantially the same and/or discounted cash flow analysis. For discounted cash flow techniques, estimated future cash flows are based on management’s best estimates and the discount rate used is a market related rate for a similar instrument. If the fair value cannot be measured reliably, these financial instruments are measured at cost, being the fair value of the consideration paid for the acquisition of the investment or the amount received on issuing the financial liability. All transaction costs directly attributable to the acquisition are also included in the cost of the investment. Judgements In the process of applying the Group’s accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect in the amounts recognised in the financial statements: Operating lease commitments-group as lessor The Group has entered into commercial property leases on its premises and equipment. The Group, as a lessor, has determined, based on an evaluation of the terms and conditions of the arrangements, that it retains all the significant risks and rewards of ownership of its property and so accounts for them as operating leases. Going concern The Group’s management has made an assessment of the Group’s ability to continue as a going concern and is satisfied that the Group has the resources to continue in business for the foreseeable future. Furthermore, the management is not aware of any material uncertainties that may cast significant doubt upon the Group’s ability to continue as a going concern. Therefore, the financial statements continue to be prepared on the going concern basis. Classification of investments Management decides on acquisition of an investment whether it should be classified as held for trading or available for sale or held to maturity. The group classifies investments as trading if they are acquired primarily for the purpose of making a short term profit by the dealers. Financial assets are classified as held to maturity if the Group has the positive intention and ability to hold up till maturity. All other investments are classified as financial assets available -for- sale. Estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the consolidated statement of financial position date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below: Valuation of outstanding claims, whether reported or not Considerable judgement by management is required in the estimation of amounts due to contract holders arising from claims made under insurance contracts. Such estimates are necessarily based on assumptions about several factors involving varying, and possibly significant, degrees of judgement and uncertainty and actual results may differ from management’s estimates resulting in future changes in estimated liabilities. In particular, estimates have to be made both for the expected ultimate cost of claims reported at the consolidated statement of financial position date and for the expected ultimate cost of claims incurred but not yet reported (IBNR) at the consolidated statement of financial position date. The primary technique adopted by management in estimating the cost of notified and IBNR claims, is that of using past claim settlement trends to predict future claims settlement trends. Claims requiring court or arbitration decisions are estimated individually. Independent loss adjustors normally estimate property claims. Management reviews its provisions for claims incurred, and claims incurred but not reported, on a quarterly basis. Investment properties Investment properties are stated at fair value which is determined based on valuations performed by professional independent valuers. Impairment losses on available for sale investments The Group treats available-for-sale equity investments as impaired when there has been a significant or prolonged decline in the fair value below its cost or where other objective evidence of impairment exists. The determination of what is “significant” or “prolonged” requires considerable judgement. Where fair values are not available, the recoverable amount of such investment is estimated to test for impairment. In addition, the Group evaluates other factors, including normal volatility in share price for quoted equities and the future cash flows and discount factors for unquoted equities. Impairment losses on held-to-maturity investments The Group reviews its individually significant held-to-maturity investments at each statement of financial position date to assess whether an impairment loss should be recorded in the consolidated statement of income. In particular, management judgement is required in the estimation of the amount and timing of future cash flows when determining the impairment loss. These estimates are based on assumptions about a number of factors and actual results may differ, resulting in future changes to the allowance. Impairment losses on receivables receivables that are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a collective assessment of impairment. This assessment of impairment requires judgment. In making this judgment, the Company evaluates credit risk characteristics that consider past-due status being indicative of the inability to pay all amounts due as per contractual terms. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 30 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 31 3 - PREMISES AND EqUIPMENT 4 - INTANGIBlE ASSETS Cost At 1 January 2013 Additions Transfers Office Office Leasehold Work in building furniture Computers Equipment improvements Vehicles progress USD USD USD USD USD USD USD Total USD 1,867,389 1,318,770 797,733 243,810 1,026,403 515,759 92,057 5,861,921 1,943 91,396 14,042 23,552 250,000 51,700 432,633 - - 78,034 Transfers from investment properties (note 6) 789,262 - Written off and disposals - (132,497) (2,810) (2,192) - - - - 14,023 - - - - - (92,057) - - - 789,262 (137,499) At 31 December 2013 2,656,651 1,266,250 886,319 255,660 1,063,978 765,759 51,700 6,946,317 Depreciation At 1 January 2013 240,861 648,814 422,276 Deprecation for the year 100,969 246,784 176,354 Written off and disposals - (116,796) (2,810) 150,117 35,851 (171) 589,375 284,558 237,075 83,145 - - At 31 December 2013 341,830 778,802 595,820 185,797 826,450 367,703 - - - - 2,336,001 880,178 (119,777) 3,096,402 Cost Opening balance Additions CLOSING BALANCE Amortisation Opening balance Amortisation for the year Closing balance Net book value Computer software / licenses 2013 USD 926,277 11,170 937,447 675,779 81,279 757,058 2012 USD 773,465 152,812 926,277 563,227 112,552 675,779 180,389 250,498 5 - INvESTMENT IN ASSOCIATED COMPANIES In 2002, the Group acquired a 33% equity ownership interest in companies registered in lebanon as shown below: Net carrying amount At 31 December 2013 Cost At 1 January 2012 Additions 2,314,821 487,448 290,499 69,863 237,528 398,056 51,700 3,849,915 1,851,593 1,238,115 514,582 165,355 915,827 416,653 - 5,102,125 15,796 160,463 379,875 79,432 161,456 120,349 92,057 1,009,428 Star rock SAL Lebanon Sina SAL Lebanon Silver rock SAL Lebanon Golden rock SAL Lebanon Written off and disposals - (79,808) (96,724) (977) (50,880) (21,243) - (249,632) At 31 December 2012 1,867,389 1,318,770 797,733 243,810 1,026,403 515,759 92,057 5,861,921 Movement on investment in associates is as follows: Depreciation At 1 January 2012 170,093 504,280 434,043 123,334 438,006 240,682 Deprecation for the year 70,768 224,342 84,957 27,575 202,249 62,977 Written off and disposals - (79,808) (96,724) (792) (50,880) (19,101) At 31 December 2012 240,861 648,814 422,276 150,117 589,375 284,558 Net carrying amount - - - - 1,910,438 672,868 (247,305) 2,336,001 At 31 December 2012 1,626,528 669,956 375,457 93,693 437,028 231,201 92,057 3,525,920 The depreciation charge for the year of USD 880,178 (2012: USD 672,868) has been included in general and administrative expenses. Fully depreciated premises and equipment still in use amounted to USD 589,615 as at 31 December 2013 (2012: 565,134). Opening balance Share of profit of results of associated companies Dividends received Country of incorporation Lebanon Lebanon Lebanon Lebanon Ownership 2013 2012 33% 33% 33% 33% 33% 33% 33% 33% 2013 USD 12,228,572 408,709 (933,651) 2012 USD 11,702,917 525,655 - 11,703,630 12,228,572 32 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 33 The following table includes summarised information of the Group’s investments in associates: 7 - INvESTMENTS Share of associates’ statement of financial position Current assets Non-current assets Current liabilities Net assets Share of associates’ revenues and results Revenues Profit 2013 USD 2012 USD 904,393 16,908,960 (6,109,723) 467,624 16,910,445 (5,149,497) 11,703,630 12,228,572 650,485 796,590 408,709 525,655 Held to maturity Unquoted bonds* Held for trading Quoted funds Available-for-sale 2013 USD 2012 USD 4,440,677 4,520,649 1,344,402 1,461,920 quoted bonds and debt securities with fixed interest rate 107,360,804 69,409,224 quoted equities Quoted funds and alternative investments Unquoted equities Investment properties of the associates are stated at fair value, which has been determined based on valuations performed by professional independent valuers who are specialists in valuing these types of investment properties. The fair value represents the amount, which the assets could be exchanged between a knowledgeable, willing seller in an arm’s length transaction at the date of valuation. All the investment properties generated rental income during the current period and the prior years. * Maturity of these bonds as at 31 December 2013 are as follows: 6 - INvESTMENT PROPERTIES The following table includes summarised information of the Group’s investment properties: Commercial building USD 2013 Land* USD Total USD Maturity 6 December 2015 27 October 2017 76,818,015 5,704,315 6,428,075 64,017,190 4,476,243 7,331,216 196,311,209 145,233,873 202,096,288 151,216,442 Carrying amount Effective interest rate 1,440,677 3,000,000 4,440,677 10% 2% Opening balance Transfers to office building (Note 3) ** Closing balance 20,877,912 (789,262) 8,461,850 - 29,339,762 (789,262) 20,088,650 8,461,850 28,550,500 Provision for impairment for equity investments charged to the consolidated statement of income amounted to USD 895,203 (2012: USD 1,231,640). 8 - DEFERRED POlICy ACqUISITION COSTS Opening balance Additions Closing balance 2012 Commercial building USD Land* USD Total USD Opening balance Acquisition costs 20,701,304 176,608 8,461,850 - 29,163,154 176,608 20,877,912 8,461,850 29,339,762 Charged to consolidated income statement 9 - INSURANCE RECEIvABlES * Land amounting to USD 8,461,850 as at 31 December 2013 (2012: USD 8,461,850) is registered in the name of the Directors of the Group. The Group has obtained an irrevocable proxy over this investment property. ** During the year there was an addition to the portion of commercial building used as an office premises for an amount of USD 789,262 which has reduced the share of building treated as an investment property. The carrying amount approximates the fair value of the investment property based on valuations performed by independent valuer. receivables from insurance companies and intermediaries less: Provision for doubtful debts 2013 USD 2012 USD 30,754,592 29,451,946 44,534,036 44,881,764 (47,667,348) (43,579,118) 27,621,280 30,754,592 2013 USD 2012 USD 97,109,788 99,542,261 (2,000,000) (1,800,000) 95,109,788 97,742,261 34 35 The movement in the provision of doubtful debts is as follows: a) Unearned premiums Opening balance Provision for the year Bad debts written off 2013 USD 2012 USD (1,800,000) (494,000) 294,000 (900,000) (900,000) - (2,000,000) (1,800,000) 2013 Reinsurers’ share USD Gross USD Net USD Gross USD 2012 Reinsurers’ share USD Net USD Opening balance 140,212,806 (23,785,793) 116,427,013 120,947,599 (31,886,053) 89,061,546 Premiums written 240,008,259 (58,767,697) 181,240,562 225,569,256 (49,760,815) 175,808,441 Premiums earned (241,066,659) 60,417,470 (180,649,189) (206,304,049) 57,861,075 (148,442,974) 139,154,406 (22,136,020) 117,018,386 140,212,806 (23,785,793) 116,427,013 Out of the above amounts, only USD 17,951 (2012: Nil) are due for more than twelve months of the statement of financial position date (Note 25). It is not the practice of the Group to hold collaterals as security, therefore the receivable are unsecured. 10 - TRADE RECEIvABlES This amount represents the balances due from the Specialty Mall customers against rental income. There are no impaired trade receivables and management believes that the trade receivables will be recovered in full. The aging of the trade receivables is less than 180 days. b) Outstanding claims Movement in outstanding claims 11 - OTHER ASSETS Accrued interest income Prepaid expenses Dividend receivable refundable deposits Employees receivables Income tax receivables Others 2013 USD 1,532,759 647,662 - 108,746 9,550 175,332 231,297 2012 USD 1,290,773 567,412 43,459 125,144 10,444 89,200 62,591 2,705,346 2,189,023 12 - INSURANCE CONTRACTS lIABIlITIES 2013 Reinsurers’ share USD Gross USD Net USD Gross USD 2012 Reinsurers’ share USD Net USD 2013 Reinsurers’ share USD Gross USD Net USD Gross USD 2012 Reinsurers’ share USD Net USD At the beginning of the year reported claims 147,595,718 (54,000,287) 93,595,431 138,288,776 (55,956,166) 82,332,610 Claims incurred but not reported 70,812,000 (13,812,000) 57,000,000 67,559,000 (18,259,000) 49,300,000 218,407,718 (67,812,287) 150,595,431 205,847,776 (74,215,166) 131,632,610 Claims paid (88,887,197) 28,755,669 (60,131,528) (94,175,991) 30,702,185 (63,473,806) Provided during the year related to current accident year Provided during the year related to previous accident years 159,549,092 (35,996,585) 123,552,507 133,595,104 (33,476,316) 100,118,788 (36,528,064) 11,750,398 (24,777,666) (26,859,171) 9,177,010 (17,682,161) At the end of the year 252,541,549 (63,302,805) 189,238,744 218,407,718 (67,812,287) 150,595,431 At the end of the year reported claims 164,884,549 (47,020,671) 117,863,878 147,595,718 (54,000,287) 93,595,431 Unearned premiums 139,154,406 (22,136,020) 117,018,386 140,212,806 (23,785,793) 116,427,013 Outstanding claims 252,541,549 (63,302,805) 189,238,744 218,407,718 (67,812,287) 150,595,431 Claims incurred but not reported 87,657,000 (16,282,134) 71,374,866 70,812,000 (13,812,000) 57,000,000 391,695,955 (85,438,825) 306,257,130 358,620,524 (91,598,080) 267,022,444 252,541,549 (63,302,805) 189,238,744 218,407,718 (67,812,287) 150,595,431 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 l a t o T D S U 3 1 0 2 D S U 2 1 0 2 D S U 1 1 0 2 D S U 0 1 0 2 D S U 9 0 0 2 D S U 8 0 0 2 D S U 7 0 0 2 D S U 6 0 0 2 D S U 5 0 0 2 D S U 4 0 0 2 D S U 3 0 0 2 D S U 2 0 0 2 D S U i i f o t n e m e t a t s h c a e t a r a e y t n e d c c a e v s s e c c u s h c a e r o f d e t r o p e r t o n t u b d e r r u c n m a c d n a s m a c d e t r o p e r h t o b g n d u c n l l l i i i i i , i l s m a c d e r r u c n i l e v i t a u m u c f o e t a m i t s e e h t l w o h s s e b a t g n w o i l l o f e h T l t n e m p o e v e d s m a C l i . e t a d o t s t n e m y a p e v i t a u m u c h t i l w r e h t e g o t , e t a d n o i t i s o p l i a c n a n fi I I D E T M I L S G N D L O H E C N A R U S N I L A R E N E G L A N O T A N R E T N I I I I S T N E M E T A T S L A C N A N F D E T A D I L O S N O C E H T O T S E T O T N A 6 3 R E B M E C E D 1 3 2 1 0 2 , 4 1 0 9 7 2 5 0 8 , - - - - - - - - - - - , 2 9 0 9 4 5 9 5 1 , , 5 6 4 7 3 7 2 5 5 , , 4 0 3 8 5 5 6 1 , , 1 2 7 4 2 4 9 1 1 , , 8 1 9 6 6 5 6 0 1 , - - - - - - - - - - , 1 2 7 4 2 4 9 1 1 , 0 7 5 , 1 7 9 7 5 , , 2 1 2 4 6 7 0 0 1 , - - - - - - - - - , 2 1 2 4 6 7 0 0 1 , , 8 0 4 4 6 2 9 7 , , 6 1 8 2 2 5 8 0 1 , 0 1 ,1 3 4 9 5 0 1 , , 6 6 0 2 7 5 0 0 1 , - - - - - - - - , 6 6 0 2 7 5 0 0 1 , , 3 1 7 5 6 9 0 9 , , 2 9 0 9 4 5 9 5 1 , 4 0 ,1 5 9 5 3 3 1 , 3 6 ,1 8 9 4 8 2 1 , , 8 1 4 3 2 3 2 2 1 , , 8 0 2 7 1 2 8 6 , , 0 2 2 9 3 8 9 1 1 , , 1 2 9 8 6 4 3 5 , , 9 7 3 1 3 3 7 3 , , 6 7 9 0 2 8 6 4 , , 0 3 5 1 6 9 7 , , 2 2 0 8 8 4 3 , , 9 3 6 5 7 3 4 9 , , 2 2 9 0 6 5 4 1 1 , , 4 4 5 9 3 9 7 3 , , 3 6 2 4 5 2 5 2 , , 6 1 4 2 6 3 5 2 , , 2 7 7 8 8 4 1 , 2 3 ,1 4 5 4 7 2 7 7 , r a e y t n e d c c a i f o d n e t A , 5 8 4 5 9 2 5 7 , 8 7 ,1 9 4 ,1 5 2 1 8 4 ,1 1 4 0 4 5 , , 5 8 4 0 1 ,1 5 3 , 9 9 4 0 2 5 4 4 , , 7 8 4 5 0 0 8 , , 5 4 8 8 0 7 1 , , 5 2 5 6 9 0 7 6 , , 7 6 6 2 1 4 9 1 1 , , 1 1 6 9 7 3 3 5 , , 3 2 9 4 9 8 0 4 , , 9 5 8 4 0 5 7 4 , , 3 7 6 4 1 7 7 , , 0 8 2 8 7 6 3 , 6 1 7 0 4 , r e t a l r a e y e n O 3 5 9 2 2 2 , r e t a l s r a e y o w T , 4 0 7 6 9 4 8 6 , , 7 3 0 5 4 6 1 2 1 , , 8 4 6 1 7 9 3 5 , , 2 8 0 1 4 6 9 3 , , 0 4 9 4 5 3 7 4 , , 8 9 3 3 7 5 7 , 6 7 ,1 9 0 5 3 , , 4 1 8 5 8 2 r e t a l s r a e y e e r h T - - - - - - - , 8 0 2 7 1 2 8 6 , , 2 6 8 5 2 5 2 6 , , 1 9 5 0 9 0 3 1 1 , - - - - - - , 1 9 5 0 9 0 3 1 1 , , 4 9 0 9 8 7 6 0 1 , - - - - - , 9 3 7 4 3 5 0 5 , , 7 6 6 9 7 3 8 4 , - - - - , 5 3 9 0 0 6 5 3 , , 8 3 8 7 6 1 , 4 3 , 8 8 7 4 8 8 4 4 , , 5 5 5 6 6 6 7 , , 8 9 0 6 9 2 3 , 8 6 5 7 6 2 , - - - 2 9 ,1 2 3 2 6 4 , 2 9 1 , 2 3 2 6 4 , - - , 2 9 5 9 2 7 7 , , 1 7 8 2 4 8 7 , , 4 0 0 6 9 2 3 , , 2 9 5 9 2 7 7 , , 8 4 8 6 9 2 3 , , 8 9 0 6 9 2 3 , - 8 6 5 7 6 2 , s r a e y n e v e E l r e t a L , 8 9 0 6 9 2 3 , 8 6 5 7 6 2 , e t a m i t s e t n e r r u C l e v i t a u m u c f o d e r r u c n i s m a c l i o t s t n e m y a p l e v i t a u m u C e t a d y t i l i b a i l l a t o T 2 5 5 5 7 2 , r e t a l s r a e y r u o F , 9 4 4 0 2 3 r e t a l s r a e y e v F i , 8 6 5 4 9 2 r e t a l s r a e y x S i 8 6 5 1 7 2 , s r a e y n e v e S r e t a l 8 6 5 1 7 2 , r e t a l s r a e y t h g E i 8 6 5 1 7 2 , r e t a l s r a e y e n N i 8 6 5 1 7 2 , r e t a l s r a e y n e T , 0 6 8 3 9 3 3 5 , , 6 9 5 5 6 6 7 3 , , 8 5 2 1 9 3 6 4 , , 4 1 2 2 6 8 7 , , 6 7 0 8 3 4 3 , , 9 3 7 4 3 5 0 5 , , 6 7 5 0 0 8 6 3 , , 9 2 9 4 2 2 7 4 , , 9 1 4 3 6 7 7 , , 9 1 5 2 1 3 3 , , 5 3 9 0 0 6 5 3 , , 6 0 2 1 1 2 6 4 , , 1 8 9 8 7 7 7 , , 1 9 8 2 1 3 3 , 9 4 5 , 1 4 5 2 5 2 , n o i t i s o p l i a c n a n fi f o t n e m e t a t s d e t a d i l o s n o c e h t n i d e d u c n l i 13 - REINSURANCE ASSETS reinsurance share of unearned premiums (note 12) reinsurance share of outstanding claims (note 12) Deferred XOL premium 14 - CASH AND BANK BAlANCES Cash and bank balances Time deposits – short term INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES aTO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2012 37 2013 USD 22,136,020 63,302,805 8,288,678 2012 USD 23,785,793 67,812,287 8,391,047 93,727,503 99,989,127 2013 USD 2012 USD 97,573,580 108,084,662 205,658,242 63,992,637 130,507,875 194,500,512 The time deposits, which are substantially denominated in US Dollars, are made for varying periods between one month to one year (2012: between one month to one year) depending on the immediate cash requirements of the Group. All deposits earned an average variable interest rate of 3.07% (2012: 2.21%). 15 - ISSUED SHARE CAPITAl Shares of USD 1 each 16 - TREASURy SHARES Authorised, issued and fully paid 2013 USD 2012 USD 143,375,678 143,375,678 The general shareholders meeting approved in its extraordinary meeting dated 24 November 2013 the purchase of 5.51% of issued stock to be treated as treasury stock in accordance with the DIFC laws and regulations. The number of treasury shares as of 31 December 2013 amounted to 7,900,000 shares. These shares were recorded at an amount of USD 12,000,000 as of 31 December 2013 (2012: Nil). 17 - DIvIDENDS PAID At a meeting held on 20 March 2013, the shareholders resolved to pay dividend of USD 0.05 ( 2012: USD 0.04 ) per share amounting to USD 7,168,784 ( 2012: USD 5,735,027 ) related to the year ended 31 December 2012. Further, the shareholders also resolved on 28 July 2013 to pay interim dividends of USD 0.04 ( 2012: USD 0.02 ) per share amounting to USD 5,419,027 ( 2012: USD 2,867,513 ) related to the current year. 38 39 18 - OTHER lIABIlITIES 22 -COMMITMENTS AND CONTINGENCIES Accounts payable Accrued expenses 19 - INSURANCE PAyABlES Payables due to insurance companies and intermediaries reinsurers – amounts due in respect of ceded premium 2013 USD 429,311 2,681,962 3,111,273 2012 USD 537,226 3,112,057 3,649,283 2013 USD 2012 USD 940,890 23,300,311 24,241,201 2,183,916 17,383,556 19,567,472 As of the date of the financial statements, the Group is contingently liable for the following: • letters of Guarantee amounting to USD 14,124 (31 December 2012: USD 9,181) to the order of the Jordanian Ministry of Trade and Industry with margin of USD 1,412 (31 December 2012: USD 918). letters of Credit amounting to USD 29,258,076 to the order of reinsurance companies for collateralising insurance • contract liabilities in accordance with the reinsurance arrangements (31 December 2012: USD 28,256,883). • letter of Guarantee amounting to USD 398,258 to the order of Friends Provident life Assurance ltd. for collateralising rent payment obligation in one of the Group entity’s office premises (31 December 2012: USD 373,192). 23 - RElATED PARTy TRANSACTIONS related parties represent major shareholders, associates, directors and key management personnel of the Group and entities controlled, jointly controlled or significantly influenced by such parties, pricing policies and terms of these transactions are approved by the Group’s management. Transactions with related parties included in the consolidated financial statements are as follows: 20 -UNEARNED COMMISSIONS The movement in unearned commissions in the consolidated statement of financial position is as follows: As at 1 January Commissions received Commissions earned As at 31 December 21 -INvESTMENT INCOME Interest Dividends Gain on sale of available-for-sale investments Fair value changes of held for trading investments Impairment of available-for-sale investments (note 7) Investments custodian fees and other investments expenses rental income, net 2013 USD 2012 USD 8,717,113 7,262,951 (9,350,877) 6,629,187 9,214,391 13,864,192 (14,361,470) 8,717,113 2013 USD 2012 USD 7,679,292 1,949,238 1,622,258 (3,972) (895,203) (1,269,361) 902,949 9,985,201 6,482,521 1,591,438 366,140 (63,782) (1,231,640) (1,087,858) 880,477 6,937,296 Consolidated statement of income Commision paid Eastern Insurance Brokers Ltd – Owned by immediate family member of the major shareholder 2013 USD 2012 USD 2,532 278,412 Compensation of key management personnel of the Group, consisting of salaries and benefits was USD 5,268,841 (31 December 2012: USD 4,884,474). Out of the total amount of key management personnel compensation, an amount of USD 285,533 (2012: USD 83,311) represents long term benefits. These long term benefits represents a phantom share option plan linked to the value of an ordinary share of the Group as approved by the board of directors has been declared during 2011. The scheme is applicable to senior executives with more than 12 months service. The amount of bonus is determined by reference to the increase in the book value of shares covered by the option. No shares are actually issued or transferred to the option holder on the exercise of the option. The options vest equally over a span of 5 years from the grant date. The bonus due amounts to the excess of book value on vesting date over grant date plus an additional 20% on the value of the excess. 24 - TAX (EXPENSE) CREDIT ON RESUlTS OF SUBSIDIARy Tax (expense) credit on results of subsidiary resulted from the profit/ losses recorded in International General Insurance Company (UK) ltd. which is subject to the United Kingdom income tax laws. Following is the movement on the deferred tax assets: Opening balance Tax (expense) credit on profit/ losses of the subsidiary IGI UK Ending balance 2013 USD 820,542 (89,924) 2012 USD 118,532 702,010 730,618 820,542 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 40 25 - RISK MANAGEMENT The risks faced by the Group and the way these risks are mitigated by management are summarised below. Insurance risk Insurance risk includes the risks of inappropriate underwriting, ineffective management of underwriting, inadequate controls over exposure management in relation to catastrophic events and insufficient reserves for losses including claims incurred but not reported. To manage this risk, the Group’s underwriting function is conducted in accordance with a number of technical analytical protocols which includes defined underwriting authorities, guidelines by class of business, rate monitoring and underwriting peer reviews. The risk is further protected by reinsurance programmes which respond to various arrays of loss probabilities. The Group has in place effective exposure management system. Aggregate exposure is modelled and tested against different stress scenarios to ensure adherence to Group’s overall risk appetite and alignment with reinsurance programmes and underwriting strategies. Loss reserve estimates are inherently uncertain. reserves for unpaid losses are the largest single component of the liabilities of the Group. Actual losses that differ from the provisions, or revisions in the estimates, can have a material impact on future earnings and the statement of financial position. The Group has in house experienced actuarial set up reviewing and monitoring the reserving policy and its implementation at quarterly intervals. They work closely with the underwriting and claims team to ensure understanding of the Group’s exposure and loss experience. In addition, the Group receives external independent analysis of its reserve requirements on quarterly basis. In order to minimise financial exposure arising from large claims, the Group, in the normal course of business, enters into contracts with other parties for reinsurance purposes. Such reinsurance arrangements provide for greater diversification of business, allow management to control exposure to potential losses arising from large risks, and provide additional capacity for growth. A significant portion of the reinsurance is affected under treaty, facultative and excess-of-loss reinsurance contracts. Geographical concentration of risks The Group’s insurance risk based on geographical concentration of risk is illustrated in the table below: 2013 Europe Middle / Far East & Africa North America Rest of the World Gross written premiums Concentration Percentage USD 42,010,789 100,686,543 2,967,044 94,343,883 240,008,259 % 18% 42% 1% 39% 2012 Europe Middle / Far East & Africa North America Rest of the World 41 Gross written premiums Concentration Percentage USD 37,502,898 95,355,232 3,204,828 89,506,298 225,569,256 % 17% 42% 1% 40% Line of business concentration of risk The Group’s insurance risk based on line of business concentration is illustrated in the table below: 2013 Energy Property Engineering Marine reinsurance Financial Casualty Aviation Ports & Terminals Political Violence 2012 Energy Property Engineering Marine reinsurance Financial Casualty Aviation Ports & Terminals Gross written premiums Concentration Percentage USD 96,513,100 45,414,264 11,603,367 13,566,699 19,655,499 16,147,305 5,711,979 9,629,808 14,107,291 7,658,947 % 40% 19% 5% 6% 8% 7% 2% 4% 6% 3% 240,008,259 Gross written premiums Concentration Percentage USD % 85,296,674 40,592,533 20,925,530 20,978,588 20,416,389 16,497,299 3,110,218 11,228,325 6,523,700 225,569,256 38% 18% 9% 9% 9% 7% 1% 5% 3% INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 42 Sensitivities The analysis below shows the estimated impact on gross and net insurance contracts claims liabilities and on profit before tax, of an ultimate development on net claims liabilities of 5% different from that reported in the statement of financial position (2012: 5%). The impact on gross claims liabilities assumes that recovered rates remain constant. 2012 Impact on gross insurance contract claims liabilities Impact on net insurance contract claims liabilities % Impact on profit USD USD USD Investments held for trading - - - 1,461,920 1,461,920 Available-for-sale investments 13,231,115 31,427,215 24,750,898 75,824,645 145,233,873 Held to maturity investments 1,520,649 Cash and bank balances 194,500,512 - - 3,000,000 - - - 4,520,649 194,500,512 209,252,276 31,427,215 27,750,898 77,286,565 345,716,954 43 - 4.75 6.86 1.48 2013 2012 + 5 + 5 12,627,077 9,461,937 (9,461,937) 10,920,386 7,529,772 (7,529,772) Financial risk The Group’s principal financial instruments are financial assets available-for-sale, financial assets held for trading, financial assets held to maturity, receivables arising from insurance, investment in associates, investment properties and reinsurance contracts, and cash and cash equivalents. The Group does not enter into derivative transactions. The main risks arising from the Group’s financial instruments are interest rate risk, foreign currency risk, credit risk, market price risk and liquidity risk. The board reviews and agrees policies for managing each of these risks and they are summarised below. Interest rate risk Interest rate risk arises from the possibility that changes in interest rates will affect future profitability or the fair values of financial instruments. The Group is exposed to interest rate risk on certain of its investments and cash and cash equivalents. The Group limits interest rate risk by monitoring changes in interest rates in the currencies in which its cash and interest bearing investments and borrowings are denominated. Details of maturities of the major classes of financial assets are as follows: 2013 2012 There is no significant difference between contractual repricing or maturity dates. The following table demonstrates the sensitivity of income statement to reasonably possible changes in interest rates, with all other variables held constant. The sensitivity of the income statement is the effect of the assumed changes in interest rates on the Group’s profit for the year, based on the floating rate financial assets and financial liabilities held at 31 December. Increase/decrease in basis points + 25 - 50 + 25 - 50 Effect on profit for the year USD 793,649 (1,587,299) 671,076 (1,342,152) Less than 1 year 1 to 5 years More than 5 years Non-interest bearing items Total Effective Interest Rate on interest bearing assets 2013 USD USD USD USD USD (%) Investments held for trading - - - 1,344,402 1,344,402 Available-for-sale investments 23,011,753 55,849,807 28,499,244 88,950,405 196,311,209 Held to maturity investments 1,440,677 Cash and bank balances 205,658,242 - - 3,000,000 - - - 4,440,677 205,658,242 - 3.56 4.47 1.78 230,110,672 55,849,807 31,499,244 90,294,807 407,754,530 Foreign currency risk Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates. Management believes that there is minimal risk of significant losses due to exchange rate fluctuations since predominantly 80% of the business transactions are in US Dollars and consequently the Group does not hedge its foreign currency exposure. Credit risk Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Group is exposed to credit risk primarily from unpaid insurance receivables and fixed income instruments. The Group has in place credit appraisal policies and procedures for inward business and receivables from insurance transactions are monitored on an ongoing basis to restrict Group’s exposure to doubtful debts. The Group has in place security standards applicable to all reinsurance purchases and monitors the financial status of all reinsurance debtors at regular intervals. The Group’s portfolio of fixed income investment is managed by the investments committee in accordance with the investment policy established by the board of directors which has various credit standards for investment in fixed income securities. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 44 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 45 Reinsurance and fixed income investments are monitored for the occurrence of a downgrade or other changes that might cause them to fall below the Group’s security standards. If this occurs, management takes appropriate action to mitigate any loss to the Group. The Group’s bank balances are maintained with a range of international and local banks in accordance with limits set by the board of directors. There are no significant concentrations of credit risk within the Group. The table below provides information regarding the credit risk exposure of the Group by classifying assets according to the Group’s credit rating of counterparties: The following table provides an aging analysis of receivables arising from insurance and reinsurance contracts past due but not impaired: Past due but not impaired Neither past due nor impaired Up to 90 days 91 to 180 days 181 to 270 days 271 to 360 days Over 360 days USD USD USD USD USD USD Total USD Neither past due nor impaired Investment grade Non investment grade (satisfactory) Non investment grade (un-satisfactory) Past due but not impaired USD USD USD USD Total USD 2013 Available for sale investments - bonds and debt securities Held to maturity investments - bonds and debt securities Insurance receivables reinsurance assets Cash and bank balances 101,651,392 5,709,412 3,000,000 1,440,677 - 39,944,033 154,594,047 75,769,440 53,783,470 51,064,195 299,189,472 187,767,194 2012 Available for sale investments - bonds and debt securities Held to maturity investments - bonds and debt securities Insurance receivables reinsurance assets Cash and bank balances 58,705,108 10,704,116 3,000,000 1,520,649 - 45,619,688 109,458,867 73,585,206 54,369,439 85,041,645 216,783,663 225,221,055 - - - - - - - - - - - - - - 107,360,804 4,440,677 19,340,348 95,109,788 - - 93,727,503 205,658,242 19,340,348 506,297,014 - - 69,409,224 4,520,649 24,157,055 97,742,261 - - 99,989,127 194,500,512 24,157,055 466,161,773 31 December 2013 80,178,750 8,938,857 2,205,496 1,914,961 1,853,773 17,951 95,109,788 31 December 2012 73,585,206 14,359,342 5,226,747 2,664,185 1,906,781 - 97,742,261 For assets to be classified as ‘past due and impaired’ contractual payments are in arrears for more than 360 days and an impairment adjustment is recorded in the consolidated statement of income for this or when collectability of the amount is otherwise assessed as being doubtful. When the credit exposure is adequately secured, arrears more than 360 days might still be classified as ‘past due but not impaired’, with no impairment adjustment recorded. The following table provides an aging analysis of trade receivables arising from Specialty Mall customers past due but not impaired: Past due but not impaired Neither past due nor impaired Up to 90 days 91 to 180 days USD USD USD Total USD 31 December 2013 31 December 2012 - 85,607 73,933 30,591 - 21,784 73,933 137,982 For assets to be classified as ‘past due and impaired’ contractual payments are in arrears for more than 360 days and an impairment adjustment is recorded in the consolidated statement of income for this. When the credit exposure is adequately secured, arrears more than 360 days might still be classified as ‘past due but not impaired”, with no impairment adjustment recorded. Market price risk Market price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual security, or its issuer, or factors affecting all securities traded in the market. The Group’s equity price risk exposure relates to financial assets whose values will fluctuate as a result of changes in market prices. The following table demonstrates the sensitivity of the profit for the period and the cumulative changes in fair value to reasonably possible changes in equity prices, with all other variables held constant. The effect of decreases in equity prices is expected to be equal and opposite to the effect of the increases shown. 46 2013 New York Stock Exchange Amman Stock Exchange Saudi Stock Exchange Qatar Stock Exchange NASDAQ Dubai Other quoted 2012 New York Stock Exchange Amman Stock Exchange Saudi Stock Exchange Qatar Stock Exchange NASDAQ Dubai Other quoted 47 Change in equity price Effect on profit for the year Effect on equit USD USD USD 2013 Less than one year More than one year No term USD USD USD Total USD Insurance contracts liabilities 293,771,966 97,923,989 Other liabilities Insurance payable Unearned commissions Total liabilities 2012 3,111,273 24,241,201 4,971,890 - - 1,657,297 326,096,330 99,581,286 Insurance contracts liabilities 268,965,393 89,655,131 Other liabilities Insurance payable Unearned commissions Total liabilities 3,649,283 19,567,472 6,537,835 - - 2,179,278 298,719,983 91,834,409 - - - - - - - - - - 391,695,955 3,111,273 24,241,201 6,629,187 425,677,616 358,620,524 3,649,283 19,567,472 8,717,113 390,554,392 +5% +5% +5% +5% +5% +5% - - - - - 67,220 Change in equity price Effect on profit for the year USD +5% +5% +5% +5% +5% +5% USD - - - - - 73,096 964,694 53,085 1,244,885 739,153 554,637 284,447 Effect on equity USD 725,665 49,153 1,216,700 563,495 426,262 945,291 The Group also has unquoted investments carried at cost where the impact of changes in equity prices will only be reflected when the investment is sold or deemed to be impaired, when the consolidated statement of income will be impacted. The Group limits market risk by maintaining a diversified portfolio and by monitoring of developments in equity markets. liquidity risk liquidity risk is the risk that the Group will not be able to meet its commitments associated with insurance contracts and financial liabilities as they fall due. The Group continually monitors its cash and investments to ensure that the Group meets its liquidity requirements. The Group’s asset allocation is designed to enable insurance liabilities to be met with current assets. All liabilities are non-interest bearing liabilities. The table below summarises the maturity profile of the company’s financial liabilities at 31 December based on contractual undiscounted payments: INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 48 Maturity analysis of assets and liabilities The table below shows analysis of assets and liabilities analysed according to when they are expected to be recovered or settled: 2012 Less than one year More than one year No term USD USD USD 49 Total USD ASSETS Premises and equipment Intangible assets Investment in associated companies Investments Investment properties - - - 3,525,920 250,498 - - 3,525,920 250,498 - 12,228,572 12,228,572 14,751,763 59,178,109 77,286,570 151,216,442 - - 29,339,762 29,339,762 Deferred policy acquisition costs 23,065,944 7,688,648 2013 Less than one year More than one year No term USD USD USD Total USD - - - 3,849,915 180,389 - - 3,849,915 180,389 - 11,703,630 11,703,630 24,452,430 87,349,051 90,294,807 202,096,288 - 28,550,500 28,550,500 - 20,715,960 95,091,837 73,933 2,596,601 - 6,905,320 17,951 - 108,745 730,618 72,367,797 21,359,706 205,658,242 - - - - - - - - 27,621,280 95,109,788 73,933 2,705,346 730,618 93,727,503 205,658,242 Insurance receivables Trade receivables Other assets Deferred tax assets reinsurance assets Cash and bank balances TOTAL ASSETS EQUITY AND LIABILITIES Equity Issued share capital 420,956,800 120,501,695 130,548,937 672,007,432 Foreign currency translation reserve Cumulative changes in fair values of investments - - - - - - - - - - - - 143,375,678 143,375,678 (12,000,000) (12,000,000) (214,298) (214,298) 22,821,709 22,821,709 92,346,727 92,346,727 246,329,816 246,329,816 retained earnings Total equity LIABILITIES Insurance contracts liabilities Other liabilities Insurance payable Unearned commissions Total liabilities ASSETS Premises and equipment Intangible assets Investment in associated companies Investments Investment properties Deferred policy acquisition costs Insurance receivables Trade receivables Other assets Deferred tax assets reinsurance assets Cash and bank balances TOTAL ASSETS EQUITY AND LIABILITIES Equity Issued share capital Treasury shares Foreign currency translation reserve Cumulative changes in fair values of investments retained earnings Total equity LIABILITIES 97,742,261 137,982 2,033,616 - - - 155,407 820,542 77,089,607 22,899,520 194,500,512 - - - - - - - - 30,754,592 97,742,261 137,982 2,189,023 820,542 99,989,127 194,500,512 409,321,685 94,518,644 118,854,904 622,695,233 - - - - - - - - - - 143,375,678 143,375,678 (230,995) 15,325,027 73,671,131 (230,995) 15,325,027 73,671,131 232,140,841 232,140,841 268,965,393 89,655,131 3,649,283 19,567,472 6,537,835 - - 2,179,278 298,719,983 91,834,409 - - - - - 358,620,524 3,649,283 19,567,472 8,717,113 390,554,392 Insurance contracts liabilities 293,771,966 97,923,989 Other liabilities Insurance payable Unearned commissions Total liabilities 3,111,273 24,241,201 4,971,890 - - 1,657,297 326,096,330 99,581,286 - - - - - 391,695,955 3,111,273 24,241,201 6,629,187 425,677,616 TOTAL EQUITY AND LIABILITIES 326,096,330 99,581,286 246,329,816 672,007,432 TOTAL EQUITY AND LIABILITIES 298,719,983 91,834,409 232,140,841 622,695,233 Capital management The Group manages its capital by ‘Enterprise Risk Management’ techniques, using a dynamic financial analysis model. The Asset Liability match is reviewed and monitored on regular basis to maintain a strong credit rating and healthy capital adequacy ratios to support its business objectives and maximise shareholders’ value. Adjustments to capital levels are made in light of changes in market conditions and risk characteristics of the Group’s activities. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 50 51 Fair value The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation techniques: level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities; level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; and level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data. Held for trading Available-for-sale Held for trading Available-for-sale 31 December 2013 Level 1 USD Level 2 USD 1,344,402 - 189,883,134 6,428,075 191,227,536 6,428,075 31 December 2012 Level 1 USD Level 2 USD 1,461,920 - 137,902,657 7,331,216 139,364,577 7,331,216 Total USD 1,344,402 196,311,209 197,655,611 Total USD 1,461,920 145,233,873 146,695,793 There were no transfers between Level 1, 2 and 3 during the year or in either the years ended 31 December 2013 or 31 December 2012. There are no level 3 investments. 26 - COMPARATIvE FIGURES Some of 2012 balances were reclassified to correspond with 31 December 2013. Classifications have no effect on net profit and equity. Reported in previous year USD Reclassifications Reclassified in current year USD USD Claims* Reinsurers’ share of claims* (111,182,933) 28,746,306 4,447,000 (4,447,000) reinsurance assets* 86,177,127 13,812,000 Insurance contracts liabilities* 344,808,524 (13,812,000) Other assets** Deferred tax assets** TOTAL 2,167,665 841,900 3,009,565 21,358 (21,358) (106,735,933) 24,299,306 99,989,127 358,620,524 2,189,023 820,542 3,009,565 *The change represents grossing up the IBNR for the prior year to reflect Gross IBNR and Reinsurers’ share of IBNR separately. The grossing up of IBNR had no effect on net profit or equity. ** The above reclassification has resulted from recording an amount of USD 21,358 in the deferred tax assets that should had been recorded in other assets. Foregoing reclassification had no effect on net profit or equity. 27 - SUBSEqUENT EvENTS There have been no material events between 31 December 2013 and the date of this report which are required to be disclosed. INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITEDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 INTERNATIONAL GENERAL INSURANCE HOLDINGS LIMITED IGI OFFICES 52 International General Insurance Holdings LImited International General Insurance Company (Dubai) Limited Address: Office 606, Level 6, Tower 1 Al Fattan Currency House, Dubai International Financial Centre, P.O. Box 506646, Dubai United Arab Emirates Telephone: +971 4 441 6797 Facsimile: +971 4 441 6514 IGI Underwriting Company Limited Address: 74 Abdel Hamid Sharaf St. P.O. Box 941428 Amman 11194 Jordan Telephone:+962 6 562 2009 Facsimile: +962 6 566 2085 regulated by the Jordan Insurance Commission Office 606, Level 6, Tower 1 Al Fattan Currency House, Dubai International Financial Centre, P.O. Box 506646, Dubai United Arab Emirates Telephone: +971 4 441 6797 Facsimile: +971 4 441 6514 regulated by the Dubai Financial Services Authority International General Insurance Company limited-Labuan Branch Address: level 1, lOT 7, Block F, Saguking Commercial Building Jalan Patau - Patau, 87000 labuan, Malaysia Telephone: +6 (087) 410 745 Facsimile: +6 (087) 419 755 regulated by the Labuan Financial Services Authority International General Insurance Company Limited Address: 44 Church Street Hamilton HM 12 Bermuda Telephone: +1 (441) 295 3688 Facsimile: +1 (441) 295 2584 North Star Underwriting Limited Address: 15-18 lime Street london EC3M 7AN England Telephone: +44 (0) 20 7220 0100 Facsimile: +44 (0) 20 7220 0101 regulated by the Bermuda Monetary Authority regulated by the UK Financial Services Authority International General Insurance Company (UK) Limited Address: 15-18 lime Street london EC3M 7AN England Telephone: +44 (0) 20 7220 0100 Facsimile: +44 (0) 20 7220 0101 regulated by the UK Financial Services Authority Kuala Lumpur Marketing Office Address: 29th Floor, Menara TA One Jalan P Ramlee 50250 Kuala Lumpur, Malaysia Telephone: +6 (032) 166 1786 Facsimile: +6 (032) 171 1786
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