IGI: Underwriting Through the Soft Market, Not Waiting for the Turn

A war-loss year, a shrinking top line, and a quiet pivot into MGA fees and India

IGIC · Earnings Call · 2026-11-04

The war year gets less noisy

International General Insurance’s third quarter is not a growth story. Gross written premium fell 8.9% in Q3 and 1.4% over nine months, while net earned premium rose 8.5% and 5.3% — the gap telling you management is deliberately shrinking ceded exposure and walking away from business that no longer clears its hurdle. Q3 net income was $28 million, or $0.66 per share, down from $33.5 million and $0.75; nine-month net income was $70.5 million versus $94.9 million. The combined ratio was 85.7% in Q3, including 6.9 points of catastrophe losses, only 2.6 points of which were war-related, and 7.1 points of favorable prior-year development. For the nine months, the combined ratio was 90.1%, with 14.8 points of cats, primarily the Middle East war. That is the key change. In the prior quarter, analysts were still probing whether the war would produce “18 or 19 points of CAT losses a quarter”; management said the loss front had been “fairly quiet” since March and April. “it's been fairly quiet on the loss front since then.” — Waleed Jabsheh, Executive (likely CFO or similar senior role) · 2026-08-05 Q3 confirms that. The war remains the single largest loss event in IGI’s history — “This year, we experienced the single largest loss event in our history. With the war in the Middle East.” — Waleed Wasef Jabsheh, Management, likely CEO or senior executive · 2026-11-04 — but the quarterly P&L is no longer being dictated by it. What is being dictated by it is the tone. Wasef Jabsheh opened with the line that matters for the cycle: “Market conditions continue to be more challenging than a year ago. And the pace of deterioration in some areas accelerating.” — Wasef Salim Jabsheh, Management, likely CFO or senior executive · 2026-11-04 That is the soft market in plain English: property rates down roughly 15% across the board, energy rates coming down “quite rapidly” despite loss activity, and reinsurance margins healthy but competitive pressure building. This is not a new theme for IGI. In February, Waleed Jabsheh already described competition as “the competition is in line with what we've been really seeing now for many -- quite a few quarters.” — Waleed Jabsheh, CFO · 2026-02-25 The difference is what management is doing about it.

Cypher, India, and the fee layer

The genuinely new item is Cypher underwriting, the specialty treaty MGA focused on cyber that IGI launched in Bermuda and owns 60% of. It is led by Ari Chatterjee, a cyber reinsurance specialist, and it began operations after securing approvals. On the call, management framed it as more than an underwriting hire: IGI will be the sole carrier, Cypher the sole underwriter, and IGI is building a retro program behind the book. The economics are multi-pronged — MGA fees, retro fees, and the underwriting result.

the whole real intention behind or big part of it is that we own a portfolio it is written on IGI paper. And then we distribute it to others who want a piece of the action.
Waleed Wasef Jabsheh, Management, likely CEO or senior executive · 2026-11-04

That is a different muscle for a $1 billion-market-cap insurer. The second platform is India. The GIFT City office was announced in June; by the current call, management said most of the team will be in place by November and all by January. The Indian market is not being sold as a quick premium grab. It is a way to write specialty lines — cyber, surety, liability, construction and engineering, ports and terminals, marine cargo, political violence, professional lines — with local talent and what management calls preferred-market status after recent regulatory changes. The phrase “long term play” appears around both Cypher and India, and that is the right way to read them: small today, strategically additive tomorrow. There is also a quieter follow-through in political violence. In May, Waleed called PV the 'hanging fruit' and described the trade as “short-term pain for longer term gain, and I truly believe that is the case on this occasion.” — Waleed Jabsheh, Executive (likely CEO or senior management) · 2026-05-06 Three months later, IGI says it has grown its PV portfolio by about 50% from a modest base, with better pricing and terms in the GCC, though the correction remains largely confined to the Middle East rather than the broader PV market. Marine is the other pocket: marine liability has tripled this year, helped by the Baltimore bridge loss resetting rates, and management expects 2027 renewals to stay healthy. That is active cycle management in action — not waiting for the market to turn, but rotating into lines where loss experience has changed the pricing.

The book value noise is not underwriting

The balance sheet looks softer than the income statement. Total equity fell to $663 million from $710 million at year-end, and book value per share was $15.99, down 5.4%. But the cause is mark-to-market: $44 million of negative bond marks over nine months, $29 million in Q3 alone. IGI holds the portfolio to maturity, so those marks are accounting volatility, not credit losses. Investment income was $14.2 million in Q3 and $42.8 million over nine months, with a 4.4% yield and duration extended to 3.7 years from 3.5. Investment income is doing real work here, even if management insists it is separate from underwriting: “Investment income is completely separate from any of our underwriting results, and we do not underwrite based on what the ... investment environment is” — Waleed Wasef Jabsheh, Management, likely CEO or senior executive · 2026-11-04 That discipline is credible, but it also means the earnings mix is more balanced than the pure underwriting story suggests. Capital return remains the third leg. IGI bought back 148,000 shares in Q3 at an average $24.68 and just under 900,000 year-to-date at $24.37, with 3.8 million shares left under the authorization. Total capital returned was just under $80 million, including $58 million of dividends and the special dividend. The company can do this because the reinsurance portfolio and short-tail book are still generating underwriting income — $43 million in Q3 and $110 million over nine months — even as top-line premiums shrink.

The setup into 2027

The prior calls make the pattern clear: IGI has been talking about a soft market and competitive pressure for several quarters, and it has been returning capital rather than chasing volume. What is new in this report is the build-out of fee-adjacent underwriting platforms — Cypher and India — plus the evidence that the war-loss quarter is seasoning. The risk is equally clear: property and energy are still the biggest lines, rates are still falling, and the PV opportunity is concentrated in one region. If the broader market does not follow the Middle East on terms and conditions, the replacement growth has to come from cyber, marine, and India faster than the old book shrinks. For a company heading into its 25th anniversary, that is a more interesting story than the headline earnings decline. IGI is not pretending the cycle has turned. It is using the soft market to buy back stock, build new capacity, and wait for the lines where loss experience is finally doing the underwriting for it.