Latin America Advisor

Financial Services Advisor

A Daily Publication of The Dialogue

How Fast Can the Region’s Insurance Sectors Recover?

The economic downturns sparked by the Covid-19 pandemic have hit Latin America’s insurance sectors hard. // File Photo: Emmanuelkwizera via Creative Commons.

Latin American insurers saw a nearly 12 percent drop in premiums paid last year amid the economic downturns of the Covid-19 pandemic, according to a report that Mapfre Economics released in September. In the region, the insurance sectors of Mexico, Brazil, Colombia and Chile were hit the hardest, according to the report, which involved 19 countries. How much will the region’s insurance sectors recover this year and next? Which segments of the insurance industry will perform the best in the period ahead, and which segments will struggle? What are the main headwinds that insurers currently face in the region?

Manuel S. Escobedo, president of the Mexican Association of Insurance Companies (AMIS): “At the end of the second quarter, the Mexican insurance sector was showing signs of recovery linked to the reopening of businesses after the second wave of the pandemic, the advance in vaccinations and relative economic stability. The insurance sector is showing growth in real terms of 6.4 percent in premiums compared to the same period of 2020, with a return on capital of 11.9 percent. Pension lines had the country’s highest growth. There was an increase in the number of IMSS pensions, which may have been caused by factors including delays in pension procedures due to the pandemic and increases in the granting of pensions due to the death of the insured. The industry is expected to grow significantly in the coming years because of the 2020 pension reform. For life insurance, growth has been 0.1 percent in real terms, that is, it remained at the same level as the same period in 2020. The automobile industry was severely…”

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About the Financial Services Advisor

Covering Latin America’s banking and insurance sectors, remittances trends and data, micro lending issues, new technologies in the industry, anti-money laundering regulations, and much more, the Inter-American Dialogue’s biweekly Financial Services Advisor, a sister publication of the Latin America Advisor, gives readers fresh insight and diverse viewpoints from financial sector leaders. To subscribe or for more information, contact Erik Brand, publisher of the Advisor, at [email protected].

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Erik Brand

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Gene Kuleta

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Anastasia Chacón González

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