View this article online: https://www.insurancejournal.com/news/international/2003/10/17/33247.htm
Standard & Poor’s has issued new reports on the Latin American insurance industry, which concludes that the market, while still in a “developing stage,” has strong growth prospects.
As far as the reinsurance market is concerned, the report noted that “Latin American reinsurance markets’ potential remains underdeveloped when compared to the mature markets of the U.S. and Europe.”
The report examines growth potential, and finds encouraging signs as a result of “increased deregulation, social security reforms, and the increasing presence in select local markets of large multinational players.” Three large markets, Mexico, Brazil, and Chile, represent 70% of the overall volume.
S&P noted that “the overall premium decrease reported by the region is largely explained by the devaluation of the Argentinean peso and a market contraction, as well as by devaluation of Brazil’s real that offset premium growth in U.S.-dollar terms.”
S&P Credit Analyst Jaime Carreno observed that “strong growth observed in the Mexican and Peruvian markets, with the maintenance of volume in the Chilean market, helped to sustain growth dynamics in the region.”
Commenting on the reinsurance market, Carreno stated, “As local economies respond to lower inflation rates, the base for developing individual life and annuities markets tied to the region’s demographics is established, representing a market with very strong growth prospects.”
The two articles, “Standard & Poor’s Top 50 Latin American Insurers” and “Latin American Reinsurance: Affected by the New Order” were published on Oct. 16, 2003, and can be found on RatingsDirect, Standard & Poor’s Web-based credit analysis system, at www.ratingsdirect.com, or on the S&P Web site at: www.standardandpoors.com.