Boston, MA -- (SBWIRE) -- 06/11/2014 -- BMI View: As of mid-2014, the latest data published by the Superintendencia de Seguros de la Naci?n (SSN - the regulator) highlights the resilience of premiums in both the non-life and the life segments. In the non-life segment, the insurers are helped by the (near) compulsory nature of major lines such as motor vehicle insurance, employee's compensation (ART) and, for farmers, agricultural related lines. The structurally high inflation also makes it easier for the insurers to pass on cost increases to customers. In the life segment, group life cover (including protection and other benefits) is widely seen by major corporates as an (inflation-protected) incentive with which they can attract and retain key staff. In both segments, the leading companies clearly have financial strength and, for varying reasons, tolerance of the consistently challenging business environment. Nevertheless, a number of companies have reconsidered their commitment to Argentina and have found ready buyers for some or all of their insurance operations in the country. We think that the process of consolidation will continue through the forecast period.
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In the non-life segment, both RSA and Australia's QBE have made acquisitions in the recent past that have given them leadership positions. Overall, we would not be surprised if the process of consolidation continued through 2014. Meanwhile, many of the leading local groups continue to benefit from their associations with government-backed financial institutions, from the support of policy-holders who see their own interests as being closely aligned with mutual insurers, and/or strong brand names.
In both of the major segments, premiums have in the recent past been distorted by the high inflation in Argentina (officially 10-11% through 2013 but widely recognised as being between two and three times as high). However, it appears that many of the companies in the non-life segment have pricing power. Partly for this reason, they have been...
The Argentina Insurance Report has been researched at source and features Business Monitor International (BMI)'s independent assessment and forecasts for the insurance sector. It examines industry developments, key growth drivers and risk management projections, including the macroeconomic situation, government policy, regulatory environment and the level of development and potential for growth, broken down by line. Leading insurers are profiled, covering premiums, products and services and competitive positioning.
BMI's Argentina Insurance Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Argentinian insurance industry.
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