Press Release - SEPTEMBER 05, 2019
Best’s Market Segment Report: Latin America Reinsurance Segment Still Attractive Despite Soft Market
FOR IMMEDIATE RELEASE
OLDWICK - SEPTEMBER 05, 2019
AM Best believes that the strengthening of the regulatory frameworks in some Latin America countries could lead to market consolidation, and increase overall demand for reinsurance. Lower interest rates and protectionism, however, could limit those prospects, according to the report.
The new Best’s Market Segment Report, “Global Reinsurance: Fighting the Last War,” notes that on a global basis, the days of large catastrophic events triggering widespread market hardening are gone, replaced by pockets of microcycles, based on geography and loss experience.
The Latin America region remains attractive owing to its growth potential and strengthening regulatory frameworks, as well as primary companies’ profitable risk selection.
“However, limited economic prospects, potential protectionism and lower interest rates could limit business
opportunities and pricing terms for participants in the region,” said Elí Sánchez, associate director. “Insured losses may have been low in recent years, but market participants will be aware of the region’s susceptibility to earthquakes.”
Historic catastrophe events in Chile, Mexico, and more recently, Peru and Panama, should be considered as reinsurers estimate their underwriting capacity, pricing and risk management initiatives in Latin America. In addition, the region remains susceptible to climate change has been experiencing increasingly volatile weather patterns.
AM Best’s market segment outlook on the global reinsurance sector remains stable, primarily reflecting a more-stabilized, non-life pricing environment, as well as a stable market environment in the global life reinsurance segment.
Other highlights from this year’s annual report on the global reinsurance include:
To access a copy of this report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=289149 .
AM Best also will host its annual Reinsurance Market Briefing at the 2019 Rendez-Vous de Septembre (Rendez-Vous) on Sunday, Sept. 8, 2019, at the Hermitage Hotel in Monte Carlo, Monaco. The briefing will start at 10:15 a.m. and end at 11:45 a.m. (CEST). To register, please visit www.ambest.com/events/rmbseptembre2019 . AM Best will hold a second Reinsurance Market Briefing in Zurich on Wednesday, Sept. 18, 2019, at the FIFA World Football Museum. More information and registration can be found at www.ambest.com/events/rmbzurich2019 .
AM Best is a global rating agency and information provider with a unique focus on the insurance industry.