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MEXICO CITY - FEBRUARY 24, 2021 02:41 PM (EST)
AM Best believes an anticipated spike in automobile insurance rates in Argentina could lead to insurance companies losing market share, although raising prices may help minimize short-term financial fallout from a potential increase in loss frequency as the economy gradually re-opens.
A new Best’s Commentary, “Policyholders Face Steep Hikes in Auto Insurance Prices in 2021,” notes that Argentinian policyholders could see an increase of more than 50% on auto insurance policy prices in 2021, as the ongoing devaluation of the Argentinian peso and supply chain disruptions has led to a rise in automobile prices. The costs of spare parts and repairs also have escalated. With automobile ownership becoming more expensive, sums assured also have increased, and thus, policy prices.
With the rate hikes, Argentinian policyholders likely are to become more selective about coverage, and the implementation of digital technologies and data analytics will provide them more cost-efficient and customized solutions. Policyholders insured by companies with outdated tariffs or with prices below the market average are the most likely to face pressured finances as insurers level up with the market through aggressive price increases.
To access the full copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=306252 .
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit http://www.ambest.com .
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