Best’s Market Segment Outlook: AM Best Maintains Stable Outlook on Peru’s Insurance Industry
Despite the growing perception of risk related to political instability in
The Best’s Market Segment Report, “Market Segment Outlook:
Peru’s macroeconomic stability has been key to insurers’ ability to navigate market cycles since 2000, in comparison with other Latin American countries that have experienced profound political and economic shifts. However, last year the combined effects of political turmoil, climate-related events and a lack of investment impacted economic growth in
“We expect that insurers with well-established enterprise-risk management capabilities, as well as depth in their reinsurance panels and relationships, will benefit the most,” said
As of
Peru’s insurance industry is quite concentrated, with four companies accounting for 87% of premiums and the five largest companies accounting for around 87% of the industry’s equity. In 2023, the insurance market grew 11.6% in nominal terms and 13% in real terms. The main growth driver (in nominal terms) has been the life segment, which reflects price adjustments as well as an influx of annuities that have migrated from the insurance plans related to private pension funds.
On the property/casualty side, fire and allied lines reflect different risk pressures, as well as greater awareness of risk by reinsurers and higher appraisals (inflation), which has finally led to an increase in premium. The third main component of growth in Peru’s insurance market has been the accident & health segment, as medical assistance also reflects medical inflation.
To access the full copy of this report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=347076.
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