In Nicaragua during 2020, a year marked by the pandemic generated by the covid-19 outbreak, the outlays for life insurance claims increased and for automobiles decreased.
Figures from the Superintendence of Banks and Other Financial Institutions (Siboif), detail that between January and November 2019 and the same period in 2020, the amount disbursed by insurance companies for life insurance coverage increased by 78%, from $10.7 million to $19 million.
Between July and October 2020, the number of people in Guatemala exploring options for life insurance online increased by 3%, and the number of Panamanian consumers seeking auto insurance increased by 39%.
CentralAmericaData's interactive platform, Consumer Insights, monitors in real time changes in consumer habits in all markets in the region and in other Latin American countries, with fundamental information to understand their behavior, new trends and anticipate eventual changes in their purchase patterns.
From January to June 2020 in Nicaragua, the amount paid by insurers for life insurance increased by 54% compared to the same period in 2019, a rise that could be explained by the health crisis generated by the spread of covid-19.
Although the Nicaraguan government had only 116 deaths from covid-19 as of July 28, the numbers of insurance companies competing in the local market reflect another reality.
Last year in Nicaragua, insurance sales totaled $199 million, 4% less than in 2018, a drop that can be explained in part by the drop in life, health and accident policies.
Data from the Superintendence of Banks and Other Financial Institutions (Siboif) detail that between 2018 and 2019 premium sales fell by $9 million, from $208 million to $199 million.
Except for Nicaragua, which projects a decline in revenues, Fitch Ratings estimates that by year-end the region's insurance markets will have grown from 3% to 8%.
According to the report Perspectives of Insurance Industry in Central America, prepared by the rating agency Fitch Ratings, El Salvador will be the market that in 2019 will register more dynamism in the region, reporting an 8% increase over revenues reported in 2018.
During the first quarter of the year in Nicaragua, premium income was down 6% from the same period in 2018, while claims payments increased 14%.
Figures from the Superintendence of Banks and Other Financial Institutions (Siboif) indicate that between January and March 2018, and the same period in 2019, premiums in the country fell from $55 million to $53 million.
Fitch Ratings forecasts that the insurance sector in Central America will close 2018 with a year-on-year increase of almost 6% and expects that in 2019 the business will reach a very similar growth rate.
The projected increase for 2018 and 2019 would be based on the behavior of the Panama, Costa Rica and Guatemala markets, however, the increases of 5.8% and 6.1% forecast for 2018 and 2019, respectively, would represent a slowdown regarding the 8.2% growth registered in 2017.
Explained by the behavior of the Costa Rican market, in 2017 Central American insurers received $5.02 billion in premiums, 7% more than in 2016.
According to a report drawn up by Revista Desempeño Asegurador, in 2017 "... insurance sales in the region expressed an absolute increase of US $334.7 million, an amount that represented a rise of 7.1% compared to sales in 2016."
Projections are that this year growth of the Central American insurance sector will be driven by activities in the markets of Costa Rica and Guatemala.
From the report "Prospects 2018: Insurance Sector in Central America" by Fitch Ratings:
Stable Rating Perspective:The rating outlook for the Central Americaninsurancesectoris stable for 2018, given that most of the rated companies maintain a stable outlook on an individual basis.Fitch Ratings believes that the sector shows stable fundamentals, as a result of good profitability levels and high liquidity and capitalization indicators in all countries, which it expects to continue to be reflected in solid balance sheets in companies.
Panama stands out as the country with the highest penetration rate in the region, and at the other end is Honduras, with the lowest rate, and below the average in Latin America.
From a report by MAPFRE: "Trends of growth in insurance markets in Latin America":
In the first five months of the year premiums totaled $77.9 million, 4% more than in the same period in 2014.
Despite being the smallest of the region's insurance markets, the rate at which premiums sold by the five insurance companies operating in the country have grown allows them to estimate that at the end of 2015 they will reach $200 million in revenue, a figure higher than the $172 million in 2014.
Little knowledge on the subject and difficulties in properly measuring the risks are some of the causes of the limited supply of this type of coverage.
Currently only one company, out of the 5 operating in the country, provides insurance for the agricultural sector.
Fitch Ratings expects moderate growth in premiums in Costa Rica, increased interest in personal insurance in Guatemala, and stable performance in Nicaragua and Honduras.
From the report "Outlook 2015: Central American Insurance Sector":
Between December 2012 and December 2013 revenue from premiums went from $138 million to $156 million.
The pace of growth in the insurance sector in Nicaragua increased during the first quarter of 2014, registering premiums of $43 million, an increase of 21% compared to the same period in 2013.
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