Latin American reinsurers set to continue strong performance

Written by Michael Griffiths

11/09/2024

Latin American reinsurers will maintain their strong performance in the second half of 2024 and into 2025, Fitch Ratings has stated in a new report.

The credit rating agency suggested that deployment of global reinsurance capacity seeking market share and diversification in the region could generate competition for local reinsurers.

Fitch is expecting “favourable” underwriting results to persist into 2025 and despite nearing the peak of the reinsurance pricing cycle, the group said that hard market conditions in Latin America may persist if insured losses remain elevated.

In 2023, Latin America experienced significant catastrophe economic losses of about US$45bn, the second highest in a decade.

Despite insured losses of $6bn being manageable relative to the record $53bn in 2017, Fitch said the gap between economic and insured losses underscores the importance of addressing the protection gap in the region.

“Our ‘neutral’ outlook for global reinsurance, characterised by strong profitability and resilience, extends to Latin America, provided that reinsurers maintain strong capitalisation and sound financial performance amid macroeconomic risks,” Fitch said in its report.

Related Articles