Overview of the life insurance market in Latin America
Market research analysts at Technavio have predicted that the life insurance market in Latin America will grow steadily during the predicted period and will post a CAGR of almost 6% by 2020. Initiatives such as enforcing professional and disciplined underwriting practices help life insurance companies to operate sustainably in the Latin American countries. The emergence of virtual networks, multichannel interaction, and direct-to-consumer life insurance policies will aid in the improvement of the value chain systems of life insurance businesses. Also, the risk-based capital regime increases the capital demand for variable life annuities and will lead to higher premiums. These factors will create a favorable environment for insurance companies to improve their profitability and will be one of the major causes for propelling the growth of this market during the forecast period.
The use of BPO for closed-book operations is identified to be one of the major trends that will gain traction in the life insurance market in Latin America over the next four years. Life insurance vendors in this region have started focusing on developing strategies that will help them reduce their operational costs. This will lead to the increased number of life insurance firms outsourcing their closed book operations to business process outsourcing (BPO) firms. Though closed book operations help internal IT systems to produce materials required for management and compliance reporting purposes, they do not generate revenue and are also driven by technology. Outsourcing the same to BPO firms helps vendors avoid expensive and risky legacy systems and also increase profits.
Competitive landscape and key vendors
Customers are always on the lookout for insurance policies with better pricing. This has induced insurance firms to venture into new markets to tap the growing demand from different customer bases and also provide advice on the best insurance and coverage policies. The growing complexity of the economy will result in an increase in the application for insurance against various risks, which will deepen the penetration of insurance products. This is likely to intensify the level of competition among life insurance companies in the already competitive market. The forecast period will also witness increased investments from major vendors to develop innovative products and also to improve their distribution and service strategies. Moreover, big insurance firms will also follow M&A techniques to retain their share of the market and also to increase their market share in developing countries.
The leading vendors in the market are -
- AXA
- Bradesco
- Itaú Unibanco Holding
- Mapfre
- Zurich Insurance
The other prominent vendors in the market are Allianz, American International Group (AIG), Aviva, Brasilprev, CNP, Grupo Nacional Provincial, Liberty Mutual, MetLife, and Porto Seguro.
Regional segmentation and analysis of the life insurance market in Latin America
- Argentina
- Brazil
- Chile
- Colombia
- Ecuador
- Mexico
- Panama
- Peru
- Uruguay
- Venezuela
This market research and analysis estimates that Brazil will account for more than 48% of the total share of the life insurance market in Latin America by 2020 and will also dominate the life insurance industry throughout the forecast period. The majority population of the country falls under the age group of 15-64 years, which will lead to economic development and improvement in the quality of life. This, in turn, will fuel the demand for insurance and coverage policies. Additionally, the growth of the middle-class population and the predicted growth of the life and pension insurance segment will also have a positive impact on the growth of the life insurance market in this region.
Key questions answered in the report include
- What will the market size and the growth rate be in 2020?
- What are the key factors driving the life insurance market in Latin America?
- What are the key market trends impacting the growth of the life insurance market in Latin America?
- What are the challenges to market growth?
- Who are the key vendors in the life insurance market in Latin America?
- What are the market opportunities and threats faced by the vendors in the life insurance market in Latin America?
- Trending influencing the market shares of Latin America.
- What are the key outcomes of the five forces analysis of the life insurance market in Latin America
Technavio also offers customization on reports based on specific client requirement.
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