New Market Study Published: Mexico Insurance Report Q2 2010

March 8, 2010 - PRLog -- This report differs from its predecessors in several respects. In our analysis of competitive conditions, we provide a much more comprehensive ranking of insurance companies in the major segments from the point of view of the organisation that is providing the data (in practice almost always the national insurance regulator or the national insurance trade association). In Mexico, for instance, the three largest non-life companies in the first half of 2009 - in terms of Gross Written premiums - were Seguros Inbursa, AXA Seguros SA de CV, and Grupo Nacional Provincial SAB, with 17.5%, 13.1% and 12.2% market share respectively. Motor insurance (all lines) represented 19.2% of the Mexican market, followed by fire and all risks (15.4%) and accidents and illness (13.6%). Over time, we hope to derive insights from observing how market shares change. We emphasise though, that a decline in share of Gross Written Premiums is not automatically a bad thing and is often the result of a deliberate corporate decision to focus on more profitable business lines. Writing in November 2009, we have been able to ensure that the report includes actual data for 2008. Reports from the CNSF, Mexico's insurance regulator, indicate that non-life premiums rose from MXN108,612mn in 2007 to MXN115,707mn in 2008. Also according to CNSF, life premiums rose from MXN 84,994mn in 2007 and MXN 94,288mn in 2008. We have generally been able to use data that has been published over the course of 2009 to adjust our forecasts for the year as a whole. We are looking for total premiums in 2009 of MXN246,137mn. This includes non-life premiums of MXN142,324mn and life premiums of MXN103,812mn. In 2014, the corresponding figures should be MXN369,887mn, MXN238,067mn and MXN131,821mn. In terms of the key drivers that underpin our forecasts, we are looking for non-life penetration to rise from 1.20% in 2009 to 1.50% in 2014, and for life density to rise from US$72 to US$115. BMI's proprietary Insurance Business Environment Rating for Mexico is 65.0. This quarter, we include a discussion of developments within regional markets - on the basis of results published by major cross-border companies in relation to Q209 or Q309 and the latest information provided by regulators and/or trade associations. Among the major insurance companies operating in Mexico, MetLife was the main contributor to the real growth of the life segment, while Inbursa was the main driver of the non-life segment. A surge in investment income - from MXN13,316mn to MXN16,027mn - was the main reason for the increase in the overall profits of the insurance sector.

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