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Follow on Google News | New Market Research Report: Mexico Insurance Report Q1 2011Recently published research from Business Monitor International, "Mexico Insurance Report Q1 2011", is now available at Fast Market Research
As the data in this report show, the US economic downturn has had an adverse impact on demand for insurance in Mexico. After almost doubling to around 2.00% of GDP in the five years to the end of 2009, non-life penetration has fallen sharply - although it is still higher than it was in 2008. Life density has fallen by about a tenth to the levels that were prevailing before the global financial crisis reached its climax in September 2008. Our medium-term growth projections are based on the assumptions that by 2015 non-life penetration and life density will return to the levels of 2009. We estimate total premiums in 2010 of MXN351,178. This includes non-life premiums of MXN208,425mn and life premiums of MXN142,754mn. In 2015, the corresponding figures a forecast to be MXN435,424mn, MXN300,833mn and MXN134,591mn. The modest increases in non-life penetration and life density are forecast to be 1.85% of GDP to 2.00%, and from US$105 per capita to US$115 per capita respectively. BMI's Insurance Business Environment Rating for Mexico, which is boosted by the manifest openness of the market to foreign insurers, is 66.4. 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 Q210 and the latest information provided by regulators and/or trade associations. Mexico's Insurance Sector Mexico's insurance sector appears underdeveloped by many metrics. In 2010, for instance, estimated total premiums are less than one third of the size of those in Brazil, even though Mexico's economy is only about a third smaller and the population is only 45% smaller. This appears unlikely to change anytime soon. Many Mexicans who can afford to use financial services, provided by banks or insurance companies, are willing and able to work with providers in the US. Partly because of the reconstruction of the banking industry following the financial crisis in the mid- 1990s, the life sector is dominated by major foreign groups, but is sufficiently fragmented to allow substantial competition. According to CNSF, the five largest players in the life segment accounted for 70% of premiums written in H110. US insurance company MetLife was the largest, with a market share of 33%. It was followed by Grupo Nacional Provincial (GNP, 10%), BBVA/Bancomer (9%), Monterrey New York Life (9%) and Citi/Banamex (7%). The non-life segment is more fragmented than it was a year ago. According to the CNSF, the five largest players accounted for 47% of premiums. AXA's operations in Mexico, enlarged by the purchase of ING Seguros in early 2008, were the largest foreign non-life insurer, with a market share of 14%. Spain's MAPFRE, with a market share of 6%, was the only other foreign group in the top five. Other leaders included the Mexican groups Qualitas (7%), GNP (14%) and Inbursa (6%). In other words, premium growth has almost certainly been constrained by competition. Compared to their peers in other major Latin American countries such as Brazil or Chile, Mexican insurers have - at least potentially - been more directly exposed to the problems of the US economy in the wake of the global financial crisis. Issues To Watch Growth Of Life Segment Life insurance premiums are growing significantly more slowly than they were in 2006-2007. Given the competitive pressures in the segment, and the economic challenges still facing Mexico, we expect the segment to stagnate from 2011. Fire Insurance And Other Non-Life Insurance Lines CNSF's H109 figures highlighted that the non-life sector has been boosted by particular lines. We anticipated that the surge in fire insurance and other lines would not be sustained and he CNSF's figures for H110 indicate that there has been no growth in either segment. However, BMI's forecasts for the Mexican economy, and non-life penetration, are consistent with a return to double-digit growth from 2011. Mexican Fixed Income Markets At a time when premiums generally are slowing, the continued favourable performance of the local bond markets will be crucial. For more information or to purchase this report, go to: - http://www.fastmr.com/ About Business Monitor International Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets. BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports. Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports. View more research from Business Monitor International at http://www.fastmr.com/ About Fast Market Research Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156. # # # Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available. End
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