World Insurance Report
Opportunities for foreign insurance capital and expertise
Foreign insurers are heavily involved and influential in the Mexican market, having brought new capital and expertise. Among the 72 private insurers in the market no fewer than 61 had majority foreign capital. In March 2009, it was announced that AXA, which had acquired the Mexican insurance operations of Dutch financial services group ING, a year earlier, planned over the next three years to invest US$100mn in the Mexican market in view of its growth potential. But there are a number of challenges. The market is very competitive, among both insurers and brokers. Indeed, the market regulator, the National Commission of Insurance and Bonding (Comision Nacional de Seguros y Fianzas or CNSF) has stated that it does not intend to limit the number of companies authorised to operate in the market. However, at the same time security has become increasingly important for clients. In addition, property insurers, as a result of changes in the way in which the market’s natural catastrophe exposures are calculated, are under pressure to buy much more reinsurance protection. Indeed, three local companies have withdrawn from the property insurance business, including writing catastrophe perils in the Mexican Caribbean, including Cancun, following Hurricane Wilma
In May 2009 the Mexican market comprised 72 life and non-life insurers, two financial guarantee insurers, two housing credit
insurers, 13 health insurers and 14 bonding companies. Of all these one was state-owned, one was a mutual and the remainder
were private companies. In real terms assets grew from US$11.32bn in 1996 to $40.97bn in 2007. The growth in technical provisions
was even more marked, from $7.54bn in 1996 to $30.46bn in 2007.