Rising costs and claims cancel out benefits of market expansion

Nine-month figures show premium growth of 23% struggling to keep up with a 32% rise in claims and a 26% rise in costs

Venezuelan insurance premiums rose by 23.4% during the first nine months of 2005, and that is in real terms, excluding double-digit inflation. The increase partly reflects higher tariffs charged in January through to September. However, the good news stops there as costs also increased and, at a rise of 25.7% to US$578mn, it outstripped premium growth. Coupled with an increase in claims totalling 31.8%, earnings dropped 17.8% for the period to U$205mn (all variations in real terms).