Why Latin Americans do not tend to get insurances?

Cath Sandoval
Copywritter

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Perhaps very little is known about the insurance world, since it is a minority of the population that can enjoy this benefit thanks to its economic stability, especially if we talk about the Latin American case.

The truth is that we contract insurance to be protected in the event that we go through an accident that compromises our integrity or that of our material assets, and we only maintain contact in a very limited way with our insurer.

The global context of the Insurance Industry

The insurance penetration rate in Latin America is very very low and is around 2.7%, well below the world rate of 6.5%. The leader in the global insurance market is the United States, where the ratio of premiums to GDP reaches 7.4%.

Did you know that Americans spend an average of only $ 247 a year on insurance? Which leaves the population underinsured.

Extracting information from a study by Fundación MAPFRE, one of the largest insurers in Latin America, it is perceived that the Latin American insurance protection gap (IPG), calculated as the difference between the current incidence and the amount of insurance needed to benefit society at an economic level, stands at 254.3 billion dollars in 2018.

In 2018 alone, the growth of the insurance market worldwide was located at 1.5%, reaching the value of 5.2 billions dollars in direct insurance premiums and the main impulse had come from the Non-Life lines, favored by the dynamism that maintained the global economy, mainly in the first half of the year.

Growth was solid, mainly in Asia, highlighting the evolution of the two largest markets, China and India. Latin American markets, for their part, moderated their growth.

How can we make sure that more people can be insured and protected against any misfortune? And why is life and non-life insurance still rare in Latin America? We will tell you about it in detail in our second part that will be available this week. Do not miss it!

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