Insurance goes beyond the sole topic of disasters — it improves social well-being, it’s an economic engine, and insurers are important investors, providing medium- and long-term stability.
On December 15, Jesús Martínez Castellanos, CEO of the LATAM North Region and CEO of MAPFRE MEXICO was invited to participate in the Invertir en México (Invest in Mexico) forum, organized by the newspaper El País. The event was coordinated by journalist Sonia Corona, and guests included Demetrio Sodi, CEO of RCO (Red de Carreteras de Occidente) and Eduardo Osuna, Vice President and CEO of BBVA Bancomer.
Regarding opportunities in the country, the MAPFRE executive highlighted the role of infrastructure as one of the big levers for the private sector to penetrate. He also commented that although perhaps this is not the right time, when we return to normal, the tourism sector will be one of the greatest potentials for growth and attracting investment in the country. He concluded by talking about the financial sector, pointing out that few people have bank accounts and insurance penetration is low, at 2.4 percent of the Gross Domestic Product according to the most recent data, when the average level in Latin America is 2.9 percent.
Martínez also highlighted the role that insurance has played during the pandemic in Mexico, explaining that “the industry has seen indemnification exceed 700 million dollars in Life and Major Medical Expense lines. Insurance goes beyond the sole topic of disasters — it improves social well-being, it’s an economic engine, and insurers are important investors, providing medium- and long-term stability.”
The talk also discussed the importance of Mexico for MAPFRE. It is a strategic country, making it a long-term focus area in the group’s development and growth plan, specifically in terms of market potential given that only 30 percent of vehicles in the country are insured. There will be an opportunity in 2021 as a result of car insurance becoming mandatory by law. He also spoke of the importance of pensions and their reform, because the replacement rate is at 26 percent of their last salary. Martínez predicted that in the coming years there will be an explosion in the retirement industry and MAPFRE is ready to take on the challenge and help Mexicans access a better scheme that guarantees well-being for the retiree.
Finally, he mentioned that one of the biggest drivers of the Mexican economy, small- and medium-sized enterprises, have thus far paid little attention to their protection, since only 5 percent are insured, exposing them to a calculated risk, since the average life of these organizations is 5 years.
Through meetings like this, experiences from different industries enrich the conversation around economic issues, building on and catalyzing Mexico’s regional importance in Latin America, not only for MAPFRE, but also for investors whose products or services can be as diverse as the opportunities that the country presents.