Geography Trends Q1 Latin America

Chile

Market Dynamics

Q1 Automobile Summary

Overall (Challenging)

Multiple related, converging factors have continued to impact loss ratios, leading to a challenging market environment: rising exchange rates have driven up new car prices and auto repair costs, a shortage of car parts continued, and car thefts frequency remained high.

Pricing (+1-10%)

Conditions have continued from Q4. Rate increases have continued due to a convergence of factors related to costs, risks, and losses.

Capacity (Abundant) Auto capacity and appetite have remained strong as this product continued to dominate the portfolio of many insurers.

Underwriting (Rigorous) Underwriting has remained rigorous, time-consuming and rigid, with restrictions imposed for coverage in some cities, as well as for theft coverage generally.

Limits (Flat) Limits have been stable; expiring limits were achieved in most cases.

Deductibles (Flat) Deductibles have stabilized; however, special deductibles continued to apply to specific cities, as well as theft and terrorism coverages.

Coverages (Stable) Expiring coverages were achieved in most cases.

A Look Ahead (Moderate) Current market conditions are expected to continue, driven by inflation, exchange rates, the ongoing car parts shortage and increase in thefts.

Q1 Cyber Summary

Overall (Challenging)

Client interest in Cyber coverage has been strengthening. Insurers have required extensive underwriting detail evidencing sufficient cybersecurity controls. This, along with a challenging pricing environment, has served to deter some organizations from purchasing this coverage.

Pricing (>30%)

Rate increases have continued. Cybersecurity posture and controls have played a major role in pricing.

Capacity (Constrained) Some insurers have withdrawn completely from this space while others have significantly reduced their available capacity.

Underwriting (Rigorous) Underwriters have become more selective and have been proposing more restrictive renewal conditions.

Limits (Decreased) As risk has grown, insurers have continued to manage their exposure by reducing limits and sub-limits.

Deductibles (Increased) Some deductible increases have been mandated with minimal option to negotiate in most cases.

Coverages (More Restrictive) Restrictions (particularly related to ransomware) have continued to be imposed.

A Look Ahead (Challenging) As claims frequency and severity continues, market conditions are expected remain challenging.

Q1 Property Summary

Overall (Moderate)

Market conditions have moderated, although underwriting has remained rigorous and focused on engineering focus.

Pricing (Flat)

Moderate and well-performing risks have generally been experiencing flat renewal pricing while hazardous risks, or risks with insufficient fire protection measures, have experienced rate increases.

Capacity (Constrained) Poor performing risk types continued to experience notable capacity constraints.

Underwriting (Rigorous) Underwriting rigor has intensified, with a focus on engineering.

Limits (Flat) Expiring limits were achieved in most cases.

Deductibles (Flat) Expiring deductibles were achieved in most cases.

Coverages (Stable) Expiring coverages were achieved in most cases.

A Look Ahead (Moderate) Current market conditions are expected to continue.

Q1 Casualty/Liability Summary

Overall (Moderate)

Market conditions have moderated although challenges have continued for some industries (automotive, pharmaceuticals and rail), as well as risks with US exposure / activities.

Pricing (+1-10%)

Modest rate increases have continued, despite more market competition.

Capacity (Abundant) Insurer appetite has been expanding which has led to more market capacity.

Underwriting (Flexible) The underwriting environment has been accommodating, with some complex coverages being granted by insurers which previously declined to quote them.

Limits (Flat) Expiring limits were achieved in most cases.

Deductibles (Flat) Expiring deductibles were achieved in most cases.

Coverages (Broader) Coverages have been broadening; some insurers granted coverages in areas that were previously restricted.

A Look Ahead (Moderate) As more capacity continues to come into the market, conditions are expected to continue to become more favorable.

Q1 Directors and Officers Summary

Overall (Moderate)

The market has moderated. Local insurer appetite has been healthy for favorable risks, especially, new business, as insurers have sought to differentiate from the reinsurance market through more favorable terms.

Pricing (+1-10%)

Price increases continued but have moderated from the more significant increases experienced in 2020 and 2021.

Capacity (Ample) Capacity has been sufficient. Local insurers have not generally adjusted their available capacity but have offered it based on the merits of each risk.

Underwriting (Prudent) Underwriting has been cautious but not overly conservative. Insurer underwriting practices remained consistent with those that existed at the outset of the pandemic.

Limits (Flat) Expiring limits were achieved in most cases; however sub-limits for additional coverages were under review in Q1 as a mechanism for reducing premium costs to align with expiring levels.

Deductibles (Flat) Expiring deductibles were achieved in most cases.

Coverages (Stable) Expiring coverages were achieved in most cases; however, reinsurers have added exclusions related to silent cyber coverage.

A Look Ahead (Moderate) Moderate market conditions are expected to continue as local insurer appetite remains healthy for favorable risks, especially new business, and insurers continue to seek to differentiate themselves reinsurers.

Q1 Trade Credit Summary

Overall (Moderate)

Market conditions have been moderate and stable, with any cost savings attributed to trade-offs in terms of coverage restrictions.

Pricing (Flat)

Pricing has been stable, and highly dependent on sector. Reductions have been available in very limited cases and were generally associated with coverage reductions.

Capacity (Ample) Credit limits were slowly returning to pre-pandemic levels; however, current geopolitical events in Eastern Europe and their macroeconomic impacts have delayed the full return to normal.

Underwriting (Prudent) Appetite has narrowed and underwriters were cautious and conservative. Policies have been cancelled for risks in geopolitically challenging areas.

Limits (Flat) Expiring limits were achieved in most cases.

Deductibles (Flat) Expiring deductibles were achieved in most cases, regardless of form (threshold, coinsurance, etc.). Reductions have been available in some limited cases.

Coverages (More Restrictive) As insurers look to limit their exposure, some have imposed coverage restrictions and offering a modest price reduction as a result.

A Look Ahead (Moderate) The market is expected to remain cautious. While conditions are not expected to deteriorate, any possible improvements will likely be stalled.

Colombia Market Dynamics

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