The Latin American growth strategy of Panama-based reinsurer Barents Re will focus on surety and niche reinsurance products in the coming years, a company executive told BNamericas.
Surety is one of the most important business lines for Barents Re in Latin America and the future growth potential of this segment is very attractive due to the large number of infrastructure projects in various countries, said Hikaru Uno (pictured), who is responsible for bonds and specialty lines. Colombia, Mexico, Panama and Paraguay are examples of such countries, Uno said.
Uno added that the small Paraguayan insurance market has become a high-growth surety market for Barents Re due to the current government’s ambitious infrastructure program. “Since 2013 our presence in Paraguay has increased significantly,” he said.
The company also sees plenty of growth potential in offering niche reinsurance products for the mass market and personal accident insurance segments in Latin America. This is something of an untapped business opportunity since global reinsurance companies in Latin America tend to focus on traditional market segments, such as P&C, said Uno.
“We aim to offer innovative products that are tailor-made for each country,” Uno said in regard to Barents Re’s niche focus in the region.
This focus is also more profitable for a smaller reinsurer like Barents Re because the traditional reinsurance segments in Latin America are experiencing declining profitability due to fierce competition among global players – and excess reinsurance capacity, said Uno. With the goal of taking advantage of attractive business opportunities and diversifying its revenues, Barents Re has expanded into several countries in Europe, as well as the Middle East and North Africa in the last few years.
Russia became the latest market for Barents Re when it opened an office in Moscow during 2014.
Barents Re does not plan to enter new markets this year, but will instead focus on consolidating its new business operations in Europe, said Uno. The exception could be Puerto Rico, which is a market that Barents Re is currently analyzing whether or not to enter, he said.