According to analysts at GlobalData, Mexico’s general insurance industry is expected to grow at a compound annual growth rate (CAGR) of 7.5%, from $18.2 billion in 2021 to $26.1 billion in 2026.
Analysts states that such growth will be driven by large infrastructure and construction projects, frequent occurrence of natural catastrophe events, and an increase in demand for health insurance policies, which are due to the COVID-19 pandemic.
At the same time, GlobalData also notes that Mexico’s general insurance industry growth will be led by property and personal accident and health (PA&H) insurance lines, which is the largest general insurance line in Mexico, accounting for a 31.3% share of the GWP in 2021, while property insurance held a 21.1% share.
However, in 2021, the PA&H segment grew by 19.3%, which was driven by the rising demand for health following increased awareness due to the pandemic.
Rakesh Raj, Senior Insurance Analyst at GlobalData, commented: “Mexico’s general insurance industry saw a 17.8% recovery in 2021 after a COVID-19-related slowdown in 2020. With large infrastructure projects such as the Mayan Train project, Dos Bocas refinery project, and Felipe Angeles International Airport (AIFA) project on the way, and more people taking out health insurance policies, the industry now looks poised for a steady performance over the next few years.”
He continues: “Even though Mexico has universal health coverage for basic insurance needs, there is a growing demand for private health insurance due to its better coverage and access to a wider network of specialists and care centers. The PA&H segment is forecast to grow at a CAGR of 8.1% during 2021-26.
“Meanwhile, increased frequency of natural catastrophic events is driving demand for property insurance, which is forecast to grow at a CAGR of 10.6% over 2021-26. In 2021, the total economic loss due to the catastrophic events such as earthquake, floods, droughts, frequent hurricanes and extreme winter weather was around $4.5 billion, thereby driving the demand for property insurance.
“Also, the government’s focus towards the construction of large infrastructure projects such as educational and health institutions, public space, and mobility infrastructure works will also have a positive impact on property insurance.”
