Mexican Sura unit expects double digit insurance growth

Sura Seguros México, the local subsidiary of Colombiaꞌs biggest financial group, started its life insurance business in December 2013 after acquiring INGꞌs operations.

In 2015, the company received the highest possible rating from Fitch due to its strong financial position. 

The insurer's CEO, Rodrigo Sandoval, spoke to BNamericas about the short-term growth plans as well as industry issues.

BNamericas: How do you perceive the Mexican market?

Sandoval: There are huge opportunities for insurers to grow in the country. Only around 15% of the people who are economically active have life insurance coverage and over half of the population has no social security.

BNamericas: How did the market welcome the ING acquisition?

Sandoval: Obviously the brand matters a lot since people and companies recognize the name and feel a secure. Sura is very well known in the region as the biggest asset manager. In Mexico, our Afore [pension fund manager] Afore is very strong and that gives clients tranquility.

BNamericas: What are your growth expectations for this year?

Sandoval: At the end of 2015, Sura reported total insurance premiums of 695mn pesos (US$40mn), with 90% coming from group insurance products and the rest from individuals. This year we expect to grow to 1bn pesos in premiums, focusing on sustainable and profitable growth.

BNamericas: How do you expect to achieve this?

Sandoval: Sura expects to continue to grow at double digits this year, like we did in 2014 and 2015, when we grew more than 20% annually. Our strategy will be to focus on promoting individual insurance products while retaining our strong growth in group insurance. This is to align the strategy with Suraꞌs parent company which is specialized in products for people rather than companies.

BNamericas: What can be done to increase the use of insurance in Mexico?

Sandoval: People typically begin to use insurance products as their disposable income increases. However, it also depends a lot on the amount of information and education they receive on this particular type of financial instruments, which can also help people to save and prepare for the future.

BNamericas: What does Sura do to increase the insurance culture?

Sandoval: Sura invests heavily in our sales force training it has recently created a business school where executives are trained to better help customers in choosing the insurance product that suits their particular needs.

BNamericas: Is there a chance you could grow inorganically in the Mexican market?

Sandoval: I think the opportunities are always there and we are always open to analyzing them, as long as they make sense to the business and add value to our shareholders.