BancoEstado unit expects insurance growth despite economic downturn
Chile's BancoEstado expects continued strong insurance growth this year, despite the downturn of the country's economy.
The state bank's insurance brokerage unit, BancoEstado Corredores de Seguros, should see an increase in its premiums of 7-8% in 2014, Carlos Martabit, the unit's president, told BNamericas.
The projected increase would be in line with last year's growth of 8%, Martabit said.
The Chilean economy has slowed sharply this year and is expected to expand at around 2%, compared to 4.1% last year, due to falling investment and slower private consumption. This slowdown has not had a major impact on premium growth, as insurance demand among the bank's clients has held up well, said Martabit.
The brokerage offers a wide range of low cost micro and mass-market insurance policies to BancoEstado's many low-income clients. It has around 3mn clients and 6mn policies, according to Martabit.
The company plans to focus on increasing the number of policies that existing clients have. The launch of new products and the use of new distribution channels will also be important drivers for premium and client growth in the coming years, he added.
US life insurance giant MetLife, which has been BancoEstado's strategic partner for 10 years, has contributed greatly to the strong growth in client base and premiums during the period, said Martabit.
MetLife acquired 49.9% of BancoEstado's insurance brokerage in 2004, in what was seen as a landmark deal for both parties.
Chile's only state bank is one of the country's largest lenders, with a strong focus on micro and small businesses and low-income families.
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