1. Session 7: Breakout Group on Insurance: Progress in the Region and Policy Challenges Ahead
Craig Thorburn, The World Bank
Regional Seminar on NBFIs in Latin America
December 4-6
Santiago, Chile

2. Observations on Status
Considerable scope for development across the region compared to other regions.
Life sector tends to lag behind non life sector.
Liberalization in progress in most jurisdictions, some for longer periods than others.

3. Externalities and Preconditions
Sector progress depends on preconditions.
Improved growth in recent years has come with improved economic stability.
Political instability in some countries has had an impact which will limit opportunities for the sector in those countries in the short term.
Continued (or restored) certainty of economic outlook required to promote long term savings environment.
International reinsurance market and pressures on home operations of international firms will also influence local operations.

4. Market Tiers
Analysis suggests a two tier regional grouping.

5. Opportunities Identified
Regulatory upgrades in a changing environment, constant vigilance
In an increasingly global market, compatibility with IAIS international standards and codes
Particular emphasis on
Review and supervision of technical provisions;
Solvency margin regime in an environment of liberalizing product controls;
Reinsurance;
Risk management, particularly ALM; and
Supervision without over regulation.

6. Opportunities II Enforcement – more consistent application
Improvement of the region against world wide benchmarks – continued liberalization steps
Improvement within the region between groupings
Larger markets can / should assist smaller markets
Cooperation and coordination at a regional and international level re-emphasized
Liberalized approach to distribution channels especially banc assurance, retail associations and internet distribution
Non life insurance – emphasis in opportunity presented by compulsory classes
Liberalization to increase efficiency and coverage
Social objectives can be enhanced