DOMINICAN REPUBLIC - Finance
President, Seguros Sura
Carlos Ramón Romero graduated from Pedro Henríquez Ureña National University and entered the insurance industry in 1977. After a three-year stint with Franco Acra & Asociados he joined Segna and occupied several positions, including General Insurance Manager, General Insurance Director, and Underwriting Vice-President. In 1994 he became Co-Owner of Gerencia de Riesgos, an insurance broker. He then spent 10 years at Tricom, a telecommunications business, before assuming his current position.
The origin of the group is in insurance. It is a company with more than 67 years of history in the Colombian market and is the leading company in that market. Three years ago, the company started the process of expanding throughout the region. Seven years ago, it bought a company in Panama, and in 2011 the group bought two companies: one in El Salvador and Proseguros. The superintendency of the Dominican Republic issued the authorization for the takeover on July 1, 2011. It has a solid reputation in the region and is focused on sustained profitability based on attracting and retaining customers by offering value-added insurance solutions. It has strong human resources and excellent risk and capital management records.
It was an attractive business opportunity for the Vicini Group enabling it to continue its focus on other sectors in its portfolio, such as manufacturing, energy, and real estate.
We billed more than $74 million in 2011, and have a 10.5% market share. Our current budget forecasts 6% growth over 2012. As of July 31, 2012, we grew 4% more than the forecast. We are among the top four insurance companies in the market
In total, 48% of our revenue comes from fire insurance, 25% comes from automobile products, and 16% comes from life and health insurance, with 86% of our company focused on property and casualty and 16% on life and health products.
One of the goals in this market is to accelerate the penetration of insurance, which is very low in Latin America. In the Dominican Republic, it is close to 1.4% of GDP. Innovating and creating products that will capture the attention of the customers is important. We do this through alternative channels such as bank insurance or affinity groups.
An insurance contract includes a host of assumed responsibilities. However, the company always works to add value to different products. Through our automobile insurance solution, this value-added could be the services we offer to the customer such as roadside and home assistance. The company is very focused on the client and is completely service oriented. This culture of service has been developed over a period of years. Over the last year, we have been focused on aligning with Segura Sura’s corporate culture. The main resource, we believe, is human capital. Pricing is not the only issue—the product and service are also important. We aim to identify customer needs, add value, and develop long-term relationships with clients. Usually, customers in the personal sector move from company to company. We want to avoid that situation. The sector has been focused on corporate clients; we are oriented to multi-segment and multi-product offerings. The usual channel is local brokers, but we have worked to diversify using our expert sales force and the latest technology. Now, customers and brokers can connect with our database through the internet and obtain quotations. We recently introduced a tool that the customer can use to go directly to the auto repair garage and from there make a claim. That is new for the industry. In the past, customers had to go to our office or to a broker. They can go directly to the auto repair shop and open the claim there.
We have offices in Santo Domingo, Santiago, La Romana, San Pedro de Macorís, and Las Terrenas. We cover the rest of the country through agencies and brokers that work with us.
Our main supplier is our reinsurance network, which is very important in this business. We have strong relationships with the top reinsurers in the world, such as Swiss Re, Transatlantic Re, and Hannover Re Group. The Dominican Republic is exposed to hurricanes and earthquakes; reinsurance enables us to share the risk in order to provide our clients the protection they need.
All our insurance solutions are designed with our client’s needs in mind. Let’s say for example business and homeowner’s insurance; due to the fact that the country is exposed to hurricanes and tropical storms, there is high demand for this type of coverage. Our reinsurance backing is designed to take into account the nature of the country. We are generally conservative. We use A-rated reinsurers to guarantee the best coverage. Our reinsurers have been working with us for many years.
Presently, there are approximately 34 insurance companies. However, the top six companies control 85% of the market. The insurance sector in this country has mainly been developed in the corporate sector making it highly competitive and price sensitive. Therefore, premiums have a tendency to get discounted in order to maintain or attract new customers. The current government is currently working on regulations in order to promote adequate premium calculations. We believe that future opportunities will stem from economic growth and insuring first-time clients in the personal segment. We have experienced a compound annual growth rate of 30% in life insurance over the last four years. Moreover, only 6% of our revenues came from life insurance six years ago—now this share has climbed to 16%. Our brokers are very happy that Seguros Sura entered the market because they felt that the industry needed a change, and that the personal segment had great growth potential.
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