What was the reason behind Swiss Re reentering the Colombian market?
The company has been active for over 150 years as the Swiss Re Group. We have been doing business in Latin America for about 120 years, and entered the Colombian market 70 years ago. We serve the market from a number of locations. As a reinsurance company, we do not require a local presence in each country. We receive support from our Zurich office as well as from New York, Miami, Mexico City, Sao Paolo, and Bogotá. Those are the locations in which we have people supporting our Colombian business. We opened a local office two years ago to sustain existing relationships, generate additional business and new talent.
Over the past two years multinational re-insurance and insurance groups have decided to enter and re-enter the Colombia market. Why now?
There are many factors. One of them is rising capitalization in the worldwide insurance business. Growth in mature markets is not as fast as in emerging ones. For example, in 2013, business growth worldwide was at 1.4%. Emerging markets registered 7.4% growth, and advanced markets just 0.3%. International capital is looking to expand into high-growth markets, one of which is Colombia. The investment environment in Colombia is conducive to capital inflows.
You recently acquired Seguros Confianza. How will this enhance your reach into mining, energy and construction? How exactly has the integration process taken place?
In 2010, Swiss Re Group's strategy was revised. We chose to increase our growth in commercial insurance markets. We identified three main growth areas, namely high growth markets, longevity and mortality business and corporates. We created holding companies and three subsidiaries to cater for each. Swiss Re Corporate Solutions focuses on corporate business, and became the 51% shareholder of a company in Colombia. Our traditional markets remain within Swiss Re Reinsurance. The Admin Re subsidiary purchases closed books of business that need efficient administration.
What is the strategy for 4G projects, and what encouraged you to invest in 4G in Colombia?
In the reinsurance segment of Swiss Re, high-growth markets, longevity and mortality are our main focus areas. We evaluate local opportunities based on their economic growth potential. These include infrastructure, agribusinesses, housing and mining. Infrastructure is a key industry. New construction is taking place in the country through Agencia Nacional de Infrastructura (ANI) and Invias. There is potential to offer reinsurance coverage for these projects as well as for existing infrastructure that is not as well protected as in other countries. 4G is one of our key priorities today. We work together with reinsurance brokers and the insurance companies to meet the government's expectations in covering this investment.
How does the strategy for consolidation in the Colombian market differ from elsewhere in the region?
Our responsibility at the local office is for the Andean region, namely Colombia, Ecuador, Bolivia and Peru. We are consolidating our position in the markets for the insurance, reinsurance and the broker sectors. Insurance companies are looking to stay in Colombia for the long term, bringing new products, capacities and services. Nevertheless, a local presence and local knowledge from local companies are valuable assets for the market.