PICC to enter Argentina: reportJuly 5 2019 by InsuranceAsia News Staff
State-owned P&C giant the People’s Insurance Company of China (PICC) is set to become China’s first entry into Argentina as an admitted reinsurer.
PICC is seeking permission from insurance regulator SSN to operate as an admitted reinsurer and is on track to begin operating in September, Jorge Strika, president of local brokerage Broker del Plata, told BNamericas.
Broker del Plata, which already works with PICC as an insurance broker, secured a multi-year contract as a result of this existing business relationship, Strika said. Broker del Plata will act as PICC’s local reinsurance representative on an exclusive basis.
PICC will initially focus on providing reinsurance for surety and operational all-risk policies for public works projects with Chinese investment, such as he under-construction Condor Cliff-Barrancosa hydroelectric complex in Santa Cruz province.
Chinese investors are heavily involved in the Argentine energy sector and largely operate in consortium with local companies.
As part of plans to strengthen the local insurance and reinsurance market, SSN has lowered entry barriers to foreign firms.
The report states that PICC also plans to widen its Argentine focus to compete with other foreign reinsurers – a development that is good news for the local market.
“It’s a very significant development because China comes with different costs,” said Strika. “The cost of reinsurance dictates the cost of insurance. Retail companies don’t retain the risk, they transfer it.”
Strika added: “Basically what they will do is start by providing reinsurance for Chinese investments in Argentina. There is lot of Chinese investment, involving a large amount of US dollars, here in the country.”
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