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Latin American reinsurance stays resilient amid prolonged soft market
AM Best said premium growth continued even as facultative pricing fell by 5% to 20% in some areas and economic growth forecasts for 2026 were revised down to 2.2%.
AM Best said the Latin American reinsurance market has remained resilient despite a prolonged soft pricing cycle, weaker regional growth, and sizable catastrophe exposures, citing themes from its September 2026 Market Segment Report.
The agency pointed to continued premium growth alongside what it described as abundant reinsurance capacity and flexible terms for cedants, even as competition in facultative business has driven pricing reductions of between 5% and 20% in some areas.
AM Best said the soft market has persisted since the second half of 2024 and carried through June and July 2026 renewals, giving insurers room to strengthen catastrophe protection while keeping terms relatively favorable.
Still, AM Best warned that conditions are shifting, noting a revised forecast from the Economic Commission for Latin America and the Caribbean for 2026 regional economic growth of 2.2%, down from 2.3%, and highlighting a major protection gap where less than 24% of nearly USD 21 billion in economic losses were insured and penetration remains below 5% of GDP.