How would you assess the development of the insurance sector in Colombia?

MAURICIO GARCÍA Ortiz The penetration of insurance products among the Colombian population is still very low, and therefore it holds huge potential for future development. Although only 26% of Colombian vehicles have insurance, compulsory insurance for traffic accidents is only offered by seven companies in the market, and penetration rates stand at 75%; the demand for these products is very high. In addition, home insurance against earthquakes and fire is one of the products that has the highest penetration rate, because it is a compulsory line and banks offer it. However, Colombia still faces a long road ahead in terms of strengthening the insurance culture among the population. At the same time, the industry is very well regulated, and thanks to intensive market research, it is increasingly integrating services and standards to meet international levels. For example, we have learned much from the Spanish insurance market in terms of products and initiatives. Last but not least, the recent free trade agreements (FTAs) will have a very positive impact on the further development of the industry in our country. In this regard, we may see new foreign companies entering the market in the near future.

ALEJANDRO SAMPER CARREí‘O The insurance sector has been growing dynamically in the past few years. Actually, statistics show that insurance premiums grew about two times faster than real GDP growth in Colombia, which is more or less in line with the rest of Latin America. That translates into a larger penetration of insurance today. However, there is still very low penetration and a low density of insurance in Colombia compared to some other countries and markets in the region. There are positives in the growth of insurance and our economy, which translates into opportunities for companies involved in the insurance business. When it comes to culture, unfortunately, insurance is not common. There needs to be a large education effort, which, if done correctly, will mean huge opportunities. As a company, we offer education but it has to be something that really reaches larger amounts of the population. We all have to continue with our best efforts education-wise, but unfortunately people learn most when some radical event takes place.

What role does diversification play in creating a wider insurance culture in Colombia?

MGO Demand for insurance products has grown marginally in the last couple of years. However, we have been able to target a wider spectrum of society by offering new and more tangible products, as well as providing more services along with insurance policies, so people can realize the benefits of having an insurance policy. For example, Liberty has focused heavily on developing its micro insurance segment in the last few years, and we have been a pioneer company in the industry. We have always prioritized consumer positions and needs in each particular case. Overall, we have seen very significant growth in the past year in this particular segment, and I firmly believe that insurance has a huge potential for development in the near future.

What is your growth strategy?

ASC Going back five to seven years, this company had a large concentration in government business. Approximately 80% of our business was with government and 20% in the private sector. We have changed significantly over the last four years; the breakdown is 60% private and 40% government. Over the past five years, we have been increasingly participating in the private insurance business without decreasing our business with the government. The company has grown more or less in line with the market. In 2012, the market grew around 11% in general insurance, and we grew around 4%. This was mainly because we did not grow in auto and mandatory auto insurance. Both of these categories make up about 42%-45% of the industry.