COLOMBIA - Finance
President, Seguros Bolívar
Jorge Enrique Uribe is a Civil Engineer from the National Faculty of Mines and has a Master’s degree in Actuarial Sciences from the University of Lausanne in Switzerland. He began his professional career at Colseguros and joined Seguros Bolívar as Vice-President of Personal Insurance. He has been President since 1994.
I think that the demand for insurance is very important in Colombia. There are two kinds of insurance that you can differentiate between: individual insurance and corporate insurance. Corporate insurance depends on the growth of the country; annual growth in the insurance sector can be up to two times the GDP growth rate. However, individual insurance can grow faster depending on the base of the insurance companies. For example, you need to have channels to appropriately reach the population. You cannot grow if you do not have a way to distribute your product. Insurance companies here are developing sales forces and new ways to reach people to offer individual insurance. I think the development of corporate insurance could go well with the growth of the economy. On the other hand, we have to develop our channels in an appropriate way to catch the surplus of individual savings.
In our case, we know that savings are very important to increase our individual businesses. We are broadening our channels to reach clients in terms of sales force, internet usage, and call centers. We will also focus on being a financial group that has different types of products, such as bancassurance. We sell many insurance policies in Davivienda’s offices, and there are about 700 offices all over the country. In those locations we sell life insurance and many other kinds of products, including automobile insurance. I see a very good future for the insurance industry with the environment that we have right now. It is getting better and better for the future because we are sure that Colombia is going to grow as the political model will not change. Change depends on how to spend the budget to help the poor and to eliminate poverty, but for us it is better. As poverty decreases, our customer base will increase in the future.
We are conscious that we have to grow; however, we want to grow in a conscious manner. If you go too fast, you can hit a wall. You have to know where your potential is, what your strengths and weaknesses are, and then manage them to find the best approach. The first strategy that is very important for us is to have synergy with our companies. There are three companies that are associated with our insurance company: Davivienda, Leasing Bolivar, and our construction company. These sources are very important for our growth. The second thing that is very important for us is technology. Without technology we cannot grow because the transactions have to be very rapid. Client contact and our promise of value have to be accomplished. At the same time, knowledge of our business is very important. We have 3,000 agents and we are always recruiting more. These agents are our ways of communicating our policies, reaching our clients, and presenting our products. We think that differentiation is more important than price. The sales force is one of the main strategies for Seguros Bolívar. We also make great efforts in educating our personnel. In Colombia, we do not have actuarial career education; therefore, we send people to the US to study. Our company has more actuaries than any other in Colombia. We think that the most important thing is not profits; the most important thing for us is humans. At the same time, we have strengthened our relationships with some allied partners, international insurers such as AXA, Factory Mutual, and Zurich among others, to expand our business with multinational companies established in our country.
The most important part of our portfolio is life insurance, which can be split into two branches: group life insurance and individual life insurance. Also, we have divided our market into low income and medium income. It is very difficult to catch the high-income sector. We are now trying to form a sales team with new kinds of presentations to offer to the high-income bracket. However, you have to have a very different kind of person. We have 1,000 people in the medium- and low-level income team. It is a specialized force offering mainly life insurance, but we are now offering home insurance as well. This is important for us and very profitable. We have almost 2,000 people selling four kinds of insurance: life insurance, health insurance, automobile insurance, and a periodical saving called capitalization. With these four products we can more or less meet all the needs to insure a family or an individual. We have a relationship with Davivienda that is very important in group insurance, the insurance that covers debt or a person with a mortgage. For life insurance, in the case of a debtor’s death, we pay the debt off at that moment. Another is fire insurance for property. These two kinds of insurance are very important for us. In Colombia, social security is divided into three branches: pensions, health insurance, and worker’s compensation. When you make a contribution to a pension fund, part of it is for your savings and the second part is for disability and death. If you are disabled, before your retirement you receive your pension, or if you die your widow receives your pension instead. Insurance companies sell these kinds of insurance to the pension funds. There are 10 million people that are in the pension fund that are eligible soon. There will be a huge mass of people that are going to retire, and we have to profit from that.
In Venezuela, the savings rate is very low. Seguros Bolívar is a life insurance company and it is very difficult to find a specialized sales force. Labor conditions in Venezuela are very difficult right now. Ecuador is showing some very good economic results and the standard of living is increasing. In the 12 or 13 years that we have been there, we have been growing well. There is a good environment and they are very good workers. In Ecuador, as in Colombia, people like to work and they like to make a lot of effort. I think there is a market for life insurance there. We are also in Panama, Costa Rica, Honduras, and Salvador, forming a network for serving and penetrating the increasingly important market of Central America.
© The Business Year – February 2013
COLOMBIA - Industry
Sales & Marketing Director, Western States Machine Company
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