Sustainability of providers and service for consumers combined with a growing demand are the key themes for the Latin America international health insurance market, according to World of America (WoA) president Maikel Garcia.
The responsibility of ensuring that disruption and turbulence do not affect consumers and corporates with international health insurance policies is the critical role for brokers, agents and intermediaries, he adds.
Garcia (pictured) was speaking to Health & Protection at the World of America 2026 Convention which brought together leading agents and brokers with insurers and providers from across the Latin America region.
Despite many changes across the sector including the rise of technology, it is market sustainability that is most critical to Garcia.
“We’ve been in business more than 40 years and we’ve seen all kinds of changes in the market and the worst is when you don’t see long term sustainability in the insurer, that’s been the biggest impact,” he says.
“We’ve seen government changes, currency changes, geopolitical situations, everything changing, but none of those impact the client base and the customer more than when a carrier goes bankrupt or goes under or out of the market.
“That’s the most direct impact you see in reputation for the industry and the broker and direct impact on the client in terms of all the liabilities that end up not being covered.”
Dynamic few years
Garcia sums up the last few years for the IPMI market in Latin America as “quite dynamic” with a lot of changes, especially through the insurer population with a lot of new options coming into the market in the last two to three years.
“If we look back ten or 15 years ago there were less than half the number of players there are today and new entrants coming into the market were not very common,” he says.
“So you didn’t see many players coming in, it was more stable in that sense, and you had some well-established brands and some companies always in different segments at the higher end or mid-size.
“Also, you didn’t have as much competition from the local market; we didn’t have a lot of the local carriers exploring international products.”
He notes that these new international and regional entrants generate a lot of disruption into how the business works.
The competition is of course positive in giving new options for advisers and clients, but does add the strain of brokers needing to learn about new products and propositions and which ones are most suitable for location and client type.
However, the main concern for Garcia and World of America from this wave of entrants is the quality and stability of those firms.
“Some carriers come into the market not having the full package, the financial stability or backing behind them, not having knowledge of the market or the preparation for it, and not necessarily being long-term stable,” he says.
“That’s one of our biggest concerns and one of the bigger issues we’ve had in the last few years.”
Citing examples of two or three carriers that collapsed in the last five years, Garcia notes there were “thousands of clients that paid a premium the week before, and suddenly a week later didn’t have coverage”.
Where people who have been long-term members of an insurer are going through significant treatment and the broker has to inform them the insurer is not going to pay anymore “that is a tough conversation to have,” Garcia continues.
“Fortunately, we’ve not been exposed to that because we picked our battles and our players very well.
“We’ve been in the position of helping those brokers who did work with those companies, and we ended up having to help them with the situation and they went through the worst time of their professional career.
“So long term stability is the biggest concern we have and it’s something that unfortunately is more exposed in the IPMI market than any other line.
“You don’t see that happening in savings, investments, disability, or travel insurance lines of business with the frequency that you see it on the IPMI market, so it’s very specific to this product line that you see that type of risk.”
Due diligence
Given the risk of upheaval and client detriment should an insurer pull out, World of America puts a significant emphasis on understanding the stability of the insurers it uses.
This deep due diligence can mean not working with insurers for a few years until they have proved their strength and ability to support the market demands.
“Our main objective to our sales force and to our team is to show them that we have to go through a process, we have to stick to what we know, we have to stick to following the process review and do the due diligence for them,” Garcia explains.
He continues: “It’s a sense of responsibility but it’s also a sense of loyalty that we have to them and their loyalty to us as well.
“It’s a huge responsibility from our part, which is what we try to keep and be proud of, but we are very serious about that process of being responsible in what we promote, how we promote it and taking care of our partners as well.”
The market appears more price sensitive than ever and while understandable, this can also cause issues, particularly where price becomes the dominant factor in insurer offerings.
“We’re seeing some of the strategies and companies being price driven more than a value proposition,” Garcia says.
“That’s concerning in the sense of how it affects the market, because you can do some adjustment in pricing, be competitive and be aggressive, but there are some lines you cannot cross as there are factors and liabilities they have to pay at the end and commit to it.
“That is one of the biggest exposures we’re seeing and how it is changing with the client.”
Training advisers
As a result, with so many insurers and propositions, the firm is investing in training for brokers to help them understand the key differences and to simplify the process for them.
“A few years back a broker might work with one or two insurance companies, now they might have six, seven or eight for the same line of products in the portfolio,” Garcia says.
“So it’s even harder for them to learn the products, keep up to date and why decide which one to pick.
“We see it a little bit from our broad scope because we might have six or seven carriers on the portfolio, but they touch different geographic regions – one might be a great product for Mexico, but it’s not necessarily a good fit for Brazil.
“Now, the broker in Brazil is exposed to a lot of those products, so they are not necessarily understanding this is a better fit for a different country because they not exposed to that experience.
“That’s our job; guiding them on what to do, how to do it and what’s the best market for them to approach.”
AI cannot be ignored
This year’s World of America convention, for which Health & Protection is media partner, includes a major focus on artificial intelligence (AI) and technology in the market.
Understandably the new technologies are starting to create significant changes in the market and these need to be addressed, especially for a sector which is often seen as being behind the technological times.
“We cannot ignore technology and AI and how it’s changing and how it’s impacting every single area of business,” Garcia continues.
“We’re seeing the efficiency that AI is generating for multiple things, in multiple lines of business, multiple areas and sectors, so we’re trying to see how we implement that and bring it to the IPMI and insurance market.
“Not only on the IPMI side, but all around and trying to generate a different set of tools for the brokers.”
Garcia explains the firm has been investing heavily in technology and developing new systems for the last 18 months.
It has been working closely with specialist technology providers to do this and wants to bring that ethos and visibility to advisers and brokers as part of the convention, and help to show how they see the business changing with the implementation of technology.
While the convention is a critical way to share market knowledge and build connections, it is also to celebrate its success and partners.
This includes placing the largest amount of business with each of the three largest insurers in the region.
“For us, it’s been a really good few years and it’s a celebration. The celebration is going to show a lot of diversity and growth, which is great because we’ve had from multiple countries and different regions, a lot of big partners coming in and doing amazingly in terms of production,” Garcia concludes.
