By: Daniel Valero Andrade
Central America sets its sights high. The insurance and reinsurance market is at a turning point, poised to consolidate itself as a key player in the region
The Central American insurance and reinsurance market is undergoing a phase of growth and transformation. Development prospects are tangible, undoubtedly placing this part of the continent in a favorable position—one that is often unfairly undervalued.
Opportunities are emerging across Personal Lines, Property & Casualty, and Parametric Insurance throughout this Latin American region, albeit alongside certain challenges, particularly on the regulatory front.
To gain deeper insight into the regional business landscape, El Asegurador LATAM spoke with Francisco Díaz Rosete, Market Head Mexico, Central America & Panama at Swiss Re, who highlighted the trends that will enable the market to develop consistently over the coming years.
EAL: What are the main trends shaping the Central American insurance and reinsurance market in 2026?
Francisco Díaz Rosete (FDR): Starting with insurance, Central America is experiencing a very significant consolidation among market players. Borders within Central America—at least in insurance and the broader financial industry—are increasingly disappearing or becoming blurred. Large groups are expanding and operating on a more regional basis rather than focusing solely on their domestic markets.
As financial services penetration increases and financial education improves across the region, insurance naturally follows.
We have observed substantial growth in Personal Lines, credit-related insurance, and voluntary insurance distributed through banking correspondents or bancassurance entities, as well as through established insurers’ bancassurance operations.
There has also been significant growth—and a very relevant emerging trend—in high-net-worth individual insurance. Additionally, Individual Life insurance, which until now has seen limited progress, is expected to develop further.
In the Auto segment, performance remains solid, with continued growth. A particularly interesting trend is Costa Rica, which ranks among the countries with the highest penetration of hybrid and electric vehicles worldwide.
This generates an entirely different dynamic compared to how the business has historically been managed in that country. Claims experience for electric vehicles—or, more specifically, their repair—is very different from that of internal combustion vehicles, especially since most suppliers for these vehicles in Central America are based in China.
This trend will extend across Latin America and introduces new challenges that insurers must reassess and address; historical loss projections are no longer representative of future outcomes.
Regarding Property and general P&C business, Central America continues to maintain similar levels of insurance coverage as in the past. Large industrial groups seek this type of coverage, as do commercial groups with extensive property exposures—such as hotels and shopping centers—that are expanding and developing. Consequently, Property insurance grows alongside this development. However, this segment appears more stable compared to other, more dynamic lines of business.
EAL: Which emerging risks—climatic, cyber, economic, or social—do you believe will have the greatest impact on Central American insurers and reinsurers this year?
FDR: The emerging risk—which is no longer so new and remains ever-present—is climate risk. We are seeing increasing impacts from so-called secondary perils. Economic losses associated with natural catastrophes remain at historically high levels and, according to industry estimates, consistently exceed USD 100 billion globally.
This USD 100 billion trend is firmly established, and what is even more important is that a high-impact event can occur at any time, as seen in Poza Rica, Mexico; Valencia, Spain; or California in the United States.
The resilience we must maintain as an industry to cover natural catastrophes is essential and non-negotiable—it is precisely why clients purchase coverage from us across the industry.
Maintaining pricing discipline, a clear understanding of what we cover, and transparency in our policy wordings are fundamental responsibilities for the sector.
Another key factor is trade. For Central America, this is highly relevant, particularly as the region benefits from nearshoring. Countries have trade agreements with the United States and other regions, positioning themselves strongly as alternatives to traditional U.S. partners.
What we anticipate in the coming years—and see as a major opportunity—is the significant development of the manufacturing industry throughout Central America. This will create opportunities for Property insurance, Business Interruption coverage, and infrastructure projects that may not have been present until now.
Demographic changes are also noteworthy. The growth of the banked population clearly indicates the expansion of the middle class in Central America, representing a significant opportunity for the insurance sector.
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