Best’s Market Segment Report: AM Best Maintains Negative Outlook on Argentina’s Insurance Industry

MEXICO CITY--(BUSINESS WIRE)--AM Best is maintaining its negative outlook on Argentina’s insurance industry, citing a volatile macroeconomic environment and negative underwriting performance in 2025.

The new Best’s Market Segment Report, “Market Segment Outlook: Argentina Insurance,” also notes elevated inflation and high real interest rates that could weigh on domestic demand. While there has been some improvement in macroeconomic conditions, Argentina’s challenging market requires that insurance companies continually adjust prices and implement strict expense containment strategies to maintain policy coverages and limit business contraction.

“The market’s overall positive results in 2025 were mainly supported by investment income, as Argentina’s insurers in aggregate recorded a combined ratio over 100, driven mainly by increasingly expensive auto claims plus high litigation rates in workers’ compensation,” said Salvador Smith, associate director, analytics, AM Best.

The industry is still dominated by the non-life segment, which accounts for over 85% of gross premiums written, led by automobile (40%) and workers’ compensation (22%). According to the report, Argentina’s developing capital markets and limited financial instruments approved by the local regulator that can adequately match insurance liabilities and regulatory requirements limit market participants’ financial flexibility. High inflation ultimately worsens insurers’ solvency and liquidity issues. “Insurers with long U.S. dollar positions, a robust capital base, diversified business profiles and good distribution capabilities are in a better position to contend with the fundamentals of the economy,” said Smith.

The report also notes that the country’s regulator, Superintendencia de Seguros de la Nacion (SSN), has deployed several resolutions aiming to deregulate Argentina’s insurance industry, including measures to include the removal of limits on workers’ compensation tariffs, the promotion of parametric insurance, the optimization of bureaucratic procedures and reporting, the removal of regulatory authorization to launch new products and business lines and updates to solvency requirements.

To access the full copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=369075.

To view current Best’s Market Segment Outlooks, please visit http://www.ambest.com/ratings/RatingOutlook.asp.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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