Auto insurance claims hit 70% in Panama; policy hikes possible

Panama's insurance industry is facing significant financial strain, with the Panamanian Association of Insurers (Apadea) reporting a 70% claims rate for auto insurance policies during the first half of the year. This means that for every dollar collected in premiums, $0.70 was paid out to cover customer claims.

Esilda González, Apadea's executive director, explained that the increasing use of insurance services directly impacts financial results. "In automobiles and health, we are in the red," she stated, highlighting the pressure on the industry. Auto-related claims specifically rose by 14.6% between January and June, contributing to this challenging financial landscape for insurers.

The health insurance sector is also experiencing similar difficulties, with a claims rate of 65.1% for the same period. Premiums written in health insurance amounted to $295.8 million, while claims reached $192.6 million.

Iván Van Hoorde, president of Apadea, indicated that potential adjustments to insurance policies might be necessary. He noted that any changes would depend on the specific coverage details, such as international benefits, deductibles, copayments, and usage frequency. "The adjustment does not depend solely on the insurer, but on the specific product," Van Hoorde explained.

Despite the rising claims, Apadea emphasized the crucial role private insurance plays in protecting individuals and their assets against unforeseen events like accidents and illnesses. However, the current trend suggests a potential for increased policy costs if the claims rate does not stabilize.