Barents Re to target Puerto Rican market
Panama-based reinsurer Barents Re has grown quickly in recent years and will shortly enter the Puerto Rican market, according to Arturo Falcon, chief underwriting officer for Latin America and the Caribbean at Barents Re.
Falcon said the company’s lawyers are working on the legal and regulatory issues that need to be solved it can obtain a license and start underwriting there but he hopes the company should be operational there by early 2014.
“I prefer to give a conservative estimate regarding when we can begin our underwriting there and I believe that we should be able to do this in January next year,” Falcon said.
“We don't plan to open an office in Puerto Rico because we will serve this market from our Miami office as we do with all other markets in Latin America, except for Panama. Serving Latin America from Miami is natural for us and it has worked very well with all the Latin American markets that we do business in.”
Falcon said Latin America has become increasingly competitive in recent years as the amount of capital in the region increases. This, in turn, has triggered downward pressure on rates.
“There's very strong competition and price pressure today in Latin America because there is a lot of available capital in the global reinsurance industry,” he said.
“Since many economies in Latin America have continued to grow at fairly high rates while economies in other parts of the world are struggling, there's a lot of interest among reinsurers – including new ones – to do business in Latin American markets. And this has led to a regional trend of increased competition and downward pressure on reinsurance prices.”
Barents Re now writes more than $200 million in gross written premium and it has more than $140 million in capital. Although initially founded in 1996, it was not until 2011 that it opened its regional offices: in Miami for Latin America, in Paris for Europe and in Beirut for the Middle East and North Africa.
“We're a young but fast-expanding company with a global growth strategy, and we've had a strong focus in recent years on positioning and strengthening our brand in the markets where we operate,” Falcon said. The company is also in the process of opening an office in Rome with the aim of offering surety coverage in the north of Italy, and in Madrid to serve the Spanish market.