Good morning, ! It’s Wednesday and in today’s issue we dive into the insurance vs inflation conundrum, the $212B Latin America’s insurance and Insurtech growing market.

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DATA DIVE

Inflation’s Hangover Still Hurts

Inflation is cooling, but the insurance industry’s headache isn’t. Global CPI may fall to 3.3% in 2025, yet the cost surge from 2021–2023 is baked into claims inflation, especially in homeowners and auto lines. Since 1998, homeowners insurance premiums have jumped nearly 200%, dwarfing the 58% CPI rise. Meanwhile, commercial auto’s slow premium growth feels like it missed the inflation memo—until recently. The upshot? Pricing models are outdated the moment they’re built, and underwriting discipline is no longer optional—it’s existential. (Read or Listen to the Full Report)

TREND OF THE WEEK

LatAm Insurance: From Quiet Climber to Regional Giant

Latin America’s insurance sector is in the middle of a serious glow-up. According to McKinsey, total gross written premiums (GWP) in the region have surged from $83B in 2014 to $212B in 2024, a 2.5x expansion over the decade. And it’s not just one-sided: while nonlife policies (think auto, health, property) have nearly tripled, life insurance has quietly grown from $36B to $93B, closing in on parity.

What’s behind the rise? A cocktail of macro and micro shifts: middle-class expansion, rising regulatory clarity, digital distribution, and growing private sector confidence. Countries like Brazil, Mexico, and Chile are seeing strong insurer penetration into underinsured populations, while local players and global carriers alike chase volume across both retail and corporate lines.

For insurers and PE firms eyeing growth markets, LatAm is no longer just “emerging, it’s asserting itself as the next frontier in scalable, premium-generating opportunity. (More)

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MARKET MOVERS

INSURTECH CORNER

LatAm Insurtech: Less Cash, More Conviction

Latin America’s insurtech scene had a funding fumble in 2024—VC investment dropped 38% YoY, landing at just $92M. But don’t mistake this for a downtrend. The back half of 2024 saw a 156% surge in funding, and the total number of insurtechs hit 502, a 5% growth. Over half the market focuses on digital distribution, while the rest supports incumbents through enabling partnerships. Growth is being powered by Chile and Peru, which led in internationalisation rates (32% and 50% respectively). As MAPFRE’s Carlos Cendra puts it: the capital may be cautious, but the ecosystem isn’t blinking. (More)

DEAL OF THE WEEK

Deal of the Week: Gallagher Doubles Down on Türkiye

Gallagher is reinforcing its regional bet on Türkiye with the acquisition of Aspera Sigorta ve Reasürans Brokerligi, a boutique broker specializing in industrial property, energy, and construction risks. The Istanbul-based firm, founded just three years ago, has built a fast-growing client base in sectors that align tightly with Gallagher’s existing footprint—and its strategic ambitions.

This deal is more than geographic expansion. It's a calculated move to deepen specialty capabilities in a market bridging Asia and Europe, amid a strengthening economic outlook. Aspera’s team, led by Evrim Ozkoc, will integrate into Gallagher Türkiye’s 25-person operation, reporting to CEO Gündüz Tezel.

Gallagher’s local history dates back to its 2021 acquisition of Brokers House, and this latest bolt-on reflects the firm’s continued appetite for scalable growth in emerging insurance corridors. (More)

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MACROECONOMICS

Old Friends: Back Reunited

A "historic" US–UK trade deal dropped this week—with more pageantry than policy. The headline tariff cuts on UK car exports? Capped at 100,000 units—just under last year’s volume. The steel and aluminum wins? Still tangled in quotas. And the digital services tax, a long-time US target, lives to fight another round. In return, UK markets will theoretically open up to more US agriculture and ethanol—products they were buying anyway. Meanwhile, intra-industry trade—like aircraft and pharma—still rules the transatlantic corridor. The UK is selling cars, the US is sending crude. Everyone’s buying and selling the same stuff. The big picture? This deal cements the status quo. (More)

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TWEET OF THE WEEK

"Success is not final; failure is not fatal: It is the courage to continue that counts."