Friday, December 8

The insurance sector entered 5% more in 2021, but did not reach the pre-pandemic level

The insurance premium income at the end of the year they stood at 61,835 million euros, 5% more than a year ago, according to the latest data released by the employers unespa. If the comparison was made in 2019, the business is still 3.65% lower. Insurance therefore shows signs of recovery after the outbreak of the covid-19 pandemic in Spain and the measures adopted to contain it, but it has not yet covered all the lost ground. Of the income achieved throughout the year, 38,277 million euros corresponded to the non-life branch and the remaining 23,558 million to life, according to provisional data collected by the Cooperative Research of Insurance Entities (ICEA).

Lines linked to business activity, as well as health and multi-risk, are the ones showing the greatest dynamism. The turnover of the life business, reflected in income from premiums, increased by 7.88% in year-on-year terms. If it is compared with the data for 2019, on the other hand, it points to a drop of 14.41%. The volume of savings managed through insurance increased slightly from one year to the next. Technical provisions stood at 195,707 million at the end of last December, 0.82% more.

The turnover of the non-life branch has remained positive. It records a year-on-year rise of 3.30% compared to December 2020, and 4.43% compared to the same month in 2019. Miscellaneous insurance contributed 9,320 million euros in the year. This category, which includes protections linked to business activity, increased by 5.57% in the last year and is a true reflection of the gradual economic recovery. The evolution of health insurance stands out, growing by 4.93% and totaling 9,849 million. Policies that protect real estate rose another 4.70% year-on-year, to 8,117 million. The car insurance situation is different. They closed 2021 with revenues of 10,990 million euros. This magnitude is 0.87% lower than that registered at the end of 2020, and 2.85% lower than the same figure for 2019.


Regarding the profit forecast for 2021, the president of Unespa, Pilar González de Frutos, has recognized that it is “too early” to have an estimate, given that the entities have not yet proceeded to formulate their accounts, although it has predicted that the results will be “in line with what has become customary in the insurance sector”: positive and stable results, without skyrocketing returns. “It is evident that the insurance sector has closed a year resisting, maintaining its activity figures, supporting the economic and social activity of our country, with good figures for maintaining employment and the quality of customer services and facing the new challenges that are presented to us in the next financial year”, he highlighted during the presentation of magnitudes for the 2021 financial year.

The general director of ICEA, José Antonio Sánchez, has pointed out that the sector could “perfectly” recover pre-pandemic billing in the 2022 financial year, provided that life savings premiums, subject to greater volatility, grow “somewhat”.

The challenges

The president of Unespa has also listed the new challenges facing the insurance sector this year, which have to do with economic developments, whether or not to maintain interest rates and the need to insist on tax treatment for medium-term savings. and long term, appealing to all the parties involved in the pension system. In addition, he has reiterated his position on the employment pension macrofund promoted by the Minister of Inclusion, Social Security and Migration, José Luis Escrivá, which in the opinion of González de Frutos will not solve the problem of pension sustainability. “I believe that it is a path that leads to nothing more than the creation of a hollow instrument, a shell in which, except for the wink that it can make to the self-employed, it will not be able to be completed with an authentic new social provision” , has criticized.

González de Frutos has recognized the possibility that some insurance companies pass on high inflation to their prices. “Each one, depending on their capabilities, will manage this within the framework of their business policy for this year, but inflation undoubtedly erodes margins in the case of insurance and any other sector,” González de Frutos pointed out. In any case, he has stated that “everything seems to indicate” that the first half of 2022 will still be subject to strong inflationary pressures derived from the impact of energy, but there will be a strong correction in the second part of the year that would lead to average inflation “much more moderate.”

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Unespa’s position on the public Sareb

The Council of Ministers is expected to approve this Tuesday a legal change that allows the Government to take control of Sareb, which would give rise to a reorganization of the capital structure of the ‘bad bank’, in which, in addition to the FROB, there are banks and insurers. The president of Unespa has assessed that Sareb was “a necessary technical solution” that was adopted at a time of severe financial crisis of financial institutions that, in the absence of this instrument, could have dragged the entire Spanish economy into more adverse situations than those that were lived at the time. As he recalled, the entire financial sector was called upon to collaborate and each company had its own individual motivations for forming part of Sareb’s capital or for subscribing to bonds issued by the company. “My assessment is that the accumulated negative results that this management company has been presenting and the fact that the European Commission has forced the Spanish Government to assume what is a reality (that it has to incorporate the accumulated losses into the public deficit) , make it, indeed, make a lot of sense from the point of view of public accounting for the State to acquire 100% of Sareb’s capital”, stated the chairwoman of Unespa.