Facebook logo
Facebook logo
Facebook logo
Facebook logo

Latest Headlines

Captive Insurance Times home | Interviews | Alvaro Ortiz of Charles Taylor ← You are here

[close]
Latest News
XL Catlin appoints Steve Bauman
22 May 2017 | New York
Steve Bauman has joined XL Catlin as head of global programmes and the captive practice in North America, effective 23 May Read more

New general counsel for California insurance department
22 May 2017 | California
The California insurance commissioner Dave Jones has appointed Ken Schnoll as general counsel for the state’s department of insurance Read more

For more news visit our news section

Upcoming events
PARIMA 2017 Shanghai
Date: 21 June 2017
Location: Intercontinental Shanghai Pudong, Shanghai
Find out more

WRCIC conference
Date: 22-24 May
Location: Marriott City Centre, Salt Lake City
Find out more

For more events visit our event section
Industry recruitment
There are currently no jobs available
For more jobs visit our recruitment section
Captive Insurance Times
View the latest issues online now

Sister publications
Securities Lending Times
http://captiveinsurancetimes.com

Asset Servicing Times
www.assetservicingtimes.com

Real Estate Investment Times
www.realestateinvestmenttimes.com

Media pack [download]
Ad specs [download]
Latest features
A noughties hit
Feature: SACs in Bermuda, first crafted in the statute in 2000, are a useful tool for both captive and commercial insurers, says Kim Willey of ASW Law Read more

Cook Islands
Country profile: In an era of increasing uncertainty, Tamatoa Jonassen suggests that the Cook Islands can be a bridge to financial security in a captive Read more

Brian McDonagh :: Marsh Captive Solutions Dublin
Interview: Many captive owners are exploring alternative forms of capital in order to strengthen their capital base in a more efficient manner, says Brian McDonagh of Marsh Read more

For more features visit our features section
Interview
Latest news
Alvaro Ortiz
Charles Taylor
Dramatic changes in the Latin American market have led to increased interest in the captive concept in the region, according to Alvaro Ortiz of Charles Taylor

How significant is the captive concept in Latin America right now?

There have been dramatic changes in the market, especially economic changes, which have led to an increase in the captive concept in Latin America.

As part of the changes, there have been down-turning economies and a change in political systems with people moving from the left to the right, which has led to a more open economy and created an ease of doing business in the region.

In addition, corporate tax rates have increased in most of the larger countries, however, we have also seen currency devaluations, which have been major. In Mexico, one of the largest economies in Latin America, there was a 15 percent currency devaluation just after the US presidential election. Chile has seen a 12 percent devaluation, Colombia had a 20 percent devaluation, and Brazil had a 23 percent devaluation.

All the major countries and economies had currency devaluations, which have led to them trying to find alternative ways to use captives, in terms of valorising their local currencies. It has been a perfect storm for captives to come into play with economies taking a different turn.

Providers such as ourselves have also been educating clients. I think the biggest hurdle in Latin America at the moment is having a lack of awareness of the captive concept.

To help educate clients, companies like us are setting up offices in Latin America, which are regional offices instead of trying to touch the Latin America market from other captive domiciles. We are actually moving towards the client and the risks.

Is regulation still holding the Latin America captive insurance market back, and if so, what is being done to change this?

Historically, regulation has been one of the largest obstacles, but Colombia has opened up its market to allow direct writing for certain captives and now Brazil, which used to only allow 40 percent of reinsurance and insurance to be placed outside of the country, is soon moving to allow 80 percent, after a decision from the government superintendent.

It is good to see that larger countries are starting to understand and embrace the captive concept.

It is essentially a product of global trade—you can get cheaper pricing outside of your country than you can in a closed-country economy.

Charles Taylor recently expanded its presence in Latin America with a new office in Panama. Have you seen an increase in demand for captive insurance services in the region?

Panama is widely regarded as the financial hub of Latin America and that is one of the reasons why we chose the location. Other reasons include the presence of small-to-large companies in Panama, and the fact that decision makers are either based in Panama or visit quarterly for board meetings.

Panama is also a major hub in terms of travel, so we can get to our clients within a few hours. After all, it is very difficult when you are in Bermuda or London to try and get someone from Latin America on the phone.

We also recently launched a new product. We have tried to go back to the captive concept, because it was a strange or difficult concept to sell to Latin America initially.

At Charles Taylor, we have created a very simple product to help them to understand the captive idea, whereby the reinsurance market covers the original client’s catastrophic deductibles.

The original insured will have a catastrophic deducible cover backed in the reinsurance market via a segregated cell captive that we create.

In the event of no loss, net profits accumulate within the cell, which enables the client to build up significant reserves over an extended period of time. The aim is for the entire deductible limit to be fully funded within a certain amount of time and amount of years.

How is the risk management function in Latin America developing? Are risk managers becoming more conscious of their needs in this area?

It is developing at a slow pace. It is something that some of the larger companies have embraced but the small and medium-sized companies are yet to embrace because of additional cost.

What we are trying to do is fill the void for risk managers who are not necessarily paying attention to those small and medium-sized companies.

Are there sufficient people with risk management skills and experience in Latin America to fully realise the benefits of captive insurance? How is Charles Taylor staffing its new office?

Risk managers are typically focusing on the large companies and have not moved their services down to the small and medium-sized companies. That is where we come in.

We are staffing our new office with local talent. One of the benefits of Panama is that it has infrastructure in terms of large commercial buildings and an English speaking high-level group of employees, due to the financial centre being here, as well as the US presence running the Panama Canal over decades gone by.

We are very excited about the new initiative in the Latin American market as a growth market, not only for captive services but also for our wider services in loss-adjusting and insurance technology. The Latin American market is increasingly important to us as a group.

To view the full issue in which this article appeared - Click Here



XL Catlin appoints Steve Bauman
Steve Bauman has joined XL Catlin as head of global programmes and the captive practice in North Ame Read more

New general counsel for California insurance department
The California insurance commissioner Dave Jones has appointed Ken Schnoll as general counsel for th Read more

A.M. Best affirms NextEra Energy captive
A.M. Best has affirmed the financial strength rating of “A (Excellent)” and the long-term issuer Read more

PRIIA puts insurance market at ease
PRIIA has reassured the insurance industry that although Puerto Rico has filed for voluntary bankrup Read more

Peter Allen joins Moore Stephens from Grant Thornton
Allen joined the company from Grant Thornton Singapore where he served as CEO and senior adviser Read more

Captive Insurance Times site map
Home
Home

Sitemap

Issue archive
Back issues online
Recruitment
Recruitment
Events andtraining
Upcoming events

Upcoming training

Company info
About us

Contact us


Copyright (C) 2013 Black Knight Media Ltd. All rights reserved. No reproduction without prior authorization