AM Best is revising its market segment outlook on Spain’s life insurance segment to stable from negative.

In its new Best’s Market Segment Report, “Market Segment Outlook: Spain Life Insurance”, AM Best notes that the segment’s growth is supported by the higher interest rate environment, which is expected to continue at least in the medium term.

The report also notes that while the segment’s profitability levels are expected to remain healthy, benefiting mainly from higher returns on insurer’s own portfolios, potential volatility in financial markets could impact the segment’s results at any given time.

On the other hand, the spike in production of guaranteed savings products is generally well managed by the segment from a risk perspective and has not had a detrimental impact on capital light products, as unit-linked products continued growing in 2023.

AM Best notes that insurers will need to navigate this new environment with the objective of maintaining a well-balanced business mix, which will be a challenge considering that strong demand for guaranteed savings products is expected to continue in coming years.

To access a complimentary copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=342962.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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