Embedded Insurance Sales Spikes in Latin America Post-Covid
In a recent interview for PYMNTS, our SVP Regional Head of LatAm Partnerships, Julio Castellón addresses the distinctive cultural and geographical opportunities and challenges in the Latin America Region emphasizing the positive response embedded insurance has had in solving the systemic underinsured problem in this region.
Latin America is a region with different regulatory frameworks and governance structures which can make it quite challenging; however technology plays a major role in our society and it is evident that large e-commerce companies are making a step towards solving these challenges by reaching consumers in a quick and convenient way.
The Latin America region is now the fastest growing in the world for e-commerce development, further pushed by the COVID pandemic and Julio believes that online shopping will continue to grow exponentially. Purchasing insurance is not a priority in this region with many seeing it as a second step in the process that consumers don’t follow through with. According to Julio, the rise of e-commerce brands have created a sense of trust with consumers thus presenting a tremendous recipe for growth in adding embedded insurance to the purchasing journey.
Research shows that a vast majority of consumers who use digital banks are very interested in receiving insurance and warranty offers based on their transactional data. This research coupled with the fact that “convenience is the number one aspect that customers appreciate when it comes to embedded insurance” saw a 400 percent to 600 percent increase in interest for protection products across verticals.
Julio emphasizes the customers in LatAm will react positively to trusted sources especially with neobanks, retailers, airlines, and more and simultaneously, positive responses have been received from some of the largest e-commerce companies in LatAm. The strength of their brands offers their customers protection as well as enabling them to sell embedded insurance.
Key Video Highlights:
0:00 Introduction to CG and Julio
0:37 The LATAM online retail and payment market has some distinctive cultural and geographic challenges and opportunities. What technological solutions can address these challenges today?
3:36 Research shows that a vast majority of consumers who use digital banks are very interested in receiving insurance and warranty offers based on their transactional data. Nearly half of respondents who use conventional banks are ‘extremely or very interested’ in receiving such offers. What does this mean for your region?
7:17 You’ve said CG will be expanding to include “some of the largest ecommerce companies in LATAM.” Where are we starting to see this?