The Impact of Import Restrictions on the Insurance Industry: Challenges and Solutions

The well-known restrictions on imports are beginning to affect the insurance industry, which came out to warn about the “inevitable impact” that the lack of imported spare parts will have on the activity.

“The shortage of imported inputs directly affects the insurance industry, especially in the automotive industry. By not having the corresponding spare parts, it is not possible to pay the compensation of our policyholders in a timely manner. This causes response times to be greatly extended, and when the spare part is found, since the supply is so restricted, the price is very high”, explains Juan Ignacio Perucchi, general manager of Libra Seguros.

The new picture of situation forces insurance companies to restructure their operation, he acknowledged. “We are carrying out quarterly budgets for income, sales and expenditures. We will have to closely monitor the achievement of objectives and the administration of future liabilities. In addition, we believe that the situation is going to worsen due to the increase in the accident rate and the inflationary indices”, warned Perucchi.

After admitting that the complaints of the insured are growing due to the impossibility of the companies to comply with the obligations of the insurers, compensate accordingly and give the predictability that the insurance must provide, from Libra Seguros they understand that they have to face the problem and give answers to those who trusted her although the problem clearly exceeds them.

Perucchi estimated that the delay in obtaining some spare parts could be extended “between four or six months if they are obtained”, and admitted that “sometimes it is impossible to repair the damaged vehicle”.

Companies maintain contacts with regulatory authorities and with national authorities. “It is always important that as an industry we place ourselves in a place of dialogue and consensus, but with the firmness that is needed in these cases. This is a problem common to the entire industry. It is a structural problem that is not having a solution because it has a clear macroeconomic origin”, the executive explained.