Eduardo Garduño Mejía,

Head Reinsurance Andean Region & Spanish-Speaking Caribbean, Swiss Re Colombia, Oficina de Representación

BIO Eduardo Garduño began his professional career within the Swiss Re Group in the late 1990s. In the last 20 years, he has held various positions within Swiss Re in Mexico, Switzerland, New York, Miami, and more recently Colombia. Within the Swiss Re Business Unit for Latin America, he has been a subscriber to life and health, a client manager, marketing actuary, senior pricing actuary, and head of life and health for Latin America. Since 2018, he has led the reinsurance operations of P&C and L&H of the Andean region and of the Spanish-speaking Caribbean from Bogotá, where he also has the position of President of Swiss Re Colombia, Representative Office. What is your assessment of the state of the reinsurance sector in Colombia?

On a macro level, there are different angles to this, starting with the global economic situation. Our economists estimate an impact in the global economy, which shrunk by around 4% in 2020. We anticipate economic recovery to be slow in 2021 and do not expect an immediate recovery.

However, this creates opportunities in the insurance and reinsurance sectors. Companies need to focus on digital solutions. We see a specific challenge due to the low insurance penetration levels in Colombia and elsewhere in Latin America. It is evident that this is affecting resilience. Insurance or reinsurance cover are important, and not just because of the effects of the pandemic. Having better protection in place in case there is a similar situation in the future is an important goal for the private sector and government to work on together. In Colombia, we’ve identified climate change, changes in mobility, digital transformation, cyber and mental health as hot topics where the industry has to be focused in within the upcoming months. This environment creates the possibility of further opportunities in reinsurance, including new product development for new risks, complementary Nat Cat Covers and the implementation of digital solutions. I’m confident we will see a complete change and innovation in our industry in terms of new products, distribution channels as well as the greater development of digital platforms.

What is Swiss Re doing to develop policies in the growing areas of technology and environmental risks in Colombia?

Considering the new environment, we have worked on creating digital solutions in three key areas that offer value. The first area is automatic underwriting models that insurance companies can use on their digital platforms. We have specific tools that help companies underwrite policies from different insurance lines, which improves their response times and customer experience. These tools are not completely new, though in Latin America, particularly Colombia, this technology was not adopted as quickly as in other regions. The second area of focus are analytics and technological solutions, such as big data. We have a group of experts dedicated to advancing digital platforms, as well as professionals in behavioral science and economics who analyze population trends and demand for portfolios. Swiss Re

helps insurance companies identify big opportunities and essential requirements for portfolios. The third area is portfolio management such as developing new tools for claim management and solutions for client retention. One of the big challenges in recent months was people cancelling policies. We developed many solutions to help insurance companies offer additional products that encourage customers to keep their policies.

What are Swiss Re’s strategies for improving insurance penetration in the market, given the role this plays in the wider reactivation of the Colombian economy?

Swiss Re’s objective is to help companies and governments to reduce the protection gap in the population, so that the countries are more resilient. This requires a change in approach, hence we are working closely with our clients, the insurance companies, to expand their offer on new products focused on people’s lifestyles. One of the elements that increases penetration is promoting specific products that address the real needs of customers, and this is closely linked to analytics. We are dedicated to understanding the needs of insurance companies to increase this penetration and have developed specific products to this extent. One area of focus exposed by the crisis is mental health. There is nothing specific addressing mental health, and we are working to develop products in this area. Another facet is distribution. Now, during and post pandemic, distribution via digital platforms is even more relevant. Therefore, creating solutions on digital platforms will be helpful in increasing insurance penetration. It is also important that the insurance industry offers simpler products that customers can easily understand because the language of insurance policies is complex. Another factor in increasing insurance penetration is having a close relationship with the public sector to promote wider insurance coverage among the population. This also has the effect of assisting the government should a natural disaster or other event that affects the entire country occurs, particularly if it is combined with a period of economic crisis. A government may not have enough funds to be prepared for this scenario.

Swiss Re is the world’s largest reinsurer. How does its experience help reduce the protection gap in Colombia?

Swiss Re is a reinsurance company with a global history of more than 150 years, more than 100 years in Latin America, and more than 50 years attending the Colombian market. It is a company with a long history in the insurance world, and Colombia is an important part of that. In recent years, we have increased our presence in this market by building a strong team focused on the particular profiles of the Colombian, Andean, and Caribbean regions. Swiss Re not only attends to Colombia, but also has a wider responsibility to the Andean region and Spanish-speaking Caribbean countries. We see great potential for insurance solutions, which, combined with low insurance penetration, creates an opportunity for insurance business growth in Colombia.