Argentina Insurance Information

CIA link to demographic/economic data on Argentina

General Argentina Insurance Information

• Compulsory Insurance:
  
  1. Motor third party bodily injury (US$10,345 limit of liability)
  2. Third Party bodily injury for passengers on public transportation systems (US$10,345 limit of liability).
  3. Liability for passengers on public and private commercial vehicles /systems;
  4. Employers are obliged to provide Group Life for all employees / workers (US$1,655 per employee);
  5. Fire Insurance for apartment buildings sold as condominiums;
  6. Professional liability for direct (as of 2005, the limit of liability was US$17,241), reinsurance brokers and school proprietors.
  7. Third party liability for aircraft operators – various limits (based on weight of aircraft) – most insureds purchase voluntary limits of to US$10 million.
  8. Workers’ Compensation (Decree 24.557).
• Non-Admitted Insurance:
  Prohibited (Note: Insurers and intermediaries can be fined up to 25 times the premium paid for breaking this rule.); the exception is for marine insurance of imports and exports.
• Policy Wordings & Rates / Tariffs Controlled:
  The old tariff system was done away with in 1991. Most wordings and rates are open to negotiation and supposed to be submitted to the SSN (Superintendencia de Seguros de la Nacion).
• Policy Language:
  Spanish.
• Types of Insurance Restricted to Government Institutions:
  None and there are no mandatory cessions to The State.
• Policy Currency:
  Argentine peso (ARS) and foreign currencies (mostly US$). Most premiums are paid in installments.
• Currency Restrictions / Exchange Controls:
  No restrictions.
• Policy Period:
  One year is the normal term although 3 to 5 year Long Term Agreements (LTA) are available for property business.
• Cancellation Provisions: By the Insured:
  Immediate; By the Insurer: 15 days written notice prior to expiration.
• Premium Tax, etc. paid by Insured:
  
  1. All lines are subject to a premium tax (insurance regulator levy = 0.60) - plus
  2. Value Added Tax (VAT) generally at 21% for all non-life other than for workers’ compensation.
  3. There are also various provincial duties - usually, 1%.
• Insurance Companies:
  Both indigenous and foreign owned insurers operate in the market.
• Brokers:
  There are a number of independent and professional brokers in the market as well as representative offices of the major alphabet brokers.
• Brokerage Commissions:
  
  1. Property Damage / Business Interruption: 10-35%;
  2. Automobile: 10-40%;
  3. Marine: 10-30%

The above are guides. Commissions on large risks are individually negotiated. Commissions cannot legally be paid to foreign brokers not licensed / registered in Argentina.

• Broker of Record Letters:
  Use of Broker of Record Letters (BORs) is not market practice though in some instances it may be required when there is a change in the existing insured / insurer relationship.
• Reinsurance:
  There are no longer any restrictions. 100% is exportable subject to fronting fees (5-10%) and reinsurance tax (4% last time we looked).
• Local Natural Hazards:
  Floods (agricultural areas – deductibles are usually 2% of sum insured or 10% of the loss with a minimum of US$3,448), Windstorm and Earthquake (Andes Region).
• Other Information:

Property Insurance

• Fire:
  Standard fire perils include - fire, lightning, aircraft, industrial explosion, strike, riot/civil commotion, lock-out, vandalism, malicious damage, aircraft or vehicle impact and smoke. The extended coverage endorsement covers the perils of windstorm, hurricane, cyclone or tornado. Earthquake, flood, storm, burst water pipe, hurricane and debris removal are available in the market for an additional premium charge.
• All Risk:
  Available.
• Coinsurance:
  100%.
• Blanket Insurance:
• Business Interruption:

UK Loss of Profits or U.S. Gross Earnings forms are available.

• Replacement Cost:
  Available.
• Discount for fire protection equipment / systems:
  Available - maximum credit 65%.

Boiler & Machinery / Machinery Breakdown / Engineering

• Wordings:
  U.S. and German. Comprehensive including Business Interruption available.
• Comments:
  Inspections are not compulsory.

General / Public Liability

• Available Wordings:
  Comprehensive General / Public and Product Liability (product recall not available) usually written on an occurrence basis and pays on behalf of the Insured. Defense costs are in addition to the policy limit. Coverage conditions can be extensive and the policy can expressed as a combined single limit (CSL).

Automobile / Motor

• Compulsory Limits:
  US$3,000,000 is the usual limit for private autos. US$30,000 is the absolute minimum limit.
• Comments:
  Coverage applies to the Insured and any licensed individual driving with the Insured’s permission. Passengers are considered Third Parties, excepting close relatives.

Workers’ Compensation

• Comments:
  All including maritime (in Argentine waters). Coverage is compulsory. Self-insurance is allowed but minimum capital requirements must be met. Extra-Territorial Benefits, Medical Expenses (including Funeral costs), Occupational Disease are also included.

Marine and Inland Transit

• Available Wordings:
  London Underwriters, including War and Strikes Riots & Civil Commotion (SRCC) for Ocean Cargo.

Inland Transit can be written on an All Risk basis.

Crime

• Available Coverages:
  Fidelity, Burglary and Surety. Note: Burglary of stock is available under a Property Damage policy.

Professional Liability

• Per Resolution 28497 direct brokers must carry professional liability insurance with a limit of US$17,241.