The opening up of the Mexican oil & gas and electricity markets will increase demand for insurance coverage for assets, income and compulsory liabilities.
On 12 December 2013, the Mexican Congress approved amendments to articles 25, 27 and 28 of the Constitution, which were subsequently approved by a majority of Mexico’s state legislatures and signed into law by the President of Mexico, Enrique Peña Nieto.
Following the reform, Pemex, Mexican state-owned petroleum company, no longer has the exclusive authority to carry out Exploration & Production (E&P) activities in Mexico. The electric sector has also seen regulatory changes giving rise to similar opportunities.
These energy reforms brings a potential revolution for E&P companies, which are now allowed, for instance, to enter agreements with the Mexican government for the exploration of oil reserves, and the performance of important roles in the electricity area.
These developments will mean that the Mexican insurance market – which is already the second largest in Latin America – will see a considerable upturn in demand.