AM Best affirms stable outlook for Spain's non-life insurance market

AM Best has maintained a stable outlook for the Spanish non-life insurance market.

The rating agency's decision is driven by a number of factors that are expected to improve the sector's performance, including growing public awareness of climate and health-related risks, rising motor insurance premiums, and a stable regulatory framework.

AM Best believes that market consolidation through mergers and acquisitions (M&A) is likely to be a primary avenue for premium growth in the near term.

The sector’s resilience is further reinforced by increasing demand for natural catastrophe coverage, especially following the floods in Valencia in 2024. This disaster served to demonstrate the crucial role of insurance and the Consorcio de Compensación de Seguros (CCS), also known as the Insurance Compensation Consortium, which is a guarantee fund financed by a compulsory additional premium levied on insurance policies.