The deterioration of income is a threat to the development of awareness and the insurance culture of Argentines

The deterioration of income is a threat to the development of awareness and the insurance culture of Argentines

The insurance awareness is the understanding of the importance of having insurance coverage against possible risks and is closely associated with insurance culturewhich is the shared knowledge of the importance of insurance industry for a society. The interference of this sector in each economy is an x-ray of how much its actors plan in the long term and in forecasting.

We can measure the importance of insurance activity in the economy through the premiums issued net of cancellations calculated in relation to the Gross Domestic Product (GDP) and the sector reaches 3.08% of GDP (includes local insurance and reinsurance activity).

Another important indicator is the average per capita expenditure allocated to this activity, which is production per capita, which indicates the average amount per inhabitant spent annually on insurance at constant weights. The issue is that, in the current context of deteriorating income, it is more complex to promote the importance of having a policy to cover possible risks.

As insurance awareness grows, insurance culture increases and, although the development of these two elements is closely associated with the positive experience of taking out insurance, as the cost of living becomes more expensive and people have greater difficulty accessing certain basic products for survival, such as food, clothing, payment for housing (rent, utilities and expenses), the possibility of thinking about protecting oneself against possible risks becomes more distant.

The deterioration of salary

The gradual deterioration of purchasing power led to, according to Government statistics, the average formal salary not reaching the poverty line in January 2024, since it cannot cover the value of a basic basket. The report from the National Institute of Statistics and Cencos (INDEC) indicated that a basic basket reached $596,823 in the first month of the year, which represents the total expenses that a family of four must make to cover all the needs considered elementary over the course of a month.

In comparison, the Average Taxable Remuneration of Stable Workers (RIPTE), measured by the government’s Ministry of Labor, was established at $555,269, more than $41,000 below the value of the basic basket. The RIPTE refers to the average number of stable formal employees in the country.

The analysis reaches a more negative connotation, considering that the RIPTE expresses gross salaries, before discounts for employer and pension contributions. In this framework, and if the 17% corresponding to social charges is deducted, the average net out-of-pocket salary of a formal worker reaches $460,873, which does not even cover the basic basket of three people, whose estimated value is $475,140. .

The negative effect of salary deterioration on insurance

This is how, in these complex economic contexts, the here and now trumps, in some way, forecasting and that threatens the insurance culture. Mandatory policies, such as those for motor vehicles or motorcycle vehicles, are the ones that present the most resistance., but many are beginning to do without home, theft or life insurance. And, in the case of companies, the mandatory work and life risks are maintained, but some extra coverage is no longer offered to new entrants.

The issue is that, when taking out insurance, the price is the most weighed nuance. However, the fact of transferring a risk to a company is key to the peace of mind of the beneficiary of the coverage.


The insurance market provides the support we need in the event of an accident, a fire, a theft and, despite the loss of purchasing power seems like a logical justification to stop contracting coverage, in reality, it is quite the opposite because it is when we most need to be protected against possible losses or deterioration of our property that we will not be able to replace or repair. with a sharp rise in prices and a salary deteriorated against inflation.

The instability and uncertainty that characterizes our country is precisely a warning that making medium and long-term plans is difficult. AND, if any problem suddenly arises and we did not have our property insured, our plans would be instantly frustrated.

Source: Ambito

Leave a Reply

Your email address will not be published. Required fields are marked *

Latest Posts