Changes in Fiscal Regulations Lead to Price Hikes
Due to recent fiscal changes, insurance companies such as GNP, Seguros Monterrey, Quálitas, and Banorte have announced price increases for their clients ranging from 4% to up to 20%. This shift stems from the inability to claim Value Added Tax (VAT) on payouts for claims, affecting both medical expense and auto insurance policies.
GNP Seguros and Medical Expense Insurance
GNP Seguros informed agents through a circular that they would raise medical expense insurance premiums by 6% in 2026, as confirmed by an agent who received the circular.
Seguros Monterrey and Medical Expense Insurance
Seguros Monterrey clients reported that their agents informed them of a potential 20% increase in their medical expense insurance policies.
Amasafac President’s Perspective on Senior Citizens
Erick Ocampo, president of the Governance and Public Sector Committee of the Mexican Association of Insurance Agents and Brokers (AMASFAC), predicts that senior citizens may face policy costs up to 40% higher this year. He estimates that average increases in medical expense coverage will range from 22-23%, with the highest impact on individuals aged 60 or older.
Auto Insurance Price Hikes
Auto insurance prices will also be affected by the inability to claim VAT on payouts for claims. Companies like Quálitas have announced that while they will absorb part of the fiscal change’s impact, there will still be price increases for their clients.
Quálitas Auto Insurance Adjustments
Bernardo Risoul Salas, Quálitas’ General Director, stated in a conference with analysts that the annual increase for individual policy renewals would be between 3-5%, in line with local inflation. Quálitas is a leading auto insurance company in Mexico, focusing solely on this segment.
In 2025, auto insurance prices increased by 1% according to data from the National Institute of Statistics and Geography (Inegi). Over the past five years, auto insurance prices have risen by 53%, surpassing the general inflation rate of 31% during that period.
Will Companies Absorb or Transfer the Impact?
Marcos Ramírez Miguel, Grupo Financiero Banorte’s General Director, stated in a conference with analysts that Seguros Banorte will absorb part of the price increase caused by fiscal changes. However, he clarified that some of the increase will be passed on to clients.
“We will absorb part of this increase and transfer a small portion to clients. The competition is fierce; as you know, it’s not just banks but also insurance companies. However, we believe it will be divided: part will be absorbed by the bank and part by clients,” Ramírez said on January 27.
The Director of Finance and Operations at Banorte added that “if you are a low-risk client, we may absorb the entire increase; however, if you’re not a low-risk client, you might receive the full VAT impact.”
No Longer Able to Claim VAT on Claims
The Federal Tax Income Law 2026 stipulates that insurance companies can no longer claim VAT paid for settling claims, following an agreement between the federal government and insurance companies.
For years, insurers claimed VAT for services purchased from hospitals or auto repair shops to compensate their clients in case of damage. This practice allowed insurers to pay less tax due to a net fiscal effect.
Now, with the agreement in place, VAT not paid from 2024 onwards has essentially been forgiven. Insurance companies will need to start paying the tax according to the new criteria from 2025.
For the 2025 payment, the government will provide a fiscal incentive for insurers to pay in installments throughout 2026 without penalties, surcharges, or interest.
These fiscal changes are expected to primarily affect auto, medical expense, and some damage insurance policies.
Discrepancy Between Agreement and Implementation
On January 13, Mexico City Mayor Claudia Sheinbaum stated that insurance companies should not raise prices due to fiscal changes, as this was not part of the agreement with her government.
“It shouldn’t be that way. We even spoke to them about this in the agreement we took. It shouldn’t be that way. I will ask the Secretary of Finance to keep an eye on this,” Sheinbaum said during her morning press conference when asked about potential price increases by some insurers.
