OUR WAY
At the beginning of 1976, Rodolfo Ciganda López (Senior), worked as Actuary of the Banco de Seguros del Estado in Uruguay, an Institution in which he had started working over 30 years before. One morning reading the newspaper, he noticed the existence of a bill that contained a modification regarding the maximum income that a public official could receive (limited to a certain percentage of the Minister’s salary) and also a reform of the ages of retirement that were in effect at that time. If that law came out (it should be remembered that at that time of the dictatorship, there was no Parliament in Uruguay, but a Council of State and obviously there was no opposition in that Body) it would harm him doubly since Ciganda (Senior), apart from his position as Actuary of “Banco de Seguros” he worked also as Professor, Grade V, at the Faculty of Economic Sciences in Montevideo and it turned out that with this new law he would not be able to receive any remuneration for the classes at the Faculty, and on the other hand it forced him to extend his retirement age for several more years. He did not hesitate for a moment and that same afternoon he presented his resignation, which was exceptionally accepted urgently (since the sanction of the aforementioned law seemed imminent). The irony is that the aforementioned law was never finally passed.
Upon retiring from “Banco de Seguros”, he received in the following months 2 offers from Argentine businessmen to work in the brokerage area, one linked more to the insurance sector and which involved spending most of the week in Buenos Aires and another specifically linked to the reinsurance area, and living in Montevideo. He chose
this last option because in addition to the fact that, living in Uruguay, from the family point of view it was less complicated, the fact that it was linked to reinsurance also motivated him more, since “Banco de Seguros” had participated a lot in that area during the last 10 years of his duty at said Institution. This is how LATINBROKER was born. The initial shareholders were until the end of 1995 Dr. Agustín de Vedia and Mr. Horacio Bach, who were also main shareholders of “Aseguradores de Cauciones” in Argentina. The project was very ambitious: to open a LATINBROKER office in each Latin American Capital, the first was in Montevideo and, almost in parallel, it started its branch in Buenos Aires. Later, those same shareholders, with local businessmen, developed similar ventures in Colombia and Ecuador. It is worth clarifying that these offices were always independent from Latinbroker S.A. with headquarters in Montevideo and a branch office in Buenos Aires. They were also close to make openings in Venezuela and Guatemala but at the last minute local contacts failed. On the other hand, the funds available, required to finance the start-up of these ventures, with the passage of time, were no longer so abundant and it was then necessary to keep the aforementioned cases only.
Initially, LATINBROKER entered into a representation agreement with the British firm Alexander Howden, one of the most prestigious insurance and reinsurance Brokers in that market at the time. There were some companies in our region that accepted international active reinsurance (INdeR, Caja Nacional de Ahorro y Seguro and RASA, in Argentina, IRB and GESB in Brazil and Banco de Seguros in Uruguay) and our work in those first years was to present the offers received from our British colleague to some of the companies mentioned above.
Of course, in reciprocity, any new account of our region should be channeled first to Howden, although as said broker was not interested in some offers due to type of risk (Bonds for instance) or even because they were relatively small amounts, we also began to establish direct relationships with many reinsurers, both regional and global to make direct placements. About the end of 1980, Howden established an agreement throughout Latin America with a group of Venezuelan origin (Cover) and we had to incorporate our agreement (which was only for Argentina, Brazil and Uruguay) into the new structure.
Thus, various meetings between our shareholders with people from Cover and Howden took place, and the company was on the way to changing its name to be called Latincover, but when the negotiations were quite advanced, our shareholders encountered some additional requests from the Cover Executives, which were considered excessive and we preferred to withdraw from the negotiation.
Hence, we found that practically 75% of the brokerage that LATINBROKER had been receiving was lost from one year to the next as the representation of Alexander Howden no longer continued. In fact, a few years later the Cover group went bankrupt and the regional Reinsurers were either not accepted by international brokers, because they did not constitute an acceptable “security”, or they had directly closed the international reinsurance and were exclusively dedicated to their domestic markets so the change would have been happened sooner or later anyway.
It was therefore necessary to substantially change the performance, no longer of representatives of a foreign Broker but as a local Broker, generating business in our area, in order to place whether via a colleague in the London market or directly with international Reinsurers.
It was quite a challenge and fortunately, largely due to the excellent reputation that Rodolfo Ciganda (Senior ) had, his long and successful previous career at Banco de Seguros, and his great wisdom and tenacity, LATINBROKER managed to face the situation and against the prognosis of others, he was not only able to maintain the office, but also to grow significantly, attracting businesses from practically all of Latin America for many years (we have had accounts from Uruguay, Argentina, Brazil, Bolivia, Colombia, Chile, Ecuador, Venezuela, Panama, Paraguay, Peru, Guatemala, El Salvador, Mexico, USA and even Canada).
Rodolfo Alvaro Ciganda (Junior) joined LATINBROKER in the middle of 1980 in what has been his only job and after succeeding in convincing his father who was not very sure of incorporating him in the company, but thanks to his mother’s mediation he agreed and things worked out quite well. He was able to take advantage of having a direct line with someone who was undoubtedly one of the persons who knew the most in Uruguay both about insurance in general and reinsurance as well and who also had the vocation of teaching, which is why he was very clear and complete in his explanations (and besides entertaining)
At the beginning of the 90’s, the Argentine reinsurance market was liberalized, the National Reinsurance Institute (INdeR) was already in a difficult financial situation and it was feared that it would go bankrupt; at the beginning, said deregulation was gradual, allowing insurers to cede to foreign reinsurers, via broker or directly, up to 40% of their risks, but already in the following year the placement of 100% was allowed since the future unviability of the INdeR was imminent and it was only a matter of time to know when it was going into liquidation.
Negotiations with reinsurers were difficult because Argentine companies were used to filling out their routine data sheets that were passed to the INdeR, but Reinsurers requested statistical figures in constant currency (remember Argentina in the 80’s changed its currency and had several hyperinflations), which was very difficult to obtain.
But along the way, and stumbling and with insurance companies that were left by the way because they could no longer continue their operation as “quasi intermediaries” (which they had had during the years of INdeR’s “subsidy”), things were straightening out and the market got used to that exercise of negotiation much more demanding and dynamic than the one that had lived in previous decades.
At that time Rodolfo Ciganda (Senior) traveled weekly to Buenos Aires, generally staying two days there and visiting a large number of Argentine private insurers. Suddenly we went from a scenario of a single large client such as INdeR, with whom we worked a lot in the placement of its retrocession reinsurance abroad, to almost 200 potential clients, again a different challenge and remover that, with the means we
had, we were able to undertake and achieve a good penetration in the market. By the way, it was not a process without bitter urges, since in the course of the 90’s some clients failed to adapt to the new regime and had to close their doors, with the consequence for us not only of losing future income but of even not being able to collect amounts already gained.
At the end of 1995, the Argentine shareholders De Vedia and Bach offered to sell 100% of the shares of LATINBROKER to the Ciganda Family (it should be clarified, up to that moment our shareholding was zero), emphasizing that it was a special offer for the Ciganda Family as a result of a very satisfactory relationship of almost twenty years and that they wanted to reward in that way. For us it was truly a very noble gesture from these businessmen, who, beyond the fact that they were undoubtedly motivated as any business man to be able to conclude successful commercial agreements, always had an exceptional human quality and a behavior of authentic gentlemen, allowing us a complete autonomy to manage LATINBROKER. With effort we managed to acquire all the shares then, turning LATINBROKER into a family business.
Precisely in that same year (1995), in a visit that Rodolfo A. Ciganda (Jr.) made to the Paraguayan insurance market, where we had several clients, Rodolfo talked with a great friend, Walter Lithitx, and the possibility of working together. Walter Lithitx had held management positions in one of the first companies in Paraguay until a few months before his meeting with Rodolfo. Thus, we agreed to a permanent representation in Asunción, with an initially quite precarious office that we occupied in a sector of a factory owned by a friend of Walter and by the way the results were spectacular, increasing the number of clients in Paraguay in a few months by 3. Then, we moved to a more representative location and incorporated additional personnel to strengthen that branch. In March 2002 Walter died suddenly of a heart attack. That was a great shock because the relationship we had was not only at work but as old friends who always went forward and forward. Drawing strength from weaknesses, thanks to the efforts of all of us who were part of the Latinbroker’s family, we were able to keep clients and even generate more business, since we believe the companies wanted and did support us especially in solidarity in the face of something as ungrateful as what had happened. Also on that occasion there was some ominous on duty who predicted little life for the Paraguay office but today it continues to work, and very well indeed.
Rodolfo Ciganda (Senior) retired at the beginning of 2002, he suffered from lymphoma for a couple of years before, against which he fought with great dignity and integrity for more than four years. He was 82 years old and had a fairly serious osteoarthritis problem that made it very difficult for him to travel, but in any case he was always a permanent source of consultation from his home for controversial issues in which having his opinion and point of view was a privilege for everyone. Today we no longer have him physically here, he left on October 19, 2004 but his evocation and memory is permanent for all of us who loved him and value his gift to get on with people, his way of being simple and transparent, in order to be a truly good man. This leads us to
redouble our efforts every day to continue making LATINBROKER a professional, serious, responsible and effective reinsurance Broker to provide security and peace of mind to its clients. That is why we are here and we hope for much longer.