To better understand the scope of these changes, it should be remembered that up to February 11, 2011, Argentina had an open market in reinsurance, based on which Argentinean cedentes could directly place their reinsurance with any foreign reinsurer duly authorized by the SSN to operate in reinsurance in Argentina from its country of origin. These foreign reinsurers authorized by the SSN were registered in a registry called "“Reaseguradores Admitidos” (Admitted Reinsurers) and had to annually submit copies of their balance sheets and report substantial changes in their operation or shareholding structure. In addition, until that date, the Argentine cedents could also place its reinsurance in any other foreign reinsurer, even if it was not an "Admitted Reinsurer", but for that, the condition was that the assignment be made through a duly registered reinsurance broker before the SSN.

As of February 11, 2011, with the issuance of Superintendency Resolution No. 35.615, the rule became that Argentine insurance companies should assign their risks exclusively to National Reinsurers, who were empowered to retrocede the risks they assumed only to "Admitted Reinsurers" duly registered with the SSN (except for certain exceptions for large risks, which could be reinsured with "Admitted Reinsurers" without intervention of a National Reinsurer). Since the enactment of Resolution No. 35.615 in 2011, National Reinsurers began to be created, companies with the exclusive purpose to operate in reinsurance with a very low minimum capital and, therefore, with almost no risk retention capacity. Therefore, as a result of this regulatory system approximately 26 National Reinsurers were created in Argentina from 2011 until today, to whom the Argentina cedents were forced to cede the majority of their reinsurance. However, in practice the National Reinsurers retained less than 1% of the risks, practically retroceding 100% of the risks to the "Admitted Reinsurers". This clearly implied in practice that most National Reinsurers (with very few exceptions) became mere intermediaries between the Argentinean cedents and the Admitted Reinsurers.

The recently issued SSN Resolution No. 40.422 is aimed at opening the reinsurance market to international markets and strengthening the solvency of the National Reinsurers, considerably increasing the minimum required capital. It is estimated that of the 26 existing National Reinsurers, under the new regulatory framework and due to the substantial increases in minimum capital that it establishes, probably not more than 10 (probably less) will remain active. The others must be absorbed, liquidated or enter in run off supervised by SSN.

As to regards the opening of the market, the new regulatory framework establishes that Argentine cedents may directly place its risks in Admitted Reinsurers as of July 1, 2017 up to a maximum of FIFTY PERCENT (50%) of its premiums ceded by contract, up to 60% in 2018 and up to 75% in 2019.