Brazilian (Re)Insurance Market
The Superintendence of Private Insurance (SUSEP) that regulates the Brazilian (re)insurance market introduced recent regulatory changes, such as:
- New limits for reinsurance cessions – insurers may assign reinsurance to occasional reinsurers (foreign entities authorized to do business in Brazil) up to 95% of the total premiums issued in reinsurance in an annual basis (the previous limit was 10%). Additionally, local reinsurers may assign reinsurance to occasional reinsurers up to 95% of the total premiums on the risks they have underwritten, in an annual basis (the previous limit was 50%).
- Opportunities in infrastructure projects impact several lines of insurance (guarantee, property, engineering, liability, etc.).
- Regulatory Sandbox to promote InsurTechs.
- New rules for the wording of insurance products and segmentation between large risks and consumer risks.
- New rules for insurers and local reinsurers using ILS (Insurance Linked Securities) that allow diversified foreign investments.
Furthermore, the LGPD (Brazilian General Data Protection Act) will create and increase demand for cyber risk insurance and for data transfer agreement in order to comply with the Brazilian law.
Consequently, many opportunities for foreign entities are coming, considering greater competition, legal certainty, flexibility, and credibility in the Brazilian (re)insurance market.