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Interest in Brazil market surges

Insurers around the world are becoming increasingly interested in the Brazilian insurance market, according to a new survey from RISKbitz. The growing interest has been driven by the liberalisation of the market in recent years, and the removal of the state reinsurer's monopoly.

Huge interest in Brazil over the summer

RISKbitz's survey found that 98.5% of C-Class executives in the insurance sector plan to visit Brazil at some point in June or July this year. According to the survey, the reasons for the visit were: M&A discussions (0.003%), renewal business (0.002%), fronting arrangements (0.0008%), discussions about local reinsurance requirements (0.002%), negotiations with regulator about licensing (0.05%), and other (99.12%).

The reasons for Brazil's sudden attractiveness for insurers and brokers were listed as follows:
-Low-key regulation
-Lack of insurance penetration
-Low level of competition
-Major infrastructure developments
-Nice weather
-Lovely beaches
-Plastic surgery

Brazilian insurers and brokers have noted a surge of interest from foreign companies. One local insurer told RISKbitz: "Our appointment book is overflowing with morning meetings in June and July. We're not quite sure what they want from us. Most say that they just want to talk about stuff. A lot of them are very big property/casualty insurers and we only write pet insurance and funeral costs. But they seem very keen, and are paying for lunch, so it's fine."

The reinsurance sector in Brazil would also appear to be booming. Local reinsurers report massive interest from foreign insurers. "We are definitely flavour of the month," said one small Brazilian reinsurer. "I mean, normally we can't compete with Bermuda or London, but suddenly we are the reinsurance centre of the world. There is a lot of interest, though none of the business has yet been confirmed, but we are hopeful that when they are here for their morning meetings we can get it all signed."

Another pointed out that he had already got some very good treaty business, involving some of the world's biggest insurers, at extremely beneficial rates and terms & conditions. "Funny thing is, they seemed more interested in the fact that my brother works in the ticket office at the Maracan? stadium, than in our attachment points or deductible requirements," he added.

Global insurers and brokers insist the interest is real and not just a passing fad, and flatly deny that it has anything to do with football. "I didn't even know it was the World Cup this year," said one broker. "Where is it? Italy? Honestly got no idea. Brazil is such a great opportunity, one not to be missed. It literally cannot wait as an opportunity."

Other news from May 2014
Travelating the Wave of Insurability
the serious stuff
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