The writing of insurance contracts in Brazil is governed by the new Insurance Contract Act (Law n. 15.040/2024). Section VII (Articles 41-53) sets out the general underwriting framework. In Brazil, underwriting precedes the insurance proposal and should preferably be conducted through a closed questionnaire presented to the applicant. This questionnaire is binding: although other underwriting techniques may be used (such as risk inspections), any information not requested through the questionnaire is presumed not to be relevant to the insurer after the risk is placed.

Article 44 sets out the consequences for misrepresentation or nondisclosure in the questionnaire. Where a false or imprecise answer is given in bad faith, the policyholder forfeits coverage while remaining liable for the premium and for reimbursing any underwriting expenses incurred by the insurer. Where the misrepresentation is negligent, coverage is reduced proportionally to the difference between the premium paid and the premium that would have been due had full and accurate information been disclosed. The policy is terminated only when, considering the undisclosed facts, coverage is technically impossible or the risk is not normally underwritten by the insurer.

Given that the Law is relatively recent and represents a true paradigm shift in underwriting, the caselaw has not yet clarified whether (i) in the context of a claim, the loss must be related to the omitted or imprecise answer if misrepresentation is discussed; (ii) in cases of negligent misrepresentation, the adjusted premium should be determined by reference to market practice or to the insurer’s own underwriting standards; (iii) gross negligence should be treated as equivalent to bad faith or as negligence.

There are no specific statutory provisions regarding the interpretation of the questions and answers in the questionnaire. However, the general rules on the construction of insurance contracts provided in articles 57 and 59 should apply. Questions presented by the insurer should be interpreted narrowly (contra proferentem) from the standpoint of a reasonable applicant, and answers should be deemed satisfactory if not clearly malicious or incomplete. If, during underwriting, the insurer fails to follow up on unanswered or incomplete questions, the insurer is presumed to have accepted the information provided.

The insurance and reinsurance sector is overseen by a range of independent and executive regulatory agencies. The market is split into three different industries: insurance in general, under the supervision of CNSP (National Council of Private Insurance) and SUSEP (Superintendence of Private Insurance); pension funds, regulated by CNPC (National Council for Complementary Pensions) and PREVIC (National Superintendence for Complementary Pensions), and the healthcare sector, overseen by ANS (National Agency for Supplementary Health).

The CNSP and SUSEP, both established by Decree-Law n. 73/1966, are the principal regulatory authorities overseeing the insurance and reinsurance market, as well as open pension funds. The CNSP, mostly through its resolutions, sets the general regulatory framework, including solvency requirements, policy standards, reinsurance and co-insurance and insurance brokerage. SUSEP is responsible for complementing and enforcing CNSP guidelines. In practice, this results in extensive supervisory activities, as SUSEP holds significant powers, including issuing detailed regulations applicable to insurance policies. The open-ended nature of many CNSP resolutions further expands SUSEP’s regulatory role.

Under Complementary Law n. 126/2007, reinsurance companies cannot underwrite insurance and vice versa. According to CNSP and SUSEP regulations (mainly CNSP Resolution n. 422/2021), reinsurers, life insurers and non-life insurers are subject to specific authorizations to underwrite. These entities can apply for an authorization to underwrite all types of risk or for a license restricted to certain branches.

The CNPC and PREVIC, organized under Law n. 12.154/2009, are responsible for regulating pension funds. In that capacity, they exercise the same supervisory and regulatory functions as CNSP and SUSEP, overseeing both market conduct and prudential regulation of the sector.

The ANS, created by Law n. 9.961/2000, is the only independent agency among all insurance regulatory bodies. Being responsible for health insurance regulation, the ANS sets limits for annual premium adjustments, defines mandatory coverage for medical procedures, authorizes health insurance underwriting and provides solvency requirements for the healthcare industry.

In summary, the regulatory framework differs depending on (i) the sector involved (insurance in general, healthcare, or pension funds) and (ii) within the insurance sector, whether the entity is a reinsurer, a life insurer, or a non-life insurer. While capital requirements, solvency rules, and policy standards are broadly similar across these markets, they are not identical.

Insurance intermediaries and other market intermediaries are regulated in Brazil. In general terms, every intermediary is subject to the good faith and fair dealing standard provided in the new Insurance Contract Act (Law n. 15.040/2024, Article 37), as understood in civil law jurisdictions. According to this standard, intermediaries must act in the best interests of policyholders and insurers, disclosing all information material to each party and protecting their legitimate expectations.

In addition to these general provisions, specific rules apply to insurance and reinsurance brokerage, insurance agents and group insurance policyholders (who act, in the Brazilian market, as relevant intermediaries). Managing general agents (MGAs) and other emerging forms of intermediation are, in the absence of a specific regulatory category, regulated under the same framework applicable to insurance agents under CNSP and SUSEP regulations,

Insurance brokers are the primary channel for distributing insurance products. Insurance brokerage is governed by three main instruments. The Brazilian Civil Code (Law n. 10.406/2002) has general rules relating to brokerage (Articles 722-729). Law n. 4.594/1964 establishes specific rights and duties for insurance brokers and requires operating authorisation from SUSEP; under this statute, brokers are responsible for counselling the applicant on which policy to take and assisting throughout claims handling. Decree-Law n. 73/1966 further provides that CNSP and SUSEP should regulate the brokerage market. The most prominent requirement is a specific professional qualification before the brokerage licence is granted.

Under Complementary Law n. 126/2007, facultative and treaty reinsurance contracts must be concluded either directly between cedent and reinsurer or through a legally authorised intermediary (a reinsurance broker). Reinsurance brokers operating in Brazil must be authorised by SUSEP. Under CNSP Resolution n. 422/2021, reinsurance brokers must comply with regulatory requirements different from those applicable to insurance brokers. The most relevant distinction is that reinsurance brokers are required to have professional liability insurance (E&O) with a minimum aggregate limit of BRL 10 million.

Insurance agents are generally limited to retail insurance, mainly distributing travel, life and certain casualty lines (e.g., extended warranty insurance). Large retailers are typically the biggest insurance agents. Insurance agents are subject to three main instruments: the Brazilian Civil Code (Law n. 10.406/2002), which has general rules relating to agency (Articles 710-721); Law n. 4.886/1965, which provides basic rules on commercial agency focusing mainly on protecting the agent as the economically weaker contractual party; and CNSP Resolution n. 431/2021, which establishes specific rules on insurance agents, such as which types of services the agent can provide (e.g., underwriting, claims handling, policyholder counselling and premium collection).

Lastly, group policyholders are commonly used – particularly in bancassurance structures – as a distribution channel, given that group policyholders traditionally bear few liabilities and can earn a commission for providing access to the group. Under CNSP Resolution n. 434/2021, a strict, non-insurance relationship between the policyholder and the beneficiaries is required, and the group policyholder is forbidden from acting as broker or insurer. The new Insurance Contract Act (Law n. 15.040/2024) regulates group policies in Articles 30-32 along similar terms.

Under Decree-Law n. 73/1966 and Complementary Law n. 126/2007, only legally authorised entities – typically incorporated as joint-stock companies (sociedades anônimas) – are allowed to write insurance and reinsurance. Insurance and reinsurance companies must comply with the requirements established in Decree-Law n. 73/1966 and CNSP Resolution n. 422/2021. In broad terms, the key criteria for authorisation include: appropriate corporate form, minimum paid-in capital, a sound business plan, and evidence of the shareholders’ financial capacity and good repute.

Legal authorisation is granted through a two-step process. Timelines vary considerably depending on the type of authorisation sought: an authorisation to act as an occasional overseas reinsurer is granted relatively quickly, while a full insurer authorisation may take up to a year.

For a full authorisation covering all classes of risk, a legal representative of the prospective shareholders must first formally apply to SUSEP for approval to establish a (re)insurance company. The application must include: a sound business plan; a full description of the corporate group and shareholders; proof of financial and economic capabilities suitable for the intended types of (re)insurance risks to be underwritten, especially the minimum paid-in capital requirement specified in CNSP Resolution n. 432/2021; a description of the financial resources to be used in the (re)insurance company; and any other document demanded by SUSEP to prove the reputation of the prospective controlling shareholders.

After authorisation is granted, the (re)insurance company must be constituted within 90 days and prove the legitimate origin of its capital. Following its establishment, SUSEP issues the authorisation for the company to underwrite (re)insurance in the approved lines of business.

Regulators have recently loosened authorisation requirements for certain types of insurance companies, notably through the “regulatory sandbox” established by CNSP Resolutions n. 381/2020 and 417/2021 and SUSEP Circular Letters n. 598/2020, 636/2021 and 700/2024.  The sandbox allows selected companies to operate under simplified requirements on a temporary basis, subject to regulatory supervision and prior approval of the proposed business model. Participants must comply with core regulatory standards and obtain full authorisation within three years of commencing operations.

International reinsurers already constituted in their home jurisdiction follow a different regime. To operate in Brazil, they must register with SUSEP as admitted or occasional reinsurers. According to Complementary Law n. 126/2007, the reinsurer must: appoint a representative residing in Brazil; present its latest financial statements; prove itself to be regularly constituted in its home jurisdiction; demonstrate a minimum of five years of active reinsurance underwriting in the type of risk it intends to underwrite in Brazil; prove the absence of any solvency issues; possess more than USD 150 million in assets; and have its individual solvency rated at least BBB or equivalent from recognised rating agencies.

Reinsurers seeking admitted status must additionally establish a representative office in Brazil and deposit USD 5 million (non-life insurance) or USD 1 million (life only) in an authorised bank account. Under the previous regulatory framework, admitted status entitled the reinsurer to a higher underwriting limit; that distinction has since been effectively abolished under CNSP Resolution n. 451/2022 and Decree n. 10.167/2019.

There are no insurance-specific restrictions on foreign ownership or control of insurers in Brazil. Foreign shareholders are subject to the same licensing and fit-and-proper requirements as domestic investors under Decree-Law n. 73/1966 and CNSP Resolution n. 422/2021, including the obligation to demonstrate financial capability and good repute. No additional requirements apply by reason of foreign ownership alone.

Foreign investment in Brazil is, however, subject to general regulation by Brazil’s central bank (BACEN), the capital markets authority (CVM) and Law n. 14.286/2021, which imposes certain reporting obligations in respect of foreign capital flows. These requirements fall outside the scope of insurance regulation, and specific advice should be sought on their application to a specific transaction.

As a rule, direct insurance in Brazil is only permitted to locally licensed insurance companies under Complementary Law n. 126/2007 and Decree-Law n. 73/1966. Limited exceptions are provided in Article 20 of Complementary Law n. 126/2007. The most relevant allows overseas insurers to cover Brazilian policyholders where there is no available capacity in the local market. Proof of lack of local capacity is regulated in SUSEP Circular Letter n. 603/2020, which requires the applicant to obtain formal refusals from at least five insurers. In practice, this provision is rarely uses: because fronting arrangements are permitted, capacity constraints can typically be addressed by placing the risk with foreign reinsurers through a local fronting insurer.

Despite these restrictions, Complementary Law n. 126/2007 does not prohibit global insurance programmes. Only risks located exclusively in Brazil cannot be insured by international insurers through policies issued abroad to Brazilian residents or entities. International groups often rely on the restrictive wording of the provision to extend broader global policies (offering e.g. higher limits or wider coverage than those available locally) to their Brazilian operations, by structuring coverage as multi-jurisdictional.

Reinsurance is different. Complementary Law n. 126/2007 expressly permits international reinsurance contracts and the operation of foreign reinsurance companies in Brazil. The law separates reinsurers into three groups: local reinsurers, admitted reinsurers and occasional reinsurers. All must hold a licence to write risks, as discussed above.

In a provision mirroring the direct insurance framework, CNSP Resolution n. 451/2022 provides that if no authorised reinsurer (whether local, admitted or occasional) is willing to write a specific risk, the insurer is permitted to cede to a non-authorised reinsurer after formally consulting all authorised reinsurers using the same procedure set out in SUSEP Circular Letter n. 603/2020.

Finally, CNSP Resolution n. 451/2022 provides that any reinsurance contract related to risks in Brazil must be governed by Brazilian law, unless the parties agree to arbitration, in which case they may select a different governing law.

Brazilian law does not permit overseas insurers or brokers to operate through branches in the traditional sense. Under Brazilian corporate law (Decree-Law n. 2.627/1940), only entities incorporated in Brazil are treated as national companies and are therefore eligible for the licences required to write insurance or act as brokers. As a result, overseas insurers and brokers that wish to operate in Brazil must incorporate a local entity, which is then subject to the applicable regulatory framework under Decree-Law n. 73/1966 and CNSP Resolution n. 422/2021, without distinction based on the nationality of the shareholders.

There are two principal exceptions to this framework. The first, expressly provided by applicable law, relates to international reinsurers, which may register with SUSEP as admitted or occasional reinsurers without incorporating a local entity, subject to the requirements set out in Complementary Law n. 126/2007. The second arises from the absence of any specific licensing requirements for insurance intermediaries that are not classified as brokers – such as agents and MGAs – which may therefore operate in Brazil without incorporating a local entity.

As noted above, overseas insurers cannot operate in Brazil through a branch in the traditional sense. They must incorporate a local entity subject to the full licensing regime. The question of branch-specific restrictions or substance limitations therefore does not arise in the Brazilian context in the same way as in jurisdictions that allow branch operations.

The closest analogue to a branch structure is the representative office that admitted foreign reinsurers are required to establish in Brazil under Complementary Law n. 126/2007. However, this office is not authorised to underwrite risks and performs only administrative functions. All underwriting activity remains subject to the requirements outlined above, including the capital deposit obligations applicable to admitted reinsurers.

Under Brazilian law, operating insurance or reinsurance without the proper licence constitutes a criminal offence. Law n. 7.492/1986, which governs financial crimes in Brazil, classifies insurance companies as financial institutions for this purpose and provides that operating without authorisation, or with authorisation obtained by false declaration, is punishable by imprisonment for one to four years, in addition to a fine (Art. 16).

In addition to criminal liability, SUSEP holds broad administrative sanctioning powers under Decree-Law n. 73/1966, including the power to impose fines (with the maximum ceiling recently increased to BRL 35 million under Complementary Law n. 213/2025), order the cessation of activities and bar individuals from holding management positions in regulated entities. In practice, administrative sanctions are the more immediate consequence for unlicensed operators, while criminal prosecution tends to be reserved for cases involving clear fraudulent intent or repeated violations.

SUSEP’s supervisory and enforcement focus is primarily (and, some would argue, almost exclusively) prudential. Compliance with the reporting and provisioning standards established in CNSP Resolution n. 432/2021, including claims provisions and capital adequacy requirements, is the central concern of the regulator. Breaches are regularly sanctioned through SUSEP’s broad administrative powers under Decree-Law n. 73/1966, which include the imposition of fines, the ordering of cessation of activities and the barring of individuals from management positions in regulated entities.

Consumer protection and market conduct have not historically been priorities for SUSEP. In practice, disputes between policyholders and insurers are largely left to the courts and to PROCON, the general consumer protection authority, rather than through proactive regulatory supervision. This is a recurrent criticism of the Brazilian insurance regulatory framework and remains a notable gap in the supervisory architecture.

Although SUSEP has long been an active sanctioning authority, the sanctions themselves have historically lacked deterrent effect. Fines were capped at BRL 1 million, and the regulator relied on blunt instruments to make sanctioning easier. The most notable examples were the strict liability of the so-called “technical director”, who could be held automatically liable for any divergence in prudential reporting regardless of fault, and the joint liability between the director and the supervised entity. Given the relatively low value of the fines, sanctions were often not contested, as the financial impact was manageable.

The landscape is now changing. Complementary Law n. 213/2025 increased the maximum administrative fine to BRL 35 million, and a significant fraud case in the local reinsurance market involving prudential reporting failures has intensified regulatory scrutiny. These developments point to a more demanding, and potentially more litigious, enforcement environment going forward, particularly in prudential matters.

Solvency regulation is primarily set out in CNSP Resolution n. 432/2021 and SUSEP Circular Letter n. 648/2022. The main prudential requirements can be divided into three categories: (i) technical provisions, (ii) minimum capital requirements, and (iii) cession limits. Additional requirements exist, such as the obligation to maintain an independent prudential committee for larger supervised entities.

Technical provisions must ensure that regulated entities hold sufficient resources to meet future obligations. These provisions must be backed by sufficiently liquid assets, with reinsurance and other risk transfer mechanisms reducing the net provisioning requirement. The main technical provisions required under CNSP Resolution n. 432/2021 include the Unearned Premium Reserve (PPNG), covering premiums written but not yet earned, the Claims Provision (PSL), which must be established monthly for all reported but unpaid claims, including monetary adjustment, interest and contractual penalties; and the Incurred But Not Reported provision (IBNR), covering claims incurred but not yet reported. All provisions must be reported monthly to SUSEP and are subject to detailed regulatory guidance published in SUSEP’s Technical Provisions Manual.

Minimum capital requirements are expressed through the Adjusted Net Equity (PLA), which represents the resources available to the insurer to absorb adverse fluctuations, and the Minimum Required Capital (CMR), which corresponds to the total capital the insurer must maintain to operate. Under Article 58 of CNSP Resolution n. 432/2021, insurers must maintain a PLA equal to or greater than the CMR at all times and must demonstrate sufficiency of technical provision coverage. Where the PLA falls below the CMR for three consecutive months, or specifically in June and December, SUSEP may require the insurer to submit a solvency regularisation plan, place it under special fiscal supervision, or initiate extrajudicial liquidation proceedings, depending on the degree of insufficiency.

Cession limits are governed through the concept of retention limits (limite de retenção) established in CNSP Resolution n. 432/2021, applicable to both insurers and local reinsurers. The retention limit corresponds to the maximum liability that a regulated entity may retain in respect of a single risk, defined as an object or set of objects whose probability of being affected by the same loss-generating event is significant. These limits must be calculated per branch and group of branches and reviewed twice a year (in February and August), in accordance with the entity’s risk management policy. Insurers whose retention limits exceed 5% of their PLA (and local reinsurers exceeding 20%) must prepare and maintain a technical note justifying those limits, which SUSEP may review and reduce at any time.

CNSP Resolution n. 451/2022 complements this framework by establishing maximum cession thresholds. Insurers that cede more than 90% of their written premiums in reinsurance in any given calendar year must submit a technical justification to SUSEP by 31 March of the following year. Local reinsurers face a stricter rule: they may not cede more than 70% of written premiums in retrocession in any calendar year, except in respect of financial, rural and nuclear risks, for which SUSEP may authorise higher cession percentages upon technically justified request.

Minimum capital requirements for SUSEP-supervised entities are governed by CNSP Resolution n. 432/2021 and are structured around the concept of the Minimum Required Capital (CMR). The CMR corresponds to the higher of: (i) the capital base (a fixed floor); and (ii) the risk capital (a variable, risk-sensitive component). Supervised entities must maintain Adjusted Net Equity (PLA) equal to or greater than the CMR at all times.

The applicable capital base depends on the entity classification under the proportionality framework established by CNSP Resolution n. 388/2020, which assigns entities to one of four segments (S1 to S4) based on market share, measured by their individual or consolidated share of total market premiums and technical provisions. S1 comprises the largest entities, defined by any of the following thresholds: premiums representing 9% or more of total market premiums; technical provisions accounting for 6% or more of total market provisions; or reinsurance and retrocession premiums reaching at least 0.36% of total market premiums. S2 includes mid-sized entities that do not meet the S1 thresholds but satisfy at least one of the following: premiums of 0.9% or more of total market premiums; technical provisions of at least 0.2% of total market provisions; or reinsurance premiums of at least 0.09% of total market premiums. S3 comprises all remaining entities that do not fall within S1, S2 or S4. S4 is a simplified, opt-in regime available to S3 entities that restrict their activities to low-complexity, short-term lines of business (such as microinsurance, motor and residential risks, and short-term personal lines) and adopt conservative investment strategies.

For insurers and open pension funds (EAPCs) authorised to operate nationwide, the capital base (Annex XXIII to CNSP Resolution n. 432/2021) is BRL 15,000,000 for S1 and S2 entities, BRL 8,100,000 for S3 entities, and BRL 3,960,000 for S4 entities. Entities operating exclusively in microinsurance are subject to a minimum of BRL 3,000,000. For entities authorised to operate on a regional basis, the capital base is lower and consists of a fixed component of BRL 1,200,000 plus a variable regional component. Local reinsurers face a significantly higher fixed minimum of BRL 60,000,000, regardless of segment or geographic scope (Annex XXV).

Risk capital (CR) reflects each entity’s specific risk profile and is calculated by aggregating four components: underwriting risk (CRsubs), credit risk (CRcred), market risk (CRmerc), and operational risk (CRoper). S1 entities may calculate risk capital using a fully or partially internal models, subject to prior SUSEP approval, while S4 entities may rely on simplified models defined by SUSEP.

In addition to these quantitative requirements, CNSP Resolution n. 432/2021 establishes qualitative rules on the composition of the PLA used to meet the CMR. At least 50% of the CMR must be covered by Level 1 PLA (essentially accounting net equity), no more than 15% by Level 3 PLA (certain accounting surpluses), and the combined amount of Level 2 and Level 3 PLA may not exceed 50% of the CMR.

Admitted foreign reinsurers are not subject to the CMR framework. Instead, they must maintain a capital deposit in an authorised Brazilian bank. Occasional reinsurers are not subject to any deposit requirement.

Where the PLA falls below the CMR, the consequences are graduated: an insufficiency of up to 50% requires the entity to submit a solvency regularisation plan (PRS) to SUSEP; an insufficiency exceeding 50% may result in special fiscal supervision; and an insufficiency exceeding 70% may trigger extrajudicial liquidation proceedings under applicable law.

Brazil does not have a policyholder protection scheme of the kind found in certain other jurisdictions, such as guarantee funds that compensate policyholders in the event of an insurer’s insolvency. There is no statutory fund or industry-financed mechanism designed to indemnify policyholders or beneficiaries for unpaid claims arising from the failure of a supervised entity.

The framework for policyholder protection rests instead on the prudential supervision and intervention powers conferred on SUSEP by Decree-Law n. 73/1966. Where a supervised entity falls into financial difficulty, SUSEP may impose a solvency regularisation plan, appoint a special administrator, or initiate intervention or extrajudicial liquidation proceedings. The technical reserves that insurers are required to maintain – and to cover with eligible assets at all times – serve as the primary buffer for policyholder obligations in stress scenarios.

In practice, however, formal insolvency proceedings have remained largely theoretical in the Brazilian insurance market in recent years. There have been no significant cases of SUSEP-supervised insurers being subjected to intervention or liquidation, reflecting both the robustness of the current prudential framework and the relative stability of the sector.

Group supervision in Brazil is not governed by a dedicated consolidated regulatory framework. SUSEP supervises insurance and reinsurance entities on an individual, entity-by-entity basis, and there is no equivalent to the group-wide solvency assessment or group supervisor regime established under the European Solvency II framework.

Group-level concepts do appear in the applicable regulations, but only in a limited and fragmented manner. The most substantive use is found in CNSP Resolution n. 388/2020, which introduces the concept of a prudential group for purposes of applying the proportionality framework described above. Under this approach, the premiums and technical provisions of all supervised entities under common control are aggregated to determine the regulatory segment (S1 to S4) applicable to each entity. While this consolidation affects the intensity of prudential requirements, it does not amount to full group-level supervision.

Beyond segmentation, CNSP Resolution n. 432/2021 allows entities within the same financial conglomerate, insurance group, or prudential group to establish a single audit committee at the level of the lead entity, provided that its reports address each supervised entity individually. CNSP Resolution n. 451/2022 further requires that intra-group reinsurance and retrocession transactions be conducted at arm’s length, with the parties bearing the burden of demonstrating that terms and conditions are consistent with prevailing market standards between independent counterparties.

Where an insurer forms part of a broader financial conglomerate that also includes banking entities, the Central Bank of Brazil (BACEN) exercises supervisory oversight of the group under its own regulatory framework. In such cases, coordination between SUSEP and BACEN may be required in practice.

Yes. Under CNSP Resolution n. 422/2021, the election, investiture and exercise of positions on the statutory and contractual bodies of supervised entities are reserved to individuals whose nomination has been expressly and previously approved by SUSEP. Prior to any corporate act of election or appointment, the supervised entity must submit a consultation to SUSEP, which assesses whether the proposed candidate meets the applicable requirements. An exception applies to re-elections and to individuals who have held a comparable statutory position in a supervised entity within the preceding six months, in which case the corporate act may proceed without prior consultation. Once SUSEP grants approval, the corporate act must be completed and the individual must take office within 90 days. Terms may last up to three years and are renewable.

The substantive fit and proper requirements, set out in Articles 44 and 45 of CNSP Resolution n. 422/2021, cover two distinct dimensions: good character and technical capacity.

On good character, candidates must have an unblemished reputation, be enrolled in the Brazilian individual taxpayer registry (CPF), and satisfy a series of negative requirements. In particular, they must not be barred from office by special legislation; must not have been convicted of bankruptcy-related crimes, tax evasion, malfeasance, corruption, embezzlement, misappropriation, administrative improbity, or crimes against the public economy, public faith, property or the National Financial System; must not have been declared ineligible or suspended from statutory positions in entities regulated by SUSEP or, on a cross-sector basis, by BACEN, PREVIC, ANS or CVM; must not have any protested promissory notes, pending judicial collections or material defaults (whether personally or through companies they control or manage); must not have been declared bankrupt or insolvent in the preceding five years; and must not have controlled or managed, in the preceding five years, any entity that underwent extrajudicial liquidation, judicial intervention, special temporary administration, or bankruptcy proceedings.

In assessing the unblemished reputation requirement, SUSEP has broad discretion to take into account any pending criminal, judicial or administrative proceedings relating to the financial system, insurance market or securities markets, even in the absence of a final conviction. The assessment is contextual and takes into account the specific circumstances of each case and the position being filled. Although broad, SUSEP has rarely invoked this prerogative to bar a nomination on unblemished reputation grounds.

On technical capacity, candidates must demonstrate professional qualifications compatible with the responsibilities of the position to which they are being appointed, evidenced by academic background, professional experience, or other factors deemed relevant by SUSEP. Members of supervisory board are specifically required to hold a higher education degree or to have served as director or board member for a minimum of three years. For certain roles, SUSEP may also require professional certification as a condition of approval.

Compliance with fit and proper requirements is not a one-time assessment. SUSEP may find non-compliance at any time during the individual’s tenure, whether the disqualifying circumstance pre-existed the appointment or arose subsequently. Such a finding may result in the suspension or revocation of SUSEP’s approval, the commencement of administrative sanction proceedings against the individual and the entity, and an obligation on the part of the supervised entity to immediately remove the individual from office. The maximum administrative fine applicable to individuals under these proceedings has recently been increased to BRL 35 million under Complementary Law n. 213/2025.

Senior managers of SUSEP-supervised entities may be held personally liable in the administrative, civil and criminal spheres.

In the administrative sphere, CNSP Resolution n. 393/2020 establishes that individuals are accountable for regulatory infractions to the extent of their personal culpability, including where they commit the act, contribute to its commission, or fail to prevent it when they had the means to do so (Art. 2º, §2º). In determining the sanction, SUSEP must assess the individual’s fault in light of their specific functions and responsibilities within the entity (Art. 11, §1º). Available sanctions include warnings, fines, suspension of professional activities for up to 180 days, and a bar from holding management positions in supervised entities for a period of two to ten years (Art. 2º). In the past, the fine ceiling for general infractions was capped at BRL 1 million — a level that limited the practical impact of individual liability. Complementary Law n. 213/2025 raised this ceiling to BRL 35 million, substantially increasing the practical stakes of personal administrative exposure. In addition, under CNSP Resolution n. 422/2021, SUSEP may also revoke the prior approval of a director or officer whose conduct no longer satisfies the fit and proper requirements, barring that individual from equivalent positions across the supervised market.

Civil liability depends on the nature of the appointment. Managers who are not statutory officers are subject to the general tort rules of the Civil Code. Statutory directors and board members of joint-stock companies are governed by Law n. 6.404/1976 (the Corporations Act), which imposes duties of loyalty, diligence and disclosure and provides for personal liability in case of breach. The business judgment rule provides a degree of protection for decisions taken in good faith, on an informed basis and in the company’s interest; liability does not arise merely from poor business outcomes.

Criminal liability is governed by Law n. 7.492/1986, which expressly extends criminal responsibility to controllers and administrators – including directors and managers – of financial institutions, including insurers (Art. 25). The most practically relevant offences for senior managers of supervised entities include: fraudulent management (gestão fraudulenta), punishable by 3 to 12 years’ imprisonment, and reckless management (gestão temerária), punishable by 2 to 8 years (Art. 4º); inserting false data or omitting required information in the financial statements of an insurer, punishable by 1 to 5 years (Art. 10); maintaining resources parallel to the statutory accounting records, punishable by 1 to 5 years (Art. 11); and operating without proper authorisation, punishable by 1 to 4 years (Art. 16).

The key presence requirement under Brazilian law is that entities wishing to write insurance or act as locally licensed reinsurers must be incorporated in Brazil as joint-stock companies under Decree-Law n. 73/1966 and CNSP Resolution n. 422/2021. Operation through a foreign branch is not permitted. Local incorporation necessarily entails the maintenance of a registered office and a physical address where the entity can be reached by regulators, courts, and counterparties.

In addition, CNSP Resolution n. 422/2021 imposes specific rules on the composition of the administrative bodies. Under Article 44, §4, no more than 35% of the positions on any statutory or contractual body of a supervised entity may be held by non-residents, meaning that at least 65% must be resident in Brazil. Where a member of the board of directors is not resident in Brazil, Article 48 requires the entity to appoint a Brazilian-resident attorney-in-fact with authority to receive service of process on that member’s behalf, for a period extending at least five years beyond the end of the relevant term. Article 49 further requires that statutory executive directors be individually assigned specific functions in accordance with applicable SUSEP regulation, creating a further expectation of local management substance.

For admitted foreign reinsurers, CNSP Resolution n. 422/2021 requires the establishment of a representative office in Brazil, which may be either operated directly by the reinsurer or outsources to a third party, subject in either case to equivalent regulatory requirements, including the implementation of internal controls. Occasional reinsurers are not required to maintain such an office but must designate a legal representative domiciled in Brazil, with authority to receive regulatory communications and legal notices on their behalf.

These physical and personal presence requirements must be maintained on an ongoing basis as a condition for retaining authorisation. SUSEP actively monitors compliance: under CNSP Resolution n. 422/2021, the inability to locate a supervised entity at its registered address, or the inability to locate its representatives or attorney-in-fact at their declared address, constitutes grounds for cancelling the license to operate. Changes to key registered information – including the address of the entity, the identity of its directors and the identity of its attorney-in-fact – must be notified to SUSEP within the timeframes set out in SUSEP Circular Letter 700/2024.

Minimum capital requirements also constitute an indirect presence requirement, insofar as the relevant funds must be maintained, demonstrable, and accessible to SUSEP at all times. Entities that fail to maintain a PLA equal to or greater than the CMR on a sustained basis face graduated intervention measures including, ultimately, extrajudicial liquidation.

Brazil does not have a consolidated regime covering outsourcing, third-party risk management, and operational resilience. The relevant requirements are instead distributed across several instruments.

On outsourcing, the starting point is regulatory authorisation. Under Law n. 15.040/2024 and Complementary Law n. 126/2007, insurance and reinsurance may only be written by SUSEP-authorised entities. CNSP Resolution n. 431/2021 defines the scope of delegable activities: agents may perform risk writing, policy issuance, claims handling and payment, whereas the “assumption of insurable risks” (assunção de riscos seguráveis) remains reserved to the insurer (Art. 6º, §§1º-2º). The precise boundary between delegable underwriting functions and the non-delegable assumption of risk remains, in practice, a grey area.

The principal sector-specific outsourcing instrument is SUSEP Circular Letter n. 638/2021, which governs cybersecurity and the outsourcing of data processing, storage, and cloud services. Supervised entities must conduct appropriate due diligence on service providers, ensure SUSEP’s access to relevant data and systems, require data segregation, and contractually impose equivalent cybersecurity standards. Cross-border outsourcing requires at least 30 days’ prior notice to SUSEP, and outsourcing does not relieve the supervised entity of its regulatory responsibilities (Art. 12).

More broadly, third-party risk management is embedded in the internal controls and risk management framework established by CNSP Resolutions n. 422/2021 and n. 432/2021. Third-party risks are captured within the operational risk capital charge (CRoper), which indirectly incentivises stronger controls by translating deficiencies in risk management into higher capital requirements.

Operational resilience as a standalone regulatory regime – comparable to the UK PRA’s framework (SS1/21 and PS6/21) or the EU Digital Operational Resilience Act (DORA) – does not exist in Brazil. There is no statutory requirement to identify important business services, define impact tolerances, or test against severe but plausible scenarios, nor is there a dedicated framework addressing critical third parties or risk concentration in cloud services. Resilience expectations are instead embedded in cybersecurity rules, internal controls framework, and general expectation of business continuity planning. Insurers within international groups typically adopt higher standards driven by group governance; for standalone domestic entities, the absence of a dedicated regime remains a notable gap and a likely area for future regulatory development.

The investment activities of SUSEP-supervised entities are subject to a dual regulatory framework under Decree-Law n. 73/1966. CMN Resolution n. 4.993/2022, issued by the National Monetary Council, establishes the list of admitted assets and the applicable allocation and concentration limits, while CNSP Resolution n. 432/2021 sets out complementary principles and prohibitions. Together, these instruments create a structured regime that organises investments into five categories (fixed income, equities, real estate, foreign exchange-linked assets, and others), each subject to asset-specific sublimits and issuer concentration caps. Similar statutes apply in health and pension funds sectors.

Within fixed income, the full portfolio may be invested in federal government securities (directly or through dedicated special-purpose funds). Corporate bonds of publicly listed companies registered with the CVM are admitted up to 75%; bank obligations, fixed income funds and fixed income ETFs up to 50%; and structured instruments such as FIDC senior quotas, receivables certificates and SPE securities up to 25%.

Within equities, the admitted limits vary according to the governance tier of the listed company: shares traded on the highest governance segments (Novo Mercado) may represent up to 100% of the equity allocation; shares on Level 2 up to 75%; and shares on Level 1 or in broad index funds up to 50%. Shares without a minimum free float threshold are capped at 25%.

Real estate investment fund quotas (FII) may represent up to 100% of the real estate allocation.

Foreign exchange-linked assets (including FX-indexed federal bonds, international investment funds and BDRs) are admitted up to varying sublimits. Structured instruments such as hedge funds quotas (multimercado) and capital-protected structured notes (COE) are admitted under the “others” modality, with at-risk structured notes capped at 25%.

In addition to these asset-level restrictions, the regulation establishes overall allocation limits by asset class. For general insurance and reinsurance operations, equities are capped at 49% of the portfolio, real estate at 20%, foreign exchange-linked assets at 10%, and “others” at 20%, while fixed income remains uncapped. Life insurance and pension products benefit from a more flexible regime, with an equity ceiling of 70% and caps of 20% for foreign exchange-linked assets and other instruments.

Issuer concentration limits apply across all modalities. No more than 25% of the portfolio may be allocated to a single financial institution, 15% to a single listed company, 10% to a single FIDC, FII or FIP, and 5% to any other single issuer. Additionally, supervised entities may not hold more than 20% of the total or voting capital of any single listed company, nor more than 20% of the net equity of any single financial institution. No more than 25% of any single class or series of securities may be acquired, with limited exceptions for government bonds and listed shares.

The framework also includes a number of prohibitions. CMN Resolution n. 4.993/2022 bars investment in securities issued or guaranteed by natural persons, in portfolios managed by natural persons, and in funds without adequate risk evaluation procedures. Self-issued securities and those issued by related parties are likewise excluded from use as asset guarantors. CNSP Resolution n. 432/2021 adds further restrictions, including a prohibition on investing in funds that could require additional capital contributions from the investor, a ban on uncovered option sales, and a prohibition on lending or pledging asset guarantors without prior SUSEP authorisation.

For admitted foreign reinsurers, a stricter investment regime applies to the resources they are required to maintain in Brazil as a guarantee of their local obligations. Up to 100% may be allocated to federal government bonds or government-bond-only special funds, and up to 80% to investment-grade debentures of listed companies, obligations of international financial organisations, or foreign exchange-linked and international investment funds.

In practice, however, the regulatory flexibility described above is rarely used in full. According to 2025 data published by SUSEP, supervised entities allocate, on average, 96% of their asset guarantors to fixed income investments. A review of individual entity balance sheets confirms that the overwhelming majority of those fixed income holdings consist of federal government securities or closely related instruments such as government-bond-only special-purpose funds.

The concentration reflects a combination of factors: the liquidity and credit quality of Brazilian government paper, the conservative investment cultures of most market participants, and the indirect incentive created by the market risk capital charge (CRmerc) under CNSP Resolution n. 432/2021, which penalises exposure to more volatile asset classes by increasing the CMR. In effect, for most entities, the regime operates in practice as a near-exclusive allocation to government bonds, notwithstanding the breadth of the framework on paper.

The management of reinsurance risk is governed primarily by CNSP Resolution n. 432/2021, which establishes the retention limit framework, and CNSP Resolution n. 451/2022, which sets out the requirements for risk transfer policies and cession limits.

Under Articles 76 to 80 of CNSP Resolution n. 432/2021, cedents must calculate retention limits – defined as the maximum liability that may be retained for each isolated risk at least twice a year (in February and August), and to report the results to SUSEP. These limits must be calculated per branch (for insurers) or per group of branches (for reinsurers) and aligned with the entity’s risk management policy. Where retention exceeds 5% of the entity’s PLA (or 20% for local reinsurers), the entity must prepare a technical note justifying those limits. SUSEP retains the power to reduce retention limits at any time.

CNSP Resolution n. 451/2022 adds a further layer of requirements by obliging insurers and local reinsurers to develop and implement a formal risk transfer policy, which must complement the entity’s broader risk management and underwriting policies. At a minimum, the policy must address: (i) the objectives of the reinsurance or retrocession programme; (ii) the technical criteria for structuring coverage; (iii) exposure limits and their alignment with business strategy; (iv) counterparty selection and monitoring, including credit and liquidity risk; (v) management of counterparty concentration; (vi) accumulation across products, lines of business, geographic regions, and insureds; (vii) catastrophe exposure; and (viii) mismatches in terms and conditions between reinsurance and underlying contracts.

The same resolution imposes quantitative ceilings. Local reinsurers may not cede more than 70% of their written premiums in retrocession in any given calendar year, subject to limited exceptions (such as financial, rural, and nuclear risks) where SUSEP may authorise higher levels upon a duly justified request. Insurers that cede more than 90% of their written premiums in reinsurance in any given year must submit a technical justifications to SUSEP by 31 March of the following year. Exceeding this threshold does not automatically result in sanctions but triggers a reporting obligation.

Local reinsurers benefit from a preferential offer mechanism under Complementary Law n. 126/2007 and CNSP Resolution n. 451/2022. For each reinsurance placement, whether automatic or facultative, local reinsurers must be given the opportunity to participate on terms identical to those offered to, and accepted by, the international market. The preferential offer must be extended on an equal basis to all local reinsurers.

The supervision of insurance sales in Brazil operates through two parallel regimes: the sector-specific framework administered by SUSEP and the general consumer protection framework under the Brazilian Consumer Defence Code.

The SUSEP framework operates across three complementary layers: product registration, distribution control and market conduct.

At the product level, SUSEP Circular Letter n. 708/2024 requires insurers to register their products electronically through the Sistema de Registro Eletrônico de Produtos (REP) before commercialisation. The framework distinguishes between two tracks: products that do not require prior approval may be marketed from the day following their registration, whereas products subject to prior approval may only be commercialised after SUSEP has granted it. In addition, SUSEP actively intervenes in product design through branch-specific circulars – such as those applicable to civil liability (SUSEP Circular Letter n. 637/2021) and surety bonds (SUSEP Circular Letter n. 662/2022) – which establish mandatory minimum conditions that policy terms must observe.

Contracts for large risks (defined by CNSP Resolution n. 407/2021 as covering petroleum, aviation, maritime, nuclear and named/operational risks, or other property lines where the insured is a legal entity with a maximum coverage limit above BRL 15 million, total assets above BRL 27 million or annual revenue above BRL 57 million) are an exception. Their terms and conditions are not subject to the minimum conditions provided in the branch-specific regulations or to prior registration with SUSEP, remaining instead under the insurer’s own custody.

At the distribution level, insurance may be sold through licensed insurance brokers, who act in the policyholder’s interests and must hold a SUSEP licence, or through insurance representatives operating under CNSP Resolution n. 431/2021. The regulatory framework governing intermediaries is addressed above.

At the conduct level, CNSP Resolution n. 382/2020 establishes binding principles of ethics, transparency, diligence, loyalty and good faith applicable to supervised entities and intermediaries alike throughout the product lifecycle, from design and distribution to claims handling and contract termination. Supervised entities must adopt a formal Institutional Conduct Policy, approved at board level, covering product design, distribution, advertising, remuneration and complaints handling. Intermediaries are required to disclose to clients, prior to sale, any material shareholding links with supervised entities, any exclusivity arrangements and the full amount of their remuneration. CNSP Resolution n. 393/2020 further defines specific conduct-related infractions subject to administrative sanctions. In practice, however, enforcement of conduct standards has played a secondary role relative to SUSEP’s predominantly prudential focus, and the conduct framework has so far had limited practical effect.

Insurance contracts offered to retail policyholders are additionally subject to the Brazilian Consumer Defence Code (Law n. 8.078/1990), which governs the entire consumer relationship.

On contractual terms, the Consumer Code treats insurance policies as adhesion contracts and renders null and void clauses that restrict or attenuate the insurer’s liability, permit unilateral modification or cancellation, or restrict access to the courts (Art. 51). Ambiguity is resolved in favour of the consumer (Art. 47).

On commercial practices, the Consumer Code prohibits a range of abusive conduct relevant to insurance distribution, including tying arrangements (venda casada), unsolicited supply of products, and the exploitation of consumer vulnerability arising from age, health, knowledge or social condition (Art. 39).

On advertising, promotional communications must be immediately identifiable as such; misleading advertising (whether by false statement or material omission) is prohibited; and the burden of proving the accuracy of any advertising claim rests with the advertiser (Arts. 36-38).

On claims handling and post-sale relations, the Consumer Code reinforces the statutory framework under Law n. 15.040/2024 by ensuring the consumer’s right to information, to adequate claims handling, and to reversal of the burden of proof in litigation where the claim is plausible or the consumer is in a position of informational disadvantage (Art. 6º, VIII).

These consumer protection rules apply independently of and in addition to SUSEP’s sector-specific conduct framework, and their enforcement falls within the jurisdiction of consumer protection authorities, such as PROCON, rather than SUSEP.

The active marketing and sale of insurance into Brazil on a cross-border basis is subject to the same authorisation requirements described above. Only entities duly authorised by SUSEP may underwrite insurance risks in Brazil, and the assumption of insurable risks by a non-authorised foreign entity, regardless of the channel through which the product is offered, constitutes an unauthorised operation under Complementary Law n. 126/2007 and Decree-Law n. 73/1966, exposing those responsible to administrative and criminal liability. Brazilian law does not permit foreign insurers to freely solicit or sell retail insurance into Brazil on a cross-border services basis without local establishment or regulatory authorisation.

Brazilian law does not establish a specific regulatory regime for distance selling or online insurance distribution. No CNSP resolution or SUSEP circular currently in force imposes requirements additional to those of the general framework by reason of the use of digital or remote channels. In particular, there are no specific rules mandating cooling-off periods, specific pre-contractual disclosure formats or channel-specific licensing.

Insurers in Brazil are subject to a layered framework of policyholder protection, combining general consumer law and sector-specific insurance legislation.

At the general consumer law level, the Brazilian Consumer Defence Code (Law n. 8.078/1990) applies to insurance contracts. Insurance policies are treated as adhesion contracts: their terms must be drafted in clear, legible language with a minimum font size of twelve points, and clauses that limit the policyholder’s rights must be highlighted to permit their immediate identification (Art. 54). Clauses that restrict or attenuate the insurer’s liability, allow unilateral modification of the contract or its price, permit unilateral cancellation without a corresponding right in favour of the consumer, or restrict access to the courts are null and void (Art. 51). Where there is doubt as to the meaning of a clause, interpretation must favour the consumer (Art. 47), and a contract will not bind the consumer if they were not given the opportunity to read it before signature (Art. 46). In litigation, courts may reverse the burden of proof in the consumer’s favour where the claim is plausible or the consumer is in a position of informational disadvantage (Art. 6º, VIII).

At the sector-specific level, the new Insurance Contract Act (Law n. 15.040/2024) sets a framework that extends beyond retail consumers to encompass commercial policyholders as well, reflecting a legislative intent to rebalance the insurer-insured relationship. In particular, insurers may not insert clauses permitting unilateral termination except in cases expressly provided by law (Art. 9º, §5º). Exclusion clauses are subject to restrictive interpretation, with the burden of proof falling on the insurer (Art. 57 and Art. 59). In claims handling, the insurer has 30 days to accept or deny coverage and a further 30 days to pay; failure to meet these deadlines triggers either deemed acceptance of coverage or a 2% late payment penalty, plus monetary correction and statutory interest (Arts. 86-88).

Brazil does not operate a system of general premium price controls. Insurers are free to set tariffs, subject to actuarial adequacy requirements monitored by SUSEP as part of its prudential oversight. The main indirect constraint arises from the statutory prohibition on discriminatory underwriting under Law n. 15.040/2024 and from SUSEP’s product oversight, which allows the regulator to require adjustments to terms and conditions before commercialisation.

The principal exception is health insurance, which falls outside SUSEP’s perimeter. Under Law n. 9.656/1998 and its implementing regulations, ANS sets maximum annual premium adjustment percentages for individual and family plans, while group plans are subject to a less stringent but still supervised review mechanism.

Brazil has a specific resolution regime for supervised insurance entities established by Decree-Law n. 73/1966, which operates in two stages: early intervention and formal liquidation, both administered by SUSEP.

At the intervention stage, where SUSEP identifies insufficient coverage of technical provisions or a deteriorating in the entitiy’s financial position, it may appoint a diretor-fiscal to oversee the entity’s operations for an indefinite period at the entity’s expense (Art. 89). Non-compliance with the fiscal director’s directions may result in the removal of the offending officer (Art. 91), and administrators facing criminal proceedings related to their management are automatically suspended (Art. 92). If these measures prove insufficient, SUSEP may propose to the CNSP the revocation of the entity’s operating license (Art. 90).

Cessation of operations may be voluntary, by shareholder resolution followed by a request for cancellation submitted to SUSEP within five days, or compulsory, ordered by SUSEP on grounds such as failure to maintain required reserves, financial insolvency or conduct harmful to the national insurance policy (Arts. 94-96). In either case, liquidation is conducted by SUSEP, which assumes full administrative and representative control over the entity (Art. 97).

Upon revocation of licence, all obligations are accelerated, pending enforcement proceedings are suspended, interest ceases to accrue if the estate is insufficient to cover principal, and all management powers are extinguished (Art. 98). Within ninety days, SUSEP must prepare a full balance sheet and a ranked list of creditors, with policyholders and beneficiaries taking priority over public and general unsecured creditors. This is followed by the realisation of assets and distribution of proceeds, with payment within six months (Arts. 100 and 104). Matters not addressed by the specific regime are governed subsidiarily by general insolvency law (Art. 107).

In practice, the formal activation of this regime has remained largely theoretical in the recent history of the Brazilian market.

Insurance disputes are heard by the general civil courts and appellate chambers that handle the full range of private law matters, and the quality of judicial handling may vary considerably depending on the court and jurisdiction. The absence of institutional specialisation means that complex insurance cases – particularly those involving sophisticated coverage structures or reinsurance arrangements – do not always receive the level of technical analysis they may require.

By contrast, certain state courts (most notably those of São Paulo and Rio de Janeiro) have established specialised chambers for corporate law disputes, insolvency and restructuring proceedings, and matters related to the enforcement and annulment of arbitral awards. Where disputes engage these areas, parties can expect a comparatively higher level of judicial familiarity with the relevant legal framework, as well as, in some cases, more efficient case management and decision-making.

Brazil has a well-developed arbitration market, underpinned by Law n. 9.307/1996, which is widely regarded as a modern and effective arbitration statute. The law provides a robust framework for the recognition and enforcement of arbitral awards, and Brazil’s principal arbitral institutions handle a substantial volume of complex commercial disputes each year.

Within the insurance sector, the use of arbitration varies by market segment. Reinsurance disputes are resolved through arbitration almost without exception. By contrast, insurance disputes between policyholders and insurers are rarely submitted to arbitration and continue to be resolved predominantly by the courts.

Law n. 15.040/2024 introduced a specific framework for alternative dispute resolution in insurance contracts. Under Article 129, parties may agree – by means of a written instrument signed by both parties – to submit disputes to alternative mechanisms, including arbitration, provided that proceedings are seated in Brazil and governed by Brazilian law. The statute also requires SUSEP to establish a publicly accessible repository of disputes and their outcomes, without identifying the parties.

Portfolio transfers between insurers are governed by Article 3º of Law n. 15.040/2024 and, at the regulatory level, by SUSEP Resolution n. 73/2026, which applies to insurers and local reinsurers.

Any partial or total transfer of a portfolio requires prior SUSEP authorisation. As a condition for approval, both the transferring entity (cedente) and the receiving entity (cessionária) must demonstrate capital sufficiency and adequate coverage of technical provisions, taking into account the transferred portfolio. SUSEP may, at its discretion, approve transfers that do not immediately satisfy these requirements, and may impose additional prudential conditions. SUSEP may also reject a transfer application where it identifies risks to prudential adequacy, to the continuity of policyholder rights, or to conduct standards (Arts. 3º and 4º of SUSEP Resolution n. 73/2026).

The required documentation is specified in SUSEP’s operational manual. Once prior authorisation is granted and the transfer is completed, the cedant must notify all affected policyholders, participants and beneficiaries within five business days, by any that allow confirmation of receipt. The notice must identify the parties, state the date and reason for the transfer, inform policyholders of any changes to contract terms, and advise them of their right to rescind without penalty within 90 days of receipt. Concurrent publication in the Federal Official Gazette or a major newspaper, and on the cedant’s website and social media, is also required (Art. 9º). The transfer is then submitted to SUSEP for formal homologation. Only after the homologation request has been filed may the transferee issue new contracts or endorsements under the transferred portfolio (Art. 11).

A transfer carried out without prior SUSEP authorisation or policyholder consent gives rise to joint and several liability of the cedant and the transferee. That liability is maintained for the remaining period of the transferred policies or for twenty-four months from the transfer date, whichever is shorter, in the event of the transferee’s insolvency (Art. 3º, §§1º and 2º of Law n. 15.040/2024).

The Brazilian insurance market is highly consolidated, with a relatively small number of large groups, most of them linked to major financial conglomerates, accounting for a disproportionate share of premiums and provisions. For new entrants seeking to compete in core insurance lines, the primary structural barrier is access to capacity. Products that depart meaningfully from established coverage structures require reinsurance backing that is generally available only to entities with established track records and relationships, making genuine product innovation difficult to achieve without support from a large financial group or foreign reinsurer.

The broader regulatory context has followed a trajectory similar to that which transformed the Brazilian financial sector over the past decade. The same liberalising measures that drove increased competition in banking and payments (e.g., streamlined authorisation processes, open distribution frameworks and a regulatory sandbox) have been brought to the insurance sector through instruments such as CNSP Resolution n. 422/2021, CNSP Resolution n. 431/2021 and SUSEP Circular Letter n. 700/2024. To date, however, these measures have not produced structural changes in the insurance market comparable to what fintechs achieved in financial services.

SUSEP’s posture towards new entrants is supportive – for example, the regulator has not created additional barriers to entry and has signalled openness to innovative business models – but it has not actively promoted the entry of new insurers as a standalone policy objective.

Insurtechs are widely regarded as a transformative force in the Brazilian insurance market, drawing comparisons with the significant impact fintechs have had on the broader financial services sector. However, it is difficult to assess with precision the tangible progress they have driven to date.

Their most visible impact has been on distribution and internal operations. The most successful Brazilian insurtech ventures have focused on how insurance is processed internally, including premium administration and claims handling, and on how products are promoted and sold to policyholders, rather than on the structure of insurance contracts or their underlying economics. In that space, there is active co-operation between insurtechs and established insurers, many of which have created dedicated teams and investment lines for process improvement and digital distribution. The regulatory framework has also evolved to accommodate this trend, with CNSP Resolution n. 431/2021 enabling a broader range of digital distribution arrangements.

At the level of core insurance, however, the impact of digital innovation remains limited. Underwriting, policy wording, loss adjusting and claims settlement are inherently similar across market participants. Insurtechs have therefore had little meaningful effect on insurance lines that depend heavily on reinsurance capacity, such as large and complex risks, although marginal innovation is visible in simpler, higher-volume lines such as mobile and bike insurance.

SUSEP has sought to facilitate responsible experimentation through its regulatory sandbox framework, which allows supervised entities to test innovative products and business models under a temporary and controlled regulatory regime.

There are no sector-specific rules governing the digitization of insurance sales or claims handling in Brazil. The general regulatory framework applies regardless of the channel through which insurance is distributed or claims are processed, and no additional requirements or formal concessions are imposed by reason of digitization alone.

The principal regulatory vehicle for supervised experimentation with digital innovation is the sandbox framework, which allows entities to test innovative products and business models under a temporary and controlled regulatory regime, with derogations from standard requirements. Beyond this mechanism, SUSEP has not issued dedicated guidance on digital sales or claims handling, and the matter is largely left to market practice.

In practice, Brazil’s largest insurers have invested significantly in the digitization of both distribution and back-office operations, including automated underwriting and digital claims handling, driven primarily by competitive pressure and operational efficiency rather than regulatory mandate.

Insurers and reinsurers operating in Brazil are subject to two overlapping regulatory layers: the general data protection framework established by the General Law on Data Protection (Lei Geral de Proteção de Dados – LGPD, Law 13.709/2018) and the sector-specific cybersecurity and data security rules issued by SUSEP, principally Circular Letter n. 638/2021.

Under the LGPD, insurers and reinsurers act as data controllers and must identify a lawful basis for every processing activity. The statute lists ten lawful bases (Article 7), the most commonly relied upon in the insurance context being contractual necessity, legal obligation, legitimate interest, and, for sensitive data, explicit consent or the performance of health-related obligations. Health, genetic, and biometric data qualify as sensitive data under Article 5, II, and their processing is subject to a stricter regime under Article 11. Crucially, Article 11, §5, expressly prohibits health plan operators from using health data for risk selection or discrimination purposes.

Data subjects enjoy a broad set of rights under Article 18, including access, correction, anonymisation or deletion, portability, and the right to object. Article 20 establishes the right to request human review of decisions made solely by automated means, a provision directly relevant to algorithmic underwriting and claims scoring models. The National Data Protection Authority (ANPD) is responsible for supervising compliance and may impose administrative sanctions under Article 52, including fines of up to 2% of the Brazilian entity’s gross revenue, capped at  BRL 50 million per violation.

As a sector-specific overlay, SUSEP Circular Letter n. 638/2021 requires supervised entities to maintain a formal cybersecurity policy (Article 4), implement incident response procedures, and notify SUSEP within 5 business days of a relevant security incident (Article 8). Entities must also submit an annual incident report (Article 9). These obligations operate alongside LGPD and do not replace it; a data breach may trigger simultaneous reporting obligations to both SUSEP (under Circular Letter n. 638/2021) and the ANPD (under LGPD).

International transfers of personal data are governed by Articles 33 to 36 of the LGPD. As a rule, transfers to foreign countries or international bodies are only permitted where the destination jurisdiction offers a level of protection comparable to that afforded by Brazilian law, or where an appropriate safeguard mechanism is in place. Article 34 empowers the ANPD to assess the adequacy of foreign jurisdictions. Entities must therefore structure cross-border transfers through one of the safeguard mechanisms contemplated by Articles 35 and 36: standard contractual clauses endorsed by the ANPD, binding corporate rules (global corporate rules approved by the ANPD for intra-group transfers), or specific ANPD authorisation. Explicit consent of the data subject is also listed as a basis, but is generally considered a fragile foundation for systematic commercial transfers.

Insurers and reinsurers face an additional sector-specific obligation under SUSEP Circular Letter n. 638/2021. Where data processing or storage is outsourced to a service provider located abroad, the supervised entity must notify SUSEP in advance, with a minimum lead time of 30 days, identifying the countries or regions where the data will be processed or stored (Art. 10, III). Foreign service providers must maintain cybersecurity standards at least equivalent to those applicable to the contracting insurer, must ensure data segregation, and must guarantee SUSEP access to information and systems for supervisory purposes (Art. 11). SUSEP Circular Letter n. 638/2021 further makes clear that outsourcing does not exonerate the supervised entity from regulatory responsibility for the data (Art. 12).

In practice, the combination of LGPD’s transfer restrictions, the absence of ANPD adequacy decisions, and Circular Letter n. 638/2021’s SUSEP notification requirements means that cross-border data flows require careful structuring and ongoing regulatory disclosure obligations distinct from those applicable to domestic data processing.

Brazil introduced a dedicated sustainability framework for the insurance sector through SUSEP Circular Letter n. 666/2022.

The Circular defines three categories of sustainability risk: (i) climate risks (physical, transition, and litigation), (ii) environmental risks, and (iii) social risks. All supervised entities must conduct a materiality study identifying and classifying their exposure to each category, reviewed at least every three years. Sustainability risk management must be integrated into the entity’s existing internal controls system and risk management framework, with specific methodologies for identification, measurement, monitoring, and reporting. Entities in the two largest prudential segments (S1 and S2) face enhanced requirements, including long-term quantitative scenario projections and detailed loss records broken down by risk type, geography, and economic sector.

SUSEP Circular Letter n. 666/2022 also integrates sustainability directly into core operations: writing criteria must take into account a client’s track record in managing sustainability risks and capacity to mitigate them; investment selection must consider the sustainability risk exposure of assets and issuers; and supplier selection must account for sustainability risk, with proportional exemptions for smaller entities.

All supervised entities must adopt a written sustainability policy, approved by the highest governance body and publicly disclosed, and publish an annual sustainability report by 30 April of each year, covering actions taken and the most material sustainability risks identified. SUSEP publishes standardised tables, with separate disclosures for climate risks, which must be annexed to the report.

There is no separate statutory ESG disclosure regime for insurers beyond SUSEP Circular Letter n. 666/2022, and no mandatory alignment with international frameworks such as TCFD, though the Circular’s risk integration requirements produce functionally similar outcomes for larger entities.

There is no specific legal or regulatory framework on D&I applicable to (re)insurers in Brazil. Supervised entities are subject to the general constitutional prohibition on discrimination (Article 5 of the Federal Constitution) and to the anti-discrimination provisions of the Consolidation of Labour Laws (CLT) and Law 9.029/1995, which prohibit discriminatory hiring and employment practices on grounds of sex, origin, race, ethnic origin, marital status, family situation, disability, and age.

SUSEP has not issued sector-specific rules on diversity and inclusion, nor has it incorporated D&I metrics into its supervisory framework or prudential segmentation criteria. Publicly listed insurance holding companies may be subject to diversity-related disclosure obligations imposed by CVM, the capital markets local authority, in its reference form requirements, but this flows from their status as listed companies rather than from insurance regulation.

The Brazilian insurance market has grown substantially over the last five years, but growth has been concentrated in some segments. Agricultural insurance, encompassing rural life, crop and livestock coverage, has been the defining type of insurance of the period, with premium volumes growing over 200% since 2019, driven by the expansion of agribusiness and government-backed credit programmes requiring coverage.

Large commercial lines, particularly named and operational risks and oil and gas, have followed a similar trajectory, reflecting the maturation of the corporate risk management culture among larger Brazilian companies. Surety and lease guarantee products have also expanded sharply, as has cyber insurance, which (though still small in absolute terms) has posted the highest growth rate of any line, exceeding 1,000% from a low base.

Looking ahead, the segments with the clearest structural tailwinds are cyber, agro and mass-market personal lines. The last of these represents the most significant untapped opportunity: Brazil’s insurance market remains, by international standards, both expensive and underpenetrated, and the gap between risk exposure and insured risk is widest in the retail segment.

The difficulty is that closing that gap would require genuinely innovative distribution and product design calibrated to local conditions – exactly the kind of structural disruption that banking experienced with the rise of fintechs. Brazil is not a market that generates insurance innovation; it imports models from the United Kingdom, the United States and other established markets and adapts them, often imperfectly, to a very different consumer and regulatory environment. The real transformation, if it comes, will be driven by whoever first develops products and distribution channels that address a consumer base that remains largely unconvinced that insurance delivers genuine value.