Despite the ongoing controversy surrounding Brazil’s government and the economic difficulties, an initiative is being put in place with the intention to turn the country into a regional reinsurance hub.
Presented recently at the CNSEG annual insurance industry event in Rio di Janeiro, the plan is already gaining attention from the London Market.
Latin America’s Insurance Centre
Much like Dubai for the Middle East or Singapore for Asia, supporters of the initiative aim to turn Brazil into a regional reinsurance hotspot for Latin America. However, doing so successfully will depend on the government relaxing certain tax and labour laws. It has been reported that the government intends to evaluate the initiative over the next few months.
Brazil certainly has the capacity and expertise needed to support greater local insurance needs. They’re a huge economy with the potential to compete on an international level. What they require is a strong agenda for growth and modernisation in order to become recognised internationally and regionally as insurance innovators.
Support from London
While the insurance industry overall is supportive of growth in Brazil, the International Underwriting Association‘s Chief Executive, Dave Matcham, has been especially outspoken.
Brazil in turn is looking to London for support, with the city recognised as a powerful centre of knowledge and the greatest global hub for the insurance industry.
The changes Brazilian insurers are pushing for in their own country will make it much easier for clients to access the London Market. In turn, Mr Matcham has stated that London is “very much open for business from Brazil.”
Over the next few months, expect to hear more about developments in Brazil and their relationship with the London Market. Reportedly, this reinsurance hub project must be sent to the Finance Ministry in Brazil before early June.
If their government is willing to re-evaluate certain laws, it will pave the way for Brazil to become the next international reinsurance hub and double the size of their market.