Adopts new reinsurance rules

According to Resolution 224 issued by Brazil's National Council of Private Insurance (Conselho Nacional de Seguros Privados) in December 2010, reinsurers that are authorised to operate within Brazil are prohibited from transferring business to an affiliated, intra-group reinsurer that is authorised abroad. According to CNSP, Resolution 225, also issued in December 2010, 40 percent of any reinsurance coverage must be placed with local reinsurers, which are allowed to change terms and conditions without penalty. Prior to this resolution, local insurers had the right of first refusal but now they must take the first 40 percent of coverage and can change policy terms at whim. The rules came into effect on 1 April 2011.

• Type:

  • Treatment and operation (Operational conditions)

• Industry:

  • Services (Financial and insurance activities)

• Sources:

  • National Council of Private Insurance, Resolutions 224/2010 and 225/2010, 06 Dec 2010
  • Economist Intelligence Unit, Brazil finance: Reinsurance rule change for foreign reinsurers , http://viewswire.eiu.com/index.asp?layout=VWArticleVW3&article_id=678059052, 29 Apr 2011
  • Business News Americas , International coalition calls on government to reverse reinsurance rules , http://www.bnamericas.com/news/insurance/international-coalition-calls-on-government-to-reverse-reinsurance-rules, 26 Apr 2011