Low penetration rates, ambitious construction projects and the approach of two world sporting events mean that Brazil is ripe with opportunities for reinsurers. Intelligent Insurer gives an overview of the market.
With the soccer World Cup looming in 2014 and the Olympic Games coming in 2016, Brazil is suddenly on the world’s radar. The forthcoming sporting events have sparked huge infrastructural investments and these, coupled with the Growth Acceleration Program (the Brazilian government’s investment plan that promotes large-scale infrastructure projects) have generated ample opportunities for reinsurers.
“A stable economy and investments to meet the booming consumer market make the situation very favourable for the potential development of the sector,” says Bruno Freire, executive director of Brazilian reinsurer Austral Re. “Our expectation is growing and we hope to achieve more than $220 million of written premiums in 2013.”
Brazil presents reinsurers with huge growth potential because, despite being the largest reinsurance market in Latin America, penetration rates are very low. Wider global factors have only increased its attractiveness.