Insurance Market in Brazil
The history of the insurance industry in Brazil started with the opening of ports for international trade in 1808. The first insurance company to function in the country was Companhia de Seguros Boa Fe, which intended to run in maritime insurance. During this period, Portuguese laws regulated the insurance activity. In 1850, the market started to develop, attracting foreign insurance companies, and countless insurance companies began to operate in other sectors.
At that time, to protect the country´s economic interest, laws were created for multinational life insurance companies. In 1939, the government founded the Brazilian Reinsurance Institute (IRB) and established a monopoly in the reinsurance industry. Only in 2007, the company lost its exclusivity, but the company still has more than 70% of profits in the reinsurance industry. Susesp is currently the official inspecting body for insurance operations, and its task is to act in the regulation, supervision, review, and incentive of insurance activities.
Even with low previsions of economic growth, the insurance market in Brazil can grow in the next years. With competition between the sectors increasing every year, one of the segments within insurance that most grow in Brazil is car insurance, which is essential to protect people’s property. Brazil is ranked in 9th place manufacturing cars, where it produces more than 2 million vehicles per year. Although the industry is increasing, people still think that car insurance is expensive (about $1,000 per year).
Still, there are more than 17 million automobiles insured in a population of approximately 200 million. States that share a border with other countries are typically the most expensive to acquire insurance, where there is the ease of cars vanish, which makes it difficult for the Brazilian authorities. Therefore, the risk is associated with price in this case in states such as Acre, Amazonas, Roraima, Pará, Amapá, Rondônia, Mato Grosso, Mato Grosso do Sul, Parana, and Rio Grande Do Sul.
The Brazilian insurance sector leads the Latin American market in revenue collection (premiums represents about 6.5% of the GDP). It ranks in the 14th place of the biggest insurance market in the world. Nevertheless, by 2020, it has the chance to move to the 8th position. Founded in 1945 as a small insurance company, Porto Seguro is currently the leader in the auto and residential segment in Brazil and its portfolio totals 8.5 million unique customers. Revenue of R$17.9 billion — a 5.3% increase over 2017.
