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Legal changes boost Brazil surety

26 February 2014

Surety insurance in Brazil has posted remarkable growth rates in recent years. A mix of legal changes with infrastructure investments should keep the wind behind its sails in the near future.

The development of the surety market in Brazil has been protracted in South America’s largest economy, but it has picked up steam at the past two years, growing at a much faster rate than the insurance sector as a whole.

Estimates by Brazil’s Superintendence of Private Insurance (Susep) and market players indicate that, in 2013, the surety market breached the mark of BRL1bn in premiums after an expansion of over 30% in a single year. Premiums had been stuck at between BRL700m and BRL800m for some years, with the product remaining little understood in Brazil. However, this situation now is changing quickly, according to Liliana Márquez, director of financial risks at Berkley in Brazil.

"The sector has grown fast and the market and buyers have recognised the value that the product adds," she said.

For a long time the surety market was constrained by the restrictions created...

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