New circular on the offer and transfer of reinsurance risks and insurance contracting abroad.

The Superintendence of Private Insurance (“SUSEP”) published SUSEP Circular No. 683/2022, which consolidates procedures related to reinsurance operations, previously provided for in sparse regulations as well as modernizes and conforms its provisions to the legislation in force concerning:

• preferential offer of risks to local reinsurers;
• proof of insufficient capacity supply of local and international reinsurers for the purpose of transferring risks with reinsurers that are not authorized to operate in Brazil; and
• contracting of insurance abroad.

Regarding the new Circular, we highlight the following provisions:

• Proof of “insufficient supply”: change in the initial period of 30-day counting period for communication about the operation to SUSEP, which was previously on the date of acceptance. As of the new rule, the counting period will begin on the contract’s initial date of effectiveness or coverage’s initial date of effectiveness, whichever is the later.
• Waiver from the obligation to submit the reinsurance and retrocession contract to SUSEP after the operation is formalized. Custody of the document by the assignor will be sufficient to comply with the regulation.
• Regarding operational procedures, reinsurers are exempted from providing an electronic address to SUSEP in order to receive formal consultations.

The Circular will enter into force on January 01, 2023 and will repeal the following rules:

I – SUSEP Circular no. 524/2016

II- SUSEP Circular no. 545/2017

III- SUSEP Circular no. 562/2017

IV- SUSEP Circular no. 603/2020

V – Electronic Circular Letter CGRES/DIR1/SUSEP No. 1/2020

Demarest’s Insurance, Reinsurance, Health and Private Pension team is available to provide any further clarifications that may be necessary.