Skip to main content

Brazil: Contract Formalisation Requirements

In January 2016, the Superintendent of the Private Insurance Superintendence (SUSEP) released Circular SUSEP 524/2016 in order to clarify existing provisions on contract formalisation of reinsurance transactions in Brazil.

Thu 17 Mar 2016

Circular SUSEP 524/2016 addresses a number of uncertainties around the application of Article 37 of CNSP Resolution 168/2007 in response to discussions and concerns previously raised by the local market.

Requirement for date and full signature

Endorsements – as well as original contracts – need to be signed by reinsurers, containing the date and identification of its representative and signatory to achieve contract certainty.

  1. This means that Lloyd’s underwriters have to sign contracts and endorsements with their full names.
  2.  For endorsements, the time frame for contractual certainty (270 days) begins with the validity of the endorsement and is separate from the signing of the original contract. Lloyd’s underwriters are therefore required to add the date of signing to all endorsements.

Formalising contracts and endorsements by electronic means

The Circular clarifies that SUSEP accepts the formalisation of reinsurance contracts to be done electronically, as well as by physical means – this also applies to any changes in terms, conditions and/or prevailing contract terms via endorsements. The cedant’s receipt of a scanned and signed copy of the formal contract, which shall be stored on any electronic or magnetic recording media, is admissible for the purposes of providing contractual certainty. No hard copies need to be stored if electronic copies are saved by the cedant.

Counter signature of cedants waived for contractual compliance

The signing of the reinsurance contract by the reinsurer, containing the date and the identification of its representative and signatory will suffice for contract certainty purposes. However, the waiver for the requirement of the cedant’s signature does not prevent the cedant and/or insurer from agreeing otherwise if it is deemed necessary for their own protection.

Acceptance of terms and conditions by the reinsurance broker

The acceptance of the terms and conditions of a contract by the reinsurance broker will not eliminate the requirement for the cedant to provide express consent for such terms and conditions. Additionally, a cover note issued by a reinsurance broker will not substitute the need for a proper reinsurance contract.

The above provisions also apply to retrocession contracts.

Article 37 of CNSP Resolution 168/2007 (as amended by CNSP Resolution 203/2009) remains in force and the new provisions of Circular 524/2016 complement and clarify the existing requirements. An e-Alert was sent out to managing agents and brokers on 23 February 2016 to highlight the requirement for Lloyd’s underwriters to comply with the new and existing requirements, especially in relation to the requirement of inclusion of date and full signature to original contracts and endorsements.


SUSEP conducts regular audits on (re)insurers operating in and from Brazil. Potential breaches are being investigated and could result in regulatory fines. Managing agents are therefore encouraged to ensure that regulatory standards around the formalisation of reinsurance contracts are maintained at all times.

English translations of Circular SUSEP 524/2016 and its provisions described above are available in Crystal.

Further information and feedback

If you have any queries or would like to provide feedback please contact:

Lloyd's International Trading Advice

Primary point of contact for advice and information
on Lloyd's trading status worldwide.

On site:

Lloyd's International Trading Advice

Lloyd's Desk, Ground Floor, Underwriting Room

+44 (0) 20 7327 6677