The new Brazilian Insurance Act, set to take effect in December 2025, will significantly strengthen insureds’ rights, making contracts more transparent and claims handling faster. Insurers will be required to provide clear and accessible policy wordings, justify claim denials in detail, and adhere to strict response deadlines, including for large risk losses. Failure to do so may result in penalties or claims being automatically accepted. The law also mandates that any ambiguity in policy terms be interpreted in favor of the insured. This shift will empower policyholders and might increase litigation in the short term as market practices adjust, while forcing insurers to overhaul internal processes, invest in staff training, and upgrade systems to ensure compliance and avoid regulatory sanctions.

Brazil’s insurance market may experience a notable increase in products linked to environmental, social, and governance (ESG) criteria. Insurers could introduce more green insurance policies, climate risk coverage, and microinsurance aimed at underserved populations, especially if regulatory pressure and consumer awareness continue to grow. Companies that successfully integrate ESG into their underwriting and claims processes might attract greater investment and customer loyalty, while those slower to adapt could face reputational and regulatory challenges. However, the extent and speed of this shift will depend on evolving market dynamics, regulatory developments, and the willingness of both insurers and consumers to embrace ESG-driven solutions.

Brazil is set to make significant progress towards establishing a national social insurance scheme for catastrophic events, such as floods and landslides. Following devastating climate disasters and a persistent protection gap, the government, through the insurance regulator's dedicated working group and with strong support from Congress and the insurance industry, is working to design a public-private catastrophe insurance model. The scheme will focus on providing rapid, emergency payouts to low-income and vulnerable populations, with eligibility and funding mechanisms shaped by ongoing stakeholder consultations. While full implementation may extend beyond 2026, the year will mark a turning point as Brazil moves from political debate to concrete regulatory proposals and pilot programmes, setting the stage for a more resilient and inclusive disaster response system.

By 2026, the ongoing rollout of Brazil’s open insurance framework may foster a wave of innovation and competition across the sector. If data-sharing protocols and interoperability standards are widely adopted, consumers could benefit from more personalised products, easier policy comparisons, and improved movement between insurers. New entrants, including fintechs and insurtechs, might leverage open data to offer tailored solutions and challenge established players. However, the pace and impact of open insurance will depend on regulatory clarity, industry collaboration, and consumer trust in data privacy and security. If these factors align, open insurance could reshape how Brazilians interact with insurance providers and drive broader financial inclusion.