Through Public Notice 05/2021, the Superintendence of Private Insurance (SUSEP) has placed for Public Consultation a draft Resolution providing for the principles and general characteristics of microinsurance.
According to the draft Resolution, microinsurance involves a classification of insurance operations focused especially on the low-income population and/or individual microentrepreneurs, who are not supported by traditional insurance protection systems.
In view of this, SUSEP establishes that the development of microinsurance operations must be guided by certain special basic principles and values, such as inclusion of the population that are situated outside conventional insurance protection, simplicity of contractual conditions, accessibility and compatibility of the product with its target audience, transparency, proportionality, sustainability, financial education, and innovation in the development of products to best meet the needs of its consumers.
The draft submitted for consultation also sets forth that microinsurance plans can comprise, separately or jointly, both coverage of damages and coverage of people.
Moreover, the draft Resolution also establishes that these products must observe specific requirements such as, for example, (i) adoption of the pay-as-you-go financial system, (ii) structuring of clause wordings written in a simplified language, (iii) clear identification of covered and excluded risks and contractual provisions in general, (iv) do not contain excessive restrictions and excluded risks, and (v) provide deadlines for settlement and regulation of claims compatible with the needs of its target audience.
The Public Consultation will be open until April 7, 2021 and comments and suggestions can be made through an electronic message addressed to email@example.com. Additionally, the table made available by SUSEP itself can be accessed through this link.
The entire draft of the CNSP Resolution can be accessed through the following link.
Demarest’s Insurance and Reinsurance team will continue to monitor the news related to Public Consultation Notice No. 05/2021 of SUSEP’s draft Resolution and is available to provide any additional clarifications that may be necessary.