The insurance market is expanding in Brazil. This means that new insurance rules need to be implemented that is better for both parties.
From January to June of this year, the market grew 19.8% compared to the same period in 2020, with a collection of R$145.1 billion, according to the National Confederation of Insurance Companies. This number surpasses the final result of 2019, before the pandemic, of R$144.7 billion.
In this context, we will talk more about the new rules and why the broker needs to be aware of these changes. Continue reading the text to find out more!
New Insurance Rules: What Are They?
On October 1, insurance can be structured with any validity period and/or with a coverage period within its validity period. This is what Circular 642/21 that was published by Susep establishes.
This circular provides for the acceptance and validity of the insurance and the issuance of minimum contractual documents. Once the rule becomes effective, the issuance and delivery of documents, such as policies and endorsements, will not be mandatory for policyholders upon contracting the insurance.
In addition, the current maximum regulatory period of 15 days for the insurer to manifest itself on the acceptance or rejection of the proposal that was received was removed. That is, if the insurer does not respond within the stipulated days, the proposal loses its validity.
Thus, the date of acceptance of the proposal will be the one that occurs first between the statement printed by the insurer, issuance of the policy, or the certificate of the date of payment of the premium. This is in case of total or partial collection that is made within the established period.
Another point is that there will be a need to fill in and sign the proposal also for cases of automatic renewal.
Conclusion, amendment, or non-automatic renewal of the contract, according to the new auto insurance rules, will only be carried out upon the proposal completed and signed by the proponent, insurance broker, or legal representative. The only exception is in cases of contracting through a ticket.
Essential elements in the proposals
Under the new auto insurance rules, every proposal must have certain elements that are essential for the examination and acceptance of risk. In fact, it will be up to the insurer to provide the broker or legal representative with the protocol that identifies the proposal received by it.
This with the date and time of the indication of its receipt, as a way to keep the process even more formal.
New insurance rules: provisional coverage
According to the new insurance rules, the total or partial collection of the premium before acceptance of the proposal will only be accepted in the event of provisional coverage being offered to the proposer, for claims, during the period of analysis of the proposal and provided that it is expressly provided for in the contractual and requested by the bidder.
If the proposal is accepted, the insurer must consider the security period provisional coverage effective in effect. This, provided that there is such provision of contractual documents.
However, in the event of a denial of risk, provisional coverage must be terminated immediately. The reason for closing in this way must be clearly and prominently indicated in the contractual conditions of the insurance.
Insurance policies, tickets, and certificates that are issued by insurers must contain the names of intermediaries, if any, informing the SUSEP registration number. In its absence, the CPF or CNPJ number.
However, the identification of the beneficiaries and the respective percentages of apportionment of the indemnity, except in the collective policy document. Identification of the insured asset or interest in cases such as damage insurance, if applicable.
Maximum guarantee limit value or maximum indemnity limit of the insured capital of each contracted coverage. Deductibles, grace periods, contracted coverage, and mandatory participation of the insured are applicable to each coverage.
In addition, the taxes directly levied on the premium, when applicable, and the link to register consumer complaints from supervised markets.
New insurance rules: billing
This circular prohibits charging for the issuance of policies, contractual documents, monitoring and recovery of credits, maintenance of records, and other administrative costs, separately from the commercial premium.
As of January 1, 2022, the issuance of contractual documents that do not comply with the discussions in this circular will subject the insurer to applicable penalties.
That is, as much as it starts to take effect even in 2022, it is good to be aware of starting applying the measures of the new insurance rules. Check out other content and news about the insurance market by visiting our blog!