Brazil Tax Reform Creates Uncertainty for Insurance Sector

Brazil's tax reform replacing PIS/Cofins with IBS/CBS and ending IOF on insurance will raise the sector's initial tax rate from 4.68% to 10.85%, though non-cumulativity and credits may offset this. The net impact is uncertain and varies by line of business and client profile, requiring operational adjustments and contract reviews. This signals potential cost pass-through and margin pressure for insurers, with implications for pricing and competitiveness.