BRAZIL Law and Practice Contributed by: Thiago Junqueira and Daniel Barreto Gelbecke, Junqueira & Gelbecke Advogados
or arbitral proceedings, suspends limitation periods during the procedure, and gives enforceable effect to settlement agreements. The position varies by contract type. In consumer insurance, mediation may be encouraged but must preserve voluntariness and consumer protection standards. In commercial insurance and reinsurance, where parties enjoy greater contractual autonomy and are professionally sophisticated, mediation is increas- ingly viewed as a useful risk-management and dis- pute-containment tool, often combined with escala- tion or multi-tier dispute resolution clauses. 9.8 Penalties for Late Payment of Claims In general, Brazilian law does not recognise punitive damages in the technical sense, although there are ongoing legislative initiatives of a broader nature seek- ing to introduce such a concept into Brazilian law. Improper delay in claims handling is addressed through specific statutory sanctions. Under the Bra- zilian Insurance Contract Act (Law No 15,040/2024), the insurer must decide on coverage within 30 days from receipt of the claim and required documentation, under penalty of forfeiting its right to deny coverage. Once coverage is recognised, the indemnity must be paid within 30 days. Failure to comply triggers statuto- ry penalties, including a 2% fine and monetary adjust- ments, without prejudice to interest and potential civil liability. Both the 30-day period for coverage determination and the 30-day period for payment may be suspended up to twice for justified requests for additional docu- ments. In cases involving greater complexity (particu- larly large-risk insurance), the supervisory authority may authorise an extension of these deadlines up to a maximum of 120 days. 9.9 Insurers’ Rights of Subrogation After payment of an indemnity, Brazilian law gener- ally grants insurers a right of subrogation in damage insurance, limited to the amount paid. The insurer is subrogated to the insured’s rights against third par- ties responsible for the loss, without affecting the insured’s remaining claim for uninsured losses. The insured must co-operate in preserving and exercising
subrogation rights, and any act that impairs subroga- tion is ineffective vis-à-vis the insurer. Subrogation is restricted in certain situations. The insurer has no right of recourse when the loss results from the negligence of close relatives of the insured or beneficiary, or from employees or persons under the insured’s responsibility, except where the liable party is itself covered by liability insurance. In personal insurance (life and personal safety), there is no subrogation: amounts paid for death or bodily injury do not transfer rights against third parties to the insurer. Insurtech development in Brazil has accelerated, sup- ported by regulatory initiatives such as the SUSEP sandbox, increased investment, and closer collabora- tion between start-ups and incumbent insurers. Most insurtechs operate through partnership models, par- ticularly as MGAs, technology providers or embed- ded insurance platforms, rather than as fully licensed insurers. Collaborations typically involve life, auto, cyber, finan- cial lines and on-demand insurance products, with a strong focus on digital distribution, data-driven underwriting and automated claims handling. Com- mon use cases include usage-based motor insurance, pay-per-use coverage for mobility and consumer goods, embedded insurance integrated into banking and e-commerce journeys, and digital life insurance distributed through brokers and platforms. The Brazilian market is characterised by pragmatic innovation, with insurers providing underwriting capacity and compliance, while insurtechs contrib- ute technology, customer experience and alternative distribution channels. 10.2 Regulatory Response In Brazil, the regulator has adopted a supportive and structured approach to insurtech development. The main initiative is the regulatory sandbox implemented 10. Insurtech 10.1 Insurtech Developments
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