Seminario Regional de Expertos OCDEASSAL:
MEJORAMIENTO EN LA TRANSPARENCIA Y MONITOREO DE
LOS MERCADOS DE SEGUROS - BRASIL
Septiembre/2013
Susep structure
Susep is the regulatory organ for insurance, private pension funds, capitalization and
reinsurance markets, having the following structure:
Ministério da
Fazenda
GMF
Órgãos
Específicos
Singulares
SPE
outros
SE
Órgãos
Colegiados
CMN
Entidades
vinculadas
Autarquias
CNSP
Bacen
CRSNSP
outros
CVM
Susep
Empresas
Públicas
Sociedades de
Economia Mista
Susep structure
Conselho Diretor
Superintendente
GABIN
AUDIT
SEGER
COGER
Procuradoria
DITEC
DIFIS
DIRAT
DIRAD
CGSOA structure
CGSOA is the General Coordination for the off-site
Solvency Monitoring, linked to DITEC, having the
following structure:
COASO
DIREF
DIMAG
CGSOA
DIPEP
COPRA
DISEC
DIMAT
COARI
DIRIS
Market
Market supervisioned by Susep (Dec/2012)
118 insurance companies
25 private pension funds entities
19 capitalization companies
12 local reinsurers
29 admitted reinsurers
61 eventual reinsurers
Brokers (insurance and reinsurance)
Statistics
Total assets (R$ billions)
Dec/2011: 453,04
Dec/2012: 548,80
Premium income (R$ billions)
2008: 88,9
2009: 100,3
2010: 112,9
2011: 132,7
2012: 159,8
Current Premium/GDP (June 2013): 3,62%
Complete statistics are available at:
http://www2.susep.gov.br/menuestatistica/SES/principal.aspx
Statistics
Percentual Participation of the Total Supervisory Market
in GPD from 2003 to 2012
Participação
3.80%
3.60%
3.40%
3.20%
3.00%
2.80%
2.60%
2.40%
2.20%
2.00%
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Data processing
FIPSUSEP
FIPSUSEP is a system used by the companies to send monthly data to Susep
Developed by Susep, contains more than one hundred groups of reports/data
and provide general, financial and actuarial information, in many levels of details
(by company, by lines of business, by policy, by losses)
Data sent remotely in MDB/text format and stored in SQL Servers in Susep
Data from a month are sent until 20th of the next month
Hundreds of checkings are done automatically before sending to Susep
The system can be downloaded at:
http://www.susep.gov.br/menu/informacoes-ao-mercado/envio-de-dados-asusep/fipsusep
Technical Provisions
The provisions are monitored monthly using FIPSUSEP data. Some
statistical provisions are calculated using the companies data, and are
compared to the values shown in their financial report
Anually Susep analyses actuarial avaliations sent by the companies
(Susep is now implementing Actuarial audit)
LAT is semestrally monitored
The assets that guarantee the provisions can be monitored daily
Susep can block the control of these assets according to solvency
analysis results
Capital Adequacy
Main Risks (in order of relevance)
Underwriting
Market
Credit
Operational
Attention => There are other classifications!
Capital Adequacy
Other Risks
Legal => valued with the operational risk
Liquidity => mitigated through actions of
internal controls and risk management
Capital Adequacy
Underwriting
Risk related to the coverages offered and risk
mitigation processes used to manage the insurance
business or the obligations of a pension plan.
Sources:underwriting, processes, pricing, provisioning, product
design, retention policy and policyholder behavior.
Capital Adequacy
Market
Risk related to the Company's exposure to movements
in the level of financial variables.
Sources: proportional to the degree of mismatch between
assets and liabilities.
Capital Adequacy
Credit
Risk of losses associated with the failure of the
borrower or counterparty of their respective financial
obligations under the agreed terms, and / or
devaluation of receivables arising from the
deterioration in the risk rating of the borrower or
counterparty.
Capital Adequacy
Credit
Splitted in two portions:
(1) credit risk associated with receivables from
reinsurers, insurers, EAPC's (pensions companies)
and capitalization companies; and
(2) credit risk of other receivables.
Capital Adequacy
Operational
Operational Risk is the possibility of losses resulting
from failure, deficiency or inadequacy of internal
processes, people and systems or from external
events.
Includes legal risk on the inadequacy / deficiency of
contracts, sanctions for noncompliance with laws and
compensation for damages to third parties arising
from activities of the institution.
Capital requirement
Minimum Capital Required (MCR)
The highest value between the sum of the main
risks and the base capital
The MCR is compared to the available capital
Solvency Monitoring – Microprudential
TOTAL BALANCE SHEET APPROACH
Solvency Monitoring – Microprudential
DISTRIBUTION OF
MCR
MCR - January, 2013
(entire market)
underwriting
credit
operational
3%
21%
76%
 Total MCR = R$ 22,5 billion (without risk correlations)
 Market risk is optional during 2013, being mandatory from 2014
Solvency Monitoring – Macroprudential
The previously displayed classification is established
from the microprudential point of view (insurance
companies).
When we consider the impact on the financial system
as a whole, the importance of risk changes.
Thus, in a macroprudential perspective, the
underwriting risk would be in a lower level of
importance in relation to market risk and credit risk,
operational risk remaining with the same relevance.
Rating
Companies prioritization system analysis
Technical
Provisions
Capital
adequacy
Assets
Analyst avaliation
A, B, C, D, E
Accounting
indicators
Solvency Monitoring
Solvency Monitoring
Pillar 1: large compliance: capital, provisions and
assets rules implementated
Pillar 2: retention limit, actuarial avaliation, risk
questionnaires, auditing, internal control, licensing
procedures
Pillar 3: large compliance: accounting plan, financial
reports and data disclosure (SES)
Solvency Monitoring
Accounting and Actuarial comissions with the market
Agreements with other regulatory organs such as ANS (Health
Insurance), PREVIC (other pension funds), BACEN (banks and other
financial inssitutions), CVM (secutities)
Licensing procedures (analisys on capital, products, board of directors,
business plan, etc)
On-site inspections (internal controls, data quality, products
comercialization, money laundering, accounting procedures, etc)
Group supervision along with BACEN. Recently a new area in CGSOA
was created to develop group supervision.
Solvency monitoring actions
Capital Inadequacy
Corrective plan of solvency
Recovery plan of solvency
Provisions/Assets insufficiency and other problems
Special monitoring regime,operation restrictions, intervention,
liquidation
Other actions
Meeting, fines, blocking of certificate of regularity
Challenges
Market Risk impact
Implementing risk margin
Improving capital market
Improving quality of the assets
Reinsurer monitoring (data bases, accounting standards, etc)
Implementing ORSA (Own Risk and Solvency Assessment)
Solvency Monitoring – Financial Stability
Risks
Mitigation
Solvency of the
individual company
Sistemic
Macroprudetial
(intra and trans)
Microprudential
(individual
company)
Results
Supervision
Regulation
Management
Internal
Controls
Financial Stability
of Macro System
Financial Stability
of the Full System
Solvency Monitoring – Financial Stability
Protection of
policyholders
Insurance
market
efficient,fair,
safe and
stable
Insurance market better
regulated and better supervised
Financial
stability
Thanks!
ditec.rj@susep.gov.br