Terra Report. Report on the Brazilian Reinsurance Market. number 15. Issue. March Index:

Transcription

1 Issue number 15 March 2015 Publication Data: June 16th, 2015 Index: Terra Report... 1 Introduction... 2 Brazilian General Insurance Market... 3 Brazilian Reinsurance Market 7 Results of Local Reinsurers. 13 Results by Lines of Business 22 Group: Property Group: Financial Risks Group: Rural Group: Liability Exhibit 1: Brazilian Insurance Segments per Susep s Classes27 Exhibit 2: List of Technical Terms Exhibit 3: Main Indexes of Local Reinsurers Acknowledgements Ratings A.M. Best B++ Global (Investment Grade) Standard & Poor s bra+ Local Terra Report Report on the Brazilian Reinsurance Market Even though the Brazilian Reinsurance Market is the focus of Terra Report, as we traditionally do, we start this issue by quickly elaborating on the composition and recent development of the Brazilian insurance market. In the 12 months aggregate ending in March 2015, the volume of the Brazilian reinsurance market (gross of commission) was BRL 9.37bn against BRL 8.51bn registered in the same period of 2014, an annual growth of 10.1%. For the 12 months aggregate ending in March 2015, the reinsurance volume (gross of commission) written by local reinsurers reached BRL 7.05bn, corresponding an increase of 26.2% in relation to the BRL 5.59bn in the same period of the previous year. It is also noted a high premium growth from Foreigner Insurance companies to Brazilian Local Reinsurers. In the first quarter of 2015 this volume of reinsurance totalized BRL 75 million against BRL 15 million of the previous year, a growth of 397%. In the first three months of 2015, Local Reinsurers produced a net profit of BRL 193 million, in contrast to a net profit of BRL 44 million registered in the same period of In this period, IRB profited BRL 128mm, while the other Local Reinsurers reported a positive result of BRL 65mm. 5 year average annual growth by segment (2009 to 2014) Shareholders Source: SUSEP, ANS, Terra Brasis Re

2 Introduction Dear reader, As we do every year, this edition of Terra Report brings a brief analysis on the composition and evolution of the Brazilian Insurance Market in We can observe a clear deceleration in premium growth across market segments. In any way, even though the market is now growing at an annual rate of 10% and not anymore at 20%, it is still a sector growing above GDP. Given the challenging current conditions of the Brazilian economy, this should still be considered a positive result. As we expected, the growth in the Reinsurance segment remains above that of the P&C Corporate segment, as Brazilian insurers continues to gradually implement reinsurance in their operations. This edition also brings an analysis of the first quarter of Reinsurance premium growth remains around 10%, unchanged from the end of The market share of foreign reinsurers doing business in Brazil has gone down in the first quarter of Nevertheless, it is worth mentioning that three months is rather a short period to analyze and the data might contain accounting distortions. A couple of additional months will be needed to verify whether this is in fact a trend. The first quarter produced good results for the Local Reinsurers, both for the IRB, as well as, for the other Local Reinsurers. The market as a whole showed an after tax profit of BRL193mm, versus BRL44m for the same period of Nevertheless, concerns are still present among market professionals over medium term results. Competition remains fierce, with global liquidity still pressuring rates. The Brazilian economy and political scenario, including the unfolding results from the ongoing investigations, is another focus of apprehension, especially for the D&O and Surety segments. Happy reading, Rodrigo Botti, ARe Chief Financial and Operating Officer Terra Brasis Resseguros 2

3 Brazilian General Insurance Market Even though the Brazilian Reinsurance Market is the focus of Terra Report, as we traditionally do, we start this issue by quickly elaborating on the composition and recent development of the Brazilian Insurance Market. For a more extensive analysis refer to the December 2012 issue of Terra Report. As previously mentioned, to analyze what is usually called the Brazilian Insurance Market is not straightforward. Often the definition of insurance market includes pension products and premium bonds ( Capitalização ). Other times, health insurance is left out as it is not regulated by SUSEP, but by the ANS. Therefore, we believe that to properly analyze the market it is necessary to break it down into different segments. We defined eight segments, as shown and described below. In Exhibit 1 we show the parameters used in this classification Gross Written Premium and Contribution per Segment (BRL billion) Source: SUSEP, ANS, Terra Brasis Re. For health insurance only insurers were considered, health plans were excluded. Analyzing at the growth of these different segments we can observe a less and more homogenous growth of the majority of the segments in 2014 compared to Roughly speaking, the segments grew last year by about 10% and not more at a 20% pace. Premium Growth per Segment in 2014 Premium Growth per Segment in 2013 Source: SUSEP, ANS, Terra Brasis Re, Banco Central do Brasil Source: Susep, ANS, Terra Brasis Re, Banco Central do Brasil However, the vast majority of segment continues to grow at a higher pace than GDP, the only exceptions being P&C Corporate and Premium Bonds segments. Retirement Funds and Other segment are the only segments that grew more in 2014 than in For Retirement Funds that is a result of a very bad growth results in

4 The Other segment growth in 2014 deserves a more in depth investigation. In 2014, within the DPVAT category, the insurance premium started to take into account consortia and DPVAT funds. This change may have been made for compliance with the new Chart of Accounts, as amended by Circular 483/2014. Thus, the volume of DPVAT premium between 2014 and 2013 doubled, distorting the Other segment. The table below illustrates. Detailing of Other Segment Other /13 Insurance Personal Injury caused by Motor Vehicles - DPVAT % Rural % Surety % Credit % Rental Insurance Bond % Stop Loss % Other % Total % Source: Susep, Terra Brasis Re Looking at a longer-term horizon, it is possible to note that all segments continue to show a growth above Brazilian GDP Economy. We believe this behavior should continue for a number of years. Average Annual Growth Over the Past 5 years per Segment (2009 to 2014) Source: SUSEP, Terra Brasis Re, ANS, Banco Central do Brasil 4

5 Now we follow with our usual analysis. The General Insurance Market, as per the methodology presented on Exhibit 1, showed a stable pace of growth of the premium during the first three months of 2015, after a period of significant drop in growth rate. For the 12 months aggregate ending in March 2015, the Brazilian Market generated BRL 85.0bn in insurance premium (general insurance) compared to BRL 79.7bn registered in the same period of the previous year, representing an annual growth of 6.6% versus 15.5% of the twelve months aggregate ending in March Evolution of Insurance Written Premiums (BRL bn) Growth of Insurance Written Premiums The loss ratio, obtained as a result of occurred losses over earned premium from the Income Statement of all the insurers from the Brazilian market, showed stability in the first three months of In the 12 months aggregate ending in March 2015, the loss ratio stood at 49.1% against 49.2% in the same period of the last year. Loss / Earned Premium Commercial Expense / Earned Premium Note: Percentage Values Referring to the Official Insurance Market Fonte: SUSEP, Terra Brasis Re, acumulado de 12 meses Obs: Valores percentuais referentes ao mercado oficial de seguros The commercial expense ratio also showed stability at the beginning of 2015, reaching 23.4% in the 12 months aggregate ending in March compared to 23.2% of the same period of

6 In the 12 months aggregate ending in March 2015, the administrative expense ratio (including taxes and other expenses) reached 15.1% the same level of December 2014, and above the 12.1% recorded in March (Administrative, Tax and Other Expenses) /Earned Premium Reinsurance Result / Earned Premium Note: Percentage Values Referring to the Official Insurance Market Note: Percentage Values Referring to the Official Insurance Market In the 12 months ending in March 2015, the Reinsurance Result Ratio, defined as reinsurance result divided by earned premium, stood at 1.4% against 2.2% of the same period of It means during the 12 months ending in March 2015, Insurance Companies incurred in lower expenses with reinsurance when compared with the same period of The Combined Ratio, including the reinsurance result ratio, showed a worsening, closing the 12 months ending in March 2015 in 89.1% compared to 86.7% registered in the same period of 2014, it was influenced by the correction in the administrative expense ratio, as mentioned in the December issue of Terra Report. Combined Ratio, Including Reinsurance Result 6

7 Brazilian Reinsurance Market In the twelve months aggregate ending in March 2015, the volume of the Brazilian reinsurance market (gross of commission) was BRL 9.37bn against BRL 8.51bn registered in the same period of 2014, an annual growth of 10.1%. The figures presented at the beginning of this year show that the downward pace of the Brazilian Reinsurance Market is not only due alterations in the renewals calendar of some Brazilian Insurers, as commented in the previous issue of Terra Report. Although the results reported in the first quarter of 2015 by Brazilian Insurers have been good, it was not enough to compensate the sharp drop occurred in December Month Aggregate Reinsurance Premium Ceded (Gross of Commission, BRLbn) The proportion of reinsurance ceded over insurance premium remained stable during the first quarter 2015, closing the period in 11.0% in line with the 10.9% of Nevertheless, this index still remains above the 9% to 10 interval, which was present at least since the opening of the market in Growth of Reinsurance Premium Ceded Reinsurance Premium / General Insurance Premium 7

8 The twelve-month aggregate coinsurance premium volume ending in March 2015 stood at BRL 2.21bn, a drop of 0.6% compared to the BRL 2.23bi recorded in the same period of the previous year. 12-Month Aggregate Coinsurance Premium Ceded (BRLbn) Coinsurance premium volume in the twelve months aggregate ending in March 2015 represented 2.6% of the general insurance premium volume compared to 2.8% registered in the same period of Growth of Coinsurance Premium Ceded Coinsurance Premium / General Insurance Premium For the twelve months aggregate ending in March 2015, the reinsurance volume (gross of commission) written by local reinsurers reached BRL 7.05bn, corresponding an increase of 26.2% in relation to the BRL 5.59bn in the twelve months ending in March Reinsurance (Gross of Commission) Written by Local Reinsurers 8

9 The local Market closed the twelve months aggregate ending in March 2015 detaining 75.2% of the volume ceded by Brazilian Insurers, almost 10 percentage points above the 65.6% recorded in the same period of Growth in Reinsurance Premium Ceded to Local Reinsurers by Brazilian Insurers Gross Reinsurance Premium Ceded to Local Reinsurers as Percentage of Total Reinsurance Premium Ceded Looking now at the first three months of 2015, Brazilian insurers generated R$ 2.23bn in ceded reinsurance, corresponding to an increase of 13.2% in relation to the same period of 2014, when they generated R$ 1.97bn. The reinsurance written (gross of commission) by local reinsurers during this three months of 2015 stood at R$ 1.74bn, corresponding to an increase of 48% compared to the same period of During this period, the volume of reinsurance (gross of commission) written by IRB was 121% higher than the previous year, other local reinsurers showed a growth of 19%. In the same period, the reinsurance written (gross of commission) by foreigner reinsurer (Admitted and Occasional licensed) dropped 39%. It is also noted a high premium growth from Foreigner Insurance companies to Brazilian Local Reinsurers. In the first quarter of 2015 this volume of reinsurance totalized BRL 75 million against BRL 15 million of the previous year, a growth of 397%. Premium Ceded by Brazilian Insurers and Premium Received by Local Reinsurers from January to March 2015 and 2014 (BRL mm) Source: SUSEP, Terra Brasis Re 9

10 The following flowcharts show the volume of reinsurance premiums and retrocession, gross of commission, in the Brazilian market in the first quarter of 2015 and Reinsurance Flow in the Brazilian Market January to March 2015 and 2014 (Gross of Commission, BRL mm) Source: SUSEP, Terra Brasis Re, BRL millions, reinsurance gross of commission figures In the first three months of 2015, the Local market received 78% of the reinsurance volume ceded by the Brazilian market, in contrast with 60% from the same period in Of this total, the Brazilian reinsurance market retroceded 44.5% against 50.7% reported in the same period of the previous year, retained BRL 1 billion compared to R$ 595 million stated in the same period of On the following page we illustrate the annual flowchart of reinsurance flow from 2007, the last year of the monopolist regime in the Brazilian reinsurance market. 10

11 Reinsurance Flow in the Brazilian Market since 2007 (Gross of Commission, BRL mm) Source: SUSEP, Terra Brasis Re, BRL millions, reinsurance gross of commission figures *For 2008 the ceded retrocession premium by Local Reinsurers was incorrectly reported in previous editions of Terra Report BRL 914 million. The correct value is BRL 1,937 million 11

12 IRB ended the first three months of 2015 with a market participation of 34%, the other local reinsurers 44% and foreigner reinsurers 22%. Reinsurance Market Share (gross of commission ) generated by Brazilian Insurers Source: SUSEP, Terra Brasis Re Gross Reinsurance Premium Ceded by Brazilian Insurers Participation in the Gross Reinsurance Premium Ceded by Brazilian Insurers Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate 12

13 Results of Local Reinsurers The figures to March 2015 have shown a good start of year for Brazilian Local Reinsurers. It is noted an improvement in the loss ratio and a Combined Ratio under 100%, in addition to an enhancement to profitability as measured by the ROE (return on equity). For the twelve months aggregate ending in March 2015, the Loss Ratio experienced by the local reinsurance market reached 74%, a decrease of 15 percentage points relative to the level of 89% registered in the same period of It is worth emphasizing that this is the Gross Loss Ratio, calculated as gross occurred losses divided by the gross earned premium (i.e. gross of retrocession, net of commission.) Loss Ratio: Occurred Losses/ Earned Premium Commercial Expenses/ Earned Premium Source SUSEP, Terra Brasis Re, 12-month aggregate The commercial expense ratio, for the twelve months aggregate ending in March 2015, showed a slight worsening, ending the period in 2.1% compared to 1.8% in the twelve months aggregate ending in March In the same period, the administrative expense ratio (including taxes and other expenses) stood in 11.6% against 10.9% registered in the same period of 2014, showing a slight deterioration. (Administrative, Tax and Other Expenses) / Earned Premium Retrocession Result / Earned Premium The retrocession results ratio, for the twelve months aggregate ending in March 2015, reached 8.8% against 1.7% for the twelve months aggregate ending in March

14 The Combined Ratio (including retrocession result index) shows improvement at the beginning of this year. For the twelve months ending in March 2015, the ratio reached 96.6% compared to 103.5% registered in the same period of Combined Ratio, with Retrocession Result Ratio It is also observed an improvement in the Combined Ratio for the IRB, as well as, for other local reinsurers. This improvement in the Combined Ratio of Other Local Reinsurers occurred despite the start of the operation of a number of new reinsurers in 2013 and 2014, which as with any reinsurer in the initial phase of operation have a very high Combined Ratio. Combined Ratio Local Reinsurance Market Combined Ratio IRB and Others Locals Source: SUSEP, Terra Brasis Re Source: SUSEP, Terra Brasis Re 14

15 We Show below the summary of results for local reinsurance Market in the first quarter of 2015 and Summary of Results and Main Indexes for Local Reinsurers for January to March 2015 and 2014 Source: SUSEP, Terra Brasis Re, numbers in BRL thousand In the first three months of 2015, Local Reinsurers produced a net profit of R$ 193 million, in contrast to a net profit of R$ 44 million registered in the same period of In this period, the IRB profited R$ 128 mm, while the other local reinsurance reported a positive result of BRL 65 mm. Net Profits January to March (BRL mm) Total Local Reinsurers Net Profits January to March (BRL mm) IRB and Others Locals Source: SUSEP, Terra Brasis Re Source: SUSEP, Terra Brasis Re As mentioned in previous issues, the current group of Other Local Reinsurers is not homogeneous and, therefore their analysis becomes more complex. This way, we continue the analysis of reinsurers based on their operation start, what we called Class Comparing the first quarter of 2015 with 2014 it is possible to see an improvement in the net profit of all class. However, the reasons for this progress are different. Only IRB and Class of 2012 have shown an improvement in the Loss Ratio and Combined Ratio, factors that contributed to a significant enhancement in the Reinsurance Operation result. 15

16 Summary of Results and Main Indexes for Local Reinsurers for January to March 2015 and 2014 by Class Source: SUSEP, Terra Brasis Re The Class of 2008 and 2010 showed a decrease in their index, being the positive subscription result for the Class of 2010 affected by the positive result with retrocession operation, probably because loss recoveries from retrocessionaries surpass the premium paid to them within the period. Main Index for Local Reinsurers classified by Class Source: SUSEP, Terra Brasis Re In terms of production, IRB showed an expressive growth when compared with the same period of the previous year. The tables below represent the summary of results of Local Reinsurers for the first three months of 2015 and

17 Summary of Results Local Reinsurers for January to March 2015 and 2014 (BRL mm) Total Local Market, IRB and Other Locals Source: SUSEP, Terra Brasis Re (1) R.O.E. Defined herein as annual net income divided by the shareholders equity of the end of the period. 17

18 Summary of Results Local Reinsurers for January to March 2015 and 2014 (BRL mm) JM, Munich, Mapfre and XL Source: SUSEP, Terra Brasis Re (1) R.O.E. Defined herein as annual net income divided by the shareholders equity of the end of the period. 18

19 Summary of Results Local Reinsurers for January to March 2015 and 2014 (BRL mm) ACE, Austral, AIG and Zurich Source: SUSEP, Terra Brasis Re, (1) R.O.E. Defined herein as annual net income divided by the shareholders equity of the end of the period. 19

20 Summary of Results Local Reinsurers for January to March 2015 and 2014 (BRL mm) Markel, Swiss, Terra Brasis and Allianz Source: SUSEP, Terra Brasis Re, (1) R.O.E. Defined herein as annual net income divided by the shareholders equity of the end of the period. 20

21 Summary of Results Local Reinsurers for January to March 2015 and 2014 (BRL mm) BTG, Scor and AXA Source: SUSEP, Terra Brasis Re, (1) R.O.E. Defined herein as annual net income divided by the shareholders equity of the end of the period. 21

22 Results by Lines of Business In this section we will analyses the different lines of business in the Brazilian Market. In contrast of the previous sessions of this report that is based on data of the Income Statement from insurance and reinsurance companies, in this section the information deriving from the Table of Operations (TO) of SUSEP s databank was used. General Insurance and Reinsurance Premiums for January to March 2015 and 2014 (BRL mm) Source: SUSEP, Terra Brasis Re, data obtained from the Table of Operations (TO) It is important to mention that discrepancies exist between the values of the Table of Operations and the Income Statements from insurance and reinsurance companies. As illustrated in the chart below, until the end of 2011 both historical series were fairly similar. From 2012, the series has started to diverge. Ceded Reinsurance by different data sources Throughout our analysis we prefer, whenever possible, to use data deriving from the Income Statements. Whereas these reports are periodically audited, we believe that data consistency is higher than the values contained in the Table Operations. However, for the business lines analysis of the following pages, the Table Operation is the single data source. 22

23 Group: Property Insurance Premium Growth of Insurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium Growth of Reinsurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium / Insurance Premium Split of Reinsurance Premium by Type of Company Source: SUSEP, Terra Brasis Re, BRL billions 12-month aggregate Loss Ratio: Insurers Loss Ratio: Local Reinsurers 23

24 Group: Financial Risks Insurance Premium Growth of Insurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium Growth of Reinsurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium / Insurance Premium Split of Reinsurance Premium by Type of Company Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Loss Ratio: Insurers Loss Ratio: Local Reinsurers 24

25 Group: Rural Insurance Premium Growth of Insurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium Growth of Reinsurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium / Insurance Premium Split of Reinsurance Premium by Type of Company Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Loss Ratio: Insurers Loss Ratio: Local Reinsurers 25

26 Group: Liability Insurance Premium Growth of Insurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium Growth of Reinsurance Premium Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Reinsurance Premium / Insurance Premium Split of Reinsurance Premium by Type of Company Source: SUSEP, Terra Brasis Re, BRL billions, 12-month aggregate Loss Ratio: Insurers Loss Ratio: Local Reinsurers 26

27 Exhibit 1: Brazilian Insurance Segments per Susep s Classes Below are definitions by Terra Brasis, of the segments referring to different lines of business supervised by SUSEP. The lines in grey denote lines of business that are deactivated or in rundown. In this report, for the definition of General Insurance, the classes related to DPVAT were excluded, since we believe that such classes should be an independent category. Other classes related to VGBL, which Terra Brasis believes should be presented together with other Retirement Plan modalities, were also excluded. Segmentation of the Brazilian Insurance Market Under SUSEP Supervision Source: SUSEP, Terra Brasis Re 27

28 Exhibit 2: List of Technical Terms Here follows an initial dictionary with the definitions that we used in this report for certain reinsurance terms. We intend to add to the list as the work progresses and believe that this would be worthwhile since several reinsurance terms have been used with different meanings. Brazilian General Insurance Market: It is the market comprising insurance operations in accordance with official regulation by SUSEP, except for those classified in the DPVAT and VGBL modality. Brazilian Reinsurance Market: It is formed by operations comprising cessions of reinsurance ceded by Brazilian insurers and assumed by reinsurers that are authorized to operate in Brazil and classified as local, admitted, or occasional. Local Reinsurance Market: It is formed by operations comprising reinsurance business assumed by local reinsurers. Written Premium or Gross Written Premium: It is the value of the premium written by Insurers or Reinsurers, before reinsurance or retrocession deductions. In the case of reinsurers, as of May 2011, it is net of commissions paid to Cedants. Net Written Premium: It is the premium written less the premium for reinsurance or retrocession. Reinsurance Premium or Gross Reinsurance Premium: The same as Written Premium or Gross Written Premium by the reinsurers. Although, by definition, this value is net of commission paid to cedants, temporarily, in this Terra Report, we indicate whether the reinsurance premium is net or gross of commission. Net Reinsurance Premium: It is the premium written by the reinsurer less the ceded retrocession premium. As per the above item, temporarily in this Terra Report, we indicate whether the reinsurance premium is net or gross of commission. Commission: It is the value that the reinsurer or retrocessionaire pays to the cedant, with the objective of covering part of the expenses incurred in the administration and production of the business. Brokerage: It is the value paid to the broker ( broker ) in compensation for the intermediation of the insurance, reinsurance, or retrocession. Overriding: It is the part of the commission paid to cedants in addition to their incurred commercial expenses. 28

29 Exhibit 3: Main Indexes of Local Reinsurers Source: SUSEP, Terra Brasis Re Main Ratios From Local Reinsurers fom January to March of 2015 and

30 Acknowledgements It is with enthusiasm that we continue to publish our market report, Terra Report, a research piece covering the Brazilian Reinsurance Market, which we share with our clients, partners, and colleagues. We are immensely grateful to SUSEP for making its databank available to the public. We also thank ANS and CNSeg for information used herein. The report also contains analyses and adjustments made internally by Terra Brasis and in this way, we apologize in advance for possible inaccuracies contained in this publication. We hope our readers appreciate this work as much as we appreciate developing it. Without a doubt, it is extremely gratifying to be involved in the Brazilian reinsurance market at such an important moment of its development. Any criticism, comment, or suggestion for this work is very welcome. 30

31 Contacts Name Title Telephone Paulo Eduardo de Freitas Botti Chief Executive Officer Bernardo Nolasco Chief Investment Officer Carlos Roberto De Zoppa Technical Executive Vice President Rodrigo Botti, ARe Chief Financial and Operations Officer Luiz Pestana Chief Commercial Officer Paulo Hayakawa Chief Underwriting Officer Priscila Grossi Risk Analyst Gustavo Palheiro Trainee

32 Offices São Paulo Av. Presidente Juscelino Kubitschek, 1700, 12º Andar Itaim Bibi, São Paulo, SP This document was prepared by Terra Brasis Re S.A. ("Terra Brasis Re") for informational purposes only. Terra Brasis Re, its partners, companies under common control, its directors, employees and agents do not express any opinion, do not guarantee, nor assume any responsibility for the adequacy, consistency, or completeness of any information contained herein or any omission regarding this report. This publication is also not designed to be a complete statement or summary of markets or strategies discussed in this document. None of the people mentioned in this paragraph shall be liable for any loss or damage of any kind arising from the use of the information contained herein, or which may be obtained by third parties by any other means. Terra Brasis Re should not be construed as providing financial, tax, or legal advice. The information contained herein was obtained from public sources, and Terra Brasis Re has not conducted an independent verification of this information. Any projections or forecasts contained in this report are based on subjective estimates and assumptions about events and circumstances that have not yet occurred and are subject to significant variations. Thus, it is not possible to ensure that results from any projections or forecasts contained in this document will be effectively verified. This publication is only valid on the date hereof, and future events could undermine its conclusions. Terra Brasis Re assumes no responsibility to update, revise, amend or cancel this publication due to any future event, unless previously requested. It is not the obligation of Terra Brasis Re to implement the procedures in this document, nor is Terra Brasis Re responsible for any inaccuracies in any negotiations or transactions relating to this report. No investment or financial decision should be based solely on the information presented here. All information contained in this report should be kept strictly confidential and can only be released, quoted, or reproduced in whole or in part, with the prior written consent of Terra Brasis Re for people who have agreed to treat such information as confidential