INSURANCE

The insurance sector in BRICS countries presents a compelling growth narrative due to low penetration rates, expanding middle classes, and increasing awareness of financial protection. However, international corporations face formidable barriers including regulatory opacity, protectionist tendencies, and mandatory local partnerships or shareholding limits. In markets like China and India, foreign insurers must navigate slow-moving licensing processes, restrictions on capital movement, and state-favored domestic incumbents. Regulatory frameworks are often underdeveloped or unevenly enforced, exposing firms to compliance ambiguity and reputational risk.

Over the last five years, international insurers have experienced varied outcomes. China has gradually relaxed foreign ownership caps in life insurance, allowing companies like Allianz to gain full control of local operations, albeit within a tightly regulated environment. In contrast, AXA exited the Indian joint venture market in 2022, citing strategic misalignment and market challenges. Brazil’s market has seen growth in digital insurance products, with foreign-backed insurtechs making headway despite inflation and political instability. Russia’s insurance sector effectively closed to Western firms following sanctions, while South African insurers have struggled with systemic risks such as high crime rates, fraud, and state-owned enterprise failures affecting reinsurance dynamics.

Key systemic challenges across BRICS include underdeveloped actuarial data, natural catastrophe exposure, and rising demand for cyber, climate, and health-related coverage—without adequate local capacity or risk modeling. Political interference, sudden product approvals or bans, and divergent solvency requirements add to operational unpredictability. Foreign insurers must not only adapt to regulatory and cultural environments but also establish deep crisis resilience strategies to withstand macroeconomic shocks and reputational fallout