Zurich Starts Brazil Reinsurer Ahead of World Cup, Olympic Games
Zurich Financial Services AG (ZURN) will invest 100 million reais ($63 million) to start a reinsurance unit in Brazil as the nation prepares to host the 2014 Soccer World Cup and the 2016 Olympic Games.
The division will provide reinsurance for its local business in Brazil written by the firm’s Zurich Minas Brasil unit and will not provide reinsurance services to third parties, according to spokeswoman Sylvia Gaeumann.
Brazil plans to invest in infrastructure to prepare the nation to host the World Cup and the Olympics, the world’s biggest sports events, Sports Minister Orlando Silva said on June 15. Investment in airports, stadiums, ports and urban transportation before the World Cup will total about 23 billion reais, Silva said. Most of the funding will come from the government.
“The Brazil reinsurance market is attractive as substantial investments in infrastructure are expected in the short term, not only because of economic and demographic growth, but also due to large events that will take place in Brazil, such as” the World Cup and the Olympics, Gaeumann said in an e- mailed statement. The insurer expects Brazil to have annual gross domestic product growth of as much as 5 percent in the coming years.
The license for the reinsurance company allows for the coverage of general insurance and life products, Gaeumann said. Zurich Financial, Switzerland’s biggest insurer, doesn’t publish its sales figures for Brazil.
To contact the reporter on this story: Carolyn Bandel in Zurich at cbandel@bloomberg.net.
To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net.
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