Could disasters in the South impact the price of property insurance for beneficiaries across the country?

The natural disasters caused by storms in Rio Grande do Sul – which have already left 100 dead and various damages – are affecting, among other sectors, the insurance market. Given the damage to homes, vehicles and other assets, the segment is expected to reach a record number of claim payments, which – in the future – could impact all beneficiaries. As a way of mitigating losses, insurers will be able to share them with customers.

“Usually the impact affects everyone, because insurance is based on the principle of mutualism between participants. However, this depends on the planning of each insurer in the region. However, it is understood that everyone could be affected in the future. In fact, the tendency is for insurance companies to be even more involved over the next few days,” explains the head of insurance at iHUB Investimentos, Bruno Saraiva.

Regarding the possibility of insurers readjusting the price in cases of increased demand, such as in Rio Grande do Sul, Bruno highlights that this is not allowed. “They cannot increase the price of services, as these are risks calculated and purchased by them. Therefore, the claim is due if the service was previously contracted. Of course, according to the general conditions and contractual rules, the services may have some adjustments at the time of contract renewal.”

When asked whether it is recommended that the beneficiary activate the insurance immediately or wait for the losses to be recorded, Bruno states that the best way is to activate the claim as soon as possible. “However, it is necessary to pay attention to the deadline for applying after the event. Car insurance, for example, is for a maximum of one year. The sooner you activate it, the better it is. But it’s also a good idea to look for a trustworthy broker and better understand the coverage contracted with the policy,” he explains.

Balance

The National General Insurance Federation (FenSeg) has not yet been able to count the number of requests and the total compensation that must be paid to beneficiaries. According to the entity, infrastructure problems in the state impact the evolution of services and data collection. A partial balance sheet is scheduled for next Friday (10/5).

The National Confederation of Municipalities (CNM) stated that, until this Tuesday (7/5), the financial losses exceeded the estimate of R$ 4.6 billion, with the record of 99.8 thousand houses damaged or destroyed in the gaucho state. The data is partial, as there are still submerged cities, and could increase exponentially as the water level begins to drop. According to the confederation, the agriculture sector was the private area with the greatest loss, estimated at R$435 million.

Measurements

CNseg reported that, due to the situation in Rio Grande do Sul, it made an appeal to its members to extend insurance contracts in all segments whose expiries fall between May 1st and 10th, with the expansion of this period also applying to invoices issued due during this period, without compromising the fulfillment of contract coverage. By the time the statement was released, 16 insurers had already adhered to the request and announced additional measures.

Catastrophe insurance

CNSeg reported that, in a public hearing at the Special Committee on Prevention and Aid to Disasters and Natural Calamities of the Chamber of Deputies, held on April 17 this year, it presented its proposals to increase the resilience of cities and rural areas, accelerate responses to assist victims and economic activities caused by climate extremes and restore municipal infrastructure.

One of the suggestions presented was the creation of Social Catastrophe Insurance. According to the entity, it is a financial instrument to support victims of disasters caused by floods, floods and landslides. Upon payment of between R$2 and R$3 charged to the electricity bill, the customer will be entitled to compensation of R$15,000 per residence and an additional R$5,000 per death, which will be paid through PIX, to ensure speed and free resources for the victims of these tragedies.