Open Banking Exchange was delighted to welcome Thiago Duarte, Co-ordinator of the Open Insurance Project at the Superintendence of Private Insurance (SUSEP). At a recent OBE webinar, Thiago discussed the state of open insurance in Brazil, and how it can serve as a blueprint for other Latam countries.
The insurance industry is undergoing a new revolution with the adoption of open finance. Across the globe, the Insurtech community has been designing innovative products to increase access to insurance, simplify management and open the market to more insurance providers to create cheaper bespoke solutions. From a business perspective, these changes will allow tech companies and SMEs to enter the space, while increasing the flexibility and speed of the market.
The regulator of private funds in Brazil has taken a bold leap forward by creating regulation which enables users to share their data with insurance companies, in the fourth stage of open banking adoption. Brazil is the only country in Latin America which has implemented regulation of this kind. As such, it serves as an influential point of reference for other countries in the region, who are considering the first steps of open finance.
Insurance is often side-lined in conversations about open finance. During a webinar hosted by OBE, however, Thiago Duarte highlighted five important benefits and objectives of the initiative:
Consumer-centric: this is the core of open insurance. Like all open projects, the customer needs to be at the centre of this transformation. Transparency is key here, enabling the customer to have a clear choice over whether and how to share their data.
Open banking: following its predecessor, open insurance also aims at consolidating the consumer’s financial life, as well as producing more suitable products for SMEs.
Financial inclusion: this is a problem across Latin America. Almost half of adults in Latam do not have bank accounts. Latin American governments are keen to include more people into the financial market, which can be achieved through innovation and technology, and by offering more suitable products at better prices.
Innovation and competition: open insurance is a fundamentally a project of innovation directed at opening the insurance market. It will create a wave of customisation, modern applications and creative tools.
Security and privacy: when it comes to sharing personal data – especially sensitive insurance data – standards and regulation are essential. If done right, open insurance will be a safer space than the Internet, providing a closed environment which only allows accredited companies.
Thiago gave a fascinating snapshot of the Brazilian market and the state of open insurance. While every country in Latin America has its own issues and requirements, differing in culture, regulators and innovation, Thiago believes that the steps of implementation in Brazil could be replicated successfully in other regions.
The core takeaway here is usability. Developers must prioritise the consumer and the simplicity of the product: if it is personal decision to share your data, that decision must be clear. Keeping this in mind, Open Banking Exchange has no doubt that open insurance – albeit ambitious – will be a success in Brazil and an example across the continent.
To stay up to date with open banking and open finance in Latam, sign up to our future webinars and become a member of Open Banking Exchange today by emailing us at info@openbanking.exchange
