Lockton Re has rolled out its advisory and structuring capabilities through locally licensed Special Purpose Securitization Entities for Brazil's Letra de Risco de Seguro (LRS) market, opening a domestic channel for insurance-linked securities in the country.
"Brazil has built one of the most thoughtfully designed ILS regulatory frameworks in the world. The domestic LRS market builds on existing global structures, bringing global governance standards, while at the same time creating innovation designed for Brazil's market realities," said Rodrigo Botti (pictured above), country head for Brazil at Lockton Re.
Botti added that the firm's representatives have been involved in discussions on the framework since at least 2023, and that Lockton Re now offers structuring, regulatory advisory and investor-facing services for the segment.
The rollout coincides with the 9th Encontro de Resseguro do Rio de Janeiro, held on May 19 and 20, where Lockton Re leadership is presenting on the role of LRS within Brazil's insurance ecosystem.
Reinsurance capacity for Latin America has expanded over the past 12 to 18 months, even as the region's climate-related protection gap remains wide, according to MAPFRE Economics.
The data placed that gap at 81%, with just 19% of total losses insured. Insured nat-cat losses across the region reached $11.6 billion in 2024, of which only $1.5 billion was covered, while insurance penetration sits below 5% of GDP.
The broker is working with an independent Brazilian-licensed SSPE, the local special purpose vehicle required to structure and issue LRS instruments, allowing Lockton Re to advise cedants without the multi-month setup timelines facing other entrants.
Clients can therefore move from mandate to issuance at an accelerated pace compared with rival platforms, the firm said. The platform accommodates indemnity, parametric and index-based triggers across perils ranging from agribusiness and infrastructure to climate catastrophe and regulatory capital relief.
The Brazil deployment mirrors Lockton's wider approach of organizing reinsurance resources around client locations, a strategy also visible in its recent reinsurance license in Saudi Arabia, which pairs global capabilities with locally led teams.
"Brazil's LRS is the most robust regulatory architecture for ILS in Latin America," said Dario Luna, who leads the Latin America and Caribbean business at Lockton Re, citing his prior work on Mexico's catastrophe bond program and parametric coverage in the region.
"Our team is now ready to deliver competitive ILS solutions for new cedants and support them in their journey as the market matures," Luna added.
Lockton Re said the offering pairs local ILS structuring expertise with a ready-to-deploy Brazilian SSPE, aimed at connecting domestic cedants with institutional investors and backed by the broader reinsurance structuring resources of the parent unit.
