Before understanding a little more about what IRB Brasil Resseguros does, it is necessary to understand what a reinsurer actually is. As a reinsurer, the company provides insurance products to other insurance companies. Therefore, the Company operates with the main product lines in this market. Thus, in addition to a real importance for the entire business chain, the company is a reference when we think of South America and especially Brazil in the reinsurance market.

IRB Brasil has certain characteristics that drive its business model in a differentiated way:

• National authority: generates greater proximity to clients and flexibility in regulation and claims payment

• Technical team: highly qualified professionals, with an average experience of 10 years

• Database: provides clear guidelines for risk management in underwriting across all segments

• Technological system: modern IT infrastructure for quantitative risk assessment

Business Lines

IRB Brasil RE primarily operates with the following classes of insurance products:

• Property

• Engineering

• Agricultural

• Oil and Gas

• Marine

• Transport

• Financial

• Liability

• Aerospace

• Life and Pension

Property and Engineering

In the property segment, IRB operates based on the analysis of operational risks of commercial and industrial establishments. Thus, it covers possible material damages resulting from fire, lightning, explosion, and natural damages, such as storms, earthquakes, and flooding. In the engineering segment, the operation is somewhat different.

Considering that engineering works are subject to very specific risks, the company focuses its operations in this segment. Therefore, it aims to ensure the payment of compensation for losses resulting from accidents occurring during the execution phase of works, installation, and assembly of new machines and equipment. Thus, IRB Brasil RE provides insurance that basically encompasses the main types of risks in engineering:

• CAR: civil works under construction

• EAR: installation and assembly

• DSU: delay in start-up

• ALoP: Advance Loss of Profits

Agricultural

In this scenario, its operations are based on covering possible losses not only related to the negative impacts on properties and agricultural production but also providing life insurance to the producer. Therefore, the main lines of the rural business that the reinsurer operates in are:

• Climate risks

• Loss of productivity

• Variation in commodity price indices

• Death of animals

• Damage to equipment and silos

• Life of the rural producer

Oil and Gas

Incredibly, IRB Brasil RE also operates with insurance related to oil activities in the countries. From this perspective, it offers policies aimed at covering:

• Risks from the construction phase to the operational phase

• Projects related to oil and gas exploration and production

• Liability risks and physical damage in the process of removing offshore platforms

Marine

Maritime risks are divided into two main groups, one related to damage to the vessels themselves and the other linked to the liability of shipowners (owners of the ships and containers).

A recognized type of insurance is called Hull, which is offered to shipowners, with coverage for losses caused to the ship's hull, engine, and machinery. And finally, there is another model called P&I, which covers the risks of liability caused by the ship, whether due to collision with another vessel, due to damage caused to the pier, docks, equipment, or port facilities, or due to environmental pollution and damage to the transported cargo.

The Company has a broad operation that encompasses the operational risks in maritime businesses, from construction to port logistics. As a result, it offers products that cover the following items:

• Shipbuilding

• Hull and machinery

• War and strikes

• Ship repair

• Vessels: sports/recreational, auxiliary, long-haul, cabotage, and inland

• Port operator

Transport

When it comes to the transport segment, IRB Brasil RE has a complete package of insurance, of which we can mention:

• Aerial

• Aquatic

• Road

• Railway

• Integrated solutions

• War and strikes

• Stock throughput: aimed at companies that import, distribute or export goods

Financial

In the financial segment, the Company operates with important services and products in the insurance market for the population, such as:

• Contractual and judicial guarantee insurance

• D&O (Directors and Officers): aimed at executives in high management positions

• E&O (Errors and Omissions): specific professional liability insurance

• Credit

• Housing risks

• Rental guarantee

Civil liability

Civil liability is based on the principle that an individual who causes harm to another person, whether moral or material, has the obligation to repair, usually through financial compensation to the harmed person. In this sense, IRB Brasil RE issues insurance policies that encompass various professionals in the following lines of civil liability:

• General civil liability

• RC works

• RC products

• RC environmental

Aerospace

In the aerospace sector, this recognized reinsurer operates with products that cover various losses in different assets of this sector, in addition to offering civil liability guarantees for professionals in this area. Among these products, we can highlight:

• Hull: for all risks

• Hull: for war

• Civil liability

• Satellites

• Drones

Life and Pension

Clearly, this line of products has a very diversified and complete portfolio. Thus, the Company is able to sell its reinsurance products to various insured parties that operate in exclusive and different niches. Therefore, we observe that the Company offers a variety of sales options, listed as follows:

• Individual life

• Group life

• Personal accidents

• Pension

• Catastrophe

• Teleunderwriting

• Agility (underwriting app)

• Critical illnesses

• Death in an air accident

• Preferred risks

• Business succession

• Hospitalization

• Surgical risk

• Professional athletes

IRB Brasil RE's operations

Simplistically, the Company's business model consists of assuming the commitment to indemnify other insurers for losses that may occur as a result of their policies. Reinsurance allows a certain insurer to reduce its liability regarding a risk considered excessive for its financial capacity, through the partial transfer of responsibility to the reinsurer.

From this, the reinsurer can receive not only the risks but also a database of clients and part of the insurance premium. Thus, it makes high liquidity financial investments that will primarily be used as a reserve fund to cover the expenses of insurers according to their demand.

Another interesting point is that it also operates with the retrocession model, that is, when it does not wish to fully assume its part of the risk, it cedes a fraction of the responsibilities it accepted to another or more reinsurers, or even to insurers, called retrocessionaires.

The company's participation in the reinsurance market in Brazil is very significant, its market share is approximately 37%. More than that, the company also has ongoing operations in other nations, including:

• Argentina

• Bolivia

• Chile

• Colombia

• Ecuador

• Paraguay

• Peru

• Uruguay

Although its major focus is in South America, it also operates in Europe, Africa, Asia, the Middle East, and North America.

The entire history of IRB Brasil RE begins in the 1930s, when it starts its reinsurance operations. More precisely in 1939, during the government of Getúlio Vargas, the Institute of Reinsurance of Brazil is created with the aim of retaining in the country the risks of national companies that were previously transferred to foreign companies.

After decades of expansion, the company gains regulatory power over the reinsurance market in Brazil, starting in 1960, after the creation of the National System of Private Insurance. Six years later, the Company changes its name to IRB Brasil Resseguros S.A. after becoming a mixed economy company.

In 2007, the company lost its monopoly in the market, which it had carried since its creation. As a result, a major cycle of 69 years marked by the absence of competitors in the country came to an end. Shortly thereafter, in 2013, the Company was privatized, concluding a process that lasted 13 years. Although at the time the company continued to have the Union as its largest shareholder, BB Seguridade, some state funds, Banco Bradesco, and Itaú entered the control block of IRB Brasil RE.

In 2017, the initial public offering of its shares took place, which began to be traded in the Novo Mercado segment of Bovespa. With this, it managed to raise just over R$ 2 billion. Additionally, the Company ranked 8th among the 10 largest reinsurers in the world by market value.

Subsequently, in 2019, IRB Brasil RE conducted two secondary offerings of shares (follow-ons), which together raised approximately R$ 10 billion.

Recently, in 2020, the company was the target of investigations into its operations and corporate governance. Consequently, there was a significant blow to its reputation as a solid player in the reinsurance business and in the entire capital market.