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Associate Director Camila Carvalho examines the usage of Transactional Risk insurance in Brazil

Associate Director Camila Carvalho discusses the growing popularity of R&W insurance in Brazil, and explores how Transactional Risk products are impacting the region’s insurance market, in Correio Braziliense.

Camila’s article was published in Correio Braziliense, 21 November 2024, and can be found here.

Writing in Correio Braziliense with Trench Rossi Watanabe’s Victor Sigaud and Silvia Bernardino, Associate Director Camila Carvalho argues that the popularity of Representations & Warranties (R&W) insurance is likely to increase significantly in the Brazilian market.

Driven by increased understanding of such products, and the need to mitigate the risks in case of breach of representation and warranty, Camila and her co-authors explain that the usage of such products to reduce risk and maximise rewards is an attractive prospect for both buyers and sellers.

Camila, Victor and Silvia point to trends in the sector, such as the reduction in the volume of M&As in the last two years, and suggest that such factors are leading to a greater number of insurers looking to R&W insurance to diversify risks, reduce exposure and expand their product offering.

While it remains to see whether this trend is here to stay, Camila, Victor and Silvia conclude that the uptick in the usage of R&W insurance will likely create a more competitive and dynamic insurance market in Brazil, with insurers able to use such tools to reduce tensions in M&A negotiations, benefit the liquidity of parties involved and mitigate the risk of litigation.