With the economy unstable and indebtedness on the rise, adjusting the pricing of policies could be the key to ensuring the sustainability of insurance companies without compromising customer adhesion.
In 2024, indebtedness had reached worrying levels in all income brackets. Data from the National Trade Confederation (CNC)[1] show that 81% of families earning up to three minimum wages were in debt, while 66% of those with incomes of more than ten minimum wages also had financial worries. The percentage of those in default for more than 90 days reached 49%, which highlights the economic instability and makes it difficult to grant credit. In other words, the scenario is challenging for the insurance sector.
A visit to the supermarket is enough to reveal how inflation continues to undermine the population’s purchasing power. Five years after the peak of the pandemic, the Brazilian economy has still not fully recovered from inflationary pressure. In March 2020, inflation stood at 4.5% and the Selic rate was below 7%[2]. By March 2025, the Selic had reached 14.25% per year[3], while the Broad National Consumer Price Index (IPCA) recorded a 12-month cumulative increase of 4.87%, surpassing the target ceiling set for the period.
With the rising cost of credit, consumption of goods and services slows down — and naturally, the insurance sector feels the impact of this contraction. Historically, insurance product penetration in Brazil has been limited[4]: only one-third of the vehicle fleet is insured, less than 20% of homes have coverage, and private pension plans reach less than 10% of the population[5] – many of which are limited to group plans. In the life insurance segment, only 17% of Brazilians have any coverage, mostly concentrated in the upper-income classes (A and B), which are less affected by economic volatility.
Economic volatility primarily affects the purchasing power of low-income households (classes C, D, and E), which tend to prioritize essential needs as the cost of living rises.
A 2022 survey[6] revealed that nearly 60% of Brazilians without insurance admit they do not feel at ease without such protection. Therefore, the main barrier is not always a lack of awareness about the importance of insurance, but rather budget constraints.
Greater insurance penetration benefits not only insurers, but also consumers and the economy as a whole. The higher the volume of policies in a given region, the more diversified the risk, the more balanced the loss ratio becomes, and the greater the insurers’ ability to adjust their prices competitively.
Risk mitigation and financial sustainability must be the guiding principles for insurers when it comes to strategic planning. Unlike other sectors that structure pricing based on fixed costs plus profit margins, the insurance market requires a highly technical and multifactorial approach. Policy pricing involves variables such as the insured’s profile, predictive behavioral models, macroeconomic conditions, climate trends, and market-specific risks. When data point to an economically unstable environment, this reality must be factored into calculations – especially for products directly impacted by default, such as credit life insurance.
To meet the challenge of pricing in volatile times, it is essential to invest in robust predictive models, continuous risk monitoring, and even the revision of contractual clauses. The possibility of renegotiating premiums should be considered without compromising the solvency of insurers, thereby preserving policyholder trust.
Building qualified data sets enables insurers to conduct more accurate analyses and make agile decisions, particularly when evaluating purchase propensity, cancellation likelihood, claims risk, credit needs, and fraud detection.
In an economy marked by uncertainty, policy pricing must be sophisticated – ensuring consumer accessibility without jeopardizing the financial stability of insurers. It is a delicate balancing act, but one that is achievable with the right strategies and tools.
[1] https://agenciabrasil.ebc.com.br/radioagencia-nacional/economia/audio/2024-12/em-2024-endividamento-dos-mais-pobres-aumenta-4-em-relacao-2023.
[2] https://www.bbc.com/portuguese/articles/c89y5zx0ekgo.
[3] https://agenciabrasil.ebc.com.br/economia/noticia/2025-03/copom-eleva-juros-basicos-da-economia-para-1425-ao-ano.
[4] https://www.infomoney.com.br/minhas-financas/58-dos-seguros-de-vida-no-brasil-sao-coletivos-o-que-sao-e-para-quem-serve-especialistas-respondem/.
[5] https://revistaapolice.com.br/2024/02/somente-15-dos-brasileiros-que-possuem-seguros-tem-previdencia-privada/.
[6] https://www.fenacor.org.br/noticias/pesquisa-somente-10-da-populacao-tem-seguro.
Available in: https://universodoseguro.com.br/a-precificacao-dos-seguros-em-tempos-de-altas-inadimplencias-e-taxas-de-juros/
Autor: Sergio Luiz Bernardelli Junior • email: sergio.bernardelli@ernestoborges.com.br
