Brazil |
General questions | Yes/
No/ N/A | Additional comments, if any. |
1 | Does the country that you are reporting on follow common law jurisprudence? | No | |
2 | If the answer to the above question is no, does the country you are reporting on follow a civil code? Please describe the judicial system in short. | Yes | Brazil is a civil law country, inspired by countries such as France, Germany and, mainly, Portugal. The Constitution is the main law, below which the whole legal system is organised. For insurance purposes, the most relevant laws are the Civil Code and Decree Law 73/1966, which provides for the National System of Private Insurance and regulates insurance and reinsurance operations. There is currently a bill before the parliament for a specific Insurance Act. |
3 | Please provide a brief description of the legal framework applicable to insurance coverage disputes in the country you are reporting on. In so doing, please consider the following questions: | N/A | |
4 | Does the insured bear the burden of establishing coverage of a claim, or does the insurer bear the burden of establishing no coverage? Please give a short description of the legal basis in your country. | | As a general rule, the insured bears the burden of establishing coverage when they first make a claim for the coverage out of court. The same applies when it comes to claims made in court. Nevertheless, there are several exceptions, such as the inversion of the burden of proof provided by Article 6, VIII of the Consumer Code and the defendant’s burden to prove any fact which stops, alters or extinguishes claimant’s rights (art 373, II, Brazilian Civil Procedure Code). |
5 | Are coverage provisions in policies interpreted broadly or is there a presumption in favour of coverage? Please give a short description of the legal basis in your country | N/A | It is possible to say that there is presumption in favour of coverage. Article 47 of Consumer Code provides that the clauses should be interpreted in the most favourable way to the consumer. Article 113 of Brazil’s Civil Code provides that the clauses should be interpreted in the most favourable way to the party that had not drafted the agreement (insured). Based on these provisions among others, courts normally rule in favour of insured when the agreement is not perfectly clear. |
6 | Are exclusions interpreted narrowly or is there a presumption against finding that an exclusion to coverage applies? Please give a short description of the legal basis in your country. | | For the reasons mentioned in the response to Question 5, exclusions are normally interpreted narrowly. |
7 | Are there universally accepted definitions for: - event
- occurrence
- damage
- cause
- originating cause
- natural peril
- force majeure
- loss
- consequential loss
If the answer is yes, please give a short description of each definition and the legal basis for that definition (ie, a rule of law, case law etc). | Yes | As mentioned, the main rules on Insurance Law can be found in the Civil Code and Decree law 73/1966. Most of the definitions below may be found explicitly or implicitly in this legislation and are universally accepted. The regulator (Susep, http://www.susep.gov.br/menu/informacoes-ao-publico/glossario) has a glossary, defining these terms as follows: - event – all and every occurrence resulted from a same cause possibly being guaranteed by a policy;
- occurrence – an event that cause damage;
- damage – a loss, which may be indemnifiable or not, depending on the terms of the policy;
- cause – the circumstance that lead the event to happen
- originating cause – the circumstance that leads to the event happening;
- natural peril – is not a legal concept, but we would qualify it as a peril that results from a natural cause;
- force majeure – an unavoidable event;
- loss – reduction or elimination of a protected good;
- consequential loss – indirect impact of an event.
|
Loss causation | Yes/
No/ N/A | Additional comments, if any. |
8 | Did the country that you are reporting about issue lockdown, stay-at-home or no-travel restrictions in response to Covid-19? | Yes | |
9 | If the answer to the question above is yes, were such orders issued nationally, by state/region or by local city/town. Please give a short description of the issuing authority and the orders issued. | | There were restriction orders from both federal, state and municipal powers. This matter was submitted to the Federal Supreme Court (STF), which endorsed the competence of states and local authorities to take measures with the objective of containing the Covid-19 pandemic, such as quarantines, isolation and restriction of activities, without the intervention of federal authorities. |
10 | If the answer to the above question is yes, were the lockdown, stay-at-home or no-travel restrictions mandatory or recommended? | | Mandatory for a given period of time, recommended for another. Several indicators were used to define restrictions on economic activities in cities, including the assessment of hospital demand from Covid-19. Such indicators were subject to variations which changed the restrictive measures. |
11 | If the country that you are reporting about did issue lockdown, stay-at-home or no-travel restrictions, were those orders suspended or revoked at any point in time? If the answer is yes, please give a short description of the timeline. | Yes | The restrictive orders were issued in March 2020 however, since June 2021, they have been relaxed or reinforced, depending on the level of the pandemic in the relevant state/city. April 2021 was the most critical period of the pandemic in Brazil. Fortunately, the current (as of November 2021) situation seems to be under control due to the massive adherence of the population to the vaccination campaign, and authorities are discussing the relaxation of the restrictive orders. However, recently major cities have decided to cancel New Year’s events as they are concerned about the Omicron variant. |
12 | If the answer to the above question is yes, were subsequent lockdown, stay-at-home or no-travel restrictions issued at any point in time? Please give a short description of the timeline. | | Please see above. |
13 | Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss? | Yes | In most insurance policies, risks relating to pandemics and epidemics are specifically excluded. Despite this, some insurers have decided to pay indemnities, emphasising that they are doing it for mere liberality; this means that insurer is not obliged (or understands that it is not obliged), but pays anyway because of the relationship and/or to avoid litigation (similar to an ex gratia payment). This scenario causes insecurity for the insured, who do not know whether their requests for indemnities will be paid out. |
14 | Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss? If the answer is yes, please give a short description of the conclusions in the judicial opinions or guidance. | No | We have not yet identified decisions from Brazil’s superior courts about this matter. However, several courts of appeal have ruled in disputes relating to the scope of insured risks and the Covid-19 pandemic, but we have not identified a uniform jurisprudential understanding on the matter. The main discussion is if the limitations to the insured risks are abusive, especially in health and life insurance policies. |
15 | If the answer to the question above is yes, did the highest court in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by the virus? Please give a short description of the conclusions in the judicial opinions or guidance. | No | |
16 | If the answer to the above question is no, did the highest court in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by government lockdown or stay-at-home orders? Please give a short description of the conclusions in the judicial opinions or guidance. | No | |
17 | Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss? If the answer is yes, please give a short description of the conclusions in the judicial opinions or guidance. | Yes | Brazil has 27 state courts and five federal courts, with no uniform decisions on the matter. As mentioned above, the main discussion is if the limitations to the insured risks are abusive, especially in health and life insurance policies. This is because for damage insurance, there is no specific authorisation from the regulator Susep to exclude pandemics from insurance coverage, a situation that is favourable to the insured. However, Susep allows such exclusions in personal insurance cases. |
18 | If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss, have other courts in the country issued such opinions? | Yes | |
19 | If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether Covid-19 is a ‘cause’ of insured loss? Please give a short description of the conclusions in the judicial opinions or guidance. | No | As mentioned above, the matter is still far from consistent in terms of court decisions. The main discussion is if the limitations to the insured risks due to pandemics, even though authorised by the regulator Susep, are abusive clauses, holding the consumer at a massive disadvantage. |
20 | If the answer to the above question is yes, do courts in the country you are reporting about hold that losses related to Covid-19 were ‘caused’ by the virus? Please give a short description of the conclusions in the judicial opinions or guidance. | N/A | |
21 | If the answer to the above question is no, do courts in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by government lockdown or stay-at-home orders? Please give a short description of the conclusions in the judicial opinions or guidance. | N/A | Especially for business interruption (and similar) insurance, there are a few decisions – not consistent – that have recognised some losses have resulted from government restricting orders, but this depends on solid evidence. In this sense, the insured must prove a link between the losses and the mandatory interruption of its activities, which can be done by comparing tax and accounting documents from the pre- and post-pandemic periods, followed with an examination of these documents by accounting experts designated by the judge. |
22 | Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss? | No | |
23 | If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss, have other courts in the country issued such opinions? If yes, please give a short description of the conclusions in such judicial opinions or guidance. | Yes | There are decisions from lower courts recognising Covid-19 as an ‘originating cause’ of insured loss, especially for health and life insurance, and that restrictions to insurance coverage in the policies are abusive. |
24 | Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’? | Yes | As mentioned above, clauses excluding events related to or occurring as a direct or indirect consequence of epidemics and pandemics declared by a competent body are common and accepted by Susep. They have long been used by almost all insurers. Despite this, a movement led by the National Federation of Insurance Brokers (Fenacor) has pressed insurers to ignore the pandemic exclusion clause for life insurance. |
25 | Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’? Please give a short description of the conclusions in the judicial opinions or guidance. | No | |
26 | If the answer to the question above is yes, did the highest court in the country you are reporting about determine that losses related to Covid-19 were covered ‘events’? Please give a short description of the conclusions in the judicial opinions or guidance. | N/A | |
27 | If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’, have other courts in the country issued such opinions? | No | |
28 | If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether Covid-19 is a covered ‘event’? Please give a short description of the conclusions in such judicial opinions or guidance. | No | Brazil’s courts have inconsistently mitigated exclusion of insurance risks due to pandemics, especially in cases involving health and life insurance, subject to consumer law. The precedents are based on the argument that risk related to any diseases, regardless of their severity or how infectious they are, cannot be totally excluded from personal insurance policies, as this would make them excessively disadvantageous for the consumer. Such coverage can only be limited in specific cases. |
29 | If the answer to the above question is yes, do courts in the country you are reporting about hold that losses related to Covid-19 are covered ‘events’? Please give a short description of the conclusions in the judicial opinions or guidance. | N/A | |
30 | If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 in the context of loss causation. | N/A | |
Aggregation of claims | Yes/
No/ N/A | Additional comments, if any. |
31 | Does the country you are reporting on permit aggregation of claims arising out of a single originating cause? Please give a short description of the legal basis. | Yes | Brazil’s legal system does not forbid aggregation of claims arising out of a single originating cause. |
32 | Does the country you are reporting on permit aggregation of claims arising out of a single cause? Please give a short description of the legal basis. | Yes | Please see the response to Question 31. |
33 | Does the country you are reporting on permit aggregation of claims arising out of a single event? Please give a short description of the legal basis. | Yes | Please see the response to Question 31. |
34 | Does the country you are reporting on use an accepted test for determining whether claims can be aggregated? For example, does the country you are reporting on apply to four unities test to determine whether aggregation is appropriate? Please give a short description of the legal basis. | No | |
35 | Have courts in the country you are reporting on issued jurisprudence concerning whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the legal basis. | No | We have not found any decisions on this matter. |
36 | Has the highest court in the country you are reporting about issued judicial opinions or guidance concerning whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | No | |
37 | If the answer to the question above is yes, did the highest court in the country you are reporting about determine whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | N/A | |
38 | If the highest court in the country you are reporting on has not issued such jurisprudence, have other courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether insureds may aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | No | |
39 | If the answer to the above question is yes, do courts in the country you are reporting about permit insureds to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | N/A | |
40 | Do the courts in the country you are reporting on permit an insured to aggregate claims related to multiple properties or business locations arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | Yes | We have not found any decisions on this issue, but see no reason to believe that it would be forbidden. |
41 | Do the courts in the country you are reporting on permit an insured to aggregate claims related to multiple lockdown or stay-at-home orders arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | Yes | We have not found any decisions on this issue, but see no reason to believe that it would be forbidden. |
42 | Have courts in the country you are reporting on issued jurisprudence concerning whether cedents can aggregate claims arising out of Covid-19? Please give a short description of the legal basis. | No | |
43 | If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether cedents may aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | N/A | |
44 | If the answer to the above question is yes, do courts in the country you are reporting about permit cedents to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | N/A | |
45 | If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 and aggregating claims. | N/A | Since there is no restriction on law, we see no reason to prohibit aggregation of claims relating to Covid-19. |
Property damage | Yes/ No/ N/A | Additional comments, if any. |
46 | Have courts in the country you are reporting on issued jurisprudence concerning whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the legal basis. | Yes | The law itself provides that losses arising from Covid-19 may qualify as property losses. This is because Brazil’s Civil Code provides two types of insurance: damage insurance and personal (ie, life and health) insurance. An insurance is a property loss insurance if it is not personal insurance. |
47 | Has the highest court in the country you are reporting about issued judicial opinions or guidance concerning whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the conclusions in such judicial opinions or guidance. | No | |
48 | If the answer to the question above is yes, did the highest court in the country you are reporting about determine whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the conclusions in such judicial opinions or guidance. | N/A | |
49 | If the highest court in the country you are reporting on has not issued such jurisprudence, have other courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether losses arising from Covid-19 constitute property damage? Please give a short description of the conclusions in such judicial opinions or guidance. | Yes | Please see Question 46 above. |
50 | If the answer to the above question is yes, do courts in the country you are reporting about permit insureds to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance. | Yes | We have not found any decisions on this issue, but see no reason to believe that it would be forbidden. |
51 | If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 and property damage. | N/A | We have not found any decisions on this issue, but see no reason to believe that it would be forbidden. |
Exclusions | Yes/ No/ N/A | Additional comments, if any. |
52 | Has Covid-19 been deemed a ‘natural peril’ in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence. | N/A | As mentioned in the response to Question 7, ‘natural peril’ is not a legal concept in Brazil. |
53 | Has Covid-19 been deemed force majeure in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence. | Yes | Article 393 of Brazil’s Civil Code defines force majeure as an unavoidable circumstance and the pandemic may be qualified as so. There are several decisions recognising it. |
54 | Is Covid-19 acknowledged as a notifiable disease in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence. | Yes | Yes. Rule number 1,972 from Ministry of Health determines that the laboratories must notify the federal government about Covid-19 cases. |
55 | Is it common for insurance policies issued in the country you are reporting on to include a pandemic or virus exclusion? Please give a short description of the legal basis and common insurance practice. | Yes | Insurance policies in Brazil commonly exclude losses related to pandemics from coverage, as this is authorised by the regulator Susep. This is especially in the case of personal insurance, as set out in Circular 440/2012, which regulates microinsurance plans, and specifically authorises the exclusion of risks caused by ‘epidemic or pandemic declared by a competent body’. |
56 | Have any courts in the country you are reporting on determined that a pandemic or virus exclusion is void as against public policy in the context of Covid-19? Please give a short description of the legal basis and relevant jurisprudence. | Yes | In consumer cases, courts normally consider such exclusion as abusive, as it makes it excessively disadvantageous for the consumer, which normally does not occur when the insured party is a company. |
57 | Have any courts in the country you are reporting on otherwise determined that a pandemic or virus exclusion is unenforceable in response to Covid-19? Please give a short description of the legal basis and relevant jurisprudence. | Yes | Please see the response to Question 56. It has been common for courts to declare such kind of clauses as abusive and therefore void and unenforceable in consumer cases. |
58 | If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 in the context of exclusions. | N/A | |
Regulatory oversight | Yes/ No/ N/A | Additional comments, if any. |
59 | Have insurance regulators in the country you are reporting on issued directives concerning coverage for claims arising out of Covid-19? Please describe the regulations that have been implemented. | Yes | After the beginning of the pandemic, the regulator for health insurance (ANS) issued several rules in the sense that insurers must provide coverage for tests and treatment for Covid-19. |
60 | Are regulators requiring or encouraging insurers to provide grace periods to insureds to make payments on premiums? If yes, please give a short description of the legal basis and relevant guidance. | No | Not to the best of our knowledge. |
Government action | Yes/ No/ N/A | Additional comments, if any. |
61 | Has the government in the country you are reporting on implemented relief measures for losses sustained as a result of Covid-19? | Yes | |
62 | If the answer to the above question is yes, are the relief measures available to both individuals and businesses? | Yes | |
63 | Briefly describe the types of relief measures available to individuals and businesses. | N/A | The government has implemented several relief measures, such as financial support to individuals, deferred payment of taxes, forbidding, for a certain period of time, ejectment for lack of rent payment, among others. |