A survey of risk managers and brokers carried out by Chartis UK reveals the risks and opportunities perceived for operations in the BRIC (Brazil, Russia, India and China) countries.

Virtually all the respondents to the survey had operations in one of more of the BRIC countries. Over 90% were present in China, Russia and India and 83% were in Brazil. Unsurprisingly the attraction of these countries was the access they offered to new consumer markets.

Russell Meagher, head of major accounts practice at Chartis UK commented, “The economic growth being experienced in these territories coupled with a growing consumer class, increased foreign direct investment and infrastructure development present extensive opportunities for all types of businesses looking to extend their reach into new markets.

“Although many of our clients are already doing business in theses markets, they were keen to understand the differences in local custom and practice that need to be recognised and accommodated in their risk management and risk financing programmes.”

The respondents’ top four operational concerns related to changing legislative environment (83%), and regulation (78%), local insurance market practices (58%) and risk management culture (56%).

“The legislative and regulatory environments faced by multinationals in the emerging markets are changing as these economies grow. Indeed, for the BRIC countries there appears to be a trend towards greater regulation in the insurance sector. An example of this is the recently announced regulatory changes in Brazil which are likely to impact the shape and structure of locally admitted policies in this territory," said Meagher. "This is the dynamic aspect of putting together compliant global programmes and one which requires a strong level of expertise on the ground in each territory.”

The insurable risks that are of prime concern to respondents are:

•crime and fraud 64%.
•the safety of physical assets 42%
•supply chain failure also 42%
•weather events 31%
•credit risk 28%.

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