Lloyd’s is to set up reinsurance operations in Brazil following the abolition of national monopoly reinsurer IRB Brasil Re.

Last month’s reinsurance bill has opened the Brazilian market to foreign reinsurers.

International reinsurers are expected to begin operating in July.

Lloyd’s has formally applied to establish operations including an office in Rio de Janeiro. It previously operated under a partnership arrangement with IRB.

Brazil is by far Latin America’s largest insurance market, accounting for $US13.4 billion ($14.8 billion) of insurance premiums and $US1.8 billion ($2 billion) of reinsurance premiums in 2005.

The reinsurance market is forecast to double over the next year.