Brazil grants 'eventual reinsurer' permit to Buffett's Berkshire

Thu May 22, 2014 8:12am EDT

Berkshire Hathaway Chairman Warren Buffett wanders the company trade show before his company's annual meeting in Omaha, Nebraska April 30, 2011. REUTERS/Rick Wilking

Berkshire Hathaway Chairman Warren Buffett wanders the company trade show before his company's annual meeting in Omaha, Nebraska April 30, 2011.

Credit: Reuters/Rick Wilking

(Reuters) - Susep, Brazil's insurance industry regulator, on Thursday issued a license allowing Berkshire Hathaway Inc (BRKa.N) to operate in the country as "eventual reinsurer."

The license permits reinsurers domiciled in a foreign country to operate in Brazil without a representative office in the country. According to the government's official gazette, Berkshire's U.K.-based unit, Berkshire Hathaway International Insurance Ltd, will be granted the license. Berkshire is controlled by U.S. billionaire Warren Buffett.

In Brazil, there are three classes of reinsurers - local, admitted and eventual. According to current industry rules, eventual reinsurers must have minimum global net assets of $150 million, be rated a notch above the minimum investment-grade ranking by a major credit rating company and have its headquarters based outside a tax-haven country.