COMPILATION OF INSURANCE AND REINSURANCE REGULATIONS - Regulation on the minimum rating required for reinsurance companies (art.65) - Amendment

WHEREAS: The regulation regarding the minimum rating required for reinsurance companies for the purpose of calculating certain technical ratios required for insurance companies, set forth in Article 65 of the Compilation of Insurance and Reinsurance Regulations.

RESULTING:
I) That on November 4, 2025, the Uruguayan Association of Insurance Companies (AUDEA) requested a review of said requirement, stating that various regulatory and market changes justified it, including increased risk management demands, the transition to a risk-based capital regime, and the downgrade of sovereign ratings of some countries in the region. Likewise, it noted that the minimum rating requirements for reinsurers in other countries in the region are lower. II) That the comparative regulatory review carried out based on said proposal confirmed that most jurisdictions set their requirement at lower rating levels, making the current Uruguayan regulation one of the most demanding. III) That based on the analysis carried out, a proposal was developed that replaces the requirement of an international risk rating equal to or higher than A- with a rating of BBB+ or its equivalent for property damage and non-pension life insurance. Pension insurance maintains the current A- rating requirement. IV) That, likewise, it was established that the rating must have been carried out by a risk rating entity recognized by the SEC (Securities and Exchange Commission) of the United States of America as an NRSRO (Nationally Recognized Statistical Rating Organizations). V) That the aforementioned regulatory proposal was put out for consultation with supervised institutions and the general public on July 1, 2026, with the deadline for receiving comments being July 22, 2026. VI) That comments and queries were received from the Uruguayan Association of Insurance Companies (AUDEA) and the State Insurance Bank (BSE). VII) That in its comments, the BSE stated that the incorporation of new risk rating entities generates a significant operational burden.

CONSIDERING:
RR-SSF-2026-561 Date: 31/08/2026 17:35:06
CIRCULAR N°2515

I) That the comments received from the industry provided elements that allowed the original proposal to be adjusted, demonstrating the value of the consultation process for the regulator.
II) That, considering the comment detailed in RESULTING VII), it was decided to limit the admitted rating entities to those established in Communication N°2010/049 currently in force.

ATTENTIVE: To the provisions of literal A) of Article 38 of Law Nro. 16,696 of March 30, 1995, in the wording given by Article 694 of Law Nro. 20,446 of December 16, 2025, and to the reports issued in file N° 2026-50-1-01530.

THE SUPERINTENDENT OF FINANCIAL SERVICES
RESOLVES:

1. REPLACE in Title VI – REINSURANCE CONTRACTING, of Book II – STABILITY AND SOLVENCY of the Compilation of Insurance and Reinsurance Regulations, Article 65 with the following:

ARTICLE 65 (CONDITIONS).
For the purposes indicated in Article 64, reinsurance companies must have an international risk rating equal to or higher than BBB+ or its equivalent for property damage and non-pension life insurance, and A- or its equivalent for pension insurance. The rating must have been carried out by an international risk rating agency selected from among the institutions established by the Superintendency of Financial Services. In case there is more than one rating and discrepancies arise between them, the lower one will be taken.

2. EFFECTIVE DATE: The modifications set forth above will take effect on January 1, 2027.
3. COMMUNICATE the resolution by Circular.

JUAN PEDRO CANTERA
Superintendent of Financial Services
RR-SSF-2026-561 Date: 31/08/2026 17:35:06
Exp. 2026-50-1-01530
Publishable: Yes - Signatory: JUAN PEDRO CANTERA SENCIÓN CIRCULAR N°2515