Brazil infrastructure projects increase focus on risk control

Increasing infrastructure investments in Brazil are driving a greater need for risk management mechanisms to mitigate financial, operational, and contractual difficulties in long-term projects. Early identification of deviations is becoming essential to prevent project delays, cost overruns, and work stoppages.

In the context of surety insurance (Seguro Garantia), risk control has evolved beyond mere policy issuance to include continuous project monitoring. This approach allows for the assessment of factors impacting contractual obligations and the identification of warning signs before they escalate into major issues.

Under Brazilian Law No. 14.133/2021, the inclusion of step-in clauses allows insurers to ensure project continuity through third parties or provide compensation to contractors, thereby increasing insurer responsibility regarding contract execution.