In a recent legal opinion issued on May 2025, the Colombian Superintendence of Finance (hereinafter, the “SFC”) addressed the applicable regulations and the activities authorized for underwriting agencies of foreign reinsurers registered in Colombia.

Below we highlight some of the main considerations by the SFC:

• 1.    Insurance and reinsurance activity: government authorization and public interest nature
  
  In accordance with Article 335 of the Political Constitution of Colombia, insurance and reinsurance activities may only be carried out with prior authorization from the State, given their public interest nature. 
   
• 2.    General concepts regarding reinsurance activity
  
  Under the current legal framework, the activities of reinsurers must be strictly limited to reinsurance operations, as established by the Organic Statute of the Financial System (EOSF) and the Colombian Commercial Code. The latter governs the reinsurance contract and reinforces its functional dependence on the insurance contract, referring to the rules and principles that govern insurance contracts—among them, the principle of shared risk—thus highlighting its “insurance-like” nature. 
  
  Accordingly, a reinsurance contract cannot exist independently; it must necessarily be linked to the prior or concurrent existence of an insurance contract.
   
• Vehicles for the operation of foreign reinsurers
  
  Decree 2555 of 2010 and the EOSF establish two alternatives through which foreign reinsurers may offer their services in Colombia:

1. Registration in the Registry of Foreign Reinsurers and Reinsurance Brokers (REACOEX), administered by the SFC.
2. Establishment of a representative office in Colombia.

• Reinsurance underwriting agencies: regulation and operation
  
  The underwriting agencies of reinsurers (coverholders) are not subject to specific regulation under Colombian law. The only guidance on the matter is found in SFC’s Legal Basic Circular (CBJ), which sets forth provisions regarding their registration.
  
  Furthermore, the underwriting agencies act on behalf of foreign reinsurers registered in REACOEX, under the express authorization of such reinsurers. Their main function is to accept or cede reinsurance risks in the name and on behalf of the authorizing reinsurer, in accordance with the powers granted to them.
   
• Procedure and requirements to operate as an underwriting agency
  
  The registration of an underwriting agency does not constitute an independent registration within REACOEX. The ability of an underwriting agency to operate in the Colombian reinsurance market depends on prior authorization granted by the reinsurer and the subsequent registration approval by the SFC in the same registry. For this purpose, the reinsurer must send the SFC an Excel form containing specific information about the respective underwriting agency. 
  
  In any case, the SFC may, at its discretion, request additional information from the reinsurer regarding its underwriting agencies.
  
  If the underwriting agency is authorized in its country of origin to act as a reinsurance broker, it must register as such in REACOEX to operate in Colombia.
   
• Restrictions and limitations
  
  Underwriting agencies may not be incorporated or operate as commercial companies in Colombia. Their activities must be conducted from abroad and are limited to the acceptance or cession of reinsurance risks on behalf of the foreign reinsurer registered in REACOEX. Furthermore, they may not operate directly within Colombian territory and must carry out their functions from outside the country.
  
  Moreover, underwriting agencies are not allowed to operate directly within Colombian territory and must instead conduct their activities from abroad. 
   
• Additional considerations
  
  In addition to the points made by the SFC in its opinion, it is important to highlight that: (i) the restriction requiring underwriting agencies to operate exclusively from abroad; and (ii) the obligation of the reinsurer to inform the SFC of the criteria and policies for the selection and approval of such agencies, were both incorporated in Section 2.2.1, Chapter III, Title II, Part I of the new CBJ, reissued in June of this year.

For more information, please do not hesitate to contact our Insurance and Reinsurance team.