XL Re is hoping to capitalise on the opening of the Brazilian reinsurance market with the opening of a new unit in the South American country.

Brazil has previously excluded foreign companies from underwriting risks directly. State-owned IRB has had a monopoly on the sale of reinsurance for the past 69 years, with companies such as XL participating in the market only through its partnership with IRB.

On April 17 all that will change as the country allows foreign reinsurers a slice of a market expected to be worth almost $4 billion within the next two years.

The new operation, based in Rio de Janeiro, will open opportunities for qualified Portuguese-speaking Bermudians. The company will have an additional office in São Paulo.

According to industry experts the size and sophistication of Brazil's financial markets means it has the potential to evolve into the hub of Latin American reinsurance. Brazil is also expected to be profitable due to the fact that it is rarely struck by disasters such as hurricanes or earthquakes.

James Veghte, chief executive officer of XL Re, said: "We at XL Re are very excited about the opening of the market in Brazil. We have had a representative office in the country for many years and I believe that we are ideally positioned to be a market leader in the new environment.

"We have a capable and experienced management team, outstanding relationships with the local insurance market and an established reputation for technical excellence and reliable service."

The new operation will be managed by Carlos Caputo, who has more than 30 years' experience in underwriting and management in the Brazilian market with an extensive background in the Brazilian brokerage business and reinsurance.

Mr. Caputo said: "We are very excited to enter Brazil on a local and admitted basis. As a leader in the Brazilian reinsurance market for nearly 10 years, we are very well known.

"XL Re looks forward to building on the excellent relations we have with clients."