There is an insurance group in the Brazilian market that has maintained a long-term return on equity of around 80-90%, has virtually no financial debt, pays out over 90% of profits to shareholders and has a current dividend yield of around 12-13%. The company is built on one simple idea: to use the vast network of branches, clients and digital platforms of state-owned Banco do Brasil to sell insurance, pension plans and savings products - and to collect fees, commissions and profit shares from subsidiaries in return, without having to build an expensive sales apparatus or bear much of the actuarial risk on its own balance sheet.

But at the same time, the group is entering a more difficult period: the Brazilian central bank is starting to cut the extremely high rates that have inflated investment returns over the past two years, the credit cycle is subdued, written premiums in the main segments have stagnated or declined slightly, and management itself is projecting a 3-7% decline in…