The devastating corruption scandal engulfing Petrobras, Brazil's largest company and one of the leading players in the oil and gas sector, is set to trigger a boom in the D&O market.

Since the beginning of the investigations into Petrobras by the Federal Police at the end of 2014, several former directors of the company and politicians (the company is partially owned by the government), as well as former directors of service companies doing business with Petrobras, have been arrested and fined.

If the scandal has weakened the strength of the Brazilian oil and gas market, it has also pointed towards the importance of buying insurance to cover the civil liability of one's employees and directors. There is now a much greater awareness among Brazilian companies of the need for D&O insurance and the importance of having adequate cover.

As a result, we expect insurance and reinsurance premiums involving D&O and professional civil responsibility in Brazil to grow exponentially in the coming year and beyond. It is likely we will also see a move towards insurance buyers seeking higher limits of coverage; up to now, Brazilian companies were buying relatively low limits compared to their counterparts around the world, but we expect this to change in the fallout from Petrobras.

The scandal has also highlighted the importance of D&O insurance to companies in other countries in Latin America and we expect this to translate into an uptick in demand in markets including Chile, Mexico and Columbia.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.