The Brazilian technology-driven financial services platform XP, announced this Wednesday the acquisition of DM10, a marketplace that connects hundreds of independent distributors with insurance and private pension products. On Monday, XP had announced the acquisition of Fliper, a Brazilian fintech focused on open banking.
XP claims that one year after its creation, its insurance arm is the fastest growing in the sector, reaching the leadership in net contributions and renewals in the social security industry in April, according to data from the industry federation in Brazil, Fenaprevi.
XP believes that it can be one of the market leaders in the next years by democratizing access to superior products and leveraging its distribution expertise.
Founded in 2007, DM10 has a network of nearly 1,000 active brokers, who will now have access to XP’s product platform, commercial support, and technology. According to the company itself, DM10 was the first in the Brazilian industry “to offer a fully digital, open-architecture platform, with high-quality brokers and ongoing development of exclusive and differentiated products along with partner insurers”.
“Retirement planning cannot be built solely on fixed income products with the Selic (the Brazilian benchmarking interest rate) at the lowest level in history. In this new environment, private pensions become almost mandatory for any long-term investment portfolio. When we compare the penetration of products here in Brazil to other countries, there is still a huge disparity”, said Roberto Teixeira, head of XP Seguros, in a press release.
The completion of the transaction is still subject to compliance with certain precedent conditions, including prior authorization from Brazil’s Central Bank.