Minister Luiz Fux, of the Federal Supreme Court (STF), voted against the levy of PIS/Cofins on the technical reserves of insurance companies and private pension entities. He is the case reporter. The trial could cost the Union R$5.3 billion over five years, according to the Budget Guidelines Law (LDO) of 2026, if the Supreme Court decides against taxation. The analysis began this Friday, 13th, in the virtual plenary that runs until February 24th.
Technical reserves are mandatory provisions that companies must make to meet commitments made with policyholders. Fux highlighted that, in addition to being compulsory deposits, the amounts are not available to companies. Therefore, the capitalization of these resources could not be considered a typical business activity of insurance companies and private pension entities – which is the requirement for the incidence of PIS/Cofins.
“Revenues from these financial investments are not part of the revenue of private pension entities and insurance companies and, as a consequence, should not form the basis for calculating contributions to PIS and Cofins”, stated the minister.
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The controversy is an outcome of the decision that defined, in 2023, that PIS/Cofins will be levied on banks’ financial revenues. The prevailing position is that federal taxes should be levied on revenue from the company’s typical activities. The Union’s victory avoided a loss estimated at R$115 billion. But the rapporteur, Dias Toffoli, stated in the ruling that the understanding of that judgment does not apply to insurance companies. Therefore, part of this value is still in dispute.
For the rapporteur of the specific action on insurance companies, Luiz Fux, the maintenance of technical reserves is imposed on insurance companies by law. Therefore, it is necessary to define whether the revenues arising from the application of these resources are part of the billing concept or not.
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In 2024, Fux even reinstated a million-dollar charge from Mapfre relating to PIS/Cofins on technical reserves. Then, the minister went back, suspended the charge again and decided to send the case to the plenary to assess the general repercussion.
Insurers claim that their technical reserves are not subject to PIS/Cofins because they are the result of contributions from their policyholders, and are not revenue from the sale of goods or the provision of services.
The National Confederation of Insurance Companies (CNSeg) argues that the incidence of PIS/Cofins on technical reserves would represent an “expansion of taxation, which will cause a relevant economic impact on the insurance sector, since the revenues generated by technical reserves have the sole objective of covering inflationary losses from the reserves themselves”, stated the entity in its 2025 legal agenda.
In a statement sent to the Supreme Court, the Attorney General’s Office of the National Treasury (PGFN) cited data indicating that the amount accumulated by the insurance sector in November 2025 with technical provisions was R$251.35 billion. The data are from the Private Insurance Superintendency (Susep). “And it is precisely on the income obtained from the investment of this capital that insurance operators refuse to contribute to Social Security”, highlighted the PGFN.
The PGFN also highlights the evolution of capital accumulated over the last five years in technical provisions. “You can see that the amount accumulated in the sector practically doubled, from R$1.25 trillion in 2021 to R$2.03 trillion in 2025.”
The judgment has general repercussions, and the result will be applied to all processes that discuss the same topic in court.
