Good morning, ladies and gentlemen. Welcome to CAIXA Seguridade's earnings call for the second quarter of 2025. This video conference is being recorded. The replay can be accessed on the company's website at the address www.ri.caixaseguridade.com.br, where the presentation will also be available for download. Please be advised that all participants will only be watching the video conference during the presentation, and then we will start the Q&A session when further instructions will be provided. Mr. Felipe Montenegro Mattos, Chief Executive Officer of CAIXA Seguridade, and Mr. Edgard Vieira Soares, Chief Financial Officer and Investor Relations Officer of the company, are present. I would now like to give the floor to Mr. Felipe Mattos, who will begin the presentation. Please, Mr. Mattos, you can proceed.
Good morning, Matheus. Good morning, everyone. Thank you for the presentation of CAIXA Seguridade's results.
Today, we will present the company's results for the second quarter of 2025. It is with great pride that I begin the highlights by celebrating the historic milestone of CAIXA Seguridade, the 10th anniversary, celebrated on May 21 2025. This is a trajectory of successful moments marked by relevant achievements and an effective contribution to the strengthening of the insurance market in Brazil. With our eyes on the future, we remain steadfast in our mission, guided by excellence, innovation, and focused on our customers' satisfaction for the next 10, 20, or however many years ahead. The celebration was marked by an inspiring institutional campaign, which brought to light the concept of "a decade making the future our present," more than a slogan. This message translates the essence of CAIXA Seguridade, which is to protect people's present while contributing to the realization of their life projects.
In this context, we launched the institutional book, Seguramente, which narrates the history of the company and its relevance in the national scenario, highlighting milestones, challenges, and achievements throughout this decade. In addition to the institutional campaign, the celebration included promotional actions, such as the launch of a package of advantages with exclusive conditions on products of our portfolio, including cashback incentives of up to BRL 25,000 for contributions to private pension and raffles of BRL 200,000 with Bem-Estar Insurance, in addition to discounts on insurance and facilitated conditions for credit letters. Moving on to the next slide, we start the highlights with two branches directly linked to CAIXA's core business, the Housing Bank. In the second quarter of 2025, both Home Insurance and house residential continued to benefit directly and indirectly from the pace of growth of CAIXA's housing loan portfolio.
I highlight that both branches achieved, once again, the best historical performance in a single quarter. Housing insurance presented another period of consistent growth, reflecting the stacking characteristic of the project, which follows the performance of the housing financing portfolio. We ended the period with BRL 985 million in premiums written, an increase of almost 12% compared to the same quarter of 2024, and year-to-date, consolidating CAIXA Seguridade's absolute market leadership in this field. Home insurance exceeded BRL 280 million in written premiums, setting a new record for the fifth consecutive quarter. This volume represents a growth of more than 22% compared to the same period of the previous year. In the first half of the year, the advance exceeded 24%.
This performance is the result of the strategy aimed at the increasing length of stay of our clients, with a focus on multi-year plans, facilitated renewal, and insurance coupled with housing, which makes the house more resilient, predictable, and sustainable. It is worth noting that we had an increase of almost 11 percent points in the renewal rate compared to the second quarter of 2024. The home insurance coupled to housing, which accounted for more than 10% of premiums written in the quarter. Furnishing this slide, I highlight the Parcela no Bolso campaign and the first installment with terms of three years cost only BRL 1 in the CAIXA credit card. This modality was responsible for almost 20% of the home insurance issuances in this quarter. This partnership with CAIXA Cartões strengthens the synergy between the conglomerate's companies while generating a base of long-term home insurance with low delinquency.
Moving to the next slide, I'd like to talk about CAIXA Seguridade in actually credit letters or credit life. In this quarter, we reached BRL 185 billion in bookings or reserves, representing a growth of more than 13% in 12 months. During the quarter, we boosted input through cashback mentioned previously in the commemorating actions of the company's 10th anniversary. This initiative resulted in a significant increase in portability received in 95% compared to the second quarter of 2024. Performance was also favored by improvements in the processes, which allowed portability to be made available in a 100% digital way. In Life Insurance, we highlight almost BRL 600 million premiums written in the quarter. Although the volume remains stable compared to the same period in 2024, it is worth mentioning the strategy aimed at long-term sustainable results with a focus on the monthly payment modality.
New sales of this modality grew more than 120% in the year-to-date compared to the same period of the previous year. This approach aims to ensure a continuous and predictable flow of premiums written, contributing to gradual growth in the coming periods. As we can see on the next screen, in the second quarter of 2025, we also reaped the fruits of the strategy aimed at consistent and sustainable long-term results in the Credit L etter and Premium Bonds segments. Starting with Credit Letter, the product maintained a robust performance driven by the current scenario of high interest rates, which favors the product as an alternative to traditional financing of housing. The volume of credit letters actually followed an upward trajectory, reaching more than BRL 5 billion, which represents a growth of almost 42% compared to the same period in 2024 and almost 40% in comparison between the first semesters.
The highlight goes to Real Estate Credit Letters, which showed an increase of more than 52% in the quarterly comparison. In the period, more than BRL 603 million in goods were delivered, an increase of almost 70% compared to the second quarter of last year. For premium bonds, we maintained our focus on monthly payment products, which continued to generate positive results. In the quarter, the almost BRL 440 million in funds raised represent a growth of 32% compared to the same period in 2024. Monthly payment collection grew more than 46% on the same basis of comparison, representing 95% of the total collected in the second quarter. In line with CAIXA's initiatives aimed at digital transformation and process optimization with a focus on customer centricity, we launched a new product, the sales journey, on the platform used by the bank's employees.
The update made the process more fluid, agile, and intuitive, reinforcing the salespeople's experience and operational efficiency. To conclude this first part, I move on to the large numbers of the company or highlights of the second quarter of 2025. We recorded a managerial net income of BRL 1.42 billion in the quarter, representing a growth of more than 35% compared to the same period in 2024 and 21% year-on-year. Operating revenue reached BRL 1.4 billion in the quarter, an increase of more than 28% in the annual comparison. Considering the accumulated in the first half of the year, the growth in operating revenue reaches almost 19% compared to 2024. This performance directly impacts our main profitability indicator, ROE, which ended the quarter close to 70%, the highest level we have ever recorded, and almost 10 percent points above what we recorded at the end of June previous year.
In line with the formal distribution adopted since last year, the Board of Directors approved yesterday the distribution of BRL 960 million in dividends related to the quarter's profit. The payout of more than 92% remains above 90%, reinforcing the company's commitment to generating value for our shareholders in a consistent and sustainable manner. I now give the floor to Edgard Soares, who will continue the presentation, bringing more details on the company's financial and operational performance in the second quarter of 2025. Edgard, the floor is yours.
Thank you, Felipe. Good morning, everyone. A pleasure to be with you. I'm going to talk about the financial, commercial, and operational performance of the company. On slide now, we summarize the performance of the finances in the quarter. It is important to note here that the numbers presented are in managerial view.
According to the new IFRS 4 standard, considering SUSEP has not yet adopted the new IFRS 17 accounting standards. In the second quarter, operating revenue grew 28.5% year-on-year, reaching almost BRL 1.4 billion. Of this volume, 58% correspond to the revenues from investments in equity interests, with an increase of 50% compared to the same period of the previous year. I highlight here the historical results of CAIXA Residencial, CAIXA Consórcio, and CAIXA Assistência. The remaining 42% of operating revenue refers to distribution, which increased by 7% compared to the same period in 2024, with emphasis on revenues on housing and home insurance lines, in addition to credit letters. In the quarter, net income exceeded BRL 1 billion, equivalent to a growth of 35.2% year-on-year.
In the normalized view, when the effects of extraordinary events on 2024 profit are disregarded, the results of the second quarter of this year would be 12.2% higher than in the same period last year. From the accounting perspective, falling IFRS 17 profit of BRL 1.028 billion corresponded to a growth of 57.3% compared to the second quarter of 2024. As mentioned by Felipe, the company achieved an ROE of 69.6%. This is the highest level in history, a growth of 9.9 percent points compared to the same period last year. This growth is due to the improvement of operating and financial results and the effects on the increase in frequency of dividend payments on the basis of shareholders' equity on a movement that began last year with the quarterly distribution. Moving to the next slide, we're going to talk about the commercial performance of the insurance business.
The housing and residential branches stood out, which maintained their trajectory of renewing their historical records of premiums. The housing line showed a 12% increase compared to the same period of the previous year, reflecting the growth of CAIXA's real estate loan portfolio. The residential branch, with a 22% increase in the same comparison, registered a record for the fifth consecutive quarter as a result of the strategies adopted for the segment and recently addressed by Felipe. I also highlight the annual growth of 62%, reaching the mark of BRL 2 million in the Rapidex product. The focus on consistent and sustainable results in the long term is a pillar of the strategy adopted by CAIXA Seguridade. In addition to these positive results and quite significant new sales of life insurance, with monthly plan increases, an increase of 121.7% compared to the second quarter last year.
Although in this quarter, the volume of premiums for the product remains stable, this dynamic tends to translate into an increase in issuance or writings over time. The lender's insurance on the credit life recorded a 43% reduction in the issuance of premiums in a year-on-year comparison. This performance reflects a more challenging macroeconomic environment marked by high interest rates, which reduce the ability to contract credit for both individuals and companies. In this scenario, we also have a reduction in the capacity or ability to acquire insurance linked to credit operations. The cost of credit is high, resulting in a lower penetration of credit life insurance. In the chart on the right, earned premiums for the second quarter of 2025 grew 6% compared to the same period, 2024, which reflects the resilience of our business.
In the year-to-date view, the segment's growth was 7% in relation to the cumulative index in the first six months last year. On the next screen, we present some operational performance indicators. Compared to the second quarter of 2024, the loss ratio decreased 34.3 percent points. This movement is due to the occurrence of extraordinary events in the same period previous year, which impacted the part of credit life and housing sectors. Compared to the last quarter, we had an increase of 0.5 percent points, reflecting a high volume of notices in the housing sector. In the first half of 2025, the loss ratio was 24.8%, within the historical level for the insurance segment. Regarding commissioning, the dynamics also remained within the historical level, with no relevant variations throughout the year.
As for the operating margin, variation of 66.7% year-on-year also reflects the loss ratio of the extraordinary events that took place in 2024. Compared to Q1 of 2025, the growth of 1.3 percent points is related to the growth in premiums earned between periods. Thus, representativeness of the total operating margin increased 11% points compared to 2024, totaling 46% in Q2 of 2025. On the next slide, we have performance and accumulation vertical by segment covering private pension and also premium bonds. Starting with private pension, the quarter was impacted in changes of the IOF , which led to a decrease in gross contribution. In the first half of the year, contributions grew 1.9% over the same period previous year, reaching an amount of BRL 12.7 billion, reflecting the mobilization of sales forces. The accumulated inflow of BRL 185 billion in reserves increased more than 13% to 12 months.
Moving to Premium Bonds, it is possible to observe the effect of strategy and focus on the monthly payment modality. Representativeness in the total collection increased in the quarter. Sales with monthly payment grew 45.6% year-on-year, which contributed to reaching a new record in the funds collected, with a growth of 31.5% compared to the second quarter of 2024. Premium Bond reserves, which exceeded BRL 2.9 billion, grew 47% in the year. Finally, in the quarter, BRL 5.3 billion were sold in Credit Letters, representing a growth of 41.5% compared to the second quarter of 2024. This performance contributed to the expansion of the stock of credit letters, which reached BRL 39.9 billion, an increase of 62% in an annual comparison. Still talking about accumulation, on the next slide, operating revenue in the second quarter grew 13.1% compared to the same period of the previous year, with an increase in all segments.
The main highlight was the Credit Letter 30% growth between the periods. With regards to operating margin of the accumulation vertical, in the second quarter, we had an increase of 15.6% compared to the same period, 2024, with growth in all segments. It is worth highlighting here the significant increases in credit letter and also capitalization, also premium bonds here. Thus, the representativeness of accumulation business in the total operating margin totaled 28% in Q2 of 2025. On the next screen, we should have more details on distribution business. It is important to highlight that the distribution business includes the results related to revenues from access to the distribution network and the use of the CAIXA brand, and the revenues from brokerage and intermediation of insurance products considered here together as brokerage revenues.
In the second quarter, brokerage revenues grew 7.3% compared to the same quarter of 2024, reflecting a mix of products sold in the period. On the left table, it is possible to follow the detailed performance by insurance lines in the accumulation business, highlighting revenues originated by housing insurance, + 30%, home 25%, and also credit letter + 55%. Regarding distribution of brokerage of the total revenues, 22% was allocated for payment of award fees for CAIXA employees and partners, and 12% was allocated to CAIXA's service fee. The 66% portion of the commission paid by the operating companies remained with the brokerage this quarter. The operating margin fell 1% compared to the same quarter of 2024 and was impacted by the performance of the lender. Also, the credit life, a product with the highest level of commissioning.
In total, the distribution business represents 26% of the operating margin, with 21% referring to insurance vertical and 5% referring to the accumulation vertical. On the next screen, operating indicators are presented in a group manner, considering percentages of CAIXA Seguridade's economic participation in each invested company. The administrative expenses ratio, ADI, improved in Q2 of 2025 with a reduction of 0.3 percent points compared to Q2 of 2024 and 0.3 percent points compared to the first quarter of 2025. The indicator maintained the trajectory of efficiency gains, with emphasis on the improvement of the indicators, the new partnerships, and in the run-off operation. The combined ratio improved 9.9 percent points in the quarter compared to the same period of the previous years, reflecting extraordinary events of claims that occurred in 2024.
Compared to the first quarter of this year, we had an improvement of 0.2 percent points, reflecting the improvement in the margins of the accumulation and insurance businesses. The ICA maintained a similar trajectory of ISC. In the quarter-on-quarter comparison, we had a higher improvement than ISC, rising to 0.8 percent points, reflecting the increase in the group financial result. Moving to the next slide, we can analyze the operating and financial results and their representativeness in the net income, considering the effect of all participations net of taxes and in the proportion due to CAIXA Seguridade. The financial result for the second quarter of 2025 was above what was observed in 2024, with an increase of 30.6%, reflecting a higher SELIC rate, a higher leverage balance applied, and the improvement in portfolio's profitability.
Thus, the financial result accounted for 32% of CAIXA Seguridade's managerial net income in the quarter, an increase of 1 percent point compared to the first quarter. Regarding the grouped composition of the investment portfolio in the second quarter of 2025, of the total of BRL 15 billion in financial investments, 48% were in post-fixed securities, 32% in pre-fixed securities, and 14% in the inflation indices. The other 6% in other types of funds. The average yield of the fixed-rate portfolio was 12.5%, an increase of 100 bps as compared to the March 2025 position, reflecting the renewal of securities that matured in the period for securities with a higher yield. With this, we conclude the presentation of our earnings for the second quarter of 2025, and we'll start the Q&A session.
Thank you to each and every one of you. Thank you, Edgard. Thank you, Felipe.
Now we're going to start the Q&A session for investors and analysts. If you wish to ask a question, please press the reaction button and then click raise hand. If your question is answered, you can leave the queue by clicking lower your hand. I remind you that the questions should be asked only in Portuguese. If you wish to ask a question via Zoom, please enter your name, company, in the Q&A field. Our first question is from Mr. William Barranjard from Itaú BBA. You may ask your question. Your mic is open.
Good morning, everyone. Thank you for your presentation. I have some questions here regarding private pension. The first is gross and net premium bonds. We have 21st. You were able to have positive in our intake, even regarding turmoil regarding VGBL and IOF.
What do you see in this growth funding, how this should be impacted from now on? Also, thinking about net funding, what you should assume we should see from now on ahead. Second question regarding also private pension, thinking about the management fee, it dropped to 0.6%. Compared to the drops in the previous quarters, has it had an impact because of the impact on this redemption rate or because of greater allocation on fixed income?
Hi, William. I'm going to start speaking, bringing some more macro data that we may have regarding VGBL and IOF and the impacts on the market. First point, William, is that those impacts were for everyone in the market, not only for CAIXA Seguridade.
We say that we had a very fast response react regarding the market, both in terms of placement when it was lowered to [BRL 50,000], the specific amount of investment, and the new decrease that we had on IOF. It impacted the whole market, not only the private pension, the investment market for all the segments. Other financial systems worked unrelentingly to understand the impacts and understand what the best reaction would be. CAIXA Seguridade, Edgard, will go in depth. We felt a great drop in origination of resources so that the market could understand what the impacts would be, but we can bring here that about 15% is expected of impact to our origination regarding what was initially estimated for our part of private pension. Edgard, if you want to go more in depth.
T hank you, Felipe.
Regarding growth funding, Felipe brought our preliminary evaluation had been at a level of 15%. We're expecting a range of 15% - 25% impact on growth funding for private pension because of the increase in IOF, tax on financial operations. In terms of net funding, CAIXA has been adopting a search for portability, a change in positioning, and we have here an expectation that is not so impacted as growth funding because the market is already quite large and CAIXA is already a consolidated institution in this market. With regards to the second question, the management fee has been reduced regarding more conservative funds, ways of investment, and greater appetite that we have been having regarding funds that are already managed in the market, bringing reserves to CAIXA Seguridade, right? I hope I've answered your questions. If you need anything else, we'll be available to go in depth.
Thank you, Felipe and Edgard.
Thank you, William. Next question is from Ricardo Buchp igel from BTG Pactual. You may proceed.
Good morning, everyone. I have a couple of questions here. This quarter, in addition to challenges because of credit origination, because of the macro conditions, you had certain issues on certain INSS issues. If you have the premiums for credit life in the next quarters, if this one is something we should look at from now on. For my second question, you see better performance origination in life premiums, and you commented that this product of monthly payment is growing more. What we saw in terms of premium bonds, how should, when should we see an acceleration in this segment of life in the next quarters of the year?
Does it make sense to have this line growing at some point in two-digit levels if you consider that greater growth in monthly plans or payment plans? Thank you.
Thank you very much for your questions. With regards to credit life, this gap that we had regarding INSS impacted for a brief period of time, it was resumed with nimbleness, and we actually have that readoption of credit life. The performance of credit life has been impacted by these variables that we have brought here that you have reinforced on your question. We have an expectation of a second half that is stronger than the previous, considering funds for rural credit are available again, the mandatory funds, and the credit lines for corporations should move forward in the second half. In addition, we've also had the launch of our credit life insurance for the credit for workers.
This should also bring a positive impact. Combining the whole situation and all the factors, the scenario of the first half should be lower than the performance that we observed in the second half of the year. The second question?
Sorry. It was about, yes, life premiums.
Regarding life, this change in strategy, when we observe the behavior of monthly payment products, we start viewing a stacking of that from the second half next year. We have a timeline of 12 months to observe this increase. The fact is that this operation of monthly payment produces this stacking and brings new business opportunities and customer relationships. We have been investing a lot in it, and we understand it's more long-lasting and brings more predictability, more return for shareholders and for the company as a whole.
Great. Thank you. Thank you.
Thank you, Ricardo.
The next question is from Kaio Prato from UBS. Kaio, your mic is open.
Good morning. Thank you for letting me ask a question. I have two on my side. First, regarding, you have had a very good performance regarding mortgage and also housing. I'd like to know if you can break it down or if we can, what we can expect from now on, if this growth level can be more sustainable on those two lines, especially in terms of home. You mentioned coupled insurance. Yes, the share and the pocket, the Parcela no Bolso . I'd like to understand more about those products, if they have an acquisition cost that is higher, their economic viewpoints, or if you imagine something of campaigns for other products as well. Perhaps you mentioned a bit of credit life.
If for any other products, if you may have any other campaigns thinking about the second half of this year. Thank you.
Hi, Kaio. Thank you for the question. I'm going to talk about the overall lines, and then Edgard can talk about that. Regarding homes, we expect a volume similar to the first. We follow the guidance given by CAIXA. CAIXA is going to disclose its number regarding Q2 and then the second half when it makes its earnings results presentation. We had a very robust semester when we have what is the guidance of CAIXA, you know, contracting rates that CAIXA has been pointing towards. We believe that what we have seen in the first half, it has been a very robust quarter, very strong, and again, above expectation.
We always work with best scenarios, but we must pay attention to a scenario that SELIC will be kept at the same level and the budget is not kept as expected. CAIXA, from what it has given to us as indication, when it brings to the market, it seems that it will be a year higher than last year, and it brings a good outlook for the second half regarding housing or mortgage. Regarding homes, we're growing at a faster rate than we grow in mortgage, and because we are working on our portfolio to go deeper into your question, Edgard can talk about it later. It's important for us to search tickets. We are seeking products that are more coupled, more necessary for each type of customer. When I have a more appropriate product for all types of customers, CAIXA works with more segmentation of customers.
We attain a higher level of customer satisfaction in terms of sales and renewals. Regarding sales strategies, campaigns are always analyzed according to needs, both for the market, sales, and for each product. If necessary, for credit life, mortgage, Rapidex will hold a campaign as long as we respect our premises, which is customer focus, the effectiveness of the campaign, and having an outreach to the real need, not only for the company, but especially for the customers we try to serve in the long term. Edgard is going to talk about the strategies.
Kaio, thank you for your question. With regards to Parcela no Bolso or sharing the pocket, it's pluriannual. It brings a dynamic of greater permanence, and through payment in with credit card. It has a likelihood of cancellation that is lower, and the operational cost is the same.
The improvement in the indicators offsets the initial payment, and we have observed a good behavior of our customers regarding the product. With regards to the residencial couplado or the home coupled, it has several advantages for customers because it brings with the installment of the mortgage payment, and it comes into the account of the customers and their monthly expense. In addition, it has reduced cost and longer term, which makes the customer actually benefit from the insurance of the life cycle of their housing contract. Actually, the loss ratio is lower with less use of the insurance. It's a strategy that has been bringing good results, and we have been investing a lot in making it along with our housing insurance. I think with the campaigns, Felipe addressed them quite well.
We have to check the need, opportunity, or timeliness, and convenience of holding them, in addition to bringing all the suitability, customer focus, and the opportunities that come up at given times in market variables for us to tap into them and not be outside them. After all, we have a wonderful distribution network in the bank, and we need to boost those businesses.
Okay. Thank you.
Thank you, Kaio. Our next question comes from Antonio Ruette from Bank of America.
Good morning, everyone. Thank you for your time for answering questions. I'd like you to elaborate on the possibility of increasing penetration and maintaining the insurance sales penetration despite a level that is potentially weaker. The question is, if we continue the interest rates, what we have in terms of levels that tend to be a bit below, considering payroll deductible.
If you can think to talk about increasing penetration, that would be great. Thank you.
Great. Thank you very much. Answering your question, I think the higher interest rate scenario leaves customers that are recurring borrowers that frequently renew their contracts. They have lower search for credit, and we have the possibility of also working on other customers that are not typical borrowers. In addition, we had a payroll deductible for workers that brought an interesting customer base for the bank to work on, space for growth. A penetration in the customer base exists. CAIXA is revisiting its strategy with customer relations. We have been working on that. It's been a time for good exchanges. We've been moving forward quite well regarding debates and everything we have been programming to deliver to our customers.
The penetration we have today should be growing on the timeline, and we should increasingly observe an expansion of the customer relationship of customers and CAIXA, and obviously through our products and our having an outreach to an increasingly greater audience.
Thank you, Antonio. Our next question is from Arnon Shirazi from Citibank.
Hi, everyone. Good morning. Once again, thanks for the opportunity. I also have two questions. My first question is regarding private payroll deductible. You said you expect an improvement in the second half on the part of credit life. If you could shed some light on the ramp-up of this product. The second question is regarding general expectations for the second half of this year. As I've mentioned, you talked about the part of mortgage or housing.
I'd like to have an overview of what you expect in terms of the second half, or if you considering you have no formal guidance for that. Thank you.
Thanks for the question. Let's talk about credit life and workers' credit. We've been developing a differentiated product. We should not keep only on the traditional products of credit life. We have a coverage that is also something that we are testing now. We should expand it in the second half, which is loss of income. This coverage is interesting because we make a previous selection of the employer, the borrower, and also the profile that we have in the portfolio is starting this operation, and we have a great possibility of having interesting penetration of the product. Today in payroll deductible, we have something, if you look at general concessions, about 40% - 50% depending on the period.
Some periods even higher than that. We should also have an interesting penetration with this new product along with those convenient parts of the portfolio. Regarding the second half, I'm going to turn over to Felipe. Just bringing an overview. For credit life, we should observe a growth regarding the first half. We have a more favorable scenario in the second half with all the things that I've already brought to you. Life insurance, we have this strategy. Actually, this payment that is going to be monthly. For private pension, we have the high interest rates. Our business is resilient and strong because of the balance between the results that we have from distribution, financial management, and our profitability from our companies. The outlook we have is earnings results, growth, commercial performance. They're line by line, product by product.
We should go into much greater detail than what we're bringing here. Overall, with strong businesses and growing results for the second half.
Hi, Arnon. Thank you for your question. Just to bring a bit of the data that you asked about, I'm going to break down into segments for, mortgage we've already talked about depends on the performance of CAIXA. It's a market leader. Also, we have in-house insurance. We have an opportunity in the second half to keep on working in our portfolio, better understand the needs of our customers, and be able to offer those customers an even better and more adapted solution to their lives regarding, the private pension. It's a challenging scenario because of the increase in the IOF. We're dealing and responding fast and quite efficiently regarding this new reality.
We have been able to maintain a good level of growth, of course, impacted by the uncertainty brought by the IOF . Regarding life insurance, we have a challenge. We actually bring in something that is low in the long term or good in the long term. We'll feel in the next 12 months, we're going to see the result of the strategy of the monthly payment. Now we're still having a growth that may be improved in the second half, and expand regarding credit life. It's been impacted in the first half. It should be growing more. We had a gap regarding the first half regarding what has been estimated. We'll work with a new reality regarding what was expected for the year of 2025, just as the whole market has acted regarding this segment. A great highlight.
We may bring our credit letter segment and also premium bonds with a high SELIC rate and the strategy of the company. We may say that we expect robust growth, as mentioned and seen in the first half. We have a good outlook in those segments, just as the system that is a product that is very closely related to our CAIXA audience, and we are very pleased to bring solutions of assistance to our customers. Speaking of products, we are working on various lines and various fronts to launch, as Edgard brought, the loss-of-income coverage, the new support and assistance, new insurance, new products to our customers. We may improve not only our results, our penetration, but especially the adaptability and customer service for our CAIXA Seguridade customers.
Thank you very much.
Thank you, Arnon. Next question from Maria Guedes from Banco Safra.
Thank you for taking my question.
I'd like to talk about a product people have been praising. Felipe mentioned, which is actually a credit letter. The product accounts for 10% of operating margin of CAIXA Seguridade, considering the performance of the product and what is distribution revenue, and a product that has had a very good performance in the industry as a whole. You have space for growing penetration within CAIXA Seguridade. I'd like to understand your view in terms of commercial performance of the product. Even though it's had very good performance, do you expect it is low as, well, if we have lower interest rates, we see a lot of competition in this product. I'd like to know the main points and what main expectations regarding it, looking at the operating margin. You have results that come from commissions and also from the operating margin as you stack certain bonds.
What would be the potential for the product for CAIXA as a whole, looking at a medium to long term? Thank you.
Thank you, Maria, for your question. On credit letter, we should talk about a complementary strategy of traditional housing or mortgage funding. Our credit letter may be a complementary tool, and in the second half, we expect to have high SELIC or interest rates. We have a robust growth in the credit letter segment. What about our strategies? It's important to stress that our credit letter has a cancellation fee that is the lowest in the market. We have customers coming from Bancassurance CAIXA. It's more qualified. The second point is that we make an analysis of the customer, their profile as we sell a credit letter.
It's not only a sale to a future acquisition of an asset, but actually the analysis to see whether the customer will be able in the future, once they are contemplative, of actually paying the installments once they are contemplative. We anticipate the controls made. We actually make the analysis before the new loans or letter. We don't want people to have credit letters as a frustration. We want those to be stream fulfillers. We have a growing margin of our business, especially while brokerage expenses are high in the beginning, and they come as revenue for CAIXA Seguridade. We think that in terms of management fees, we have a differential regarding the market. We're still very young. Our operation of credit letters in the current model is from 2021, and our average management fee is still a bit high.
Although we have brought in previous calls, we expect it to stabilize between 3%, 3.5% over the years based on the portfolio. Edgard, overall, I've mentioned that everything. If you want to go in depth.
T he challenge of going in depth after so much information you've shared, regarding commercial strategy, just to share with you, it's important for us that we have been working on reduced installment payment on the product. It brings a possibility for customers that already pay rent. They can actually have, for example, a credit letter for real estate. They can actually pay higher installment when they have, you know, high credit letters. The customer is paying some kind of financing or loans. They use the car, for example, for commercial activity. They may have a credit letter and actually buy the vehicle. Reduced installment is a strong strategy, expanding the CAIXA channels.
The way CAIXA has been positioning regarding its channels is also important, and the credit letter segment is following that. We know it's a very competitive market, and we have a lot of players. There is fierce competition in the market, but it is a product that is a dear product for Brazil. People like the product, and we have in the CAIXA brand its soundness, the indicators. Felipe talked about the indicators that we have. We have better indicators than the market, and now we have a high contemplation, a low cancellation fee. Our product is well positioned. We'll position it better in media, in the ways people can visualize the product so that we have an increased audience, and it can be reflected when we have a lower interest rate. We have a trade-off between traditional positioning and credit letters, as you've been observing.
We have a record of hiring housing and mortgage and also credit letters, so we can coexist with the two movements on banks' counters.
Thank you very much. Our next question is from Tiago Binsfeld from Goldman Sachs. Tiago, you may proceed.
Hi, good morning. Felipe, Matheus, Edgard. First, wish you Edgard success in the new position. My question is exactly that, the change in CFO. If you can comment if anything changes in terms of strategy in the company, what changes Edgard tapping into your experience that is very vast in the retail network of CAIXA if you see opportunities of improving incentives and also a part of private pension? Thank you.
Tiago, thank you very much for your question. You gave me an opportunity. I was expecting at some point to be able to talk about that.
Initially, Eduardo has worked here as a Director in several roles at CAIXA Seguridade. I'm very grateful to everything he has done. He actually performed greatly. He was an exemplary executive. We were very happy to have him in the company. We don't expect line changes in our way of thought and the way we act. We like and we fight to keep on being a company that is predictable, a conservative company, and also our shareholders and customers are able to trust. We don't expect any change. This is not our idea of change in any line of our action in the financial field. The first part, it's important for us to bring it up. Edgard's arrival, which has been exemplary from our commercial in CAIXA Seguridade, he also has a very sound background in the financial department and also in the controllers' area.
We brought Edgard from the commercial seat to the financial seat because we expect continuity in our way of work and our lines of thought. We strengthened ourselves with a person that has a strong commercial resume, bringing Edgard from commercial to financial. He deals with that very well. We wanted to share this impression, this idea to the market that we want to continue being what we are. We understand that our business model is something solid. It's a successful model, and we believe in it. Therefore, we plan to continue as we have been so far. Once again, I'd like to thank Eduardo for everything he has done.
Thanks, Edgard, for the period he's been in commercial and wishing him great success in expressing mine, not only mine, and from the Board of Directors of CAIXA Seguridade, total trust in the performance and work of Edgard heading the financial department and Sidney, who's going to take over the commercial department.
I'm going to take the floor to thank for your congratulations. I'd like to say that I've been two years with great Edu, CFO of the company, when working in the commercial department, to highlight how much we've grown together, learned, shared ideas, and we'll keep on being the same direction that we have had so far.
I'm sure that we're going to follow this line of work, the work that we have, the team that we have that is very strong, that has brought all the results, predictability to you so that we can keep on working together over this period. I'd like to thank, thank Edu, and pay tribute to him. Welcome Sidney, a wonderful person, a long background in the retail network. We work together in the retail of the bank, and I'm sure that we're going to keep on firm on the same pace we had with the new management. Thank you very much, and to success to all of us.
Thank you, Edgard.
If I could just have a follow-up, tapping into your experience coming from the commercial area regarding incentives for distribution of products, do you think today the incentives are well positioned, or if you see any opportunity, perhaps more in the long term of the improvement and even increasing the products within the network?
I am moved, and the answer for the second question never came up. With the remodeling, and let me put it like this, the strategic change that the bank is going through and that we are engaged, the expectations of various incentives of the bank should be reflected at all layers of its commercial department areas, branches, and portfolios, and we're working along with them to foster correct incentives to the right people, to have the sales made to the right customers, and all that being done in a sustainable way.
Today, we have incentives, of course. It's the bank's counter. We have competition of all financial products we have in the bank. We are here with about 20% of the weight we expect of the performance of normal commercial activities. What we have been sharing with you, we have room for other incentive mechanisms of performance evaluation. CAIXA has been evaluating that. We see perceptions of both of colleagues that work in branches, as well as various managers here, so that we can tap into those strategies and foster new incentives. The traditional ones that we have will be maintained, and we are evaluating the inclusion of other instruments now in the near future, and we'll analyze that along with the bank to launch that as soon as possible. Thank you.
The most important that we may say is that CAIXA Seguridade is an irrelevant part in the CAIXA's results, and we don't expect any changes in the guideline of the bank regarding incentives and the policies of what is already done. After all, CAIXA Seguridade will intend as a conglomerate to follow CAIXA's steps and grow better, serving society and our customers.
Okay. Thank you.
Thank you, Tiago. We have one more question. Guilherme Grespan from JP Morgan.
Hi, good morning. Thanks for the presentation and opening up for questions. Two more technical questions on my side. In life, remind us what is the percentage of the premiums linked to IGP-M, the prospects for the forthcoming months, considering IGP-M has been supplied with the devaluation rate. The second one is private pension and credit letters. Can you remind us what is the accounting method of commissions?
Not from brokerage, I think it's CAIXA regime, but only from the viewpoint of the operational subsidiary. Just to remind what is CAIXA regime, if it's deferred over time, if it's cash. The context of the question is more private pension. If you could actually answer on credit letters, if this commission of credit letters is also deferred. Thank you.
Grespan, thank you for the question. Today we have 70% of life linked to IGP-M. It's a representative share, bringing very objectively the answer to your question. Regarding private pension and credit letters, results on the company are deferred on timeline. It generates stacking all the dynamics we already have. Level of commercialization today reflects in the future results. Some products may suffer because of tax, and the part of credit letters is greatly improved. We have to work credit letters because it's a product of CAIXA.
Perfect. Thank you.
Thank you, Grespan. We now have one more question in writing from the HSBC analyst Carlos Gomez Lopez. I'm going to ask your question. His question is regarding changes of tax policies. First, regarding if there is an outlook of changes in the IOF, considering the impact those changes have on the system, and this generates a negative impact for accumulation of financial resources in Brazil. This is the first question. The second question is regarding the outlook and impacts of increase in social contribution for insurance companies in June. He'd like to know if this is going to materialize, who should be impacted.
I think the first question is more important.
We'd also like to know regarding your questions regarding the tax scenario and the impacts that what they may bring will always going to work according to the market, the industry analyzing the market according to what comes up. We cannot stipulate or say what will happen if there will be actually a change in the fiscal or tax policy. Perhaps what has been in terms of changes in the tax reform regarding policies that may come up that are not on our radar are things that we cannot clarify. I can assure you that we'll be following the market according to our industry in action in a proactive way as ready as possible. Edgard, go ahead.
Carlos, what we have to say regarding tax changes is that it is something that actually does not depend on us.
We have to work and change as fast as possible to adapt and to be inserted in the market. We have been observing where we are keeping everything on our radar and having a countercyclical measure so that we can have certain measures in search of more portability work on inputs or customers have to be a second institution. We can be a second private pension institution, and we have a logic working on to be countercyclical, aiming at best results in the area regardless of the scenario. Second question, the preliminary analysis we've made is the impact of the movements in what we have in terms of funding. The levels are halfway for us to be able to analyze, but 5% is what we have observed so far.
Okay. Thank you, Carlos.
I'm going to move on to the next question in writing from a shareholder who called himself Matteo. First question was answered regarding the new financing lines regarding private credit. It's being delved into regarding impacts that may happen. Regarding the non-renewal of the shareholder contract.
Matteo, thank you for the question, for your interest. It's interesting to have investors following our earnings results call, and it's very good to be in touch with everyone regarding the first part, as Matheu's brought. We have been debating the question. We don't need to be long on that. The part of Too Seguros, the renewal of the agreement, is simply non-commercializing the actual housing insurance of the Too Seguros. Our equity or our share is maintained in the company. We have the commercial agent of the PAN Bank made by Too Seguros.
We, as participants of this corporation, will have the results or the company whilst we are partners, as we are also keeping a share of it. We follow on the same path. As to bank counter commercialization, we follow with the first option, which is CAIXA Residencial. The housing is the second option on the market. Our second option on the counter is a Tokio Marine, the insurance company that offers the housing insurance along with our CAIXA Residencial. In brief, for the time being, nothing changes. We don't have an outlook of change regarding that much. On the contrary, we'll continue with housing insurance on the bank from these two insurance companies. We follow the Too Seguros with the bank.
Okay, thank you very much. The Q&A session is closed. I'd like to give the floor to Felipe Mattos so that he can make his final remarks.
Thank you, Matheus, Edgard , but especially thank you who believes in CAIXA Seguridade, who follows our results, our performance, to every employee, enthusiast, and shareholder that takes a bit of their time, that uses a bit of their time to be here with us to encourage even more our continuing with this company that certainly will be a success for the next 10, 20, or 100 years. Thank you very much.
CAIXA Seguridade, this video conference is closed. We thank everyone for their participation and wish you all a very good day.