Brazilian lawmakers and insurance industry representatives called on Tuesday for a larger rural insurance program, arguing that it would reduce the fiscal cost of repeated debt renegotiations for farmers hit by crop losses.
The discussion took place in Brasília at an event titled “The Rural Insurance Brazil Needs,” organized by the consultancy Meridiana. The account is based on single-source reporting from CNN Brasil.
Climate Risk
Participants said Brazil’s current approach to agricultural risk needs modernization as extreme weather events become more frequent. Their central argument was fiscal: subsidizing broader insurance coverage would cost the public sector less than responding after losses with successive rounds of farm debt relief.
Rural insurance in Brazil helps producers protect crops and revenue against losses linked to weather and other risks. The debate has gained urgency because agribusiness is a major part of Brazil’s economy and a politically influential sector in Congress.
Senator Tereza Cristina, a member of the center-right Progressistas party from Mato Grosso do Sul and a former agriculture minister, said Brazil needs to strengthen a culture of insurance among rural producers and expand the range of products available.
“We have to work with our farmer so that he has the culture of insurance. And insurance is not only climate-related,” she said, according to CNN Brasil.
Cristina said producers should also have access to income insurance, parametric insurance and other formats so each farmer can choose the most suitable protection for his production. Parametric insurance pays out when a predefined event or index occurs, rather than after a traditional loss assessment.
Fiscal Argument
Cristina also questioned the level of public funding for the policy. She said a budget of R$1 billion was insufficient for a sector responsible for about 30% of Brazil’s gross domestic product.
Dyogo Oliveira, president of CNseg, Brazil’s national confederation of insurers, said rural insurance had moved beyond a complementary instrument and had become essential to the economic sustainability of agribusiness. He argued that economic policy should take a longer-term view of the issue.
“It will be much cheaper for the Treasury to expand rural insurance than to keep renegotiating agricultural debt,” Oliveira said, according to CNN Brasil.
The argument links agricultural policy to Brazil’s wider fiscal debate. Debt renegotiations can offer short-term relief after crop failures, but they also shift part of the risk to the government and create recurring pressure on the federal budget.
Bill in the Senate
Representative Pedro Lupion, who leads the Parliamentary Agricultural Front (FPA), also defended a stronger culture of protection in the countryside. The FPA is a powerful congressional caucus representing agribusiness interests.
Lupion said Brazil needs to accelerate the creation of a system similar to the one used in the United States, which he said took more than two decades to build. He also pointed to expectations around Bill No. 2,951/2024, which would reform rural insurance rules.
The Chamber of Deputies approved the bill with changes last month, sending it back to the Senate for a final vote. The Senate is the upper house of Brazil’s bicameral National Congress.
Beyond the legal framework, the event discussed proposals to improve risk management in agriculture, diversify insurance products, encourage the use of technology and incorporate international experience. Supporters said those changes could make farming more resilient as climate risks rise.
The event had support from CNseg, Fenseg, the national federation for general insurance, and the Instituto Pensar Agropecuária, a policy institute linked to the FPA.