Contracting agricultural insurance: impacts of extreme events

Abstract

This paper aimed to analyze the impacts related to extreme events in the process of agricultural insurance contracting in 2022, especially as a result of the events that occurred in 2021, based on data and indicators made available by the Ministry of Agriculture and Livestock (MAPA) for Brazil and the state of Mato Grosso do Sul (MS). We made a quantitative and descriptive research, using secondary data. From the collected and analyzed data, we concluded that: a) the readjustment of the subsidy program for the rural insurance premium (PSR - Programa de Subvenção ao Prêmio do Seguro Rural) and the budget allocated to the subsidy contributed to the increase of number of producers benefited by this public policy; b) the loss of insurers in Mato Grosso do Sul, understood here as the difference between premiums and amounts indemnified, was 31.5% higher than that for the country in 2021; c) approximately 80% of claims paid in 2021 were due to drought, that is, the weather was the event responsible for most claims both in Brazil and in Mato Grosso do Sul; and d) the high loss ratio related to the 2021 harvest implied an increase of the average price for policies for the country and for the state of Mato Grosso do Sul, with a greater increase for Mato Grosso do Sul.