Winter harvest insured area grew 56% with support from Mapa

The Ministry of Agriculture, Livestock and Supply (Mapa) released this Wednesday (7) the consolidated results of rural insurance contracts for the 2020 winter harvest, which were supported by the Rural Insurance Premium Subsidy Program (PSR). In total, 44.787 policies were contracted, an increase of 62% compared to the same period in 2019. The growth in the insured area was 56%, totaling 3,1 million hectares and the total insured value was R$6,4 billion, 87% higher than in the previous harvest. 

For the director of Mapa's Risk Management Department, Pedro Loyola, this expansion in hiring occurred mainly due to the volume of resources invested in the PSR. “In 2020, we managed to more than double the budget applied to the winter harvest, there were around R$250 million in subsidies for rural producers to pay for insurance. Remembering that this year we also increased the percentage of subsidy to the premium for these crops”, he points out. 

The insured value of policies contracted for second-crop corn crops jumped from R$2 billion in 2,5 to R$2019 billion in 4,8, while the total insured value of wheat policies totaled R$2020 billion, compared to R$1,5 million last year. Insurance contracts for oat, canola, barley and sorghum crops also showed significant growth.

Improved coverage

Another important result highlighted by Loyola was the increase in the level of coverage contracted by producers. The level of coverage for the expected productivity of the crop is a percentage that reflects how much protection the producer will have in the event of an accident, that is, how many bags are protected by insurance. This level can generally vary between 65% and 80%, depending on the crop and planting region.

"In the case of 2nd harvest corn, for example, in 2019, 94% of policies had a coverage level of 65% and only 4% with 70% protection. In 2020 we observed that 18% of policies contracted the 70% level, This demonstrates the producer’s concern with increasingly protecting their crops”, says Loyola. 

Hiring

Producers interested in taking out rural insurance should look for a broker or financial institution that sells rural insurance policies. Currently, 14 insurance companies are authorized to operate in the PSR. Rural insurance is aimed at individual or legal producers, regardless of access to rural credit. 

The economic subsidy granted by the Ministry of Agriculture can be requested by any individual or legal entity that cultivates or produces species covered by the Program. For grains in general, the premium subsidy percentage can vary between 20% and 40%, depending on the crop and type of coverage contracted. In the case of fruits, vegetables, sugar cane and other types (forests, livestock and aquaculture) the percentage of subsidy to the premium will be fixed at 40%. 

Soybeans, summer corn, bananas, apples and grapes in Pronaf

For producers who are taking out funding credit from financial institutions and are included in Pronaf, between July and October, there is a pilot project with resources of R$50 million from the PSR to encourage the taking out of agricultural insurance for soybeans and summer corn (subsidy of 55% of the premium) and for bananas, apples and grapes (subsidy of 60% of the premium).

North and Northeast

For grain producers in the North and Northeast regions, the PSR will allocate R$50 million exclusively to these regions.