Brazil enacts new legal framework for rural insurance

Seguro Rural Lei nº 15.526 agribusiness agricultural insurance Brazil

Brazil has enacted Law No. 15.526, establishing a new legal framework for rural insurance to stabilize the agricultural sector. The legislation aims to prevent the recent decline in protected areas, which fell from 13.77 million hectares in 2021 to just 3.2 million in 2025.

A key feature of the new law is the protection of federal funds for the Rural Insurance Premium Subsidy (PSR) against budget freezes, making these expenses mandatory within the limits of the Annual Budget Law. The law also introduces the Rural Insurance Stability Fund (the “Catastrophe Fund”) to provide supplementary coverage for large-scale losses and sets strict deadlines for claim processing and payments.

This regulatory shift comes as the agribusiness sector faces significant challenges. The Brazilian Association of Agribusiness (Abag) has identified five priorities for the next government, including more predictable credit and climate protection. Simultaneously, rural credit delinquency for individuals reached a record 9.69% in August, a sharp increase from 0.95% in 2023, driven by high interest rates and climate-related losses.