Antônio Jorge (“AJ”) da Mota Rodrigues, Head of Howden Re Brazil, is drawing attention to the growing impact of climate risks on Brazil’s insurance and reinsurance sectors. As the country prepares for COP30 in Belém later this year, AJ highlights the urgent need for better climate resilience strategies.
With nearly 30 years in reinsurance broking, AJ has observed significant changes in Brazil’s market. He noted that since 2007, when international reinsurers entered what was previously a closed market, exposure to climate risk has become the main challenge.
Raising awareness remains a key obstacle. “We need to help people understand that the next event isn’t a question of ‘if’, but ‘when’, and that reinsurance has a role to play in protecting lives and livelihoods,” AJ said.
He added: "Climate has always been a subject that captivated my interest. Long before it was a regular topic of discussion, I was reading scientific papers and following the data. I could see these patterns changing in Brazil - floods, landslides, droughts, bomb cyclones - and I kept thinking, this is something we need to be ready for, as an industry and as a population.”
Brazil was once seen as low risk for natural disasters, but recent years have brought more frequent climate-related events. In 2021, severe drought damaged soybean crops nationwide. “In 2021, we saw a devastating drought that wiped out soybean crops across Brazil, one of the world’s largest soybean exporters,” AJ explained. “Loss ratios for some insurers reached 700%. It was the first time we experienced a market-wide insurance loss driven by climate.”
The May 2024 floods in Rio Grande do Sul covered an area larger than Hurricane Katrina’s impact zone in the U.S., yet insurance penetration in Brazil remains below 6%. This resulted in high economic losses but relatively small insured losses. “The floods served as a wake-up call for the entire market,” AJ said.
Following these events, reinsurers have begun demanding improved data rather than simply raising prices. “After the floods, reinsurers didn’t necessarily raise prices, they asked for better data,” AJ said. “They asked questions including: How much of a portfolio is in high-risk zones? What’s the geolocation of insured assets? Most insurers in Brazil couldn’t answer, because that data wasn’t being tracked. They had never needed to.”
He continued: “Now, we’re at an inflection point. There’s an urgent need for catastrophe models, but also for the data that makes those models useful. At Howden Re Brazil, we’ve been investing in both, to ensure that we have the right tools in place to effect meaningful change for our clients and the wider industry.”
To address these needs, Howden Re Brazil is developing catastrophe models specific to local conditions instead of relying solely on global templates. The team includes a full-time meteorologist and produces quarterly climate reports along with alerts about new weather systems tailored for Brazilian insurers.
“We are the only player in the market who does this currently,” AJ said. “Through building local models and working with the market players, we are raising awareness of the data required and how to best prepare portfolios to use those tools.”
Looking ahead to COP30—which will take place deep within Amazonia—Howden Re Brazil is collaborating with its parent company’s global Climate Risk and Resilience team to adapt research findings with insights relevant to regional stakeholders.
AJ explained: “We’re localising reports and adding insights that are meaningful to the challenges and opportunities here and that can influence public and private stakeholders to act.”
Additionally, Howden Re Brazil works closely with CNseg—the national insurance confederation—to boost public understanding of insurance products and increase coverage rates nationwide.
“This is also why COP30 is so important,” AJ said. “It puts resilience and insurance on the agenda at the highest level. But we need coordinated action across government, industry, and society to make a real change.”