Law 2178 of 2021 – Legal and Financial Framework for Agricultural Insurance and Strengthening of Agricultural Risk Management

Agricultural insurance is an instrument that allows us to face climate variability events and constitutes a financial tool for managing risks of climatic and biological origin. The ISA makes it easier for the producer to purchase an agricultural insurance policy that protects him from these risks. The ISA provides a premium subsidy of up to 95% for small, low-income producers; up to 90% for a small producer and up to 40% for a medium producer. With the ISA, producers can insure agricultural activities such as coffee, cocoa, potatoes, corn, bananas, rice, avocado, sugarcane, among others. As well as activities related to pig farming, poultry farming, bovine and buffalo farming, among others.

Rural Tranquility Insurance was designed by Seguros Bolívar to protect agricultural producers against excessive rain or drought that affect their productivity and income. This is parametric insurance with cutting-edge technology, which remotely obtains historical and satellite information in real time to evaluate weather conditions and determine compensation payment. More than 14,400 producers will benefit from Rural Tranquility Insurance, which is equivalent to an amount of more than $12.7 billion in Agricultural Insurance Incentives. 81% of beneficiary farmers are small, low-income producers. This allows them to protect investments worth more than $94,000 million pesos in crops such as coffee, cocoa, papaya, corn, banana, rice, avocado, sugarcane, among others. To pay for these policies FINAGRO will contribute between 80% and 95% of the premium value and Davivienda will assume the non-subsidized part of the premium plus VAT.