The incidence of extreme weather events in Brazil, particularly floods in the metropolitan region of Rio de Janeiro, has led to a significant increase in economic losses linked to natural disasters.
This study highlights the important "protection gap" between total losses and those actually insured, emphasizing the challenges of expanding insurance coverage, including barriers such as high costs, contract complexity, and risk perception.

The study proposes the implementation of an innovative parametric insurance system, involving both the public and private sectors, as a strategy to reduce the vulnerability of at-risk communities, promote climate resilience, and enable more efficient recovery in the face of climate change.
The initiative also underscores the need for inclusive dialogue and resource mobilization to overcome obstacles in the evolution of climate finance and insurance policies within the Brazilian context.

EPGE Brazilian School of Economics and Finance (FGV EPGE)
Researchers: Humberto Moreira, Sophie Mathes, and Bernard Salanié (Columbia University)

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