Howden Re releases Q1 Brazil climate report, detailing growing risk landscape for insurance and infrastructure
Published
Read time
London, 7 May 2025 – Howden Re, the global reinsurance and strategic advisory arm of Howden, today published its Fourth Issue of the Brazil and Global Climate Impacts report in collaboration with MeteoIA, a leading climate analytics firm. This report provides detailed insight into Brazil’s evolving climate conditions through a retrospective overview of the past three months’ activity across the country and provides a forecast of anticipated climate activity for the upcoming quarter.
This is the latest in an ongoing series of reports from Howden Re Brazil, analysing the evolving climate and its role in the expanding Brazilian insurance sector.
Growing Latin American economies are driving expansion and strengthening insurance markets. Brazil's insurance sector, previously limited by a closed reinsurance market until 2007, is now experiencing a surge in demand, which in turn is increasing the need for more sophisticated data and analytics to map risks in the region.
Antonio Jorge Da Mota Rodrigues, Head of Howden Re Brazil, commented: "The first quarter of 2025 exposed both ends of Brazil’s hydrological extremes - from river overflows and urban flooding to drought and soil stress. The Brazilian insurance sector is facing an inflection point. While the market expands and reinsurance is becoming more widely adopted, today’s evolving environmental threat patterns require innovative solutions grounded in advanced data and analytics to help foster resilience and insure against a changing climate. COP30, held later this year in Brazil, comes at a critical time for putting new climate insurance solutions at the forefront.”
Get the full report
January to March 2025: a season of heterogeneous precipitation anomalies
The report highlights notable differences in precipitation across regions. While northern regions such as Roraima and Maranhão experienced excessive rainfall driven by a southward-shifted Intertropical Convergence Zone (ITCZ), central and southern Brazil, including Rio Grande do Sul as well as southern and western Mato Grosso do Sul, experienced severe drought and heat stress.
- February brought above-average rainfall to Amazonas and Pará, yet March saw widespread deficits across Goiás, Bahia, and the Southeast.
- Cities across Paraná, Rio de Janeiro, Maranhão, Bahia, and Amazonas posted new 24-hour rainfall records, in some cases exceeding 60% of their monthly average in a single day. These hyperlocal storms triggered flooding, exposing urban vulnerabilities to short-duration, high-intensity weather events.
- After a period of drought, the rivers of the Amazon began their flood season. In Manaus, the Rio Negro showed signs of recovery, though still below historic seasonal norms, peaking at 21m. Meanwhile, in Acre, floods displaced hundreds, showing the pendulum swing from water scarcity to severe excess.
- Extreme heat with Rio de Janeiro registering a heat index above 52°C in February and São Paulo registered record-breaking temperatures for the summer.
The scenario of extreme temperatures is not limited to Brazil, with the report citing that, globally, January 2025 was the hottest ever recorded, reaching 13.23°C, 1.75°C above pre-industrial levels, while Antarctic and Arctic Sea ice shrank to record lows.
Projections: elevated risks for crops, power grids and health systems
Looking ahead, the National Oceanic and Atmospheric Administration indicates an increasing probability of La Niña transitioning from low intensity to a neutral phase from March onwards, with a continuation of regionally split rainfall and temperature extremes:
- South and Central-West Brazil face below-average rainfall in April, which could have implications on soil moisture deficits for the tail end of the first crop harvest.
- May and June will bring above-average precipitation to Rio Grande do Sul and the Northeast, offering partial relief to an area which has been severely affected by drought.
- Temperature anomalies are expected to intensify, with maximum temperatures in western Mato Grosso do Sul and Rio Grande do Sul rising 2.4–3.0°C above average, potentially compounding stress on infrastructure and public health systems.
Reinsurance in the spotlight as COP30 nears
As Brazil prepares to host COP30, insurers and reinsurers are adapting to a new normal - one increasingly defined by secondary perils and regional susceptibility to climate events. From flood events to drought-induced soil degradation, Brazil’s climate volatility highlights the need for continued innovation in the insurance sector to identify ways to expand coverage across the region and increase access to those who need it most. In order to achieve this, structured data collection is key, allowing more accurate modelling and pricing frameworks based on historic events, helping the industry respond more effectively to evolving risks. With the right tools and collaboration, the industry is well-positioned to play a central role in strengthening Brazil’s preparedness for, and response to, climate events.