How Swiss Re insures illegally deforested farmland in Brazil

Water shortages in the Amazon, record temperatures in major cities and floods with dozens of deaths in the south of the country: Brazil is increasingly suffering from extreme weather phenomena. They are the main reason for the sharp increase in state-subsidized crop and livestock insurance. At the same time, however, the agricultural industry in Brazil is the biggest contributor to the global climate crisis and thus to extreme weather - due to its direct emissions, but also through deforestation and the so caused expansion of agricultural land. Against this backdrop, it is scandalous that Swiss Re took out at least 19 policies between 2016 and 2022 for large farms that the authorities have proven to be illegally deforested. Because the cultivation of crops and livestock farming are prohibited in such restricted areas, these insurance policies de facto supported illegal activities. 

This was brought to light by the investigative organization Repórter Brazil with publicly available data and on-site research. Their breaking story was financed by the Investigation Award presented by Public Eye for the third time. According to this data, Swiss Re, which in many countries is not only a reinsurance company, was ranked fourth last year for agricultural contracts concluded as part of a state subsidy program. The total area insured by the Brazilian subsidiary of the Zurich-based group under this program covers 659,000 hectares, which is roughly equivalent to the canton of Grisons. This includes, for example, the 2,400-hectare farm Manto Verde, for whose soybean cultivation Swiss Re has taken out an impressive 17 insurance policies since 2016. This regardless of the fact that Manto Verde has been declared a restricted area by the authorities due to illegal deforestation. 

Repórter Brasil has also documented various cases in which Swiss Re has concluded insurance contracts with farms that illegally cultivate indigenous protected areas and sometimes even use armed violence. One such client was a defendant in a murder case when he took out three insurance policies and another is under investigation for slave labor on his coffee farm.  When confronted with these facts, Swiss Re, which operates in 25 countries, merely states that "we strive to identify sustainability risks throughout our business." According to last year's sustainability report, the Group aims to neutralize its greenhouse gas emissions by 2050. At the same time, however, it is ignoring any climate policy responsibility in its business in Brazil, whose gross emissions from deforestation in 2021 exceeded the total emissions of a country like Japan, according to the Observatório do Clima. 

For more information please contact 

Oliver Classen, Media director and Award coordinator, +41 44 277 79 06, oliver.classen@publiceye.ch  

Carla Hoinkes, Agriculture expert, +41 44 277 79 04, carla.hoinkes@publiceye.ch