Colombia’s national government has contracted five parametric agricultural insurance policies covering 14,402 smallholder farmers across Sucre, Córdoba, Cundinamarca, Meta and Chocó, with protection extending to as many as 41,600 people in farming households. The policies provide up to $20.14 million in coverage against drought and excess rainfall as Colombia prepares for the anticipated effects of El Niño in the second half of 2026.

The policies took effect August 1, 2026, giving participating departments a financial mechanism designed to respond more quickly when severe weather thresholds are reached.

“Preparing for El Niño means acting before disasters strike. Through this collaboration between the national government, the five participating departments and international partners, we are providing smallholder farmers with the financial protection they need to manage climate risks and protect their livelihoods.” – Lucy Inés García Montes, Governor of Sucre

The initiative is led by the Ministry of Agriculture and Rural Development (MADR) and FINAGRO, in coordination with the governments of the five participating departments.

The program was delivered through the Tripartite Agreement Programme, a public-private partnership involving the Insurance Development Forum (IDF), the United Nations Development Programme (UNDP) and Germany’s Federal Ministry for Economic Cooperation and Development (BMZ), with financing channeled through the InsuResilience Solutions Fund (ISF).

How parametric insurance works

Unlike conventional agricultural insurance, which generally requires an assessment of physical losses before a claim can be paid, the policies use a satellite-derived Water Balance Index monitored at the municipal level.

The index compares current conditions with historical data to identify periods of severe drought or excess rainfall. When predetermined thresholds are exceeded, payments are triggered automatically, potentially allowing affected farmers to receive financial support without waiting for individual loss assessments.

The product was co-designed by MADR with an IDF-member consortium comprising Guy Carpenter, Swiss Re, AXA Climate, Munich Re, insurtech company Raincoat and Colombian insurer La Previsora.

The consortium members and ISF co-financed the initiative, while the first-year premium was jointly funded by the Colombian government and ISF.

First departmental use of parametric insurance

The program represents the first use of parametric insurance by departmental governments in Colombia as a tool for agricultural risk management, according to the organizations involved.

For participating departments, the coverage is intended to provide a source of rapid financing following severe climate events while reducing reliance on emergency public funds. The initiative is also designed to establish the technical, legal and financial foundations for expanding parametric agricultural insurance to additional departments.

José Fernando Sánchez, senior vice president of Guy Carpenter Colombia and an IDF member, said the consortium’s participation demonstrated the potential of public-private collaboration to protect livelihoods and strengthen Colombia’s insurance market.

Dr. Annette Detken, head of the InsuResilience Solutions Fund, said climate-risk insurance can help smallholder farmers and rural communities recover more quickly from drought and excess rainfall.

The UNDP worked with MADR and FINAGRO to integrate the insurance policies into Colombia’s broader agricultural risk-management framework. Its work included supporting product development and strengthening the institutional capacity of departmental governments to adopt parametric insurance.

The program comes as Colombia seeks to strengthen financial tools for managing agricultural exposure to increasingly volatile weather conditions. By using predefined climate indicators rather than conventional claims assessments, parametric coverage is designed to provide liquidity soon after a qualifying event and help farmers maintain their livelihoods and productive capacity.

Building a model for climate-risk financing

The five policies cover farmers in departments with different agricultural profiles and climate exposures, creating a multi-region test of how satellite-based insurance can operate within Colombia’s decentralized agricultural risk-management system.

The initiative’s backers say the experience could provide a foundation for scaling parametric insurance to other parts of the country, while building local government capacity to identify, finance and manage climate risks.

For smallholder farmers, the immediate benefit is financial protection against weather events that can damage crops and undermine household income. For governments and insurers, the program offers a way to shift part of the financial burden of climate-related agricultural losses away from emergency response and toward pre-arranged risk financing.

The Insurance Development Forum is a public-private partnership co-chaired by UNDP and the World Bank Group that brings insurance expertise together with public policy and development priorities to strengthen resilience to disasters.

Headline photo by Frank Meriño via Pexels)

Colombia’s Superintendencia Financiera de Colombia (Financial Superintendency of Colombia, or SFC) has published for public comment a draft external circular that would give banks, insurers and other supervised financial institutions temporary instructions to assist consumers affected by the magnitude 7.4 earthquake that struck the country on August 10, 2026. The comment period, open since August 12, closes at 11:59 p.m. on August 14, 2026, giving industry and the public a two-business-day window to respond, according to the draft text and the SFC’s own consultation record.

The earthquake, with an epicenter in the municipality of San José del Palmar in Chocó department and a depth of 96 kilometers, triggered 991 additional seismic events within a 900-kilometer radius, according to figures cited in the SFC’s draft circular, including 115 in the magnitude 5.0-to-5.9 range, 18 between magnitude 6.0 and 6.9, and three exceeding magnitude 7.0. The national government declared a state of national disaster the following day, August 11, through Decree 1171, covering Antioquia, Caldas, Cauca, Chocó, Quindío, Cundinamarca, Risaralda, Huila, Valle del Cauca, Tolima, Putumayo, Norte de Santander and other affected territories for an initial 12 months, renewable for an equal term, as Finance Colombia reported at the time.

Death toll still climbing

As of the evening of August 12, Colombian President Abelardo De La Espriella cited a balance from the Unidad Nacional para la Gestión del Riesgo de Desastres (National Unit for Disaster Risk Management, or UNGRD) showing a toll that had continued to climb since the quake struck two days earlier.

“We have 25,872 affected families, 53,816 people, sadly 265 dead, 3,494 injured, and the number of missing has risen alarmingly to 496.”— Colombian President Abelardo De La Espriella, citing the UNGRD balance, August 12, 2026

The same balance reported 11,347 homes destroyed and 53,526 damaged, 140 buildings collapsed, and 1,819 schools and 631 community centers affected. Earlier counts from the same day had put the toll lower, underscoring that the figures remained provisional; international search-and-rescue teams, coordinated by UNGRD, were still arriving as of August 13 to assist Colombian personnel, and officials have cautioned the toll is likely to keep rising.

Colombia’s disaster management law, Ley 1523 de 2012, activates a special legal regime once a national disaster is declared, including articles 86 and 87, which allow affected debtors to seek refinancing of existing obligations. The SFC’s draft circular says it is exercising its instruction authority under the Estatuto Orgánico del Sistema Financiero (Organic Statute of the Financial System) and Decree 2555 of 2010 to translate that legal framework into binding instructions for the institutions it supervises.

Refinancing terms for affected borrowers

Under the draft measures, lending institutions would be required to adopt refinancing programs for borrowers affected by the disaster, subject to conditions drawn directly from the 2012 law: refinancing would apply only to obligations contracted before August 10, 2026, with payments due on or after that date; the new loan term could not exceed double the remaining term or 20 years, whichever is shorter; refinanced terms could not be more burdensome than the original ones; and borrowers would have to apply while the disaster declaration remains in force. No interest or late fees would accrue between the disaster declaration and the completion of the renegotiation, a period the draft caps at 90 days. Lenders could also offer additional voluntary relief, such as grace periods or special interest rates, provided the terms are no more burdensome for the consumer and the measures are not applied as a blanket restructuring practice rather than case-by-case review.

Credits refinanced under the program would keep the risk rating they carried before the disaster was declared, with credit-bureau reporting frozen for up to 12 months after the refinancing is completed, and the draft specifies the refinancing would not count as a modification or restructuring for prudential reporting purposes. Lenders would also be permitted to use alternative data sources to assess a borrower’s future repayment capacity, accounting for the likely economic recovery of the borrower’s sector.

Insurers, fund managers and severance withdrawals

Insurance companies would be required to establish expedited claims and payment channels for policyholders in affected areas, prioritize payment of healthcare providers’ invoices tied to the disaster, and adopt policies to facilitate premium payments, including for policies unrelated to credit operations. Trust companies and brokerage firms would be asked to evaluate mechanisms to speed redemptions from open-end investment funds without a minimum holding period, and to consider waiving early-redemption penalties for funds that carry one, for consumers affected by the disaster. Severance-fund administrators would be instructed to expedite housing-related severance withdrawals for affected members, within the bounds of Colombia’s existing severance-withdrawal rules.

The draft also directs supervised entities more broadly to maintain continuity of financial services where security conditions allow, disclose any changes to branch hours or closures, strengthen digital channels, and activate business-continuity plans in affected zones; to clearly publicize the terms of any relief programs; and to set up priority service channels for complaints and claims tied to the disaster. The SFC said it would establish its own priority contact channel to help affected consumers navigate complaints against supervised entities.

In its internal cost-benefit review, the SFC’s research and analysis unit found no reason to delay the proposal, concluding that reduced default risk, faster insurance payouts and improved liquidity access for affected consumers would outweigh the compliance costs institutions face in adapting systems, training staff and expanding service channels. The regulator said the draft requires no new budget appropriations and can be implemented with existing staff and technology. It also said a competition-impact questionnaire it completed under Colombia’s competition-advocacy rules returned entirely negative responses, meaning no referral to the Superintendencia de Industria y Comercio (Superintendency of Industry and Commerce) was required.

A two-day window, and a toll still being counted

The SFC set the unusually short two-business-day comment window under an exception in Colombian regulatory procedure that allows shortened public consultation periods when a rule responds to urgent, unforeseeable circumstances. The regulator said the scale of the disaster and the need for a prompt, uniform response from the financial sector justified the shortened timeline. Comments can be submitted using a standard form referencing filing number 2026182440, by email to normativa@superfinanciera.gov.co or in writing to the SFC’s deputy director of regulation. If adopted, the circular would take effect upon publication and would remain in force for as long as the national disaster declaration stands, though any relief already granted to consumers would continue on its own terms after the circular expires.

Colombia has also drawn $1.3 billion USD in international pledges since the earthquake struck. The comment window closes before search-and-rescue operations are expected to conclude, and the casualty figures the SFC cites as justification for the rule are themselves preliminary and likely to keep changing.

Above photo – Damage in Pereira, Colombia (Photo: Vance Campbell)

Photo: Mapfre’s office in Barcelona. (Credit: Bengt Nyman)

This beat overall growth in net attributable profit for the Spanish insurer across its operations in the Latin American region, which saw an uptick of 0.7% in the quarter versus the first three months of 2023.

With total premiums of around €2,500 million in Latin America, the region accounts for more than a third of Mapfre’s total premiums.

“The good indicators of the first quarter, with an ROE of more than 10%, reflect the strength of our business model and are the first results of the new strategic plan,” said Antonio Huertas, chairman and CEO of Mapfre, in a statement released with the results. “Our geographic diversification continues to provide solid and profitable growth.”

Mapfre Q1 2024 Performance in Latin America

In addition to the overall results, Mapfre also released the following information about its first quarter performance in Latin America.

• Premiums grew by 8%, while net income stood at €33.5 million, with significant contributions from Mexico and Peru. Issuance in local currency grew with the evolution in Chile (13%), the Dominican Republic (12%), and Peru (12%).
• The combined ratio improved to 99.9% (-0.3 p.p.), with a positive performance in general and motor insurance, offsetting health and accident performance.
• The life business continues to contribute very positively and financial income continues its upward trend.
• In Mexico, premiums amounted to €368 million (+10.5%), also supported by the appreciation of the peso (+8%). Both the Automobile and Life branches have experienced strong business growth. The combined ratio stood at 96.9% and net profit amounted to €12.3 million.
• In Peru, premiums reached €203 million, up 12.1%, while net income stood at €12.3 million.
• Adjustments for hyperinflation, mainly from Argentina, have had a negative impact on the result of €17.9 million (€8.6 million in 2023).

Economic growth in Latin America is decelerating, but has been resilient – generally exceeding the ratings firm’s expectations so far this year, despite global demand pressures and weaker commodity prices. Risks continue to persist, including slowing GDP; high, albeit decelerating, inflation rates; tight external funding conditions; and political/regulatory uncertainty.

Commodity prices will be the main transmission channel of China’s rebound for Latin American economies. While some metal prices, such as copper and iron ore, have risen in recent months on China’s reopening, gains may be limited given that China’s recovery will likely be focused more on consumption (and services) rather than fixed investment and infrastructure stimulus, implying less of an upside for metal prices. Fitch recently reduced its short-term prices for copper, aluminium, zinc and thermal coal in a revision of its global metals and mining assumptions.

Political risk remains elevated in many Latin American countries and already have taken an economic toll in Peru, Ecuador and Bolivia. Successive shocks are pressuring the political landscape, including the pandemic and the related rise in poverty and income inequality in 2020, the uneven recovery in 2021, high inflation in 2022 and the return to a weak growth path in 2023. These factors increase the potential for social mobilizations that can pressure public finances and debt trajectory, and lead to weaker growth and investment.

In 2H23, the loss ratio of the main business segments (except SOAT) is expected to improve once the effect of a full year of upward adjustments in premium prices is seen, accompanied by more controlled inflation.

Fitch’s report includes an overview of currently rated companies, the macroeconomic outlook for Colombia and an overview of the most important factors in the industry. These include the composition of the Colombian market by company and business line, the development of financial performance after the pandemic affected period and the companies’ current levels of leverage are reviewed in Fitch’s report. In addition, the report analyzes the composition of the investment portfolio of the rated companies.

The full report is available at www.fitchratings.com or by clicking here.

According to an edict issued by the Prosecutor General of Colombia on January 4^th of this year they have:

“Opened a preliminary investigation against Daniel Quintero Calle, as mayor of Medellin D.C.T.I., as president of the Board of Directors, Jorge Andres Carrillo Cardoso as manager and others to be determined, members of the Board of Directors of Empresas Publicas de Medellin – EPM, for the alleged omission of the obligation to insure the Ituango Hydroelectric project against all risks in force 2021.”

Essentially, the investigation is looking into whether Quintero, as EPM’s chairman of the board of directors, and General Manager Jorge Andrés Carrillo allowed or caused mandatory insurance coverage on the Hidroituango project to lapse in 2021. Instead, EPM may have improvised, self-insuring itself to the tune of $23 million USD, a tiny amount compared to the value and potential risk of the project.

Colombia has a dual prosecutorial system, with the Fiscalia equivalent to general prosecutors of most crimes by private citizens and companies, while the Procuraduria is a prosecution structure focused specifically on public sector corruption, malfeasance by government entities, civil servants, and elected officials.

Daniel Quintero made a political point of going to battle against CCCI, the consortium that began construction of the Hidroituango project, and instead sought to re-bid the unfinished $5 billion USD project. One problem he faced is that no insurer wanted to participate by insuring the rebid contract after hundreds of millions of dollars in claims have already been paid.

This is the second investigation the Procuraduria has opened against Quintero, as it is also looking into irregularities in his “Software Valley” project, that was supposed to open 21 software centers throughout the city to promote education and entrepreneurial activity. Though contracts have been issued and money paid, according to local daily El Colombiano, though the mayor promised 21 new software centers, seven counted as new are actually existing facilities, and 14 don’t exist at all.

Photo: EPM

Construction began on the bridge, formally named the Atanasio Girardot Bridge, in 2014, but though finished, was never put into service, and was blocked off by containers after an armed standoff between the two countries in 2019.

In January of that year, then Colombian President Ivan Duque joined Brazil, Argentina, Chile, Peru and the US in breaking ties with the country after political intervention in Venezuela worsened, and called on Venezuelan dictator Nicolas Maduro to step down. In February, after the Venezuela Aid Live concert backed by British impresario Richard Branson was held on the Colombian side of the border near the bridge, anti-Maduro activists in Colombia and Brazil attempted to forcefully transport food, medicine, and other goods into Venezuela. Law enforcement used tear gas and rubber bullets in several instances while vehicles were set on fire and opposition forces threw Molotov cocktails. At least two people died and some 300 were injured during a chaotic weekend. Afterwards, Maduro cut diplomatic ties with Colombia, and the bridge did not open.

Colombian President Gustavo Petro last year ran on a campaign platform of normalizing ties and reducing tensions with the Maduro regime in Venezuela. The Minister of Foreign Affairs, Álvaro Leyva Durán, said that with the implementation of this infrastructure “the commitments of the governments of Colombia and Venezuela and the desire of Presidents Gustavo Petro and Nicolás Maduro, to advance in normalization of our relations, materialize. This is work that will allow us to ensure peace and security on our border and will directly benefit our peoples.”

The opening of the Tienditas bridge is part of a process of reestablishing border crossings that began September 26 with the opening of the Simón Bolívar and Francisco de Paula Santander bridges along the border with Norte de Santander. With the commissioning of the Atanasio Girardot bridge, since the beginning of 2023 all the crossings are fully enabled, including those of Arauca, Puerto Santander and river crossings.

The Atanasio Girardot bridge is located about 20 minutes from downtown Cúcuta, near the Villa Silvania sector, and about 10 kilometers north of the existing Simón International Bridge. The bridge crosses the Táchira River, and has six lanes for vehicles to circulate in both directions.

Some of the land border crossings with Venezuela have been closed for up to 7 years.

Crossing Requirements

Venezuela to Colombia

• Drivers must have documents proving ownership of vehicle
• SOAT or equivalent insurance coverage
• License plates in good condition
• Vehicle in optimal mechanical and safety conditions
• For stays exceeding 3 months, the vehicle must pass a mechanical/safety review
• Drivers must have a current, valid driver license
• All individuals must have a valid passport, Venezuelan cédula, Special Permanence Permit (PEP), Temporary Protection Permit (PPT), or Border Mobility Card (TMF).

Colombia to Venezuela

• Driver must have proof of ownership of the vehicle
• Proof of insurance coverage valid within Venezuela
• License plates in good condition
• Vehicle in optimal mechanical and safety conditions
• Drivers must have a current, valid driver license
• All individuals must have a valid passport or Colombian cédula

In the case of cargo transport vehicles, in addition to policies and certificates of optimal mechanical and safety conditions, the border authority will require the certificate or document of suitability granted to the company and permission to provide services or complementary permit for the provision of services for cargo.

Travel advisory

Nationals of other countries are advised to consult with their foreign ministry regarding travel requirements and advice for Venezuela. The US State Department flatly states: “Do not travel to Venezuela due to crime, civil unrest, poor health infrastructure, kidnapping, and the arrest and detention of U.S. citizens without due process or fair trial guarantees.”

The ride followed a route passing through Sopó, Sesquilé, and Guatavita, accompanied by Colombian cyclist and world time trial champion Santiago Botero.

“This ride was created for business leaders in Colombia to live an experience of wellbeing, and thus strengthen ties, challenge themselves in an integral way, experiencing first-hand the benefits of wellbeing, and likewise, promote it within their organizations with their employees,” said Mauricio Acosta, Head for the Andean region of Aon.

“For our organization it is an objective to promote integral corporate wellbeing as a highly relevant factor for the attraction and retention of human talent, increasing collective resilience and corporate productivity,” added Acosta.

EPM issued a written statement saying (translated):

That, with the purpose of promoting the plurality of participation in the process and in view of the difficulties identified in the insurance market, the closing date for the reception of offers of the public request CRW 167467, whose purpose is the construction of the final civil works of the Ituango Hydroelectric Project (generation units 5 to 8), which was scheduled for this Friday, November 4, 2022, has been extended.

The term was extended by thirty-three (33) calendar days and, therefore, the reception of offers will be until December 7, 2022, at 4:00 p.m. Addendum No. 9 containing this modification was sent through EPM’s ARIBA contracting system to potential bidders who are participating in this process and was published on the Te Cuento portal on EPM’s website www.epm.com.co

This indicates two difficulties: The first is that EPM is having difficulty attracting additional bidders to take over an unfinished and highly politicized project. Medellín Mayor Daniel Quintero first demanded renegotiation of the contract that the construction consortium (CCCI) building Hidroituango was working under, and when that failed, litigation ensued.

Now, the Quintero-controlled EPM has put out for bid the construction of the heavy construction associated with installation of the second four turbines, and has, based on its statement above, had difficulty attracting sufficient bidder interest, and for those bidders participating, difficulty in obtaining insurance coverage. Spanish insurer MAPFRE has already paid out $100 million USD in claims on the project, and now with the litigation, changing contractors, and EPM’s potential financial liability should they be fined by Colombia’s Energy & Gas Regulation Commission (CREG), the project is understandably very difficult to insure.

Add to that, the Colombian President Gustavo Petro has said that the turbine testing poses a mortal risk to the citizens living downstream of the dam, and should be evacuated during testing.

All the additional risk means that whatever contractor that wins the bid will likely do so at a price that takes into account the added uncertainty and liability, meaning the project will be vastly more expensive than it would have been otherwise. Should the bids be opened on December 7, the day before a public holiday in Colombia, we will find out; but based on the pattern to date, we should not be surprised by more delays.

This is turning out to be more complicated than the mayor or his political appointees on EPM’s board anticipated.

Above photo: The space where turbines 5-8 will eventually go, once a contractor is selected and insurance is found. (photo: Loren Moss)

Currently, Fabio Cabral serves as deputy country president in Colombia, reporting to Manuel Obregón. Cabral comes from AIG, where he served as General Manager for Ecuador. In his new role at Chubb, he is responsible for all product lines, the relationship with agents, insurance brokers and multi-line distribution partners, as well as the company’s functional areas in Colombia.

“We are pleased to welcome Fabio to our operation in Colombia. He has extensive experience in the insurance sector, having grown and developed sustainable businesses in the region,” said Marcos Gunn, Senior Vice President of Chubb Group and Regional President of Chubb Latin America. “His experience, extensive knowledge and skills in underwriting, marketing and distribution will be decisive for our customers, business partners and our more than 250 employees in the country.”

Cabral has more than 20 years of experience in the industry, mainly at AIG Seguros. He holds a bachelor’s degree in marketing from the Universidade da Cidade (Rio de Janeiro, Brazil), a certification in Business Management from the Getulio Vargas Foundation, a bachelor’s degree in Risk and Insurance from St. John’s University in New York and a certification in Customer Experience from EDES Business School in Ecuador.

Photos courtesy Chubb