Rural green insurance, as an extension of agricultural insurance, is increasingly being endowed with green financial attributes by the government and is expected to play a significant guiding and incentive role in the green transformation of agriculture. This paper, based on provincial panel data from 2011 to 2021 (excluding Hong Kong, Macao, Taiwan, and Xizang), first constructs a relevant index system to calculate the agricultural green development index for various provinces, cities, and regions. A two-way fixed-effects spatial Durbin model is then employed to empirically examine the impact of rural green insurance on agricultural green transformation. The study finds that rural green insurance has a positive overall effect on agricultural green transformation, with the enhancement of rural green insurance in one area also having a positive spatial spillover effect on the green transformation of neighboring areas. Mediation effect analysis further reveals that rural green insurance promotes agricultural green transformation by encouraging farmers to expand production scale, increase capital investment, and improve technological levels. Heterogeneity analysis shows that the effect of rural green insurance on agricultural green transformation is relatively smaller in grain-producing regions and eastern provinces. Based on these findings, it is recommended that both central and local governments improve the green fiscal support system for agriculture, guide rural green insurance to develop continuously in a green direction, and adjust agricultural insurance coverage according to local conditions, leveraging the regional linkage effects of agricultural green development.