Annual Report 2018: Working toward a Climate-Resilient Future

The InsuResilience Secretariat commissioned the United Nations University’s Institute for Environment and Human Security (UNU-EHS) and Social Impact Partners, a new joint venture between Munich Re and The Hollard Insurance Group, to develop a comprehensive and objective concept and methodology that provides transparent and comparable information on countries’ vulnerability towards climate and disaster risks and their readiness for insurance solutions.

Climate risk insurance is a risk transfer solution that aims to protect individuals, businesses and countries against the negative impacts of extreme weather events that are becoming more frequent and more severe due to climate change.

InsuResilience Global Partnership's Report "Applying a Gender Lens to Climate Risk Finance and Insurance." Gender-sensitive climate risk insurance (CRI) has the potential to play a role in the adaptation as part of a wider risk management strategy.

Government institutions provide support to develop the market for innovative extreme weather insurance and adopt the regulatory and institutional frameworks so that these kinds of insurance products can be promoted. Challenges related to this objective are: Lack of an effective regulatory environment for establishing products as parametric index insurance exists in the region; the current Insurance Acts in the target countries do not address weather-based index insurance. Previous market failures in the Caribbean have resulted in extra vigilance and caution being exercised by the regulatory

Insurance – though no panacea for climate change-related extreme weather events – can serve as a measure for adaptation of vulnerable populations to climate change. People that are especially vulnerable to climate change predominantly rely on traditional coping mechanisms, such as the use of savings. However, these traditional measures are often insufficient and can lead to a negative impact on their overall resilience in the long term. Insurance could serve as one measure to cover losses occurring from an extreme weather event but the vulnerable population are often not familiar with

Vulnerability to climate change can lead low-income communities deeper into poverty in the long run. Improving their ability to respond to, and cope with climate change-related shocks can increase social resilience and decrease vulnerability. Therefore, by establishing a mobile phone text message that alerts insurance policyholders to approaching extreme weather events, the project has sought to improve the risk management capacities of target communities. Challenges related to this objective are: Close cooperation is required between the local insurers and national disaster management