On the heels of one of the worst – and most costly – Atlantic
hurricane seasons on record, a global initiative has been
launched at the United Nations Climate Change Conference
(COP23), in Bonn, Germany,
with the aim of providing insurance to hundreds of millions of
vulnerable people by 2020 and to increase the resilience of
developing countries against the impacts of climate change.
In 2017, extreme weather events are estimated to have caused
more than $200 billion worth of damage worldwide, as
hurricanes, droughts and rising sea levels devastated
vulnerable communities with increased frequency and intensity.
In the face of skyrocketing costs, new forms of financial
protection have become an increasingly urgent part of the
climate change discussion.
The InsuResilience Global
Partnership is a major scaling-up of an initiative started by
the G7 in 2015 under the German Presidency. It aims at meeting
the pledge of providing cover and support to an extra 400
million vulnerable people by 2020.
The Global Partnership now brings together G20 countries in
partnership with the so called ‘V20’ nations, a group of 49 of
the most vulnerable countries including small islands like
Fiji, which holds the Presidency of COP23.
“The Global Partnership is a practical response to the needs of
those who suffer loss because of climate change,” said the
COP23 President and Fijian Prime Minister Frank Bainimarama.
This announcement on climate risk insurance was made a day
before the high-level segment of COP23, which Heads of State
and Government, Ministers, and UN Secretary-General, António
Guterres, are expected to attend.
Thomas Silberhorn, Parliamentary State Secretary to the German
Federal Minister for Economic Cooperation and Development,
announced support of 125 million dollar for the new Global
Partnership as part of the launch. This follows the £30 million
commitment to the initiative made by the British Government in
July 2017.
“Climate risk insurance is a response to the simple fact that
extreme weather events are constantly increasing in number and
intensity, and also a response to our experience that the
international community and the countries affected by extreme
weather events tend to really act after those incidents
occurred and they tend to come too late and to intervene not
significantly enough,” Mr. Silberhorn told a press conference.
“So our intention is to act more preemptively, to act in time,
and to act decisively in order to reduce the impact of extreme
weather events. Insurance is one tool to address this
challenge,” he added.
A partnership for climate and disaster risk finance and
insurance solutions
The Global Partnership supports data and risk analysis,
technical assistance and capacity building according to
countries needs and priorities, solutions design of concrete
risk finance and insurance solutions, smart support for the
implementation for such schemes and monitoring and evaluation
efforts.
“This new and higher ambition initiative represents
one shining example of what
can be delivered when progressive governments, civil
society and the private sector join hands with creativity and
determination to provide solutions,” said Patricia Espinosa,
Executive Secretary of the UN Climate Change secretariat
(UNFCCC).
The Caribbean Catastrophe Risk Insurance Facility (CCRIF), for
example, is being supported with the help of ‘InsuResilience.’
The most recent example of support was in September 2017, when
more than $55 million was paid out to 10 Caribbean countries
within 14 days of hurricanes Irma and Maria, which left an arc
of destruction across the region.
The money was used in various ways, for example, to quickly buy
urgently needed medicines and to build emergency shelters for
the people affected by the storms.
In Zambia, InsuResilience supports the NWK Agri-Services cotton
company, which offers direct weather and life insurance to
small contract farmers. In 2015, some 52,000 farmers decided to
buy insurance. Following a major drought in 2016, more than
23,000 farmers received payments.
