Details - International Climate Initiative (IKI)

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As of: November 2017

Regional institutions, adaptation, and insurance: expanding coverage for medium-level weather extremes in vulnerable countries using risk reduction and innovative insurance solutions


Objective and activities

The project developed solutions for managing weather-related risks – what are known as extreme weather events, such as hurricanes and droughts. It is also supported the development and launch of public safety networks and public-private insurance schemes for vulnerable population groups. To this end, it brought together three key stakeholders: the Caribbean Catastrophe Risk Insurance Facility (CCRIF) as a regional insurance pool, MicroEnsure, a pioneer in the provision of local insurance solutions, and the international reinsurer Munich Re. The project partners designed and launched products that combined risk reduction and climate risk insurance in order to protect low-income population groups in the Caribbean, such as farmers and smallholders, against weather-related damage. If a specified threshold, such as amount of rainfall or wind force was exceeded, policyholders automatically received payment; complex claim procedures were not necessary.

State of implementation/results

  • Project completed
  • The weather index insurance policies Livelihood Protection Policy and Loan Portfolio Cover have been developed and approved by the responsible authorities in Grenada, Jamaica and Saint Lucia; as of June 2013, low-income population groups and microcredit institutes can purchase policies
  • In Saint Lucia, insurance policies have been specially developed for microcredit institutions (Loan Portfolio Cover) to insure them against microcredit borrowers who default due to weather conditions; this enables microcredit institutions to lend microcredits in areas which previously were seen as too risky due to weather extremes
  • Training and capacity development activities on applying weather index insurance policies (in particular for local insurers) are conducted
  • MunichRe acts as international reinsurer for the respective national primary insurers
  • In December 2013 an extreme weather event took place in Saint Lucia triggering the first successful payments to holders of the Livelihood Protection Policy

Project data

Country:
Belize, Grenada, Guyana, Jamaica, Saint Lucia

Partner institution:

Implementing organisation:
Munich Climate Insurance Initiative (MCII)

BMUB grant:
€ 2,035,530

Duration:
03/2011 till 06/2015

Website:
Website



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