Climate adaptation and insurance in the Pacific

Background

Over the past decade, climate disasters have emerged as the leading cause of internal displacement, uprooting more than 20 million people from their homes each year. The Pacific Small Island Developing States (PSIDS) face a high risk, with seven of them ranking among the top ten countries most susceptible to extreme weather events. In an already hazardous region, the growing impact of climate change-induced disasters disrupts economic and social progress and hampers development. Many individuals in the region do not have insurance and cannot deal with the financial consequences of a disaster, leaving them vulnerable to an increasingly volatile climate. Urgent action is needed to strengthen resilience against climate risks by developing appropriate mechanisms.

Purpose

PSIDS need proactive measures to mitigate the impact of climate disasters. Disaster risk reduction and climate change adaptation efforts strive to reduce community vulnerability and promote sustainable development. Climate and disaster risk finance and insurance can play an important role in this context.

Recognizing the urgency, the ILO has partnered with the United Nations Capital Development Fund (UNCDF) and its Pacific Insurance and Climate Adaptation Programme (PICAP). This innovative initiative aims to enhance the financial preparedness and resilience of PSIDS against climate change and natural hazards. The collaboration between the ILO and UNCDF will help PICAP to expand to other countries, identify partners and build the capacity of stakeholders for parametric insurance in the region.

Activities

The project includes the following activities:
  • Prepare capacity-building training materials and modules.
  • Conduct technical and financial trainings among market players.
  • Identify insurance and other financial service providers to offer relevant products and support their engagement with the programme.
  • Organize events and meetings with key stakeholders.
  • Share lessons learned.