Loss and Damage

The InsuResilience Global Partnership (IGP) needs a clear focus on the most vulnerable and a vision beyond insurance


Poor people like here in the Philippines need better protection from the impacts of climate change they did not cause. Photo: J. Grossmann/Brot für die Welt

On 14 November 2017, the InsuResilence Global Partnership (IGP) was launched at a high level event during the UN Climate Change Conference (COP23) in Bonn. The partnership is an expansion of the InsuResilience initiative which was founded in 2015 under the German G7 presidency with the aim of covering an additional 400 million poor and vulnerable people with insurance by 2020. The Global Partnership was now announced by Germany, the United Kingdome and Ethiopia which is currently the chair of the V20 nations, a group of the most vulnerable countries.

The objectives of the IGP are to strengthen the resilience of developing countries and protect the poor and vulnerable from the impact of disasters. More specifically the IGP wants to support “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”.

Germany together with the Ethiopian Chair of the V20, the United Kingdom (UK) and the World Bank has been one of the driving forces behind the InsuResilience Global Partnership. Germany has also announced a funding commitment of €110 million of (mostly) new funding during the launch last week. It thus follows a £30 million pledge made by the UK in July 2017. Combined with the funds that Germany has already put into the establishment or expansion of climate risk insurance approaches, the IGP seems to become an important element of German climate finance, hence a critical look may be needed.

Support and concerns from civil society

Civil society groups have broadly welcomed the IGP and its aim to support countries and in particular the most vulnerable among them to deal with the devastating impacts from droughts, floods and tropical storms and to better prepare against the increasing climate and disaster risks due to climate change.

Still, there are concerns as to how the initiative will be put in practice, and civil society organizations have called for a better inclusion of the following key points in the Partnership:

  1. Ensuring a focus on Climate and Disaster Risk Financing and not just insurance
    For the Partnership to become a success it needs to have a broader focus than insurance – in reality, not just in rhetoric. To date, much of the Partnership still prioritizes insurance and mentions existing insurance mechanisms like the African Risk Capacity (ARC) or the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAF), but not other funding schemes such as Mexico’s Natural Disaster Fund (FONDEN). Through a broader Climate and Disaster Risk Financing (CDRF) focus the Partnership can provide a strong role in helping countries explore a wider range of climate disaster risk finance instruments and support risk reduction planning for broader resilience.
  2. Ensuring that the IGP supports broader resilience
    The Partnership should ensure that risk financing schemes are embedded within a broad understanding of how they contribute to building resilience and link with risk reduction and adaptation. Following a holistic approach to dealing with risk includes financing for measures such as increasing resilience against climate-related weather extremes, early warning systems, contingency planning and long-term adaptation strategies to changing climate conditions. The Partnership needs to clarify how it will practically support such measures.
  3. Development of pro-poor principles
    The Partnership is committed to protecting the lives and livelihoods of poor and vulnerable people and to strengthening the resilience of developing countries – and it involves public money which should be used for achieving the objectives of the IGP and not for creating new markets for insurance companies. The Partnership thus needs to be based explicitly on pro-poor principles. Such principles should include a human rights based approach to its instruments with a clear focus on the poor and vulnerable, gender and equality policies, a needs-based approach as well as transparency and accountability. Based on these principles, the Partnership needs to offer clear guidance for public-private partnerships implemented under its schemes.
  4. Implement climate justice
    Asking poor countries, or poor people, to pay for insurance schemes to help them deal with the damage that was mainly caused by industrialized countries is at odds with climate justice. The Partnership should seek ways to mobilize funding, e.g. among the polluters, to cover the costs of setting up and operating insurance and other climate risk financing systems, including subsidizing insurance premiums for poor countries or people who had no role in causing the problem.
  5. Ensuring impact and a focus on evidence
    As CDRF and insurance are relatively new mechanisms, there is not a huge body of evidence, experience and practice to build from and to demonstrate the linkages between CDRF and resilience. The Partnership needs a strong focus on monitoring and evaluation to build up the evidence and also ensure that its work is very carefully and transparently monitored. These efforts should be focusing not only on the activities implemented and the number of people covered by insurance schemes, but need to carefully look at how effective it has been at reducing losses and enhancing people’s resilience.
  6. Ensuring the IGP is demand-driven
    It is essential that the partnership is accountable to people on the ground and that there is transparent consultation in the development of the partnership. This includes a strong role for civil society organizations in the affected countries which can help to ensure that the money reaches those in need and that the financing schemes actually meet their demand.

These points are essential for the success of the Partnership and should be taken up when the rules and modalities are carved out in more detail over the next months.

Finally, while initiatives such as the Insuresilience Global Partnership are very welcome and send a positive signal, they cannot replace a clear roadmap to increasing the levels of international climate finance by donor countries to $100 billion by 2020 as well as the need to start exploring innovative finance solutions which can generate truly additional finance to address the consequences of climate change.

Christine Lottje