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Pacific Catastrophe Risk Insurance Pilot Launched

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Pilot program to help governments respond to natural disasters

The Marshall Islands, Samoa, Solomon Islands, Tonga and Vanuatu are all part of a pilot catastrophe risk insurance programme launched on January 17, 2013 to provide their governments with immediate funding if a major (natural) disaster occurs.

Japan, the World Bank and the Secretariat of the Pacific Community (SPC) have teamed up with the 5 Pacific Island Countries to launch the Pacific Catastrophe Risk Insurance Pilot. It will test whether a risk transfer arrangement modelled on an insurance plan can help Pacific island nations deal with the immediate financial effects of disasters.

The pilot relies on state-of-the-art financial risk modelling techniques and is the first ever Pacific scheme to use parametric triggers, linking immediate post-disaster insurance payouts to specific hazard events.  This joint effort will allow Pacific island nations to access earthquake and tropical cyclone catastrophe coverage from reinsurance companies at an attractive price.
The World Bank will act as an intermediary between the pilot countries and a group of insurance companies selected through a competitive bidding process – Sompo Japan Insurance, Mitsui Sumitomo Insurance, Tokio Marine & Nichido Fire Insurance and Swiss Re. The underlying risk modelling for the transaction is being provided by AIR Worldwide.

The Pacific Catastrophe Risk Insurance Pilot is part of the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI), a joint initiative of the World Bank, SPC, and the Asian Development Bank with financial support from the Government of Japan, the Global Facility for Disaster Reduction and Recovery (GFDRR) and the European Union.  

PCRAFI was launched in 2007 and aims to provide Pacific Island Countries with disaster risk assessment and financing tools to enhance their broader disaster risk management and climate change adaptation agenda.

FURTHER INFORMATION:
http://pcrafi.sopac.org

Last Updated on Wednesday, 06 February 2013 11:31  

Newsflash

31st August 2012 - A study of tropical cyclones and associated wave action is providing information that can be used to assess the resilience of Mangaia, the most southern of the Cook Islands, to the impacts of climate change and sea level rise.

Mr Jens Kruger of the Secretariat of the Pacific Community (SPC) said that with coastal communities, private property, family homes and public infrastructure, such as the harbour, already exposed to extreme weather events, the recent study will help to support a risk-based approach to climate change adaptation.

Mr Kruger is the Physical Oceanographer with SPC’s Oceans and Islands Programme in the Applied Geoscience and Technology (SOPAC) Division.

He explained that data gathered during the study can be used to develop models of different scenarios to assess how changes in the climate and sea level would affect the frequency, magnitude and extent of coastal inundation on the island of Mangaia.

The data were collected by a team from SPC/SOPAC, the Cook Island's Ministry of Infrastructure and Planning, and New Zealand’s National Institute of Water and Atmospheric Research.

The research is part of the Pacific Adaptation to Climate Change project, funded by the Global Environment Facility through UNDP Samoa and SPREP (Secretariat of the Pacific Regional Environment Programme). The project involves 14 Pacific Island countries including Cook Islands.

‘A key outcome of the study has been the Cook Islands Coastal Calculator, an engineering spreadsheet that can be used to provide information on waves and water levels at the shoreline, wave run-up and the resulting inundation,’ said Mr Kruger.