Lloyd’s has advanced its collaboration with the United Nations Capital Development Fund (UNCDF) and the Sustainable Markets Initiative’s Insurance Task Force through the execution of training workshops for parametric insurance in Papua New Guinea and Fiji.
The workshops are part of an effort to expand access to insurance in regions susceptible to climate change, focusing on the development and comprehension of parametric insurance among local insurers, reinsurers, and central banks in the Pacific Island nations.
The initiative stems from a Memorandum of Understanding (MOU) signed in September 2023 by the parties involved. The agreement is aimed at enhancing the technical expertise of insurance providers in the Least Developed Countries (LDCs), Small Island Developing States (SIDS), and other areas vulnerable to climate impacts.
The partnership plans to extend its model to other regions such as Asia and parts of Africa, aiming to adapt and scale solutions across these areas.
Rebekah Clement, corporate affairs director at Lloyd’s, expressed enthusiasm about the progress made under the MOU.
“Parametric insurance can play a vital role to support sovereign states with the financial impact of climate disasters, unlocking funds at speed and redirecting them into resilience strategies,” Clement said.
Dirk Wagener, the UN resident coordinator for Fiji and several other Pacific nations, also highlighted Fiji’s achievements in parametric insurance, particularly its success since introducing the first product for smallholder farmers, fishers, and market vendors in 2021.
“Convening the workshop in Fiji and PNG will set the tone for two-days of learning, robust discussion, peer-to-peer exchanges, knowledge sharing and network building that will strengthen the efforts to build climate resilience in the region,” Wagener said. “Some key topics to be covered include introduction to in-country risks and their insurability, weather and crop yield index insurance, pricing, distribution, operations, and policy.”
Finally, Ariff Ali, governor of the Reserve Bank of Fiji, pointed to the workshops’ role in enhancing local industry capacity.
“It will greatly enhance the understanding and knowledge of parametric insurance for climate-vulnerable countries in the Pacific, as a viable option to pursue especially with the excellent track record of communities getting quick payouts,” Ali said.
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