Latin America & the Caribbean

The Caribbean: Enabling Policy Environment
Government institutions provide support to develop the market for innovative extreme weather insurance and adopt the regulatory and institutional frameworks so that these kinds of insurance products can be promoted. Challenges related to this objective are: Lack of an effective regulatory environment for establishing products as parametric index insurance exists in the region; the current Insurance Acts in the target countries do not address weather-based index insurance. Previous market failures in the Caribbean have resulted in extra vigilance and caution being exercised by the regulatory
The Caribbean: Financial Literacy
Insurance – though no panacea for climate change-related extreme weather events – can serve as a measure for adaptation of vulnerable populations to climate change. People that are especially vulnerable to climate change predominantly rely on traditional coping mechanisms, such as the use of savings. However, these traditional measures are often insufficient and can lead to a negative impact on their overall resilience in the long term. Insurance could serve as one measure to cover losses occurring from an extreme weather event but the vulnerable population are often not familiar with
The Caribbean: Innovation & Technology
Vulnerability to climate change can lead low-income communities deeper into poverty in the long run. Improving their ability to respond to, and cope with climate change-related shocks can increase social resilience and decrease vulnerability. Therefore, by establishing a mobile phone text message that alerts insurance policyholders to approaching extreme weather events, the project has sought to improve the risk management capacities of target communities. Challenges related to this objective are: Close cooperation is required between the local insurers and national disaster management
Peru: Market Development
Sustainable insurance solutions for agricultural and climate risk requires a joint effort of both the public and the private sector: the partners need to cooperate and commit to facilitating a market development process. Private insurance companies design appropriate insurance products, establish administrative processes and carry the risk. They invest financial and human resources and commit themselves to the agricultural and climate risk insurance markets. Government support that goes beyond creating an enabling regulatory environment can be critical to the sustainability of such systems
Peru: Financial Literacy
The Peruvian agricultural sector, which is fundamentally important to the national economy, is particularly affected by natural hazards caused by climate change. Insurance as a possible risk management strategy has received only little attention so far (both by clients and by the industry) due to the following reasons. Limited experience with financial products including insurance. Overall lack of understanding of and interest in (climate) insurance among most stakeholders. Widespread lack of trust in insurance companies amongst the population. Lack of investigation and research with respect
Insurance for Climate Change Adaption Project
The core objective is to provide the target group with the opportunity to obtain insurance by means of an innovative insurance scheme for extreme weather events.
Climate Risk Adaption and Insurance in the Caribbean
The core objective is to overcome barriers and catalyze solutions to address middle-level weather-related risks and facilitate public safety nets and public-private insurance solutions for vulnerable people.
East Africa – Peru – India  Climate Capacities (EPICC): Climate Capacity Building:  Risk Anticipation and Minimization
The overall aim of the project is to strengthen resilience against disruptive weather phenomena and climate change at the national, regional and local level in three partner countries: Tanzania, Peru, India.
Insured Against Climate Risks
Peru has a risk transfer system for the agricultural sector financed by the state and the private sector, including insurances against climate risks.
Market Development & Innovation -
Over the past 30 years in the Caribbean, floods and tropical storm damage affected 1.5 million people directly and caused over USD 5 billion in damage. The increasing frequency and intensity of extreme weather events stress societies and natural systems. Challenges 1. Affordability issues for the target low-income segment. Additional transaction cost and taxes. Also, even with this cost structure, insurers and distributors are not sufficiently incentivized to push the product. 2. Intensive marketing efforts and consumer education are needed to increase the scale of LPP. Technology