SCOR has provided an update on the rollout of its parametric microinsurance cover against climate change in Fiji, and says its plans to expand into other Pacific island territories are “already underway.”
The reinsurer has been involved since 2021 in the collaborative development and rollout of the Pacific region’s first parametric insurance solution, which aims to protect local farmers against the risk of cyclones and torrential rainfall.
The solution was developed under the Pacific Insurance and Climate Adaptation Programme (PICAP) of the United Nations Capital Development Fund (UNCDF), in a partnership between UNCDF, the UN University Institute for Environment and Human Security, the Pacific Office of the United Nations Development Programme, Weather Risk Management Services Pvt. Ltd. (WRMS) India, local insurers, and SCOR.
Following what SCOR regards as a “successful” rollout last year, UNCDF has expanded the scope of the solution in 2022, introducing two new parametric microinsurance products to the market in August.
Designed for Fiji’s most vulnerable communities, one of these products is aimed at farmers, fishers, market vendors and small businesses, while the other targets social welfare recipients who rely heavily on government support after extreme weather events.
Furthermore, given the successful implementation of the product in Fiji, SCOR and its partners are looking to expand coverage to other Pacific islands, having launched the product in Vanuatu in October, and with a launch in Tonga currently underway.
“The products in the initial phase focus on farmers and other vulnerable communities in Fiji. But the plan is to gradually roll them out to other sectors and geographies in the Pacific,” said Swapnil Soni, Senior Underwriter and Market Manager for Agricultural Reinsurance at SCOR.
“Such products would not only support individuals at the grassroots level against increasing incidences of Nat Cat events, but also ensure strong resilience after an incident has occurred.”
Anuj Kumbhat, CEO of WRMS, the climate and agriculture risk management company behind the parametric data, also commented: “With the backing of strong partners like SCOR, we have got the flexibility to innovate on parametric insurance solutions that can address key climate risks of vulnerable communities in the Pacific Island countries.”
And Krishnan Narasimhan, Global Lead Specialist (Climate Disaster Risk Insurance) at UNCDF, further stated: “Through a market systems development approach, UNCDF has enabled national and global partnerships to fill a significant market gap in developing and deploying the Pacific region’s first ever market-based parametric microinsurance product covering small holder farmers, fishers, market vendors and small businesses.”
“The support of SCOR has been crucial in this initiative as they have provided the reinsurance capacities to local insurers who have made available such innovative risk transfer solutions. And UNCDF now has ambitions of growing the CDRI programme beyond the Pacific and we look forward to continuing our engagement with SCOR.”
