ILO and UNCDF collaborate to grow parametric insurance in the Pacific

New partnership to build the capacity of insurers and distribution channels on disaster risk reduction and climate change adaptation.

Press release | 22 June 2023
GENEVA, Switzerland (ILO News) - The International Labour Organization (ILO) and the United Nations Capital Development Fund (UNCDF) have signed an agreement to collaborate on climate adaptation and insurance in the Pacific. From June 2023, the ILO and UNCDF will work together in the context of UNCDF’s Pacific Insurance and Climate Adaptation Programme (PICAP) to expand the initiative to eight countries and build on the growing role of insurance in disaster risk reduction and climate change adaptation. The engagement will also explore placing inclusive climate risk insurance as one of the potential solutions to address loss and damage at the community and household levels.

Pictured, from left to right: Mr Krishnan Narasimhan (Programme Manager, Pacific Insurance and Climate Adaptation Programme, UNCDF), Mr Henri Dommel (Director, Inclusive Digital Economies, UNCDF), Ms Rie Vejs-Kjeldgaard (Director, Department of Sustainable Enterprises, Productivity and Just Transition, ILO) and Mr Pranav Prashad (Senior Technical Officer, Impact Insurance, ILO).
The new partnership builds on lessons drawn from ongoing UNCDF interventions in Fiji, Tonga and Vanuatu and will, along with implementation partners, include four activities:
  • Capacity building of insurance companies to develop climate and disaster risk finance and insurance (CDRFI) products.
  • Assisting distribution channels in strengthening collaboration with insurance companies.
  • Sharing lessons learned.
  • Growing the technical and financial capacity of the industry and ecosystem partners to offer CDRFI products to a range of low income and underserved customers.
The ILO and UNCDF are uniquely positioned to advance this work given the strong community reach and stakeholder relationships of the two organisations in the Pacific.

Henri Dommel, Director, Inclusive Digital Economies, UNCDF: “The partnership is to build on the key lessons learned by UNCDF from the initial two years of CDRFI implementation. These lessons underscore the necessity to enhance the capacity of partners to close the protection gap in LDCs and underserved markets through evidenced-based risk financing and insurance solutions.”

Craig Churchill, Chief of the ILO’s Social Finance Programme: “The ILO looks forward to collaborating with UNCDF to develop solutions to one of the more urgent challenges of our time. The insurance industry has a crucial role to play to help mitigate the impact of climate change, and this project will aid in enabling insurers and relevant stakeholders in fulfilling that role.”

About the ILO: The International Labour Organization is the United Nations agency for the world of work. We bring together governments, employers and workers to drive a human-centred approach to the future of work through employment creation, rights at work, social protection and social dialogue.

About UNCDF: The United Nations Capital Development Fund (UNCDF) is the United Nations' flagship catalytic financing entity for the world’s 46 Least Developed Countries (LDCs). With its unique capital mandate and focus on the LDCs, UNCDF works to invest and catalyse capital to support these countries in achieving the sustainable growth and inclusiveness envisioned by the 2030 Agenda for Sustainable Development and the Doha Programme of Action for the least developed countries, 2022–2031.

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