Pacific Catastrophe Risk Insurance Facility ACT 2016
18 October 2021
PCRIC Engages in Talks on Risk Pools and Smart Premiums at the InsuResilience Global Partnership
17 November 2021
The Pacific Catastrophe Risk Insurance Company (PCRIC) showcased its work in enhancing the resilience of Pacific Island States at a panel session held at the Resilience Hub during COP26. This invitation highlighted PCRIC’s significant role in disaster risk financing.
The discussions emphasized the crucial interconnectedness and interdependency required in developing disaster risk financing instruments. CEO ‘Aholotu Palu participated in conversations about how organizations like PCRIC are utilizing insurance and disaster risk finance tools to adapt to climate change.
“Resilience is a fervent conversation topic these days and has become a dominant framing for policies and programs aimed at reducing vulnerability to extreme weather and natural hazards; promoting climate change adaptation and strengthening countries’ abilities to manage risk,” he remarked.
The panel session, titled ‘Building Financial Resilience in the Pacific,’ took place on November 3rd and was hosted by the United Nations Capital Development Fund (UNCDF), United Nations University Institute for Environment and Human Security (UNUEHS), and United Nations Development Programme (UNDP).
With adaptation and resilience at the forefront of the agenda, panel participants explored best practices, strategies to amplify messages globally at COP26, and pathways for future action beyond the climate change summit.
In line with the theme ‘Finance & Pacific Regional Hub,’ Mr. Palu outlined PCRIC’s initiatives in providing Pacific Island Countries (PICs) with innovative financial and technical solutions to manage their disaster risks. He highlighted efforts to build financial resilience through novel techniques.
“We are supporting countries in developing their own national Disaster Relief Fund strategies by mapping out all the available financial instruments. This includes budget reserves, contingency funds or credit, and both traditional and parametric insurance. We ensure these instruments complement each other, based on a comprehensive assessment of the risks each country faces,” he explained.
A key point in his address was the significant increase in demand for enhanced technical understanding from the PICs. Mr. Palu elaborated, “Member nations are starting to recognize the gaps in their knowledge base regarding these solutions and are increasingly seeking advisory support from PCRIC, while also aiming to upskill their teams and local resources.”
He also discussed the advantages of risk pooling, where multiple nations share their risks. This approach often shifts them from being considered ‘uninsurable’ or ‘cost prohibitive’ to being part of a more attractive group for donors and insurers.
“Risk pooling is an incredibly powerful tool for achieving proactive Disaster Risk Management. It streamlines donor support after a disaster, mobilizes resources for parametric coverage with speedy payouts, and fosters long-term development gains. It also grants countries greater autonomy to ensure post-disaster funding is used effectively,” he noted.
Well-positioned to play an increasingly critical role in disaster risk management (DRM), PCRIC used the COP26 platform to articulate its capabilities and the benefits it offers to the island nations of the Pacific.
As a dedicated regional provider of specialist disaster risk finance services, PCRIC is owned by the island nations of the Pacific. The company offers technical assistance, specialized collaborations, and innovative products to help the Blue Pacific Continent better prepare, structure, and manage finances for disaster resilience. This ultimately ensures rapid access to unencumbered liquid funds in post-disaster situations when nations need it most.
For more information, please contact:
ceo@pcric.org or aholotupalu@yahoo.co.uk
