The Pacific Catastrophe Risk Insurance Company (PCRIC) team recently convened a meeting with the specialists from Willis Towers Watson (WTW) to deliberate on the development of the new drought product, which the latter has been developing in the past year. This bespoke product was initiated at the request of the Pacific Ministers of Finance during the “Understanding Risk Finance Pacific Forum” in Vanuatu in 2018 as a response to the increasing frequency of droughts due to changing climates.
The meeting served as a valuable opportunity for both organisations to exchange ideas and updates on progress made in product development. During their discussions, a key area of focus was ensuring the product’s appropriateness for the unique climate conditions of the Pacific region, which has been a critical consideration throughout the product’s development process. In addition, the ongoing regional dialogue on enhancing resilience to mitigate the harmful losses and damages caused by natural hazards, which are further compounded by the impacts of climate change, were also taken into account.
PCRIC is currently in the final stages of data validation before the policy development phase begins in order to roll out the drought product in the coming months. It’s envisioned that PCRIC’s parametric solution for disaster risk financing will provide adequate coverage to communities vulnerable to the catastrophic effects of droughts.
Soon, the PCRIC team will travel to countries within the region, offering technical and policy support with the aim of promoting better understanding of the risk pool insurance product program. The team will also shed light on possible premium financing opportunities that are available to the countries.