PCRIC Meets with the UN World Food Programme at COP27
While at COP27, the Pacific Catastrophe Risk Insurance Company (PCRIC) CEO Mr. Aholotu Palu had the opportunity to meet with Mr. Mathieu Dubreuil, the Senior Programme Advisor for Climate Risk Insurance for the United Nations World Food Programme (WFP). This meeting was a result of an earlier conversation with WFP held virtually a month ago.
In Africa for the last few years, WFP has been purchasing ‘replica’ policies from the African Risk Capacity Ltd. insurance facility (ARC), a sister sovereign risk pool organisation. This process strengthens governments’ policies, by increasing the coverage and number of people protected against climate catastrophic events.
WFP buys the policies on exactly the same terms as the governments. With this in place, if an applicable disaster where to strike which triggers a payout, then the government receives a payout to implement its response, while WFP receive its own payout. Both responses are coordinated. This allows WFP to then utilise those funds for early action, such as allocating it towards social schemes that provides cash transfers to the most vulnerable communities.
A different approach has been undertaken in the Caribbean and Central America, where WFP provides funds to top up the coverage purchased by the governments, to strengthen shock responsive social protection systems. In 2022, this approach allowed to protect around 2 million people in 10 countries.
The success of this exercise has spurred WFP to expand this initiative to the Asia Pacific region and to collaborate with PCRIC. There are plans to organise a workshop to be held in the Pacific early next year to identify the needs in the region, and develop a model adapted to the countries before further action is considered. This work will be made possible thanks to the transfer out signed with the Global Risk Financing Facility (GRiF), with the support of Germany and the UK.
