Climate Summit Brings Global Partnership to Better Manage Climatic Shocks

UN climate summit ends today with new momentum for climate insurance, but more ambitious steps are needed to further climate policy agenda.

Bonn, 17 November 2017 – Today the 23rd climate summit, the Conference of the Parties (COP), concludes two weeks of intense negotiations, expert meetings and policy panels.

“We have seen new momentum on the issue of climate insurance,” says Peter Hoeppe, Chairman of the Munich Climate Insurance Initiative (MCII). “The announced Global Partnership on climate and disaster risk financing and insurance solutions, concrete financial commitments by some industrialized countries as well as the wide set of presentations of projects and programmes give me hope that the world can prevent the protection gap from growing further and further”.

The climate protection gap characterizes the global damage by hazards that is not addressed through proactive measures. In the past 35 years, the impact costs of climatic hazards have more than quadrupled while especially vulnerable countries currently have few options to close the resulting protection gaps through insurance. The Global Partnership signed by industrialized and vulnerable countries, multilateral institutions, NGOs and insurers intends to strengthen the resilience of developing countries and protect lives and livelihoods of poor and vulnerable people against climatic disasters. MCII is one of the signatories as a supporting partner.

If applied properly, climate insurance can become one of the key strategies to better prepare countries and their citizens for the risks that climate change presents. The damages caused by extreme weather often hit vulnerable populations the hardest, and can force them to resort to coping strategies that can impede sustainable development and drive them further into poverty. However, timely and reliable payouts from climate insurance allow them to recover more quickly – and be better prepared for future disasters. The German Chancellor, Angela Merkel, also supported the idea of climate insurance when she spoke at COP 23, saying “insurance solutions can be a good and lasting possibility to create a buffer for risks.”

COP 23 also detailed several policy steps for the UNFCCC negotiations in the next years. “Countries achieved modest advancement for detailing the Paris Agreement”, says Sönke Kreft, Executive Director of MCII. “On the aspect of climate related impacts, countries decided on a set of concrete activities for collaboration in the next years, including an upcoming focus on how to better finance affected countries.” Parties also agreed on the next steps that need to be taken to conclude the details of the Paris Agreement at COP 24 scheduled for December 2018. Kreft adds: “There is the clear need for countries to strengthen their existing climate policy goals – reduce their emissions and add policies and investment for resilience. Current ambitions are not enough to manage the impacts of climate change and question the long term viability of available resilience options including climate insurance solutions for vulnerable people.”