Initiatives such as the Global Risk Modelling Alliance can help build trust and confidence in risk transfer tools in countries where insurance is not traditionally used as a disaster risk management tool, according to Insurance Development Forum (IDF) risk modelling steering group programme manager Nick Moody.

Bangladesh floods

Moody told a COP26 side event that projects such as GRMA would help democratise the risk management process and enable countries on the front line of climate change impacts to make their own decisions. 

“For countries on the front line when it comes to climate change, it doesn’t make sense for decisions about their future to be made based on someone else’s viewpoint.

“If the analysis is based on local research that in turn brings greater trust and confidence,” he said. 

At a practical level, Moody said the GRMA was about helping to reduce uncertainty.

“The best way to do this is to integrate global and local knowledge that can produce metrics that can unlock finance, whether for investment or risk transfer.” 

The GRMA was officially launched at COP26 through the signing of an agreement between the IDF and the V20 group of vulnerable countries to build risk analytics capability where most needed. 

The GRMA programme comprises three elements. Firstly, open-source technology and standards, provided by the industry and optimised for public-sector use. 

The Oasis open risk modelling platform is being further developed for public sector and humanitarian use cases. 

Secondly, it will include a public good fund to help countries fill model and data gaps, to be resourced by donors.

 The third element will see a technical assistance team of public and private sector practitioners work with countries on applied projects, jointly resourced by donors and the insurance industry.