The Insurance Development Forum (IDF) has partnered with the Start Network coalition of humanitarian charities to launch a new service providing ex-ante funding for escalating climate-related risks.
The Start Ready financing facility will provide pre-agreed funding for risks such as drought, flooding and headwaves, based on pre-agreed triggers.
IDF will provide expertise on using techniques such as risk pooling to ensure that funding organised ahead of crises can be stretched to protect more people. RenaissanceRe will provide technical risk modelling expertise.
IDF said it has put forward experts from the insurance industry to support Start Network’s members, who will initially be building ‘anticipatory finance’ mechanisms in eight countries.
IDF chairman Denis Duverne, who also chairs Axa Group, said the initiative will provide a major step-change in the effort to open up access to climate risk understanding.
“As an industry we have consistently recognised that climate change is the biggest challenge of our time,” he said.
“A fundamental pillar of addressing it will be greater access to climate risk information, tools and standards, as well as benchmark metrics that will shed light on the climate risks of today and on future impacts.”
IDF also today confirmed the launch of two other notable initiatives. Firstly, it has signed an agreement with the Vulnerable 20 Group of Ministers of Finance to build risk analytics capability, which will pave the way for the creation of the Global Risk Modelling Alliance.
It has also confirmed the establishment of the multi-partner Global Resilience Index Initiative (GRII), which is set for a formal launch next Monday.
Partially funded by the insurance sector, the initiative intends to provide a globally consistent model for the assessment of resilience across all sectors and geographies, curated on an open-source basis.