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Boost to Climate Insurance Access in Vulnerable Nations

Lloyd’s of London, the global hub for insurance and reinsurance, acting on behalf of the Sustainable Markets Initiative’s Insurance Task Force, is partnering with the UN Capital Development Fund (UNCDF) to expand insurance access in climate-vulnerable countries. The collaboration, marked by the signing of a Memorandum of Understanding (MOU), will see the parties join forces to design innovative insurance products to bolster financial resilience against climate-related shocks in Small Island Developing States (SIDS) and Least Developed Countries (LDCs). Initially, the partnership’s focus will be on crafting and scaling solutions in Fiji and the Pacific Islands, before aiming to replicate this model in other regions, including Asia and parts of Africa. It will also use public-private partnerships to bridge the insurance protection gap while sharing knowledge with stakeholders such as policymaking think-tanks, UN agencies, and academic research institutions. Mourad Wahba, Officer-in-Charge of the UNCDF, said: “Insurance can serve as a powerful tool, not only in support of climate resilience, but also to secure the delivery of the Sustainable Development Agenda in the world’s most vulnerable countries.” He added, “To deliver on this promise, we will need innovation and collaboration.” As the Chair of the Insurance Task Force, Lloyd’s will collaborate with the UNCDF to identify and address potential policy challenges hindering the development of climate risk insurance in developing markets. Further, it will promote best practices to help SIDS and LDC policymakers effectively mitigate climate catastrophe risks.

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