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The Sectoral Community (SC) on Integrated Resilience Approaches in Agriculture was developed to inform, design and test innovative integrated solutions in the agricultural sector, as well as support the development of funding criteria for such projects. Following a series of meetings and presentations the SC issued the following guidance for those designing projects and developing proposals for integrated resilience approaches in agriculture and those funding these projects. For project designers and developers, it is recommended to identify the resilience objectives and risk management activities, as well as cost-effective and complementary options. Furthermore, they should seek feedback from various stakeholders and build on existing evidence and best practices. The recommendations for funders include classifying the integration of various stages and processes as an investment objective, considering cost-effectiveness, enabling and incentivizing the use of sound economic risk modelling, and taking into account unintended consequences and tradeoffs. Funders should also pursue a principles-based approach when making investment decisions. Learn more about the InsuResilience Focus Topic on Integrated Approaches here.

Over the past decades, a suite of new Climate and Disaster Risk Finance and Insurance (CDRFI) tools has been generated across the development, the humanitarian and the private sector. Examples include index-based insurance, catastrophe bonds, forecast-based financing, pooled funds and many other innovations. Unfortunately, these innovative instruments have often been implemented largely in isolation of each other. Most of them are not integrated in comprehensive disaster risk financing strategies or linked more systematically to recent humanitarian efforts to scale anticipatory action (AA). They all serve different purposes, address different target groups and are based on different modalities – which has its advantages but also results in untapped potential, a loss of synergies, and risks leaving behind those who need the financing the most. In March 2021, the Anticipation Hub, the InsuResilience Global Partnership (IGP) and the Risk-Informed Early Action Partnership (REAP) teamed up to launch the “Sectoral Community on Linking Anticipatory Action to Risk Financing”. The objective of the Sectoral Community (SC) is to bring together the development & humanitarian sector, public & private actors, civil society actors, researchers and think tanks to exchange experiences and share ideas on how various CDRFI tools and anticipatory action can be better integrated. To deepen the discussions, the SC members came up with the idea to draft ‘think pieces’ – succinct, policy-relevant opinion pieces in which SC members could advocate for a particular position or objectively describe the issue/challenges and possible opportunities, options and solutions at hand. SC members developed a set of 10 questions, and they were then invited to address those questions based on their experience, technical expertise and further research. The think pieces are not necessarily providing the views of the organisations of the respective authors but their personal perspective. About every 4-6 weeks the SC gathered over the course of 2022 to discuss and refine the ideas coming out of the think pieces.

This document proposes methodological guidance to define the ‘scaling factor’ to determine the size of premium and capital support (PCS) at macro-level. It is based on the ‘SMART PCS Principles’, developed by the InsuResilience Global Partnership (IGP) to scale-up the climate and disaster risk finance and insurance (CDRFI) solutions. Conceptual guidance on what considerations need to be taken to determine the size/amount of PCS is provided across all five SMART PCS Principles. Principle ‘A’ (accessibility) in the SMART PCS concept note argued that ‘transparent, uniform and consistent criteria for needs-based PCS levels should be formulated’ to guide donors in determining an “uptake-enabling” size of PCS intervention (Töpper and Stadtmüller, 2022). The paper introduces and suggests an indicative formula to calculate externally supported (donor) share of the premium for a government. The formula is proposed as a fraction that reflects need-based considerations, along with a scaling factor that needs to be defined in an evidence-based fashion to suit different country contexts. Based on this formula, the report provides methodological guidance to define the scaling factor. Further, the feasibility of the overall formula, in terms of its practical use, is also reviewed to identify limitations and suggest appropriate remedies.

In 2021, the InsuResilience Global Partnership developed a set of SMART Principles for the purposes of guiding the design and implementation of appropriate premium and capital support (PCS) that could help scale up climate and disaster risk finance and insurance (CDRFI). One of the five principles, ‘Value for Money’ (VfM) describes the impact each dollar of premium and capital support has on the resilience of poor and vulnerable countries and people. The principles also highlight that the value proposition of PCS should include crowding-in, rather than undermining, private capital, ‘recognizing the key role that effective private insurance markets can play in resilience-building of developing economies’. This guidance note contributes to the practical implementation of the VfM principle. It does so by proposing a framework and methodology for the ex-ante assessment and comparison of different PCS options, aiming to inform and support decision-makers. The guidance note is based on, and aligned with, the SMART Principles, the IGP’s monitoring and evaluation framework (IGP, 2021), and IGP pro poor principles (IGP, 2019).

This guidance note aims to provide practical step-by-step guidance on how to translate international commitments relevant to improving the gender-responsiveness of Climate and Disaster Risk Finance and Insurance (CDRFI) solutions into action at the national and institutional level. These international commitments include the United Nations Framework Convention on Climate Change (UNFCCC) Paris Agreement; the 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs); and the Sendai Framework for Disaster Risk Reduction (the Sendai Framework). The InsuResilience Global Partnership (IGP) is aligned to these frameworks. This guidance provides advice on how to integrate gender and CDRFI considerations into the policy development process and policy content. It assesses the guidance that these policy frameworks offer for the CDRFI financing ‘sector,’ it also explores the challenges and opportunities in converting international, national, and institutional strategies into action. The target audience is policy makers, programme implementers and national level organisations that are involved in the design and implementation of policies related to CDRFI. This guidance note is intended to be read in conjunction with the ‘Policy Report: The Nexus between International Gender and Climate and Disaster Risk Finance and Insurance Frameworks to support with National Action.’

Better financial preparedness against risk is a central part of a comprehensive approach to disaster management. Risk financing and risk transfer are approaches to planning for risks that cannot be reduced or avoided practically or cost-effectively and may include a strategy and practical measures to ensure the availability of funds for post-disaster relief and reconstruction, commensurate with the scale and frequency of anticipated risks. Risk financing is of growing interest to a wide range of development and humanitarian actors searching for solutions to bridge a growing global post-disaster financing gap. This report describes key features of risk financing and risk transfer, examines some of the current challenges at the contextual and programmatic levels as well as institutional challenges donors might face in engaging in risk financing and recommends a set of principles and policy approaches to guide future donor support and engagement.

There is a growing consensus that climate change impacts should be considered in the development of adaptation strategies by decision makers at all levels. This requires identifying cost-efficient adaptation measures, resulting from a structured risk management approach. The Economics of Climate Adaptation (ECA) approach offers a unique contribution, which combines risk assessment, adaptation measures and risk transfer. Its results allow a flexible identification of cost-effective climate adaptation measures for a variety of projects and sectors.

Climate and disaster risk finance and insurance (CDRFI) promises substantial resilience benefits. Yet, due to affordability challenges as well as market inefficiencies, to date they are not used to the extent they could. Limited uptake, in turn, threatens the sustainability of their supply. In the wake of fiscal pressures that were exacerbated by the Covid-19 pandemic, the topic of premium financing as a means to financially support CDRFI solutions and address the affordability challenge is gaining importance. In this context, the effectiveness of financial support for CDRFI could be improved by a coordinated, principled approach to premium financing. For this, there is a need to overcome the lack of awareness and evidence-based guidance on the conditions under which affordability and sustainability concerns for insurance solutions in vulnerable countries are best addressed through – inter alia – premium financing or other forms of concessional finance.   This Policy Note presents a common understanding among InsuResilience members and partners regarding recipient eligibility, volume, duration, and form of premium and capital support as well as the conditions under which this support will be provided. The HLCG approved the principles at its 5th meeting on the 27th of October 2021.The SMART Premium and Capital Support Principles presented in Part A provide an overarching framework to address these questions. They offer conceptual guidance for the provision, channelling and use of PCS by donors, implementers, clients and other recipients, and are intended to inspire a principled, coordinated approach on PCS provision and use among stakeholders. Part B presents an overview on how the principles could be applied in programming and designing premium and capital support at the macro- and meso-/micro-levels.

This guidance note provides practical step-by-step guidance on how to achieve a gender-smart Climate and Disaster Risk Finance and Insurance (CDRFI) programme through effective planning for monitoring and evaluation (M&E) throughout each stage of the programme cycle. This includes at the design, implementation, and impact stages of such a programme. Additionally, it also provides advice on the collection and use of sex-disaggregated data and features case study examples for best practices from within and beyond the InsuResilience Global Partnership. The target audience for this guidance note is practitioners involved in the design and/ or implementation of any stage of the programme cycle of a CDRFI project.