A Human Rights-based Approach to Climate Risk Insurance

Even if the goal of limiting temperature rise to 1.5 °C will be achieved and serious adaptation measures are in place, extreme weathers will put people and their livelihoods under risk – especially the poorest and most vulnerable communities in developing countries. The need for managing these climate risks is becoming more pressing as global temperatures rise. Tools that have been gaining attention and promotion in recent years are climate risk insurance and insurance-related instruments. When designed carefully, they can buffer some of the risks by providing financial support in the aftermath of an extreme weather event. The Munich Climate Insurance Initiative (MCII) provided valuable input formulating seven pro-poor principles aiming to secure that insurance schemes are designed and implemented so that they do no harm and the poorest and most vulnerable can benefit from these schemes (Schäfer et al., 2016). While the call has furthermore been made for a human rights-based approach to climate risk insurance (ibid.), its embodiment still remains vague. This paper aims at helping to fill this gap. It presents conditions for and design choices of climate risk insurance and insurance-related instruments that can ensure an effective, efficient and human-rights-based contribution to climate risk management that benefits those most in need and discusses which actors to involve.