G7 ConferenceGermany wants to foster climate risk insurance
07.05.2015 | Berlin – At a conference held as part of Germany's G7 Presidency, Minister Gerd Müller highlighted the importance of climate risk insurance for developing countries. Together with its G7 partners, Germany seeks to improve the protection of the poorest in developing countries through insurance, with a view to better protecting them against the impact of climate change. These people are particularly affected by the increase in extreme weather events such as droughts, floods and hurricanes.
The conference was held at Gasometer in Berlin-Schöneberg. In his opening speech, Minister Müller said, "Climate change is presenting the developing countries with enormous challenges. Most recently, cyclone Pam caused major damage on many islands in the South Pacific. Climate change can undo development achievements overnight, plunging people into renewed poverty. It is important to hold negotiations on climate targets, but we also need practical answers to climate change. Climate risk insurance is an effective way of providing quick and practical assistance on the ground to people in difficult situations."
Minister Müller announced that Germany would make available 150 million euros under the G7 initiative for the development of climate risk insurance.
Policymakers from all over the world and experts from the finance and insurance industry, from research institutes and non-governmental organisations used the conference to discuss ways of improving the general environment for climate risk insurance markets in developing countries. Minister Müller welcomed prominent guests, including Anote Tong, the President of the Republic of Kiribati; Nigerian Finance Minister Ngozi Okonjo-Iweala; and Achim Steiner, head of the United Nations Environment Programme (UNEP).
Germany wants to significantly increase the availability of insurance to protect people against climate risks in the form of extreme weather events. Among other things, Germany wants to provide financial support to developing countries. This is to benefit individuals, small enterprises, but also entire countries. So far, only some 100 million people in developing countries are covered by this kind of insurance. The initiative seeks to increase the number of poor people with access to such insurance by 400 million over a period of five years. Use is to be made of public funding from G7 countries but also of private capital, so as to achieve the biggest possible impact.
There are already successful examples of climate risk insurance schemes, for instance the African Risk Capacity (ARC), which provides drought insurance for African countries and is being supported by Germany and the UK.
Germany has made climate action a top priority of its G7 Presidency, as a new global climate agreement is to be adopted in Paris at the end of this year. Germany also wants the outcome of today's conference to inform the agenda of the G7 summit in Elmau, Bavaria, in June.