Flooding on the Philippines

Climate change and development Climate risk insurance

Climate risk insurance improves people's protection against climate-related loss and damage, thus strengthening their financial resilience against the negative impacts of climate change. The disbursement of insurance payments can serve as quick assistance in an emergency and prevent impoverishment, hunger and indebtedness.

During its G7 Presidency, Germany has made a start on developing a Global Shield against Climate Risks. The Shield gathers activities in the field of climate risk finance and preparedness under one roof. As a result, people and authorities will be able to access the assistance that they urgently need when disaster strikes more easily and more quickly.

The Shield builds upon the InsuResilience Global Partnership, which works towards comprehensive and active climate risk management worldwide. The Partnership promotes cooperation among states, the private sector, multilateral institutions, civil society organisations and research institutes.


Germany's G7 input
Logo: Global Shield against Climate Risks
Background facts
Rice harvest in Bangladesh

German activities InsuResilience Global Partnership

Expanding climate and disaster risk finance and insurance solutions

Standbild aus dem Video "InsuResilience Global Partnership"

Video InsuResilience Global Partnership – A platform for action

The aim of the InsuResilience Global Partnership (External link) is to increase the long-term resilience of the poorest and most vulnerable groups in developing countries and emerging economies against climate risks. The expansion of climate risk financing and insurance instruments is intended to enable governments, enterprises and households to respond more quickly and effectively to natural disasters, thus minimising potential resulting costs.

During Germany's G20 Presidency in 2017, it joined forces with the UK, Fiji, Ethiopia and the World Bank to launch the InsuResilience Global Partnership as a joint G20 and V20 initiative. The V20 (Vulnerable Twenty Group) is an alliance of the finance ministers of the 55 countries that are most vulnerable to climate change. The Partnership now has more than 120 members representing industrialised and developing countries, civil society, the private sector, international organisations and the scientific community (as of September 2022). Germany is the biggest supporter of this key initiative.

The various programmes within the Partnership support pre-agreed schemes (such as climate risk insurance) which provide protection against the financial risks of climate impacts and disasters. Quick assistance and recovery protect the livelihoods of poor and vulnerable people against the consequences of climate-related events. Moreover, the Partnership supports the development of comprehensive climate and disaster risk strategies at the national and local levels in poor and vulnerable countries.

The Partnership has set itself an ambitious target in its Vision 2025: to provide coverage to 500 million of the world's poorest and most vulnerable people by 2025.

Currently, 24 programmes comprising over 300 projects are in progress under the umbrella of the InsuResilience Global Partnership in more than 100 countries. As a result, 150 million people had already gained coverage against climate risks in 2021. The Global Shield against Climate Risks builds on this experience, the existing structures and the close partnership with the V20. The Global Shield shall integrate the existing activities and make them more readily accessible, while mobilising additional finance at the same time. Cover against climate risks shall thus be made more systematic, better coordinated and more permanent compared to previous instruments. The aspiration is to provide coverage against climate risks for more poor and vulnerable people and countries in a more effective manner, closing their coverage gap permanently in a step-by-step process.

Further information about the Partnership:

German activities BMZ achievements in the field of climate risk insurance

The InsuResilience Global Partnership assists national and sub-national governments in developing comprehensive climate and disaster risk management strategies so as to improve their preparedness for the negative consequences of climate change.

Germany continues to support existing programmes such as African Risk Capacity (ARC). By mid-2020, ARC drought insurance paid out 61 million US dollars to the governments of Mauritania, Senegal, Malawi, Niger and Côte d'Ivoire and to humanitarian players such as the Start Network, assisting more than 3.2 million people in severe drought situations.

Insurance solutions

 Caribbean Catastrophe Risk Insurance Facility

Caribbean Catastrophe Risk Insurance Facility (CCRIF) Internal link

When the Caribbean Catastrophe Risk Insurance Facility (CCRIF) was founded in 2007, it was the first regional insurance pool of its kind. In 2015, the Facility was expanded. It now also covers the countries of Central America. Guatemala, Panama and Nicaragua have since joined.

Logo: Global Risk Financing Facility

The Global Risk Financing Facility (GRiF) Internal link

In October 2018, the German government joined forces with the UK and the World Bank to set up a new implementation programme to expand and enhance climate risk insurance solutions for vulnerable countries, the Global Risk Financing Facility (GRiF).

Logo: Global Index Insurance Facility

Global Index Insurance Facility (GIIF) Internal link

The Global Index Insurance Facility (GIIF) is a dedicated World Bank Group programme administered as part of Global Practice Finance, Competitiveness & Innovation. This endeavour is implemented within the framework of the InsuResilience Global Partnership. All GIIF donors are members of the Partnership.

Logo: InsuResilience Solutions Fund

InsuResilience Solutions Fund (ISF) Internal link

Another important implementation programme of the InsuResilience Global Partnership is the InsuResilience Solutions Fund (ISF). It supports the development of innovative climate risk insurance products in developing and emerging economies in order to buffer the impacts of climate change.

Logo: InsuResilience Investment Fund

InsuResilience Investment Fund (IIF) Internal link

The InsuResilience Investment Fund (IIF) is an initiative of KfW Entwicklungsbank on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).

House in Haiti destroyed by an earth quake

Natural Disaster Fund (NDF) Internal link

The Natural Disaster Fund (NDF) offers developing countries appropriate solutions that are based on scientific weather models, insurance mathematics methods and risk transfer instruments.

Cooperation in action

Village in the Somali region of Ethiopia where nomads have settled because of the ongoing drought

Africa: Cooperation in action Insurance policies against drought effects – ARC and ARC Replica Internal link

The African Risk Capacity (ARC) and ARC Replica provide support to African countries' efforts for better drought preparedness and offer them protection against financial losses from drought. This facilitates quick and effective assistance.

A young girl on a makeshift bridge after flooding in Sindh province, Pakistan.

Pakistan: Local micro insurance InsuResilience Investment Fund provides support for local institutions Internal link

Pakistan regularly experiences extreme weather events with negative consequences for the population, especially in agriculture. With support from the InsuResilience Investment Fund (IIF), a local foundation in Pakistan offers farmers a chance to combine micro loans for livestock purchases with micro insurance.

Torrential rainfall in India

India: InsuResilience Solutions Fund Insurance against natural disasters for the Indian state of Nagaland Internal link

Weather extremes such as torrential rainfall, floods and landslides cause major damage to public and private property. In 2017 alone, such events affected 30 per cent of Nagaland’s population. The InsuResilience Solutions Fund is promoting the development of an insurance scheme that boosts the state’s financial capacity in the event of disaster.

Background facts

As at: 20/09/2022