NDF - Financing for climate change and development projects

Insurance Instruments for Climate Adaptation [NDF C31]

Photo: Jørgen Schytte
Livestock herders
Index based insurance products for crops
Tailored insurance products linked to large-scale infrastructure
9.12.2017
The project will conduct a study to support the development of climate insurance instruments for specific types of climate risks in Africa.

Africa Regional
Insurance Instruments for Climate Adaptation
Ref: NDF C31

EUR 0.5 million
Project period: 2012-2017
Partner agency: World Bank 

Project completed in December 2017. Actual disbursed amount EUR 466 825,28.

Objectives

The objective of this study is to support the development of climate insurance instruments for specific types of climate risks in Africa.

The study would build on and take forward ongoing work on identifying climate risks in the Africa region as well as to scope possible insurance investments for Africa.

Phase 1 entails: (i) a detailed regional drought and flood risk and vulnerability profiles that illustrate the climate-growth-poverty nexus in Africa; (ii) an inventorying and assessment of insurance instruments; and (iii) an assessment of priority clustering of insurance instruments and countries (individually or groups).  Phase 1 provides understanding necessary to develop the insurance market in Sub-Saharan Africa.

Phase 2 entails an assessment of insurance instruments available to the hydropower sector to (i) further climate risk and vulnerability profile development for droughts, floods and storms, making greater use of country-specific data sources and quality assessment through ground-truthing; (ii) contribute to a preliminary design of climate insurance programs to address climate risk; and (iii) facilitate stakeholder consultations, training and capacity-building related to climate insurance development.

Financing

Total cost of the project will be EUR 0.6 million, of which NDF will provide EUR 0.5 million, and World Bank EUR 0.1 million.

NDF Contact

Program Manager Aage Jørgensen
Telephone +358 10 618 002