Coral reefs head for cover
VATUROVA Foundation Fiji has become the latest entity to head for cover in parametric insurance through a “groundbreaking” policy aimed at protecting coral reef.
Developed by British-American insurance service provider Willis Towers Watson (WTW) in partnership with Fiji-based correspondent broker Insurance Holdings (Pacific) Pte Ltd, the policy will be administered by the Pacific Catastrophe Risk Insurance Company (PCRIC).
Announcing its selection as administrator of the product, PCRIC said the product marks its first non-sovereign policy and also the first that has a specific focus on the impact of disasters on nature.
“This product aims to offer rapid payouts after a tropical cyclone damages the reef. It covers costs for reef clean-up, restoration, and community aid to address food and water security concerns resulting from storm damage,” PCRIC stated.
WTW said the policy is tailored to deploy rapid payouts of up to $US450,000 ($F1,011,464) for reef restoration and community assistance if cyclone hits and is being supported by BHP Insurance through social investment funds.
“BHP is funding an innovative parametric insurance product, which aims to support the conservation of coral reefs and surrounding local communities in Fiji’s northern Lau Group, and build the knowledge base for how similar financial products could be used to improve climate resilience. We are pleased to work with WTW and Vatuvara Foundation on this project, which supports BHP’s commitments to action on climate, conservation and empowering communities,” Ashley Preston, head of climate resilience at BHP said.
Vatuvara Foundation director Katy Miller commended the quick access to funds built into the policy.
“Increased frequency and severity of extreme weather events is expected in the area, and protecting natural ecosystems in the Lau Group is crucial to build longterm community resilience to anthropogenic threats including climate change,” she said.
PCRIC, whose core mission is to help Pacific Island countries enhance their disaster resilience by helping facilitate swift access to financial resources, said the initiative “sets a global precedent for coral reef conservation and climate adaptation.”
“The commendable efforts of the Vatuvara Foundation, spanning reef conservation and community empowerment, have earned recognition from the Fijian Government for their alignment with national interests and developmental goals,” PCRIC chief executive officer Aholotu Palu said.