Insurance Development Forum Summit 2022

The world today faces a combination of risks and fragilities that is without precedent. The confluence of the covid-19 pandemic, the climate crisis and recent geopolitical insecurity are driving a surge in global vulnerability and the emergence of unprecedented risks that the world will need to bear for some time. 
 
Prior to the COVID-19 pandemic, numerous countries faced debt distress, with debt levels exceeding regional targets, debt-service costs rising to unsustainable levels, and elevated refinancing risks. These combined experiences point to an era of crises and the expectation of significant rollbacks in terms of the gains that the developing and emerging world have made in the last two to three decades.
 
This high-level discussion will draw perspectives from leaders across the development finance community and private sector on the global recovery agenda in the context of managing a ballooning debt crisis and the role of pre-arranged financing and insurance in increasing resilience in a world of growing uncertainty.

Throughout history, individuals have come together to protect what they value and secure more hopeful futures by sharing risks through collective pools of resources. While often overlooked, risk sharing systems (public, private, mutual) represent significant scientific, cultural and economic assets, with modern risk-sharing systems extending from social protection to informal community networks and the insurance industry. These systems will have a crucial role to play in effectively confronting the climate crisis and many of the other crises that the world is increasingly having to contend with and which represent a collective systemic risk management challenge[1]
 
As the world enters into a new era of much needed investments — in energy security and climate and pandemic security, across both developed and developing world – a significant opportunity exists to shape a more resilient future. Such investment will require new and vastly scaled up public-private sector compacts, globally as well as nationally and a strengthening of risk sharing systems. This session will aim to explore specific ways the industry (through its tools and capabilities) can drive better risk management and protection systems at scale. 

[1] Risk Sharing in the Climate Emergency: Financial regulation for a resilient, net zero, just transition | Cambridge Institute for Sustainability Leadership

Success in closing protection gaps and building resiliency requires action by many in both the public and private sector, as well as other stakeholders. This panel will address the critical role that government policies, laws and regulations play in creating an environment that allows for the insurance industry to respond to the urgent need to address these vulnerabilities. The panel will address issues such as market access and product regulation, regulation of technology, the role of governments in increasing financial literacy (including insurance literacy/risk awareness) and how tax policies, public/private insurance solutions and other government actions can help address availability and affordability issues.

Please see description below for further information about the expert and networking sessions.

This high-level panel will mark the formal launch of the Global Risk Modelling Alliance (GRMA). The GRMA is founded on the principle that equal and widespread access to risk understanding in climate-vulnerable economies will lead to improved risk management strategies and increase the flow of climate and disaster risk finance. Ultimately this will benefit vulnerable groups, build confidence and collaboration in growing markets and create a tide on which all boats can rise. The event will aim to: (i) Establish the rationale for the GRMA programme, (ii) creating awareness and interest among potential sovereign and development partners; (iii) mark its operational availability, highlighting key concepts, components and benefits and (iv) encourage further international partners to commit their support to the programme.

The urgent needs of vulnerable countries and people in the face of increasing climate risks need to be addressed. Building on the InsuResilience Global Partnership, the G7 want to substantially strengthen the global climate and disaster risk finance and insurance (CDRFI) architecture, jointly working towards a global shield against climate risks. The aim of the global shield is to foster more systematic, coherent and sustained financial protection to help reduce the negative impacts of climate change on vulnerable countries and people.

The release of the G7 Development Ministers’ Meeting Communiqué1 identified the Global shield as a priority with the clear intention to bring “the private sector fully on board”. With the G7 Leaders' Summit 2022 expected to be convened the week after the IDF Summit (on 26 – 28th June), this discussion will provide insight into the vision and objective of the G7 Global shield efforts.

This session will cover:

• A problem statement on the global imbalance in risk understanding,and why it has to be addressed
• The benefits of local ownership of risk understanding
• What the private sector brings
• How the Global Risk Modelling Alliance (GRMA) can help

This session will both raise awareness of the pervasiveness of extreme heat in our communities and our economies as well as bring an action-oriented agenda to the table to address insurance and finance solutions. The session will focus on emerging markets and vulnerable populations.

The promise of universal social protection is hard to fulfil, especially in low-income and developing countries. While risks associated with climate change and natural hazards are escalating, the Covid-19 pandemic put systems further under pressure and demonstrated the importance of a comprehensive array of public and private risk management tools to support the resilience of poorer individuals and communities, who were hit the hardest. 

This session explores the concept of adaptive social protection and the complementarity of inclusive insurance and other risk financing mechanisms to increase climate and overall risk resilience in low-income and developing countries. We will look at specific types of insurance cover, existing and emerging, that can mitigate the risks of impoverishment and/or contribute to more stable levels of wealth and income, the potential public-private partnerships that could leverage macro, meso, and micro-level insurance as a critical part of the social safety net and the policy and regulatory measures that could enhance the enabling environment for those to be deployed. We will also discuss the practical measures that countries have put in place to enhance their social protection programmes.

This session will unpack the complexities of locally led disaster risk financing systems showcasing Start Network’s new financing facility Start Ready. Through a dynamic discussion with key stakeholders such as donors, the insurance community, and local actors, this session aims to deepen the understanding of the key challenges and opportunities that disruptive humanitarian financing has, and its particularly impact to at-risk communities.  

Some of the topics that this conversation will touch upon are financial risk pooling in the current financing infrastructure, locally led disaster risk financing, donors and key stakeholder’s challenges and opportunities.

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