Positive steps in issue of climate change insurance
The proposal by the Alliance of Small Island States (A.O.S.I.S.) for an insurance pool to cover the cost of loss and damage caused by climate change was finally approved by world leaders at the 23rd United Nations Framework Convention on Climate Change Conference of Parties (C.O.P. 23) held in Bonn, Germany.
“In 1991, A.O.S.I.S. proposed an insurance pool to cover the cost of loss and damage. And this week, at last, an insurance mechanism was launched that will finally provide better access to more affordable insurance for those who need it most,” C.O.P. 23 president and Fiji Prime Minister Voreqe Bainimarama said while making the announcement at the Fiji Pavilion yesterday.
And After 26 years of trying to get world leaders to agree to the proposal, Mr. Bainimarama said this was one of the successful outcomes of the climate talks that will be concluding this week.
Mr. Bainimarama said the Alliance of Small Island States (A.O.S.I.S.) and the Pacific Small Island Developing States (S.I.D.S.), which Samoa is a member of, have been making the case of the most vulnerable to climate change since the late 1980s.
“And this week, at last, an insurance mechanism was launched that will finally provide better access to more affordable insurance for those who need it most,” he said.
Mr. Bainimarama said loss and damage in the context of climate is not an abstract concept.
“It is a reality experienced by far too many people around the world already.
“And we know that is the case with 1.1 degree warming.
“On some recent projections, we are headed to 3 or 4 degrees and that will spell catastrophe.”
He said the Fiji Clearing House for Risk Transfer was launched to assist in the sharing of insurance information and solutions.
“And I’m very proud that these initiatives have happened during our Presidency of C.O.P. 23.
“I want to pay tribute to the perseverance of all those who have been promoting this idea for almost 30 years.
“This change is necessary because the current global insurance system does not work well enough for the poor and vulnerable.
“And certainly our people and my Government really struggled when Fiji was struck last year by the biggest cyclone ever to make landfall in the Southern Hemisphere.”
Cyclone Winston in Fiji killed 44 people, destroyed thousands of homes, schools and health centers and caused losses amounting to 30 per cent of their G.D.P.
“Mercifully, it spared most of the tourism areas on which our economy relies heavily on.
“But as I have said before, we are deeply apprehensive, even fearful about what would happen if a similar event was to score a direct hit on our major towns, cities and tourism properties.
“It could easily wipe out our economy in the space of a few terrifying hours and set back our development for decades.
“And also make it impossible for us to achieve our Sustainable Development Goals.
“On top of the terror and heartbreak of Winston itself, many of our people had to deal with the fact that the loss of their homes and possessions wasn’t covered by insurance.
“They effectively had to start their lives again with no financial means.
“And while my Government responded quickly with a Help for Homes Initiative to assist our people to rebuild, we cannot always replicate such assistance each time a climatic event occurs.”
Mr. Bainimarama said the initiatives would offer practical assistance and hope.
“With a generous financing arrangement for the partnership from Germany, the United Kingdom and other nations and financial institutions such as the World Bank, climate-vulnerable people throughout the world at least have an avenue to bounce back more quickly.
“It is a huge leap forward and we are delighted at the level of cooperation between governments, international institutions, private sector insurance, academia and civil society organisations that have made this possible.
“It is another wonderful example of the grand coalition in action and a good result from C.O.P. 23.
“Within Fiji, we know that our infrastructure must be upgraded or designed to cope with climate change.
“This week, we have also celebrated a water and wastewater investment of more than US$400 million (T$1.02 billion) through a blended finance arrangement to improve the climate resilience and the public health of our capital city, Suva, and its surrounds.
“As well as threats to infrastructure, we also have major concerns over the effect of sea level rise, ocean warming and acidification on our fisheries, reefs and mangroves.
“This is already affecting our coastal communities and is obviously a threat to the future of our tourism industry if we don’t solve this problem now.”
He concluded that loss and damage wasn’t some distant prospect.
“It is a grave and present reality. And as C.O.P. President, I am aware of the responsibility of maintaining the dialogue between parties – which I’m told is now going to be called the Suva Dialogue – to maintain focus on this issue and get to grips with its impact.
“At the same time, we need measures that provide practical access to finance for adaptation and enable us to build our resilience to climate change.
“It was one of my main motivations for taking on this role.
“And I intend to use my Presidency of C.O.P. to encourage more initiatives like the insurance mechanisms already launched this week,” Mr. Bainimarama said.