From the Pacific Coast of Mexico to the Caribbean and the Florida Gulf Coast, communities and cities have been severely impacted by hurricanes, especially this year. Many of these places rely on small business, like tourism and fishing, to keep their communities thriving.However, most of these businesses are uninsured. Parametric insurance is increasingly seen as a helpful tool to fill this gap. With this type of insurance, payouts already kick in once certain criteria, such as windspeeds, occur during the storm. The idea is that recovery from the storm can start as quickly as possible and provide a more reliable buffer to potential damages.
A recent article in Context News elaborates on the need for such insurance and the barriers to rolling out programmes. UNU-EHS Senior Expert Sinja Buri was featured in the article and expressed concern regarding the slow pace of programme roll outs in the Caribbean region. She highlighted that it is not yet widely available and that it is currently not even an option in some countries. According to the climate risk finance expert, key barriers are high premium costs and limited regulations.
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