On 12 October 2017, the Munich Climate Insurance Initiative (MCII) — hosted by the UNU Institute for Environment and Human Security (UNU-EHS) — won the prestigious 2017 Momentum for Change Award for its efforts to bring key actors together to address climate risks and poverty by implementing climate risk insurance for vulnerable people in developing countries. Under the auspices of the project Climate Risk Adaptation and Insurance in the Caribbean, MCII designed and implemented the Livelihood Protection Policy (LPP) in Jamaica, St. Lucia and Grenada. The LPP enables individuals to sign up for climate risk insurance no matter what their profession or income level.
The purpose of the Momentum for Change Awards, spearheaded by the UN Climate Change secretariat (UNFCCC), is to shine light on some of the most innovative, scalable, and practical examples of what people across the globe are doing to combat climate change. These so called “Lighthouse Activities” demonstrate the variety of climate action happening around the world; winners were chosen from more than 460 entries.
As a mission-driven, non-profit think tank, MCII seeks to bring together experts from a variety of backgrounds to develop microinsurance solutions for the most vulnerable populations. MCII has been a long-term advocate in support of climate risk insurance approaches to protect vulnerable populations that are affected by climate change — a global problem that most impacts the poorest, but to which they have not contributed. The LPP is a weather index-based insurance policy designed specifically to help low-income individuals recover from the damage caused by strong winds and/or heavy rainfall during hurricanes and tropical storms. In the case of extreme weather, those covered receive cash payouts soon after the event to help them get back on their feet more quickly. By extending financial protection to underserved vulnerable communities, MCII is demonstrating the role that financial inclusion can play in climate change adaptation.
In the Caribbean, the positive effects of microinsurance products such as the LPP are palpable. Aside from protecting low-income people, who are particularly vulnerable to the impacts that extreme weather events can have on their livelihoods, the products also allow policyholders to rebuild more quickly. Therefore, they are better prepared for future disasters, because they do not have to resort to a variety of coping strategies that harm their ability to withstand and recover (e.g., selling assets, reducing food consumption, or taking children out of school or borrowing) in the event of a crisis.
For more information, see the press release on the UNU-EHS website.