Disaster Risk Financing Instruments

Disaster Risk Financing Instruments

subtitle Financing Instruments

Strengthening financial resilience and preparedness for disasters and slow-onset hazard events requires a strategic approach to risk financing. This approach must consider both the potential frequency and severity of different events and risks. The effectiveness of risk financing instruments in relation to different risks can be significantly improved when different types of instruments are combined strategically to help maximise coverage and reduce gaps in protection. Governments need financing to meet a variety of disaster risk-related needs. These resources are required at various times for disaster prevention, preparedness, response and recovery. The amount of resources needed at these stages will vary, as does the cost of capital. These financial resource needs can be broadly broken down into ex-ante financing needs (for which resources are spent before an event takes place) and ex-post needs (for which resources are spent after an event occurs). There are a variety of risk financing instruments that use either ex-ante or ex-post resources. These are described in detail below.

While the cost associated with ex-ante and ex-post financing needs are borne at different points, they should both be considered before an event occurs, during the drafting of the DRF strategy and DRM plan. DRF planning ensures that the risk financing tools that are ultimately selected are the most appropriate and cost-effective given the need.

Pacific Catastrophe Risk Insurance Company (PCRIC)

Risk Instrument Type

Risk Transfer

Description

PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.

PIC(s)/ Beneficiaries

Current Pacific Island country members of the Foundation (PCRFI) are Cook Islands, Fiji, Marshall Islands, Samoa, Tonga and Vanuatu. All other member nations of the Pacific Island Forum Secretariat (PIFS) are eligible and are actively encouraged to become members.

Asian Development Bank- Contingency Disaster Funds

Risk Instrument Type

Risk Retention

Description

ADB’s Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.

PIC(s)/ Beneficiaries

Cook Islands, Palau, FSM, Kiribati, Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, Vanuatu, Federated States of Micronesia

Pacific Insurance and Climate Adaptation Programme (PICAP)

 

Risk Instrument Type

Risk Transfer

Description

UNCDF, UNDP, and UNU-EHS are jointly implementing the Pacific Insurance and Climate Adaptation Programme (PICAP) that aims to develop, deploy, pilot, test, and scale market-based financial instruments including parametric insurance. This new approach to offering insurance will provide Pacific people with immediate cash relief after extreme weather events and natural hazards. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments.

PIC(s)/ Beneficiaries

Fiji, Solomon Islands, Samoa, Tonga, Vanuatu

 

IDA Catastrophe Deferred Drawdown (Cat DDO) World Bank

 

Risk Instrument Type

Risk Retention

Description

A contingent financing line that provides immediate liquidity following a natural disaster, and/or health-related event. Funds become available for disbursement after the drawdown trigger – typically the member country’s declaration of a state of emergency – is met. At approval a country must have an adequate macroeconomic policy framework and a satisfactory disaster risk management program in place (or under preparation), which the Bank will monitor periodically

PIC(s)/ Beneficiaries

Samoa, Vanuatu, Tuvalu and Fiji

 

Contingent Emergency Response Components (CERC) World Bank

 

Risk Instrument Type

Risk Retention

Description

CERC is an arrangement within IDA projects that allow IDA funds to be quickly reallocated to emergency recovery activities in the event of a disaster. Inclusion of a CERC in IDA projects enables countries to use IDA funds without the need for time-consuming project restructuring. Up to 5% of un-disbursed IDA funds can be drawn upon through the CERC budget line. The inclusion of CERCs within World Bank projects is increasingly recommended for all IDA eligible countries. For example, Federated States of Micronesia, Marshall Islands, Samoa and Tonga have either used or have access to CERC financing arrangements.

PIC(s)/ Beneficiaries

Samoa, Tonga, Federated States of Micronesia, Marshall Islands

Forecast-based or Anticipatory Crisis Finance and Early Action - IFRC, FAO, OCHA, WFP, START Network

 

Risk Instrument Type

Risk Reduction and Preparedness Instruments

Description

Forecast-based/Anticipatory finance is triggered ‘post-forecast, pre-emergency’. These concepts refer to financing arrangements that use available climate and weather information and forecasts to trigger financing for pre-planned actions designed to prevent risks and reduce the potential for harm to people and property before an event occurs.

PIC(s)/ Beneficiaries

National Red Cross Societies & other stakeholders respectively.

Rapid Credit Facility - International Monetary Fund

Risk Instrument Type

International Emergency Financing

Description

provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.

PIC(s)/ Beneficiaries

(PRGT Eligible IMF Members) Federated States of Micronesia, Kiribati, Marshall Islands, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu, Vanuatu

Micro Insurance for Homes, Individuals, Families, Communities and Businesses - Fiji CARE

Risk Instrument Type

Risk Transfer

Description

Fiji Care’s community-based insurance product offers a low cost bundled insurance inclusive of life insurance, medical coverage and fire protection.

PIC(s)/ Beneficiaries

Fiji, Solomon Islands and Vanuatu

Link

 

Central Emergency Response Fund (CERF) - United Nations

Risk Instrument Type

International Emergency Financing

Description

The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.

PIC(s)/ Beneficiaries

Fiji, Solomon Islands, Papua New Guinea, Vanuatu, Marshall Islands

Disaster Relief Emergency Fund - International Federation of the Red Cross and Red Crescent Societies

Risk Instrument Type

International Emergency Financing

Description

The Disaster Relief Emergency Fund (DREF) provides immediate financial support to National Red Cross and Red Crescent Societies. The DREF is managed by the IFRC Secretariat as a central fund and requests are reviewed on a case-by-case basis. Funds can be allocated in as little as 24 hours. Grants can be provided for small to medium scale disasters and health emergencies that do not always attract the attention and interest of media or the international community. Funding can also be accessed in the form of loans for Emergency Appeal to kick start operations in large-scale disasters.

PIC(s)/ Beneficiaries

All National Red Cross Societies

Rapid Credit Facility and Financing Instrument - (International Monetary Fund)

Risk Instrument Type

International Emergency Financing

Description

The Rapid Credit Facility (RCF) provides rapid concessional financial assistance to low-income countries (LICs) facing an urgent balance of payments (BoP) need with no ex post conditionality where a full-fledged economic program is neither necessary nor feasible. The IMF’s Rapid Financing Instrument (RFI) provides rapid finance to all countries facing an urgent balance of payments need as the result of a financial crisis, disaster event, or other major sources of economic disruption.

PIC(s)/ Beneficiaries

Tonga, Samoa, Solomon Islands (RCF and RFI), Papua New Guinea

The Tuvalu Climate Change and Disaster Survival Fund

 

Risk Instrument Type

Risk Retention

Description

A nationally driven and nationally owned fund that provides a sustainable, predictable and accessible source of finance for Climate Change and Disaster Risk Management activities

PIC(s)/ Beneficiaries

Tuvalu

 

Standby Emergency Credit for Urgent Recovery (SECURE) - Japan

Risk Instrument Type

Risk Retention

Description

A contingent credit line, which gives governments immediate access to funds after a natural disaster, based on pre-existing agreements.

PIC(s)/ Beneficiaries

Fiji

Pacific islands climate change insurance facility (PICCIF)

Risk Instrument Type

Risk Transfer

Description

Is a proposed body aimed at the development of climate change risk-transfer products for Pacific Island nations. The aim of the PICCIF is to help people, cultures and livelihoods rebuild after the impacts of climate change. It seeks to address a variety of slow onset and extreme weather events that are currently not covered in the Pacific region by insurance or other mechanisms. It aims to provide the necessary incentives and information to improve the ownership and actions on addressing climate change risks. The PICCIF is additional to the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI) as it responds to climate change risks and will, build on the work of other insurance, social payment and index mechanisms that operate at the regional, national, community and individual level but address specific needs in the context of Pacific Island Countries that are not being met at the moment

PIC(s)/ Beneficiaries

 

The Pacific Resilience Facility - PIFS

Risk Instrument Type

Risk Transfer

Description

The PRF provides full-grant financing without debt. The PRF is a self-sustaining financial model. The PRF will offer grants to governments for community-level projects that are: crucial for disaster risk reduction, small-scale and community-level. Forum Leaders have endorsed the PRF. It is the only self-sustaining Facility of its kind that is led by the region and focused on the communities of the Blue Pacific.

PIC(s)/ Beneficiaries

 

Humanitarian Cash Programm - Pacific Regional Cash Working Group

Risk Instrument Type

International Emergency Financing

Description

Cash and Voucher Assistance (CVA) continues to be an expanding modality for the delivery of humanitarian assistance in the Pacific region. The humanitarian partners have used CVA along with other modalities to support the lives of people affected by disasters due to Its role as an efficient, effective, and flexible mode of addressing the humanitarian needs during all stages of the disaster life cycle have enhanced, while strengthening livelihoods, markets, and local economy or long-terms sustainable results in a dignified way with the inclusion of gender and disabilities mainstreaming and targeted actions. Contributing also to the recovery, resilience, and peacebuilding agendas.

PIC(s)/ Beneficiaries

Fiji, Vanuatu, Solomon Islands, Papua New Guinea

Multi-Donor Trust Fund for Tsunami, Disaster and Climate Preparedness - ESCAP

 

Risk Instrument Type

Risk Retention

Description

The Fund is part of the overall United Nations effort to strengthen resilience across the Asia-Pacific region. It contributes to the narrowing of capacity gaps and supports the development of an integrated, regional early warning system comprised of a network of collaborative centres. In 2011, the scope of the Fund was expanded to also cover disaster and climate preparedness, while retaining a focus on end-to-end early warning for coastal hazards.

PIC(s)/ Beneficiaries

 

 

Asia Pacific Disaster Response Fund - ADB

 

Risk Instrument Type

International Emergency Financing

Description

The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.

PIC(s)/ Beneficiaries

Fiji, Nauru, Niue, Solomons Islands, Vanuatu, Cook Islands, Kiribati, Tuvalu, Papua New Guinea, Federated States of Micronesia, Marshall Islands, Samoa, Palau

 

National Budgetary Instruments

Risk Instrument Type

Risk Retention

Description

Available public funds as dedicated national funds to help improve national financial capacity to absorb the financial costs of climate change and disaster-related losses.

PIC(s)/ Beneficiaries

Tonga, Tuvalu, Kiribati

Link

 

Sovereign green bond

Risk Instrument Type

Risk Retention

Description

Green bonds are debt instruments used by the government to finance projects that have a positive impact on the environment. in 2017, Fiji was the first developing country to successfully issue a sovereign green bond, which raised FJD100 million to fund climate projects. The country also raised more than FJD392 million between 2017 and2019 through an Environmental and Climate Adaptation Levy (ECAL), imposed on specific goods and services to fund domestic efforts to adapt to climate change and reduce risk.

PIC(s)/ Beneficiaries

Fiji

National Disaster Relief and Rehabilitation Fund and the Rehabilitation Fund

Risk Instrument Type

Risk Retention

Description

These funds support DRR and recovery activities. The Ministry of Finance and the NDMO work together to allocate funds. There are also examples of smaller funds, which have been used to support communities to prepare for or recover from disaster.

PIC(s)/ Beneficiaries

Fiji

Climate Relocation and Displaced Peoples Trust Fund

Risk Instrument Type

Risk Retention

Description

A trust fund dedicated to finance anticipatory relocation of communities and infrastructure considered to be threatened by severe climate or disaster risk. This fund is designed to act as a source of immediate finance to support communities displaced unexpectedly following a disaster event. The fund is resourced by both domestic revenue and external donor support. The Fiji Government deposits 3% of all revenue raised through ECAL in the trust fund, and also seeks contributions from bilateral and multilateral sources

PIC(s)/ Beneficiaries

Fiji

 

Disaster Risk Finance Instruments by Country

Cook Islands
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Federated States of Micronesia
Risk Instrument Type
Instrument Title
Description
Link
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
Risk Retention
Contingent Emergency Response Components (CERC) World Bank
CERC is an arrangement within IDA projects that allow IDA funds to be quickly reallocated to emergency recovery activities in the event of a disaster. Inclusion of a CERC in IDA projects enables countries to use IDA funds without the need for time-consuming project restructuring. Up to 5% of un-disbursed IDA funds can be drawn upon through the CERC budget line. The inclusion of CERCs within World Bank projects is increasingly recommended for all IDA eligible countries. For example, Federated States of Micronesia, Marshall Islands, Samoa and Tonga have either used or have access to CERC financing arrangements.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Fiji
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Transfer
Pacific Insurance and Climate Adaptation Programme (PICAP)
The Pacific Insurance and Climate Adaptation Programme aims to improve the financial preparedness and resilience of Pacific Islanders towards climate change and natural hazards through the development and implementation of market-based meso- and microinsurance schemes. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments. Fiji, Vanuatu, Tonga, Samoa, and the Solomon Islands will be covered under the multi-year programme.
Risk Transfer
Micro Insurance for Homes, Individuals, Families, Communities and Businesses - Fiji CARE
Fiji Care’s community-based insurance product offers a low cost bundled insurance inclusive of life insurance, medical coverage and fire protection.
International Emergency Financing
Central Emergency Response Fund (CERF) - United Nations
The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.
Risk Retention
Standby Emergency Credit for Urgent Recovery (SECURE) - Japan
A contingent credit line, which gives governments immediate access to funds after a natural disaster, based on pre-existing agreements.
International Emergency Financing
Humanitarian Cash Programm - Pacific Regional Cash Working Group
Cash and Voucher Assistance (CVA) continues to be an expanding modality for the delivery of humanitarian assistance in the Pacific region. The humanitarian partners have used CVA along with other modalities to support the lives of people affected by disasters due to Its role as an efficient, effective, and flexible mode of addressing the humanitarian needs during all stages of the disaster life cycle have enhanced, while strengthening livelihoods, markets, and local economy or long-terms sustainable results in a dignified way with the inclusion of gender and disabilities mainstreaming and targeted actions. Contributing also to the recovery, resilience, and peacebuilding agendas.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Risk Retention
National Disaster Relief and Rehabilitation Fund and the Rehabilitation Fund
These funds support DRR and recovery activities. The Ministry of Finance and the NDMO work together to allocate funds. There are also examples of smaller funds, which have been used to support communities to prepare for or recover from disaster.
Risk Retention
Climate Relocation and Displaced Peoples Trust Fund
A trust fund dedicated to finance anticipatory relocation of communities and infrastructure considered to be threatened by severe climate or disaster risk. This fund is designed to act as a source of immediate finance to support communities displaced unexpectedly following a disaster event. The fund is resourced by both domestic revenue and external donor support. The Fiji Government deposits 3% of all revenue raised through ECAL in the trust fund, and also seeks contributions from bilateral and multilateral sources
Kiribati
Risk Instrument Type
Instrument Title
Description
Link
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Risk Retention
National Budgetary Instruments
Available public funds as dedicated national funds to help improve national financial capacity to absorb the financial costs of climate change and disaster-related losses.
Nauru
Risk Instrument Type
Instrument Title
Description
Link
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Niue
Risk Instrument Type
Instrument Title
Description
Link
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Palau
Risk Instrument Type
Instrument Title
Description
Link
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Papua New Guinea
Risk Instrument Type
Instrument Title
Description
Link
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
International Emergency Financing
Central Emergency Response Fund (CERF) - United Nations
The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.
International Emergency Financing
Rapid Credit Facility and Financing Instrument - (International Monetary Fund)
The Rapid Credit Facility (RCF) provides rapid concessional financial assistance to low-income countries (LICs) facing an urgent balance of payments (BoP) need with no ex post conditionality where a full-fledged economic program is neither necessary nor feasible. The IMF’s Rapid Financing Instrument (RFI) provides rapid finance to all countries facing an urgent balance of payments need as the result of a financial crisis, disaster event, or other major sources of economic disruption.
International Emergency Financing
Humanitarian Cash Programm - Pacific Regional Cash Working Group
Cash and Voucher Assistance (CVA) continues to be an expanding modality for the delivery of humanitarian assistance in the Pacific region. The humanitarian partners have used CVA along with other modalities to support the lives of people affected by disasters due to Its role as an efficient, effective, and flexible mode of addressing the humanitarian needs during all stages of the disaster life cycle have enhanced, while strengthening livelihoods, markets, and local economy or long-terms sustainable results in a dignified way with the inclusion of gender and disabilities mainstreaming and targeted actions. Contributing also to the recovery, resilience, and peacebuilding agendas.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Republic of Marshall Islands
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
Risk Retention
Contingent Emergency Response Components (CERC) World Bank
CERC is an arrangement within IDA projects that allow IDA funds to be quickly reallocated to emergency recovery activities in the event of a disaster. Inclusion of a CERC in IDA projects enables countries to use IDA funds without the need for time-consuming project restructuring. Up to 5% of un-disbursed IDA funds can be drawn upon through the CERC budget line. The inclusion of CERCs within World Bank projects is increasingly recommended for all IDA eligible countries. For example, Federated States of Micronesia, Marshall Islands, Samoa and Tonga have either used or have access to CERC financing arrangements.
International Emergency Financing
Central Emergency Response Fund (CERF) - United Nations
The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Samoa
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
Risk Transfer
Pacific Insurance and Climate Adaptation Programme (PICAP)
The Pacific Insurance and Climate Adaptation Programme aims to improve the financial preparedness and resilience of Pacific Islanders towards climate change and natural hazards through the development and implementation of market-based meso- and microinsurance schemes. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments. Fiji, Vanuatu, Tonga, Samoa, and the Solomon Islands will be covered under the multi-year programme.
Risk Retention
IDA Catastrophe Deferred Drawdown (Cat DDO) World Bank
A contingent financing line that provides immediate liquidity following a natural disaster, and/or health-related event. Funds become available for disbursement after the drawdown trigger – typically the member country’s declaration of a state of emergency – is met. At approval a country must have an adequate macroeconomic policy framework and a satisfactory disaster risk management program in place (or under preparation), which the Bank will monitor periodically
Risk Retention
Contingent Emergency Response Components (CERC) World Bank
CERC is an arrangement within IDA projects that allow IDA funds to be quickly reallocated to emergency recovery activities in the event of a disaster. Inclusion of a CERC in IDA projects enables countries to use IDA funds without the need for time-consuming project restructuring. Up to 5% of un-disbursed IDA funds can be drawn upon through the CERC budget line. The inclusion of CERCs within World Bank projects is increasingly recommended for all IDA eligible countries. For example, Federated States of Micronesia, Marshall Islands, Samoa and Tonga have either used or have access to CERC financing arrangements.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
International Emergency Financing
Rapid Credit Facility and Financing Instrument - (International Monetary Fund)
The Rapid Credit Facility (RCF) provides rapid concessional financial assistance to low-income countries (LICs) facing an urgent balance of payments (BoP) need with no ex post conditionality where a full-fledged economic program is neither necessary nor feasible. The IMF’s Rapid Financing Instrument (RFI) provides rapid finance to all countries facing an urgent balance of payments need as the result of a financial crisis, disaster event, or other major sources of economic disruption.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Solomon Islands
Risk Instrument Type
Instrument Title
Description
Link
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
Risk Transfer
Pacific Insurance and Climate Adaptation Programme (PICAP)
The Pacific Insurance and Climate Adaptation Programme aims to improve the financial preparedness and resilience of Pacific Islanders towards climate change and natural hazards through the development and implementation of market-based meso- and microinsurance schemes. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments. Fiji, Vanuatu, Tonga, Samoa, and the Solomon Islands will be covered under the multi-year programme.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
Risk Transfer
Micro Insurance for Homes, Individuals, Families, Communities and Businesses - Fiji CARE
Fiji Care’s community-based insurance product offers a low cost bundled insurance inclusive of life insurance, medical coverage and fire protection.
International Emergency Financing
Central Emergency Response Fund (CERF) - United Nations
The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.
International Emergency Financing
Rapid Credit Facility and Financing Instrument - (International Monetary Fund)
The Rapid Credit Facility (RCF) provides rapid concessional financial assistance to low-income countries (LICs) facing an urgent balance of payments (BoP) need with no ex post conditionality where a full-fledged economic program is neither necessary nor feasible. The IMF’s Rapid Financing Instrument (RFI) provides rapid finance to all countries facing an urgent balance of payments need as the result of a financial crisis, disaster event, or other major sources of economic disruption.
International Emergency Financing
Humanitarian Cash Programm - Pacific Regional Cash Working Group
Cash and Voucher Assistance (CVA) continues to be an expanding modality for the delivery of humanitarian assistance in the Pacific region. The humanitarian partners have used CVA along with other modalities to support the lives of people affected by disasters due to Its role as an efficient, effective, and flexible mode of addressing the humanitarian needs during all stages of the disaster life cycle have enhanced, while strengthening livelihoods, markets, and local economy or long-terms sustainable results in a dignified way with the inclusion of gender and disabilities mainstreaming and targeted actions. Contributing also to the recovery, resilience, and peacebuilding agendas.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Tonga
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
Risk Transfer
Pacific Insurance and Climate Adaptation Programme (PICAP)
The Pacific Insurance and Climate Adaptation Programme aims to improve the financial preparedness and resilience of Pacific Islanders towards climate change and natural hazards through the development and implementation of market-based meso- and microinsurance schemes. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments. Fiji, Vanuatu, Tonga, Samoa, and the Solomon Islands will be covered under the multi-year programme.
Risk Retention
IDA Catastrophe Deferred Drawdown (Cat DDO) World Bank
A contingent financing line that provides immediate liquidity following a natural disaster, and/or health-related event. Funds become available for disbursement after the drawdown trigger – typically the member country’s declaration of a state of emergency – is met. At approval a country must have an adequate macroeconomic policy framework and a satisfactory disaster risk management program in place (or under preparation), which the Bank will monitor periodically
Risk Retention
Contingent Emergency Response Components (CERC) World Bank
CERC is an arrangement within IDA projects that allow IDA funds to be quickly reallocated to emergency recovery activities in the event of a disaster. Inclusion of a CERC in IDA projects enables countries to use IDA funds without the need for time-consuming project restructuring. Up to 5% of un-disbursed IDA funds can be drawn upon through the CERC budget line. The inclusion of CERCs within World Bank projects is increasingly recommended for all IDA eligible countries. For example, Federated States of Micronesia, Marshall Islands, Samoa and Tonga have either used or have access to CERC financing arrangements.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
International Emergency Financing
Rapid Credit Facility and Financing Instrument - (International Monetary Fund)
The Rapid Credit Facility (RCF) provides rapid concessional financial assistance to low-income countries (LICs) facing an urgent balance of payments (BoP) need with no ex post conditionality where a full-fledged economic program is neither necessary nor feasible. The IMF’s Rapid Financing Instrument (RFI) provides rapid finance to all countries facing an urgent balance of payments need as the result of a financial crisis, disaster event, or other major sources of economic disruption.
Risk Retention
National Budgetary Instruments
Available public funds as dedicated national funds to help improve national financial capacity to absorb the financial costs of climate change and disaster-related losses.
Tuvalu
Risk Instrument Type
Instrument Title
Description
Link
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
Risk Retention
The Tuvalu Climate Change and Disaster Survival Fund
A nationally driven and nationally owned fund that provides a sustainable, predictable and accessible source of finance for Climate Change and Disaster Risk Management activities
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.
Risk Retention
National Budgetary Instruments
Available public funds as dedicated national funds to help improve national financial capacity to absorb the financial costs of climate change and disaster-related losses.
Vanuatu
Risk Instrument Type
Instrument Title
Description
Link
Risk Transfer
Pacific Catastrophe Risk Insurance Company (PCRIC)
PCRIC is a regionally focused captive insurance company owned by Pacific Island nations through the Pacific Catastrophe Risk Insurance Foundation (PCRIF), based in the Cook Islands. As a captive insurance company, the endeavours are directed entirely toward the disaster risk insurance requirements of Foundation member countries. Products are designed to meet specific needs identified by Pacific Island nations, and in times of crisis aim to deliver timely post-disaster liquidity to support rapid relief. In addition, PCRIC is able to facilitate technical assistance to help countries build resilience to disaster and climate risks and in this way help them sustain development gains.
Risk Retention
Asian Development Bank- Contingency Disaster Funds
ADB's Contingent disaster financing (CDF) program will improve the resilience of the participating Pacific developing member countries (DMCs) to disasters triggered by natural hazards and health emergencies. It supports policy actions strengthening resilience to disasters and provides a source of financing for timely emergency response and early recovery. The program is the third phase of the Pacific Disaster Resilience Program; the first phase was approved in December 2017. ADB’s assistance comprises policy-based loans to the Cook Islands and Palau, and policy-based grants to the FSM, Kiribati, the Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.
Risk Transfer
Pacific Insurance and Climate Adaptation Programme (PICAP)
The Pacific Insurance and Climate Adaptation Programme aims to improve the financial preparedness and resilience of Pacific Islanders towards climate change and natural hazards through the development and implementation of market-based meso- and microinsurance schemes. The programme will offer an option for the national and sub-national governments to consider subscribing to a ‘macro to micro’ scheme, where a government level insurance policy pays out to individuals, to support the most vulnerable segments. Fiji, Vanuatu, Tonga, Samoa, and the Solomon Islands will be covered under the multi-year programme.
International Emergency Financing
Rapid Credit Facility - International Monetary Fund
provides concessional finance in the form of loans to low-income countries when urgent financial support is required. Though focused more on supporting macro-economic stability, this facility may also serve as a relevant source of support following a disaster event.
Risk Transfer
Micro Insurance for Homes, Individuals, Families, Communities and Businesses - Fiji CARE
Fiji Care’s community-based insurance product offers a low cost bundled insurance inclusive of life insurance, medical coverage and fire protection.
International Emergency Financing
Central Emergency Response Fund (CERF) - United Nations
The CERF via the Rapid Response Window provides quickly disbursed grants to support three types of emergency situations: a) sudden onset emergencies b) the deterioration of an existing humanitarian situation c) time-critical interventions. In most cases, a maximum of USD30m can be applied for by UN organisations to support national responses.
International Emergency Financing
Humanitarian Cash Programm - Pacific Regional Cash Working Group
Cash and Voucher Assistance (CVA) continues to be an expanding modality for the delivery of humanitarian assistance in the Pacific region. The humanitarian partners have used CVA along with other modalities to support the lives of people affected by disasters due to Its role as an efficient, effective, and flexible mode of addressing the humanitarian needs during all stages of the disaster life cycle have enhanced, while strengthening livelihoods, markets, and local economy or long-terms sustainable results in a dignified way with the inclusion of gender and disabilities mainstreaming and targeted actions. Contributing also to the recovery, resilience, and peacebuilding agendas.
International Emergency Financing
Asia Pacific Disaster Response Fund - ADB
The fund provides quick disbursing grants to assist DMCs meet immediate expenses to restore life-saving services to affected populations following a disaster and to augment aid provided by other donors in times of crisis.