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Insurance and risk transfer

The process of formally or informally shifting the financial consequences of particular risks from one party to another, whereby a household, community, enterprise or State authority will obtain resources from the other party after a disaster occurs, in exchange for ongoing or compensatory social or financial benefits provided to that other party. Risk insurance is a key disaster risk management activity.

This theme covers aspects of disaster risk financing, catastrophe bonds, financial resilience, and micro-insurance.

Latest Insurance & risk transfer additions in the Knowledge Base

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Research briefs
Research sheds light on why the National Flood Insurance Program is $22 billion in debt – and how it could be reformed

Study finds that hurricane-driven “hyperclustered” flood events in the last two decades account for more than half of NFIP claims to date.

The Society for Risk Analysis (SRA)
Update
Why does the U.S. flood insurance gap persist, and how can private insurance transform the market?

New Moody’s RMS modeling finds that two-thirds of U.S. flood residential modeled losses go uninsured.

Moody's
Parametric insurance for drought and market impacts mitigation in the hydropower sector thumbnail
Documents and publications
Parametric insurance for drought and market impacts mitigation in the hydropower sector

This study presents a comprehensive framework for designing and evaluating parametric insurance schemes aimed at reducing financial risks arising from drought and volatile electricity markets in the hydropower sector.

American Geophysical Union
Kibera slum, Africa, Kenya, Nairobi. Low-gauge mabati (tin) roofs provide little protection against the heat, meaning that residents need to use insulation to keep cool.
Update
When disaster strikes: How fire insurance protects lives and property in informal settlements

Across the world’s informal settlements, a single spark can erase a family’s home, savings, and livelihood in minutes. Yet fire insurance is rarely accessible or trusted by low-income households.

International Labour Organization (ILO)
Update
CCRIF launches the Livelihood Protection Policy (LPP) to safeguard vulnerable groups after storms, hurricanes and extreme rainfall events

In the wake of Hurricane Melissa, which left thousands of low-income Jamaicans struggling to rebuild their lives and livelihoods, a groundbreaking parametric insurance product, the Livelihood Protection Policy (LPP), is being launched in Jamaica this week

Caribbean Catastrophe Risk Insurance Facility, the
Update
Valencia floods: lessons in claims and recovery, one year on

Spain’s DANA floods in late 2024 exposed the complexities of disaster recovery. The event revealed how insurance, business continuity and community resilience are interdependent in a world of rising climate risk.

Zurich Insurance Group Limited
Earthquake
Update
Hande Akın reflects on Türkiye's Disaster Risk journey and future

In this interview, Hande Akin explains how TCIP provides affordable, compulsory earthquake insurance to millions of homeowners, highlighting TCIP’s evolution, including its rapid response to the 2023 Kahramanmaraş earthquake.

Financial Protection Forum (World Bank)
Gender analysis of climate and disaster risk finance and insurance in the Pacific thumbnail
Documents and publications
Gender analysis of climate and disaster risk finance and insurance in the Pacific

This analysis looks at tailored, gender- sensitive financial products that can enhance women’s resilience and inclusion in climate risk management efforts.

The Global Shield against Climate Risks
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