Insurance Development Forum launches first Tripartite Project for Peru
London: The Insurance Development Forum (IDF), a public-private partnership led by the insurance industry and supported by international organisations, announced today the signing of a Grant Agreement between Germany’s InsuResilience Solutions Fund (ISF) and an IDF project consortium, who will jointly fund the project to design an insurance programme for Peru’s public schools. The project will provide the Government with options to cover all or a subset of its more than 50,000 public schools against the impact of natural disasters and aims to improve continuity for children’s education by accelerating reconstruction, while also strengthening the country’s resilience.
The start of the Peruvian Public Schools project marks the first country execution under the Tripartite Agreement between the IDF, the German Federal Ministry for Economic Cooperation and Development (BMZ) and United Nations Development Programme (UNDP), officially signed in September 2019, during the United Nations Secretary General’s Climate Action Summit.
This ground-breaking three-way partnership committed to providing funding, technical assistance and risk solutions to 20 climate-vulnerable countries by 2025, through leveraging the risk management expertise and capacities that the private sector and insurance markets can offer, in close collaboration with the public sector, to address the increasing impacts from climate change. It looks to amplify the strengths of the various parties and scale-up the use of risk financing mechanisms to deliver on global resilience and adaptation ambitions.
The first execution of this Tripartite Agreement will be delivered by an IDF project consortium led by AXA XLand Munich Re, which includes the Peruvian Association of Insurance Companies (APESEG) as the initiator of the project, as well as risk modellers GEMFoundationandJBA Risk Managementand the InsurTech Picsure.
Eduardo Morón Pastor, President of APESEG, said: “The chance that this project provides to consider alternative options for an insurance solution, developed by global reinsurance companies in partnership with APESEG, is extremely valuable for Peru. It will allow the Government to make choices that can help it to increase its resilience to catastrophic events.”
IDF Secretary General Ekhosuehi Iyahen, said: “Innovative public-private partnerships between the insurance sector and governments can enable and optimise the use of insurance and its related risk management capabilities to build greater resilience and protection for people, communities, businesses, and public institutions that are vulnerable to disasters and economic shocks. We are delighted to see our Tripartite Agreement move to implementation with the Peruvian Public Schools Insurance Scheme project. It is also as a signal that we can indeed accelerate our efforts given the urgency of existing needs.”
She added, “The IDF is focused on producing tangible benefits and meaningful solutions at a scale that help build resilience to climate change in the most vulnerable countries and sectors. We see scope for further application of the Tripartite project approach in other countries and sectors such as agriculture, and public infrastructure.”
Since signing of the Tripartite Agreement in September 2019, its members undertook a detailed consultative process across the respective institutions, with various partners, including governments and the InsuResilience Programme Alliance, and established a framework to deliver the Tripartite projects with an effective methodical approach.
In alignment with its principles of fairness and transparency, IDF projects end with the delivery of a risk financing solution to a sovereign or sub-sovereign partner. These governments and/or sub-national entities are then able to consider their options towards operationalising or improving on their risk financing systems and programmes, which can include going through relevant public tender requirements and processes.