Insurance solutions can help to restore mangroves as natural coastal defences

This report assesses the potential of mangroves as cost-effective risk reduction mechanisms and identifies where insurance could be used to help guarantee the continuation of this benefit for communities and countries alike.

• First, it provides an overview of habitat insurance and the risk reduction benefits of mangroves.
• Then, it makes a spatially explicit benefit-cost analysis for mangrove restoration across the entire Caribbean to identify where there may be cost effective opportunities for insurance and investment in mangroves.
• Lastly, the report provides a high-level market analysis of opportunities in the Caribbean for mangrove insurance based on these benefit-cost analyses and our experience with the reef insurance model. 

The results identify that there are many opportunities for mangrove restoration across the Caribbean. There are 20 states, territories and countries in the region that have sections of coastline where the benefits of mangrove restoration, in the form of coastal protection, exceed the costs of mangrove restoration using a 7% discount rate.

There is potential for any mangrove insurance product to be marketed to either private or public customers. In the short-term, however, a mangrove insurance product geared towards the public sector appears most feasible. With a mangrove insurance policy, local or national governments could use the insurance coverage to restore damaged mangrove forests with the aim of protecting communities and assets from storms, which could impact local food sources, local infrastructure, and local economies