What do we know about preparing financially for disasters? An assessment of the evidence gap

This brief provides an overview of the Centre for Disaster Protection working paper ‘The impact of pre-arranged disaster finance: Evidence gap assessment’, which examines the evidence on how to prepare better for disasters, specifically the evidence on the welfare impacts of interventions that pre-arrange finance for disaster response. A strong body of evidence provides a compelling case that the current policy response to disasters—sudden, calamitous events that cause losses that exceed a community’s or society’s ability to cope using its own resources—is inadequate.

This reality has been underscored by Covid-19, which has reversed a decade of welfare progress. A recent study by the Centre for Disaster Protection reviews the evidence on the welfare impacts of proactive approaches to setting up finance for disaster response. It considers interventions designed to strengthen individuals’ and firms’ ability to pre-arrange finance for disasters as well as interventions that pre-arrange finance for governments, humanitarian agencies, and NGOs for disaster response. The study, which draws on peer-reviewed publications that use a valid method for assessing impact, sheds light on evidence showing what works and what does not, and it highlights where more evidence is needed.