The potential role of disaster insurance for disaster risk reduction and climate change adaptation
Using Ethiopia as a case study, this paper discusses the value of two key factors, "timeliness" and "reliability" that disaster insurance could bring to humanitarian intervention. Its purpose is to explore the potential role of Index-based Disaster Insurance as a tool for climate change adaptation and social protection in developing countries.
It first provides an overview of recently piloted micro policies and macro policies; then outlines several limitations of the micro approach as a tool for social protection, and moves on to discuss the macro approach and its potential as a more sustainable instrument for humanitarian intervention. Using Ethiopia as a case study, it argues that the current appeal-based emergency model is unsustainable. It then discuss the possible value of two key factors, "timeliness" and "reliability", that disaster insurance could bring to humanitarian intervention. Finally, specific recommendations are provided for donors, governments and civil society.