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Methodological guidance to assess the value for money of premium and capital support towards climate and disaster risk finance and insurance

Research report

Written by John Ward, Lena Nur, Vikrant Panwar

Research report

This report contributes to the practical implementation of the ‘Value for Money’ (VfM) principle, which describes the impact each dollar of premium and capital subsidies (PCS) has on the resilience of poor and vulnerable countries and people. Aiming to inform allocation decisions, it provides a framework and methodology for the ex-ante assessment of the VfM of PCS options. This includes allowing decision-makers to compare premium versus capital support towards climate and disaster risk and finance insurance (CDRFI) solutions, synthesising the effects of the different support options within one country, or of the same option across different countries.

The report was produced in partnership with the InsuResilience Global Partnership (IGP) secretariat, as part of a set of three advisory reports exploring issues in relation to the design and use of PCS, to help guide the further development of climate and disaster risk financing and insurance (CDRFI). These reports also contribute to the Global Shield against Climate Risks, a major initiative launched at COP27 in Sharm el-Sheikh. The Global Shield aims to increase ‘pre-arranged finance’, which can be disbursed quickly and reliably in anticipation of - or just after - a disaster occurs, to protect people and governments in developing countries against climate change impacts. You can find out more about the other reports here.