Canada to invest $50 million in G7 climate risk insurance initiative in developing countries
News Release
December 5, 2015 – Ottawa, Ontario – Environment and Climate Change Canada
Today, the Honourable Catherine McKenna, Minister of Environment and Climate Change, announced Canada’s contribution of Can$50 million to the G7 Initiative on Climate Risk Insurance to help people in developing countries protect themselves against the economic consequences of more intense and increasingly frequent natural catastrophes like severe flooding, droughts or heavy storms.
Insurance helps poor and vulnerable countries build resilience to the impacts of climate change by covering a portion of the risks that arise from natural hazards and extreme weather events. Together with the G7 and our partner countries, Canada is working to provide up to an additional 400 million poor people with insurance against the risks of climate change by 2020.
Canada is a leading contributor in supporting climate risk insurance in developing countries, notably through its participation in the Caribbean Catastrophe Risk Insurance Facility. Since its inception in 2007, the Facility has made 13 payouts for hurricanes, earthquakes and excess rainfall totalling approximately US$38 million to eight member governments.
Canada’s contribution to the G7 Initiative on Climate Risk Insurance will help to stimulate greater coverage of effective climate risk insurance markets in countries that are the most vulnerable to natural disaster. In doing so, we will work closely with all stakeholders by funding insurance policies.
Today’s announcement is part of Canada’s pledge of Can$2.65 billion over the next five years to support developing countries’ transition to low carbon economies that are both greener and more climate resilient. This is the most significant Canadian climate finance contribution ever.
Quotes
“The risks and costs of climate change on developing countries are very significant and Canada is proud to do its part in providing greater access to insurance.”
– The Honourable Catherine McKenna, Minister of Environment and Climate Change
“Developing countries are the most affected by climate change. Canada is committed to supporting the poorest and most vulnerable countries to adapt to the adverse effects of climate change, including by using innovative mechanisms like climate risk insurance.”
– The Honourable Marie-Claude Bibeau, Minister of International Development and La Francophonie
Quick Facts
- Climate risk insurance is a means of obtaining insurance against the risks of extreme weather events such as severe flooding, droughts or heavy storms. It can play an important role in providing security against the loss of assets, livelihoods, and lives, and the G7 Initiative on Climate Risk Insurance aims to increase the number of people covered by this kind of insurance by 400 million by 2020.
- Canada was the largest contributor to the establishment of the Caribbean Catastrophe Risk Insurance Facility, providing $25 million from 2007-2012.
- Canada will also contribute $10 million to the World Meteorological Organization to support better early warning systems in the most vulnerable communities under the Climate Risk and Early Warning Systems (CREWS) initiative. This funding contributes to the overall goal of assisting developing nations to become more climate-resilient.
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