Catalyzing Inclusive Risk Finance in LAC: Opportunities for Innovation in Guatemala and the Caribbean
Organizer: World Food Programme (WFP)
|In the session, Kathryn Milliken and Andrea Camargo from the World Food Programme (WFP) will present the Risk Finance Strategy for LAC and the risk layered approach adopted by WFP Guatemala. Edgar Uribe (Swiss Re) and Iker Llabres (MiCRO) are going to present the work behind the design of the weather index microinsurance product that will be piloted in Guatemala from April 2021 with Aseguradora Rural.|
Background: The Latin America and Caribbean (LAC) region is exposed to a diversity of shocks threatening communities’ livelihoods and food security. Building resilience of the most vulnerable and food insecure is a priority for WFP, with risk financing playing an important role.
The Regional Office of WFP in Latin America and the Caribbean adopted in 2020 a Risk Financing Strategy to encourage the adoption of innovative, responsible, sustainable and scalable risk financing tools to build resilience of the most vulnerable and food insecure. Inspired by this regional strategy, Guatemala is adopting a layered approach where the complementarity between microinsurance, forecast-based financing (FbF), and macro and meso risk financing tools is at the core. Other countries such as Dominica, Cuba, Dominican Republic, Haiti and El Salvador are currently exploring the pathways to integrate risk financing tools within their programmes.
WFP Guatemala, in collaboration with Swiss Re (reinsurance coverage), Aseguradora Rural (local reinsurer) and the Microinsurance Catastrophe Risk Organisation (MiCRO) (technical design of the product), has worked on the integration of a weather index microinsurance product covering drought and excess rain into their programmes to boost resilience and productivity of smallholder farmers and microentrepreneurs. In order to ensure sustainability, WFP Guatemala designed a scalable and sustainable strategy that requires linking the microinsurance product with supply value chains. The product is awaiting the approval of the Guatemalan supervisory authority, Superintendencia de Bancos (SIB).
Kathryn Milliken, Climate Change Adviser (World Food Programme)
Andrea Camargo, Risk Finance Consultant (World Food Programme)
Iker Llabres, Actuarial Officer and Business Manager for El Salvador (MiCRO)
Edgar Uribe, Underwriter and Senior Product Manager (Swiss Re)