Publikation COP 24 Alternatives to Climate Risk Insurance in the Philippines

How to build community cooperation and volunteerism as a resilience strategy and an alternative to the UNFCCC-backed climate risk insurance system.

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Rising global temperatures have caused great alarm not just among international climate groups and experts but also for communities in the Global South who are least responsible, but ironically the most vulnerable to the impacts of climate change. This study provides examples of communities from the Philippines impacted by climate change and disaster which have self-organized to provide quick, pre-emptive responses. Beyond this, the study seeks to showcase how these self-organized community initiatives have transcended emergency action into a sustained undertaking that encompasses livelihood reconstruction, awareness-raising, organising and mobilising. These community initiatives, when further improved, can be widely advocated as alternatives to climate risk insurance and other market- based solutions to achieve climate resiliency. 

The study also plays an important role in providing a critical perspective on climate risk insurance instruments for loss and damage — the unavoidable impacts of climate change that simply cannot be addressed with traditional adaptation mechanisms. The research poses a critique of existing climate risk insurance instruments in the Philippines with the experiences of five (5) communities in the country with primary data collected through focused group discussions (FGDs) and key informant interviews (KII). 

Climate risk insurance is one of the financial instruments being promoted by the United Nations Framework Convention on Climate Change (UNFCCC) and the Warsaw International Mechanism (WIM) on Loss and Damage. The WIM was established to address loss and damage associated with impacts of climate change and is at the forefront of the market-based solutions is climate risk insurance. 

The study finding is that InsuResilience, one of the leading market- based instruments, is inadequate to address loss and damage associated with climate change. By pushing for an insurance system that focuses on post-disaster monetary compensation rather than providing opportunities to communities to develop their own practices of responding to climate change-related weather events, the concept of historical responsibility – the idea that developed nations which had for so long plundered and polluted the environment to accumulate global wealth are accountable for the climate crisis – is effectively diluted. Furthermore, the case studies presented in the research are viable options to replace climate risk insurance instruments and to build climate-resilient communities.