Evaluating Sovereign Disaster Risk Finance Strategies : Case Studies and Guidance
Disaster risk finance is an important component of the disaster risk management and climate change adaptation agenda. It aims to increase the financial resilience of countries against natural hazards by strengthening public financial management and...
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/972881478686747136/Evaluating-sovereign-disaster-risk-finance-strategies-case-studies-and-guidance http://hdl.handle.net/10986/25381 |
| Summary: | Disaster risk finance is an important
component of the disaster risk management and climate change
adaptation agenda. It aims to increase the financial
resilience of countries against natural hazards by
strengthening public financial management and promoting
market-based disaster risk finance solutions (such as,
sovereign catastrophe risk transfer solutions for
governments or domestic catastrophe risk insurance markets
for public and private assets). This report complements the
more theoretical framework paper with a demonstration of how
the framework can be applied in practice. Five case studies
illustrate a range of questions that policy makers might
ask, potential instruments to be considered, and economic
conditions, and a Guidance Note presents principles for such
analyses. The structure of the report is as follows: the
proposed framework is presented, outlining the approach of
the opportunity-cost framework and its limitations. The five
case studies are introduced and the contingent liability and
finance strategies considered in each are outlined.
Subsequently, the five case studies are presented in five
chapters, each standalone with relevant annexes (including
at the back of the report). Finally, a Guidance Note
outlines how the framework may be applied in a practical
manner to another country’s plans for the disaster risk
financing of a contingent liability. Lastly, a Glossary is
provided. The purpose of the entire report is to illustrate
how to apply the framework to a country-specific question.
All formulae and calculations applied in these case studies
follow those in the technical framework paper. It does not
aim to make any generalized conclusion about which finance
mechanisms are cheapest or how disaster risk finance should
be structured. |
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