The ISF has signed a grant agreement to support the implementation of an index-based flood risk transfer instrument to strengthen the resilience of vulnerable populations against flood events. Morocco’s exposure to flood risk is expected to worsen due to the expected effects of climate change, climate migration, and the growth of coastal cities, where vulnerable households bear a disproportionate impact. The InsuResilience Solutions Fund (ISF) is co-funding the implementation of the project alongside the Fonds de Solidarité contre les Evènements Catastrophiques (FSEC), Gallagher Re, and Société Centrale de Réassurance (SCR).
With its diverse landscape, Morocco encounters the recurrent challenge of natural disasters, particularly along its expansive coastline. The country’s susceptibility to events such as floods, exacerbated by rising sea levels, significantly impacts its coastal regions. With over half of the population and numerous industries situated along these vulnerable coastal areas, the looming threat of rising sea levels compounds the risk of floods.
In an effort to strengthen the resilience of vulnerable populations against these climate events, the ISF signed a grant agreement with Fonds de Solidarité contre les Evènements Catastrophiques (FSEC), as the project lead, Gallagher Re, an international reinsurance broker, and Société Centrale de Réassurance (SCR), a local reinsurance company. The project’s objective is to enhance the resilience of vulnerable and uninsured populations against flood risk by strengthening FSEC’s financial response through the use of an index-based flood risk transfer solution, supported by the installation of inundation sensors.
FSEC is a public-funded entity that provides partial compensation to those affected by disasters. The new insurance product will support FSEC to increase its financial capacities to provide compensation to uninsured vulnerable households in the event of a flood. FSEC will act as the policyholder and provide support to the risk modelling work. Gallagher Re and SCR will support the product design and provision of risk capital. The proposed flood risk transfer instrument will cover up to three pilot cities in Morocco.
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