When disaster strikes, resources must be mobilised quickly and efficiently to assist people in affected areas. Having the right financial instruments, policy mechanisms, and disaster management strategies in place allows governments to not only provide emergency humanitarian assistance, but also to repair national assets and infrastructure like buildings, bridges, roads, and communications networks. Governments typically use a mix of financial tools to address the short-term (emergency response), mid- term (recovery), and long-term (reconstruction) impacts of a disaster. However, these efforts carry a high price tag, and ASEAN member states (AMS) face a variety of challenges, from budget constraints to a lack of cross-sector coordination, enabling legal and regulatory frameworks, internal capacity, quality data, and funding.

In Southeast Asia, where natural disasters are common, there is strong scientific consensus that extreme weather events will become more frequent and severe in the next century. Agriculture, which is heavily dependent on weather patterns, is an especially vulnerable sector. In most AMS, agricultural insurance can provide a pathway for farmers to become more resilient to the financial shocks of natural disasters and climate change, more self-reliant in food production, and better able to apply new technologies and commercialise their operations.

Combined with other disaster risk financing tools, strategies and systems, agricultural and disaster risk insurance markets and programmes can provide a vital financial safety net in times of crisis. This report looks at the state of disaster risk finance in AMS, addresses barriers to widespread uptake, and highlights potential solutions and best practices. It concludes with a set of recommendations for ASEAN and AMS to build resilience to climate and weather-related disasters, through: 

• Regional cooperation, coordination, and knowledge exchange between AMS on disaster risk standards, systems, policy, and regulations.
• Coordinated disaster risk financing and agricultural insurance strategies and instruments, as well as investments in risk reduction.
• Robust regional knowledge platforms that build the technical capacities of governments, insurance companies, and authorities at the ASEAN level.
• Investments in data, innovative new technologies, and risk market infrastructure and services to strengthen domestic insurance markets.
• Well-designed insurance products that meet the needs of farmers and low-income populations most vulnerable to climate- and weather-related disasters.

Source - Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH - https://www.giz.de