The International Conference on Inclusive Insurance (ICII) 2024 in Kathmandu, organised by Munich Re, brought together a diverse array of stakeholders, including governments, private sector representatives, researchers, and civil society organisations, to explore pathways for inclusive insurance. SLYCAN Trust’s Multi-actor partnership (MAP) on climate and disaster risk management and finance project team participated in alignment with its work on Climate Disaster and Risk Finance and Insurance. SLYCAN Trust’s MAPs is dedicated to fostering effective, equitable, and poverty-oriented measures to finance resilience-building against climate and disaster risks.

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Amid growing climate challenges, the conference underscored the critical role of integrating innovative financial tools with holistic risk management strategies to enhance resilience for vulnerable communities.

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Insurance: A piece, not the whole puzzle 

A recurring theme throughout the conference was that insurance can act as a pivotal role in climate risk management but cannot function as a stand-alone solution. It bridges financial gaps, helping vulnerable communities recover from disasters, yet it does not directly reduce exposure or vulnerability. Examples of successful initiatives that integrate parametric insurance to protect smallholder farmers from climate shocks–by swiftly disbursing payouts when predefined conditions, such as rainfall thresholds, are triggered—have demonstrated the potential of insurance as an effective risk management mechanism when implemented properly.

Effective climate risk management requires a multi-dimensional strategy encompassing prevention, preparedness, and ecosystem-based solutions.

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While agricultural insurance schemes, such as crop or livestock policies are prevalent in climatically vulnerable countries, they often lack inclusivity and fail to address subregional differences. Redesigning these schemes with a focus on local needs and inclusivity must be a key consideration in developing effective instruments. Risk management frameworks should also incorporate risk layering, cost-sharing, and timely disbursal mechanisms to address diverse financial needs. ICII 2024 stressed on the importance of embedding insurance into broader adaptation plans to support sustainable livelihoods and address root causes of vulnerability. 

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ClimaComms at ICII 2024: Communicationing Inclusive Insurance

ClimaComms, in partnership with SLYCAN Trust, hosted a discussion on strategies for effectively communicating the benefits of climate insurance. The session explored using simple language, localised storytelling, and community-centred approaches to engage vulnerable communities. These insights are elaborated in Climate.2.0: Developing compelling narratives for climate communication in inclusive insurance frameworks

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Key Takeaways from ICII 2024

the conference highlighted innovative practices, including:

• Scaling Inclusive Insurance models: Collaborations with telcos, Microfinance Institutions (MFIs), and digital platforms (digital wallets) have made low-cost insurance more accessible. 
• Collaboration with existing social systems: Locally-led cooperatives, CSOs, and networks enhance public trust and support expedited claims processing.
• Leveraging technology: Digital tools (mobile apps) streamline enrollment and claims processing, while Interactive Voice Response (IVR) systems ensure accessibility in remote, disaster-prone areas.
• Embedding risk reduction: Bundling insurance with value-added services (weather advisories, early warning systems, and agricultural extension services) further enhances resilience by equipping communities with the tools and information needed to mitigate risks and adapt to changing conditions effectively.
• Supportive policy environment: Strengthened regulatory frameworks incentivise providers to extend coverage to vulnerable populations.
• Private sector engagement: Public-private partnerships are crucial for mitigating risks of uncertainty and enabling market growth.
• Fostering public trust: Simplified processes, transparency, and timely payouts enhance the role of insurance as a reliable risk management tool.

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Conclusion

ICII Kathmandu 2024 provided a platform for regional insights and dialogue on inclusive insurance and climate risk management. It underscored the need for public-private partnerships and integrated approaches combining financial instruments, nature-based solutions, inclusive policies, and community-driven initiatives. As climate risks grow, the lessons from ICII 2024 highlight the power of collaboration, innovation, and inclusivity in building resilience and empowering vulnerable communities to navigate the uncertain climate future.

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