The Role of Climate Risk Insurance in Building Resilience of the Fisheries Sector– the Coast (Caribbean Oceans and Aquaculture Sustainability Facility) Example and Application

Isaac Anthony, Elizabeth Emanuel, and Gina Sanguinetti Phillips

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ABSTRACT

The fisheries sector in the Caribbean is an important source of livelihoods and contributes significantly to food security, providing access to inexpensive protein in a region that is challenged to overcome its overdependence on a carbohydrate-focused diet. While the sector is not a leading contributor to the Gross Domestic Product (GDP) of most countries, it is important to the development and stability of rural and coastal communities. Additionally, the importance of the fisheries value chain and linkages with other sectors such as tourism, is substantial. The COAST case study is presented to demonstrate how climate risk insurance can support governments in their efforts to build back better after a natural hazard event and create a resilient fisheries sector. The COAST parametric insurance product for the fisheries sector was developed by CCRIF SPC under the Caribbean Oceans and Aquaculture Sustainability Facility with financial support from the World Bank and the United States State Department. A COAST policy provides coverage for losses caused by adverse weather to all players in the fisheries industry, for direct damages caused by tropical cyclones to fishing vessels, equipment and infrastructure. It promotes gender equity, as women in the fisheries sector are specifically included. This case study also demonstrates the role of climate risk insurance in advancing shock-responsive social protection. By participating in COAST, governments commit to strengthening their fisheries industry systems and registration procedures, as well as their social protection registries, leading to the sector being more sustainable and resilient to the impacts of climate change.

HOW TO CITE : Anthony, I., E. Emanuel, and G. Sanguinetti Phillips, 2026. The Role of Climate Risk Insurance in Building Resilience of the Fisheries Sector– the Coast (Caribbean Oceans and Aquaculture Sustainability Facility) Example and Application. Contribution 7.1, p493-501 IN CRFM, 2026. Volume I: Technical Papers. Presented at the CRFM 20th Anniversary Scientific Conference, 28-31 August 2023. CRFM Special Publication No. 37, CRFM Secretariat https://www.crfm.int/index.php?option=com_k2&view=item&id=942

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Thursday, 24 June 2021 (Jamaica Ministry of Agriculture and Fisheries)  For the first time, Jamaica’s 26,000 registered fishers will have access to insurance coverage for their vessels, engines and other equipment with the launch of the Safety Net insurance policy provided by Advantage General Insurance Company.

“This Advantage Safety Net policy is the first of its kind. It is the first [time] that artisanal fishers will be able to go into an insurance company to take out an insurance policy to protect their fishing vessels,” said Green.

Minister Green (left) at the unveiling of the Safety Net policy for fishers

Speaking at the virtual launch held at the Ministry's Hope Gardens offices in St. Andrew on June 22, Green said the policy will protect fishers against a wide array of perils both at sea and on land and even when their vessels are being repaired.

“It not only gives them greater security; it also gives them greater accessibility to the things they need to enhance their businesses,” Green stated.

In addition, Advantage General has also provided for fishers and farmers special access to discounted rates for insuring their cars and homes, the agriculture and fisheries minister stated.

Noting the need to provide protection for farmers in relation to all the investments that they have placed in the ground and in their greenhouses that are subject to so many vagaries, especially in relation to weather, Green said the next step is the provision of crop insurance.

For her part, Vice-President of Underwriting and Channel Management at Advantage General, Ruth Cummings, in outlining the benefits under the package, said the protection provided by the Safety Net policy includes accidental loss or damage to fishing vessels and accessories by fire, explosion, malicious acts, flood, hurricanes and other such perils as well as theft of vessel or outboard.

“We believe it is important that fisherfolk are protected and have peace of mind as they go about their business,” said Cummings.

ABOUT SAFETY NET POLICY

The Safety Net policy provides coverage for accidental physical loss or damage to the fishing vessel and its accessories including theft. For the first time, vulnerable fishing communities will have access to insurance coverage developed specifically for them.

We recognize our fishers and farmers as the backbone of our economy and the primary providers of the food we eat. We want to protect their livelihood by providing affordable and accessible insurance coverage.

https://agic.ymgclicks.com/safetynet/

Over the past 30 years, storms, hurricanes and flooding associated with climate change and climate variability have had devastating impacts on Caribbean people, their property and livelihoods, and on the social and economic development of our region.

As noted in a recent public address delivered by Milton Haughton, the Executive Director of the Caribbean Regional Fisheries Mechanism (CRFM), "Fishers and fishing communities, in coastal areas are particularly vulnerable to natural disasters especially the storms and hurricanes during the hurricane season each year."

The hurricane season opened last month and will run through to November, and fishers and fishing communities, in coastal areas are particularly vulnerable to natural disasters especially the storms and hurricanes duringthis time of the year.

It is in this context that Haughton highlighted an initiative to reduce risk to the fisheries sector in the Caribbean. This is the provision of Risk Insurance for fishers.

On the occasion of Fisherfolk Day, 2017, Haughton detailed the initiative as follows:

"Since 2015, United States Department of State has been partnering with the World Bank, CRFM, the Caribbean Catastrophe Risk Insurance Facility (CCRIF), CNFO, and others to develop a parametric insurance product to be implemented by Caribbean governments to promote the resilience of their fisheries sector against the peril of increasing climate-change related disaster risk," he explained.

According to the CRFM Executive Director, the insurance policy would be structured in a way to provide incentive for governments to promote and implement international best practices in fisheries management and a disaster risk management, but before they purchase the policy, countries would be evaluated to determine how well they are doing in implementing these best practices.

"For example, Countries with good fisheries management systems and disaster risk management plans in place for the fisheries sector would pay lower premiums and receive higher payouts if there is a disaster. Payouts would be made by the insurance facility when the agreed trigger event has occurred," he explained, adding that funds would be used to help with the rehabilitation and reconstruction of the fisheries sector.

"The CCRIF is also in the process of developing a micro-insurance policy for low income persons in the fisheries in the region. This is called the Livelihood Protection Policy (LPP)--designed to protect low-income people against extreme weather risks," Haughton said.

This policy, he explained, will be available through existing insurers.

"The LPP is being customized for small-scale fishers and small aquaculture operators in the region with the intention to cover losses to livelihoods caused by storms, heavy rainfall, high winds and other climate related variables. The policy will provide quick payouts to enable fishers and fish farmers to recover more quickly after a damaging event," Haughton announced.