[Courtesy Announcement] SEADRIF Insurance Company makes 2 payouts for a total of US$1.5 Million to support flood response in Lao PDR within 1 business day
Singapore, Wednesday 16 August 2023 – On Monday 14 August 2023 the SEADRIF Insurance Company made two payouts totaling US$1.5 Million directly to the Government of the Lao PDR to provide rapid support to the country. This is just 1 business day after the Lao PDR Ministry of Finance submitted the notice of loss forms to trigger two payouts on Friday 11 August 2023.
The SEADRIF Insurance Company is part of the broader SEADRIF Initiative that provides participating ASEAN member countries with technical advice and financial solutions against climate shocks and natural disasters. The SEADRIF Insurance Company issued its first product to the Government of the Lao PDR in February 2021 for protection from floods and other perils. These two payouts come from the finite insurance component under this insurance policy.
One claim is for US$800,000 to support response for the current flooding affecting 10 provinces including Vientiane Capital, Houaphan, Xayaboury, Xiengkhouang, Vientiane Province, Xaysomboun, Bolikhamxay, Khammouane, Savannakhet and Champasak. This situation is ongoing and the SEADRIF Insurance Company is closely monitoring the developments to be ready in case it triggers a further payout.
The second claim is for US$700,000 to support remaining reconstruction tasks after a tropical storm caused flooding in Oudomxay, Xayaboury and Luang Prabang regions in August 2022. This claim was submitted by the Government of the Lao PDR together with the notice of loss for the ongoing flooding.
As ASEAN’s first regional climate and disaster risk pool, the catastrophe insurance product provided by the SEADRIF Insurance Company to the Government of the Lao PDR contains two complementary parts: a parametric component and a finite risk component. The two payouts were made under the finite risk component that is designed to provide financing for costs resulting from events which do not trigger the parametric component.
Mr. Yoshihiro Kawai, Board Chair of the SEADRIF Insurance Company said:
“The SEADRIF Insurance Company collaborated with the Government of the Lao PDR in offering the first insurance policy that provides protection against flood risks and other shocks. Within an hour of receiving the notice of loss forms, the board convened and approved the claims. Payouts have been expedited to contribute to a timely response and recovery efforts.
Climate change is increasing the frequency and intensity of extreme weather events. We are committed to stand with the Government of the Lao PDR and other member countries in strengthening the financial resilience against disaster risks in the ASEAN region, through the use of innovative financial products.”
The payout of US$1.5 Million will be managed by the Government of the Lao PDR through their own system and processes. The Government of the Lao PDR committed to use funds in accordance with a pre-approved contingency plan. This includes goods and services that support post-disaster emergency relief, response, and recovery efforts. All spending will follow the SEADRIF Environmental and Social Management System (ESMS) which was prepared in line with the World Bank’s Environmental and Social Framework (ESF).
About the SEADRIF Initiative
SEADRIF is a regional platform that provides participating nations with advisory and financial services to increase preparedness, resilience and cooperation in response to climate and disaster risks. SEADRIF is established and owned by ASEAN+3 countries, with financial support from the Governments of Japan and Singapore. The World Bank is the lead technical partner to SEADRIF.
About the SEADRIF Insurance Company
The SEADRIF Insurance Company is incorporated in Singapore and licensed as a general insurance company to offer insurance solutions to member countries. It is regulated by the Monetary Authority of Singapore. The SEADRIF Insurance Company closely collaborates with member countries to develop products that help governments better manage the costs when natural disasters hit.
For more information and updates, please visit: seadrif.org/the-seadrif-insurance-company
This news release was originally published in the SEADRIF website - Link here.