TUVALU Prime Minister Feleti Teo called for more investment in Pacific regional disaster-financing institutions and changes to insurance triggers, saying households had suffered losses without receiving immediate assistance when payouts did not activate.
“Households left without immediate assistance” after “the parametric trigger was not met, even though real losses had occurred,” Teo said at a PRECOP31 side event convened by the Pacific Catastrophe Risk Insurance Company, ESCAP and the Asian Development Bank.
Teo cited Cyclone Pam, saying Tuvalu was not directly hit, but the storm’s “tail brought surges that flooded homes across our low-lying atoll.”
He said thresholds should be refined so “smaller but devastating impacts are not overlooked.”
Tuvalu’s risks include king tides, coastal flooding, sea-level rise, and drought, Teo said. The entire population lives within one kilometre of the coastline, he said, making preparedness and timely financing critical.
“Every minute lost without action is a minute lost from saving lives,” he said, arguing that pre-arranged financing could provide “the right money at the right time” and help stabilise recovery.
Tuvalu has joined the PECRC Foundation, which pools climate disaster risks with other countries in the region, and introduced a micro-parametric insurance product for a high-tide scheme, Teo said.
He said the arrangements were intended to provide immediate cash after a qualifying event and strengthen the country’s preparedness.
“We fully understand that payouts may not cover the total cost of disasters,” Teo said. “But having immediate support for relief efforts is far better than having nothing at all.”
He said Tuvalu also needed premium subsidies and capital investment from the Global North, as well as more resources for regional institutions.
He said those bodies should be recapitalised so they could take on more of the region’s risk directly, rather than transferring it to international markets, where pricing was often prohibitive for small island nations.
Teo also called for parametric products to scale beyond current market limits and be accessible regardless of a disaster’s magnitude. Financing triggers, he said, should be redesigned for “slow-onset events, not only single rapid catastrophic events.”
The PECRC and the Pacific Resilient Facility complement national risk-retention tools such as survival funds, Teo said.
He also cited contingent credit facilities, including the World Bank’s catastrophe deferred drawdown option, as part of a coordinated approach to reduce the pressure disasters place on people and economies.
“Tuvalu is strengthening its preparedness by joining PECRC, which helps fill critical gaps in our toolbox of resilience measures,” he said.
“We must therefore move beyond reactive appeals after disaster strike.”