Insurance Authority, JICA Discuss Parametric Insurance for Climate Risks

Kathmandu — The Koshi Provincial Office of the Nepal Insurance Authority and experts from the Japan International Cooperation Agency (JICA) have discussed ways to expand parametric insurance to manage climate and disaster-related risks in Nepal.

The discussion focused on the use of insurance to manage economic losses caused by climate change and disasters, as well as the data, infrastructure and technology required to develop and expand parametric insurance products.

Rajendra Maharjan, head of the Insurance Authority’s Koshi Provincial Office, said reliable, regular and adequate risk-related data is essential for expanding parametric insurance. He said technical cooperation with Japan could help develop products suited to Nepal’s specific risks and needs.

He highlighted the potential use of satellite and other technology-based data to develop indices for floods, extreme temperatures, rainfall, excessive rainfall and drought. He said integrating risk data from different parts of the country could support the development of appropriate products and their nationwide expansion through non-life insurers.

The meeting also emphasized coordination with the Department of Hydrology and Meteorology and other technical agencies to improve data availability and reliability. Participants also discussed technical and practical challenges, stakeholder cooperation and the potential for multi-peril parametric insurance.

Maharjan also presented the Insurance Authority’s recently introduced multi-peril wildlife insurance policy as an example of how multiple risks can be covered under a single product.

The meeting was attended by JICA expert Daiki Noshe, climate risk expert Madhusudan Gautam and other expert representatives. The participants discussed potential areas of technical cooperation to strengthen the development of parametric insurance in Nepal.