This document summarizes a presentation on building disaster-resilient communities. It notes that while natural disasters in the past year killed 20,000 people and caused $131 billion in economic losses, many nations spend more on disaster relief than risk reduction. For example, in Australia $50 million is spent annually on risk reduction but $560 million on post-disaster recovery. The document advocates for greater investment in risk reduction measures like early warning systems and building codes, which can reduce losses and reliance on disaster spending. It describes an initiative by the Principles for Sustainable Insurance to evaluate risk reduction strategies and work with stakeholders to better manage disaster risks.

1. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Building disaster-resilient communities
The Global Resilience Project of the
UNEP FI Principles for Sustainable Insurance Initiative
Butch Bacani
Programme Leader
UNEP FI Principles for Sustainable Insurance Initiative
PSI
Principles
for Sustainable
Insurance

2. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
The case for action: A skewed funding focus
Last year, 20,000
people were killed or
went missing due to
natural disasters
Global economic
losses due to natural
disasters amounted
to USD 131 billion,
representing almost
2% of GDP
Many nations spend
more on disaster
relief & recovery than
disaster risk
reduction
Funds are diverted to
dealing with disasters
after the fact, rather
than being spent on
reducing the risk of
disasters happening
BUT

3. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
An example: The Australian experience
 Total economic costs of natural disasters
in Australia average $6.3 billion each year,
and projected to rise to 23 billion by 2050
 The Australian government invests $50
million each year in disaster risk
reduction measures but more than $560
million on post-disaster recovery
 For every $10 spent on post-disaster
relief & recovery, only $1 is spent on
disaster risk reduction
AUSTRALIAN GOVERNMENT
INVESTMENT
DISASTER RISK
REDUCTION
$50 million
POST-DISASTER
RELIEF & RECOVERY
$560 million

4. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Risk reduction investment: The benefits
More investment in disaster risk reduction will lead to:
 Less economic, social and environmental losses
 Safer and more disaster-resilient communities and economies
 Less public and private funds spent on disaster relief and
recovery, enabling better investment
 More access to affordable insurance to help communities
manage the uncertainty of adversity and the financial
hardship associated with unexpected losses

5. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
The role of the insurance industry
Insurers are uniquely placed to drive change in managing disaster risk
Global
connections
and reachLocal
community
connections
Ability to
influence
stakeholders
Deep
knowledge
of disaster
risk
Building
collaborative
frameworks
Aligned
economic
interests
Insurance industry
as risk managers,
risk carriers and
investors

6. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
The Principles for Sustainable Insurance (PSI)
‘The Principles for Sustainable Insurance provide a global
roadmap to develop and expand the innovative risk
management and insurance solutions that we need to
promote renewable energy, clean water, food security,
sustainable cities and disaster-resilient communities.’
Ban Ki-moon, UN Secretary-General

7. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
The PSI Global Resilience Project
The project brings together insurers from around the world to:
Deepen understanding of
disaster risk reduction
Assess the
economic, social and
environmental costs
Use this information to help
governments and
communities manage risk

8. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Taking a phased approach
Evaluating risk
reduction
measures, and
identifying barriers
Building a global
disaster map and
identifying at-risk
communities
Working with
stakeholders to
drive change and
reduce risk
Current phase Next phase: 2014-15

9. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Assessing the effectiveness of risk reduction
Social benefit: Reduction
in lives lost
Social benefit: Reduction
in lives adversely affected
Economic benefit Cost
Effectiveness

10. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Assessing the effectiveness of risk reduction
DISASTER RISK REDUCTION MEASURES
Behavioural Structural Ecosystems
CYCLONE
Mangroves
Sand dunes
Seawalls
FLOOD
Controlled barriers
Wetlands
Land-use planning
EARTHQUAKE
Building codes
Retrofitting
Relocation
MULTI-HAZARD MEASURES (cyclone, flood, earthquake)
Education & communication Risk mapping Early warning & evacuation

11. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
Ideas for the Post-2015 Framework
for Disaster Risk Reduction
More
effective
disaster risk
reduction
More standardised data
and greater data sharing to
enable communities to
identify vulnerabilities and
best risk reduction
measures
A portfolio approach,
drawing on a number of
risk reduction measures
which address risks at a
community level
A greater funding focus on
risk reduction, as opposed
to disaster relief &
recovery A clear understanding of
the disaster risk
management continuum
(from understanding and
reducing disaster risk—to
disaster relief & recovery,
and risk financing
Harness the full potential
of the insurance industry in
the disaster risk
management continuum as
risk managers, risk carriers
and investors

12. 5th
International Disaster and Risk Conference IDRC 2014
‘Integrative Risk Management - The role of science, technology & practice‘ • 24-28 August 2014 • Davos • Switzerland
www.grforum.org
The Principles for Sustainable Insurance
A global sustainability framework and initiative of the
United Nations Environment Programme Finance Initiative
Learn more at www.unepfi.org/psi
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