Vanuatu’s government has showcased its commitment to disaster risk management through its quick response to a 7.3 magnitude earthquake that hit Port Vila on December 17. The nation utilized its membership in the Pacific Catastrophe Risk Insurance Company (PCRIC), allowing it to secure a prompt sovereign insurance payout of $1.2 million (around FJ$2.79 million) within just 14 days of the disaster. This quick payout exemplifies PCRIC’s efficient disaster response capabilities.
During a formal presentation in Port Vila, PCRIC CEO Aholotu Palu handed over the funds to Prime Minister Charlot Salwai Tabimasmas and Finance Minister Johnny Rasou Koanapo. Although Palu acknowledged that this financial assistance would not cover all earthquake-related damages, he emphasized its vital role in supporting governments following natural disasters.
The insurance policy in question was carefully crafted in collaboration with Vanuatu’s government representatives and took effect a mere 16 days before the earthquake. It allocates 80% of premiums to cyclone risks, while the remaining 20% is evenly divided between earthquake and tsunami coverage. A noteworthy aspect of this policy is its people-centered payout trigger, which bases disbursements on the estimated number of individuals impacted by the disaster instead of simply evaluating the damage to infrastructure.
Palu noted that the payout significantly exceeded the government’s contribution for earthquake coverage by over 73 times, highlighting a substantial return on investment and demonstrating Vanuatu’s dedication to improving disaster preparedness.
PCRIC aims to strengthen resilience among Pacific nations by offering them essential financial tools to manage the effects of natural disasters. Vanuatu’s experience serves as an optimistic example for other countries in the region, underlining the importance of strategic planning and timely financial responses in addressing climate change challenges.
This incident is not only indicative of effective disaster management practices but also fosters hope for future recovery efforts throughout the Pacific. By enhancing community resilience and encouraging collaboration, nations can better prepare for future natural disasters, ultimately leading to stronger, more sustainable communities.
Vanuatu’s rapid acquisition of this insurance payout stands as a promising testament to the power of proactive disaster risk management, presenting a model that other nations could benefit from as they navigate the unpredictable outcomes of climate change.
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