The Japanese and Singaporean governments with the World Bank are setting up an insurance scheme against natural disasters in Asian countries, as climate change raises the risk for catastrophic cyclones and flooding.
Myanmar and Laos will be the first countries to buy the insurance. They will pay a combined $20m to cover damage to bridges, piers and other public infrastructure caused by a natural disaster. Cambodia is considering joining the framework as well, reported Nikkei Asian Review.
Administrative aspects will be handled by the Southeast Asia Disaster Risk Insurance Facility, a platform based in Singapore with support from the Japanese and Singaporean governments.
The World Bank will help calculate payouts, using satellite photos and other tools to evaluate damage even if local communications networks fail. The goal is to make up for as much of the damage as possible, using contributions from advanced economies and other players.
The new insurance will focus on lower-income countries with limited private-sector coverage. It may be extended to medium-income countries eventually as well, and Vietnam, Indonesia and the Philippines have expressed their interest.