The World Bank's Disaster Risk Financing and Insurance Program (DRFIP) wanted (1) to develop a technical note on how policymakers identify, analyze, and treat disaster risk; (2) to consider which financial instruments (for example, insurance or warranties) were best suited to ensure rapid recovery of infrastructure services after a disaster; (3) to compile a set of case studies on disaster response and financing across different countries. This technical note would serve as a technical input to the 2019 Asia-Pacific Economic Cooperation (APEC) Working Group on Disaster Risk Financing and Insurance.
DHInfrastructure drafted a technical note for the 2019 APEC Working Group, based on an extensive literature review, and interviews with policymakers, World Bank staff, and insurance industry professionals. We analyzed how disaster risks are unique to other risks related to infrastructure and discussed the advantages and disadvantages of different types of risk mitigation and allocation. We also identified countries to serve as possible best practice case studies on disaster risk planning and finance, to be presented at future APEC annual meetings. Furthermore, we investigated the potential of the World Bank's new financial instruments that could be leveraged to rapidly restore services after a disaster. Finally, we also developed case studies on disaster response and financing in both the United States and the Caribbean. These case studies discussed the disaster response procedures and frameworks established in each jurisdiction, as well as the different financial instruments utilized by disaster response stakeholders to improve their effectiveness prior to, during, and after emergency events. These case studies also provided lessons on effective disaster response and financing to be incorporated by other developing countries interested in improving their disaster response efforts.