UN launches $40 million insurance cover for disaster preparedness

Staff Correspondent: The United Nations has launched a new insurance scheme worth up to $40 million to protect funding for early disaster assistance when several major emergencies occur at the same time. The aim is to help vulnerable people protect their homes, food and livelihoods before floods, cyclones and other disasters strike.

The UN Office for the Coordination of Humanitarian Affairs (OCHA) announced the scheme on November 2, in partnership with UNICEF and the World Food Programme (WFP). Gallagher Re arranged the coverage, with Liberty Mutual as the lead insurer. The Centre for Disaster Protection provided technical advice.

Under the scheme, OCHA will allocate funds when forecasts warn of approaching disasters. If total allocations from the UN Central Emergency Response Fund (CERF) for early assistance exceed $61.5 million during the insurance period, insurers may provide up to $40 million in additional funding. The amount paid will depend on the policy terms.

The insurance will not pay compensation directly to individuals or national governments. Instead, payments will go to CERF to support early humanitarian assistance. People in disaster-prone areas may receive help through UN programmes, depending on local risks and needs.

OCHA's $150 million anticipatory action portfolio covers more than five million people. The new insurance could help extend assistance to more people, although no estimate of additional beneficiaries has been released. UNICEF has also taken out separate insurance to protect its $5 million contribution to 10 joint anticipatory action programmes.

UN Emergency Relief Coordinator Tom Fletcher said: “Disasters don’t wait for us to get our act together. We need to be ready before they strike.”

The UN highlighted an example from Bangladesh to show how early assistance can help families prepare for disasters.

In 2024, a woman named Salma received cash assistance from WFP just 24 hours before floods struck. She used the money to buy dry food and fuel and took steps to protect her belongings and livestock. The assistance helped her family prepare meals during the floods. It was funded through the existing CERF programme, not the new insurance scheme.

A joint report by WFP and the Bangladesh government found that around 430,000 people received early disaster assistance through 15 initiatives across 20 districts in 2024. However, more than 54% of households needing assistance did not receive it. For flash floods, the reported assistance gap was 88.2%.

The report estimated that $42 million would be needed for early disaster assistance in 2025. When it was published in February that year, more than half of the required funding had not been secured.

A September 2026 study by WFP and the World Bank found that families benefited more from receiving cash before floods than from receiving the same amount afterwards.

According to UN data released in May 2026, Bangladesh has 24 anticipatory action arrangements covering eight types of disasters. These arrangements have more than $36 million in pre-arranged financing and preparedness capacity.

However, the UN has not said whether the new insurance will fund early disaster assistance in Bangladesh. It has also not disclosed the premium, policy period or how quickly payments would be made after a claim is triggered. No Bangladeshi insurer or reinsurer has been identified as a participant.

A joint WFP-Bangladesh government report has recommended exploring insurance and long-term financing to strengthen early disaster assistance. However, it remains unclear whether the new UN scheme will create opportunities for Bangladesh's insurance sector.