STEP 2 Relief Programmes and Alternative Livelihoods
Relief programmes respond to the immediate needs of the target population through, for example, food imports, food distribution, livelihoods and asset protection, and cash for work activities, to longer-term recoveries such as restoring livelihood and community assets (e.g. storage facilities, canals [cleaning], irrigation systems, local infrastructure).
Index insurance, with its fast payouts, has a crucial role to play in coping with emergencies. Particularly, in the case of damaged infrastructure such as roads, lack of electricity, interrupted communications and dysfunctional access to finance, payouts can be delayed. In this situation, a ‘tangible early recovery voucher’ would speed up the payout and could improve confidence in insurance. Payouts do not necessarily have to be in cash when prices for basic items are high, payment-in-kind such as construction material may be of better value. For example, in the Philippines other measures were taken by the government and the insurance providers to adjust existing processes to smooth the payout after Typhoon Haiyan in 2013 (GIZ-RFPI, 2015), including:
- The Philippine Insurance Commission relaxed the conditions for claims settlement, e.g. documentation of losses after Typhoon Haiyan.
- Official circulars permitted a fast initial payout of a lesser amount while the insurance providers paid the remaining part later.
- Insurance providers used mass onsite assessments of areas instead of individual claim verification.
- Insurers who knew their distribution channel well, and trusted them, permitted quick bulk-claim settlements, as individual verification would have been too time-consuming.
- Unconventional payment processes were initiated (e.g. setting up temporary Claims Action Centres, payment-in-kind).
Tools and Guiding Questions
What is the requirement for response and resilient recovery measures to address the immediate needs of the affected population and who provides and supports payment for them?
How do insurance payouts affect the implementation of the relief programmes?
Semi-structured interviews with government officials (and affected communities).
Financial statements of the government pertaining to relief and recovery programmes.