World Meteorological Organization Working together in weather, climate and water Background on Weather, Hydrological and Climate Services for Financial Risk Transfer markets Maryam Golnaraghi, Ph.D. Chief of Disaster Risk Reduction Programme First Meeting of the WMO Expert Advisory Group on Financial Risk Transfer (EAG-FRT I) December 2011 WMO HQ, Room 8 Jura Geneva, Switzerland WMO

Increasing Number of Meteorological, Hydrological and Climate Hazards (1980 – 2010) Source: Munich Re Topics Geo 2010

Socio-economic Impacts of Climate-Related Extremes on the Rise ! Intensity Frequency Heatwaves Heavy rainfall / Flood Strong Wind Water Resource Management People Agriculture Energy Urban areas Need for Multi-sectoral risk management Drought Transportation Aral Sea Hazard intensity and frequency increasing linked to climate variability and change! Vulnerability and exposure on the rise !

Three international negotiation processes related to Disaster and Climate Risk Management and links to Financial Risk Transfer Hyogo Framework for Action (HFA) – United Nations International Strategy for Disaster Reduction (UN-ISDR) United Nations Framework Convention on Climate Change (UNFCCC) Global Framework for Climate Services (GFCS) (WCC-III)

Hyogo Framework for Action 2005 – 2015 Weather, Hydrological and Climate Services for Comprehensive Risk Management Decision Making Risk TransferRisk Assessment Hazard databases Hazard statistics Climate forecasting and trend analysis Exposed assets & vulnerability Risk analysis tools PREPAREDNESS: early warning systems emergency planning PREVENTION and MITIGATION: Sectoral Risk Management Medium to long term planning (e.g. zoning, infrastructure, agriculture…) CAT insurance & bonds Weather-indexed insurance and derivatives Other emerging products Risk Reduction Information and Knowledge Sharing Education and training Governance and Institutional Framework (Multi-sector, Multi-level, Multi-Hazard)

Hazard / Risk Assessment (historical and forward looking) Hazard Analysis and Mapping Exposure and Vulnerability Potential Loss Estimates This information is critical for decision-making and development of strategies to reduce the risks Heavy Precipitation and flood mapping Assets: population density agricultural land urban grid Infrastructure Businesses etc Number of lives at risk $ at risk Destruction of buildings and infrastructure Reduction in crop yields Business interruption etc Need for historical and real time data Statistical analysis tools meteorological, hydrological and climate forecasts and trend analysis

Multi-Hazard Early Warning Systems National to local disaster risk reduction plans, legislation and coordination mechanisms

Recent advances in climate forecasting and trend analysis provide unprecedented opportunities to support …. Water resource management Land zoning Infrastructure and planning (urban, rural) Agricultural productivity and food security Health epidemics Insurance / Finance Tourism Sectoral Risk Assessment and Management

(Re)Insurance Markets and other Alternative Risk Transfer Mechanisms What type of Financial tools? Which Risks?Who Could Benefit? Requirements for Hydro-Met and climate Services? Traditional and Alternative Risk Transfer tools and schemes Governments Companies Individuals Other Historical and real-time data Sub-seasonal, Seasonal to inter-annual climate forecasts Decadal climate trend analysis Long term trend analysis Financial risks

WMO DRR Crosscutting Programme To leverage expertise, resources and capacities of WMO Members, technical programmes and operational network and to build alliances with the UN and other partners to support capacity development for disaster risk reduction decision- making at all levels.

Disaster Risk Reduction: Life & economic losses USERs: Disaster Risk Management, Agriculture, Water Resource Management, Infrastructure, Urban development, Health, Insurance, etc Research and modeling Observations and data Forecasting and analysis tools Regional aspects Products and Service Delivery International aspects Capacity Building Integrated approach to Delivery of Weather and Climate Services for Target Sectors National aspects, DRR Governance and institutional framework changing!

Integrated approach to Delivery of Weather and Climate Services for Target Sectors

Need for significant Capacity development of NMHS for delivery of meteorological, hydrological and climate services 70% need restructuring of national policies and legislation and clarification or roles of NMHS 67% full or some modernization of infrastructure (observations, operational forecasting, telecom, etc)) 80% technical and management training 80% strengthening or building multi-sectoral partnerships WMO DRR Survey (2006)

Identification and documentation of good practices (Policy, institutional, technical operations, products and services, etc. ) Coordinated National and Regional Projects Development of guidelines, standards, tools, methodologies and training programmes Monitoring, Evaluation and Feedback Knowledge Development Technical Commissions, Programmes and Technical Partners Operationalization and Capacity Development Members, RAs, DRR partners and Regional centers Strengthening Services through Linking Knowledge and guidelines to Capacity Development Projects

DRR Implementation Approach Thematic Guideline and good practices Thematic Expert Advisory Groups (Users, partners, WMO Members) to guide the overall approach –Expert Advisory Group on MHEWS (will continue) –Expert Advisory Group on Hazard/Risk Assessment –Expert Advisory Group on Financial Risk Transfer –Task Team for provision of Met/Hydro and Climate Services for Humanitarian Planning, Preparedness and response Systematic engagement of WMO technical commissions/programmes and Membrs Leveraging with other partners’

South East Europe (2007- present) 8 countries South East Asia (2010 – present) 6 countries Central America and Caribbean (2010- present ) Costa Rica and Mexico and all Caribbean Islands Comprehensive Capacity Development DRR and Adaptation Projects Underway Since 2010 with Members & UN Haiti Partners: WMO, World Bank, UN-ISDR, UNDP, Regional Socio-economic Groupings and regional DRR agencies, Regional Centers, WMO Regional Association, NMHS, National DRM agencies and economic line ministries South Asia (early discussion stage) 5 Countries

Background related to establishment of EAG-FRT ….. Traditional and alternative risk transfer markets… Legislative developments in developed countries (e.g., US, UK, EU) Penetration of FRT to developing and least developed countries Changing risk profiles linked to climate change Expressed need from the sector for weather, hydrological and climate services

Background related to establishment of EAG-FRT ….. WMO consultations (2007 – 2011): Expert Meeting on “Requirements of the Catastrophe Insurance and Weather Risk Management Markets”, December 2007, WMO Headquarters ( Plenary Panel on Climate Extremes, Early Warning and Disaster Risk Reduction at WCC-III (31 August – 4 September 2009 ( Panel on “Climate Services, Catastrophe Risk and Capital Markets – GPDRR III, 11 May 2011 (Geneva, Switzerland), ( events/v.php?id=194) events/v.php?id=194 Participation in various user forums WMO Executive Council deliberations: 58th, 59th, 60th sessions of Executive Councils Request of the 16th WMO Congress (May 2011)

Establishment of the WMO Expert Advisory Group on Financial Risk Transfer ( Overall Goals) Concrete recommendations for priorities, targets and deliverables between 2012 and 2015 –Good practices, lessons learned and training and awareness raising among the meteorological, hydrological and climate communities –Research –Needs and requirements for targeted (data, forecasting, etc) operational services and service delivery models –Partnerships and alliances with user community –Pilots and implementation

First Meeting of the WMO Expert Advisory Group on Financial Risk Transfer 13 – 14 December 2011 (Expected Outcomes) recommendations for priorities, targets and deliverables between 2012 and 2015 Final Terms of Reference of EAG-FRT Criteria for good practice identification of cases for documentation in 2012 first guidelines and training Outline of the EAG-FRT work plan (2012 – 2013) Date of the 2nd meeting of the EAG-FRT in 2012

First Meeting of the WMO Expert Advisory Group on Financial Risk Transfer 13 – 14 December 2011 (meeting web page)

First Meeting of the WMO Expert Advisory Group on Financial Risk Transfer 13 – 14 December 2011 (Documents) Doc 1: Agenda Doc 2: Background Doc 3: membership and Draft TOR of EAG-FRT Other background documents

First Meeting of the WMO Expert Advisory Group on Financial Risk Transfer 13 – 14 December 2011 (Sessions) Session 1: Opening and introduction Session 2: Disaster Risk Financing and Financial Risk Transfer Markets Related to Weather, Hydrological and Climate Extremes in a Changing Climate (User Perspectives) Session 3: Research and Operational Meteorological, Hydrological and Climate Services to Support Target FRT Markets and Lessons Learned Session 4: Finalization of the Terms of Reference of ERG-FRT and the work plan

Thank You For more information please contact: Dr Maryam Golnaraghi Chief of Disaster Risk Reduction Division World Meteorological Organization 7 bis, Avenue de la Paix P.O. Box 2300 CH-1211 Geneva, 2, Switzerland Tel: (+41 –22) Fax: (+41 –22)