by Monica Odhiambo, Advisor, Global Shield Secretariat
image credit: Markus Quabach
As climate and disaster risks intensify, the challenge is no longer only to mobilise more finance. It is to ensure that funding is aligned with national priorities, moves quickly through effective delivery systems, and reaches the people most at risk.
This message was central to the Global Shield against Climate Risks’ participation in the 2nd Bonn Risk Finance Dialogue, held alongside the UNFCCC SB64 Climate Conference in Bonn, Germany. Convened by the Munich Climate Insurance Initiative (MCII) and the United Nations University – Institute for Environment and Human Security (UNU-EHS), the Dialogue brought together policymakers, practitioners, financial institutions, researchers, and development partners to examine how climate and disaster risk finance and insurance (CDRFI) can better support countries in managing growing risks.
Under the theme “Scale Up | Scale Out | Scale Deep”, discussions focused on strengthening country-led financial protection systems, expanding innovative approaches to climate risk finance, and ensuring that solutions are inclusive and responsive to the needs of vulnerable communities.
Across three sessions, the Global Shield shared lessons from its country processes that pointed to a common conclusion: effective financial protection is not just about mobilising finance. It is about connecting finance to national priorities, strengthening delivery systems, and reaching those most at risk.
Scaling up: Linking global finance with country priorities
One recurring theme throughout the Dialogue was that scaling financial protection is not simply a matter of mobilising additional finance. It also requires aligning resources with national priorities, institutions, and delivery systems.
During the session “Scaling Up CDRFI: Linking Global Finance with Country-led Financial Protection”, the Global Shield Secretariat highlighted the importance of country ownership in designing financial protection systems that respond to national needs.
Through its country-led process, the Global Shield supports governments in identifying protection gaps, financing needs, and priority investments through stocktakes, gap analyses, and Requests for Support. These processes help countries translate technical analysis into concrete investment priorities while strengthening coordination across government institutions and development partners.
A central message from the discussion was that delivery matters. Pre-arranged finance can only fulfil its purpose when it moves quickly through national systems and reaches people before or immediately after a disaster. Strengthening implementation capacity and delivery mechanisms is therefore as important as mobilising financial resources.
Scaling out: Leveraging existing financial systems to expand protection
Innovation was another major theme of the Dialogue, particularly the potential to use existing financial systems to extend protection to more people.
During a parallel session on “Leveraging Financial Systems to Scale Climate Risk Protection”, the Global Shield Secretariat shared an emerging area of work in The Gambia, where remittances have been identified as a potential pathway for expanding access to climate risk finance.
The Global Shield supported a stocktake and gap analysis to better understand how Gambian households cope with climate- and disaster-related shocks. One finding stood out: for many families, the first source of support in difficult times is not an insurance payout or government assistance, but money sent home by relatives living and working abroad.
This finding is particularly significant in The Gambia, where remittances account for more than 30 per cent of GDP and are one of the country’s largest sources of foreign exchange. Beyond supporting household consumption, education, and housing, these flows already play an important role in helping families recover from shocks.
This raises an important question: could these existing financial flows also expand access to climate and disaster risk finance?
Remittance-linked insurance offers one possible avenue. Rather than requiring households to engage with entirely new financial systems, these models use established remittance channels to finance or distribute insurance products. Experiences from countries such as Ghana and Mexico show that remittance channels can expand access to financial protection. Although most existing models focus on life, health, or accident insurance, they demonstrate the broader potential of trusted financial networks to strengthen resilience.
Importantly, this discussion has already moved beyond analysis. The Gambia’s Request for Support to the Global Shield proposes exploring how remittances could help finance insurance premiums for vulnerable households. As a next step, the Global Shield will support a scoping exercise to assess how remittance flows could contribute to expanding access to climate risk finance.
Scaling deep: Ensuring financial protection is inclusive
The Dialogue also emphasised that scaling financial protection requires looking beyond the number of people covered. It requires asking who benefits—and who may still be left behind.
During the parallel session on “Scaling Financial Protection in Least Developed Countries and Small Island Developing States”, the Centre of Excellence on Gender Smart Solutions presented findings from gender analyses conducted jointly with the Global Shield in Malawi and the Pacific Island Countries of Fiji, the Marshall Islands, and Tonga.
The analyses examined systemic barriers to equitable access to financial protection and developed practical recommendations to help ensure that CDRFI reaches those who need it most.
Discussions highlighted that women and girls in least developed countries and small island developing states are often disproportionately affected by climate-related disasters. Climate impacts compound existing inequalities, including insecure land tenure, unequal access to financial services, and limited economic opportunities. At the same time, women-led and grassroots resilience initiatives remain underrepresented in the design and implementation of commercial and government-led CDRFI programmes.
A key takeaway was that gender-responsive financial protection cannot be treated as an afterthought. Gender considerations must be integrated throughout the project cycle—from risk analysis and product design to implementation and monitoring. Stronger engagement with women’s organisations and community groups is also essential to building financial protection systems that are both equitable and effective.
Looking ahead
Although the sessions examined different dimensions of climate and disaster risk finance, they converged around a common message: strengthening financial protection is not only about developing new instruments or mobilising additional resources.
It is about connecting finance to national priorities, building on systems that people already use and trust, strengthening institutions and delivery mechanisms, and ensuring that protection reaches those most vulnerable to climate-related shocks.
Whether through country-led financial protection strategies in Senegal, the exploration of remittance-linked insurance in The Gambia, or the integration of gender considerations into financial protection in least developed countries and small island developing states, the discussions showed that the future of CDRFI lies in practical implementation and locally owned solutions.
As countries face increasingly frequent and severe climate shocks, these conversations reinforce the importance of country-led approaches that combine technical expertise, innovative financing, and inclusive implementation to strengthen resilience where it matters most.
