ABSTRACT
This chapter explores the goal, functioning and emergence of the Pacific Catastrophe Risk Insurance Pilot, a regional catastrophe insurance pool run by the World Bank. The pilot was part of the larger Pacific Catastrophe Risk Insurance Initiative (PCRAFI) and provided six Pacific Island states with index-based insurance coverage against tropical cyclones and earthquakes, including tsunamis. In 2016, after a successful trial, the pilot was transformed into a stand-alone insurance company. The first part of the chapter presents the goals of the original insurance pilot and illuminates how the arrangement worked on a technical and practical level to fulfill these objectives. The second part reviews the genesis of pilot. It shows how the idea to set up a regional catastrophe insurance mechanism has come about, zooms in on the making of the regional insurance arrangement and points to the practical challenges involved in the implementation. In doing so, it illuminates the various processes, actors and activities leading to the establishment of the Pacific Catastrophe Insurance Company.
