Willis Towers Watson Launches Coral Reef Insurance Program

The Mesoamerican Barrier Reef system is listed as Critically Endangered by the International Union for the Conservation of Nature on the Red List of Ecosystems. The reef system is home to 65 species of corals and over 500 species of fish as well as many other protected species. Coastal wetlands, mangrove forests and seagrass beds also protect against storms and coastal erosion.

Thanks to the effects of climate change and other stressors, the risk of hurricane impact leading to irreversible degradation and mortality of corals has increased.

“Rapid action to clean up the reef and restart regeneration and recovery is essential to reduce the overall impact of lost ecosystem services – in social and economic terms,” WTW said. “However, restoring natural ecosystems is often not a priority following extreme events, as resources are mainly focused on infrastructure and gray goods.”

The new project is co-funded and implemented by WTW and the Mesoamerican Reef Fund, the regional funding system for the large-scale maintenance, conservation and restoration of the reef system. MAR Fund will be the policyholder for the program.

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“In 2018, we launched the Global Ecosystem Resilience Facility at the World Ocean Summit in Cancun,” said John Haley, CEO of Willis Towers Watson. “We are delighted to be back in Central America, in partnership with the MAR Fund and supported by the InsuResilience Solutions Fund, to strengthen the resilience of the Mesoamerican Reef and its communities.

“Marine ecosystems may be ‘free’ public goods, but their active maintenance is essential to maintain their health and value. This program helps us learn how insurance can provide a unique shared governance framework for managing reefs and other valuable natural ecosystems. “

“This collaboration is a great opportunity for the MAR region,” said María José González, Executive Director of the MAR Fund. “We view the insurance model as a risk management tool that will provide immediate funding for reef restoration, thereby contributing to building coastal resilience and restoring MAR and the environmental services it provides. MAR Fund will be the policyholder and manage the payments. We will work closely with national governments and other partners and stakeholders to build the necessary capacities for emergency response and preparedness. “

The InsuResilience Solutions Fund (ISF) signed the grant funding agreement for the program.

“This partnership combines the expertise of local partners and the insurance industry, ensuring that products are developed according to the needs of the vulnerable population,” said Annette Detken, Director of ISF. “Our grant will co-finance the development and implementation of this innovative insurance product ensuring coastal ecosystems that provide vital services to local communities. We believe this insurance solution could serve as a model for other countries seeking to protect important natural resources like coral reefs. “

Payments under the program will be triggered by the intensity of a hurricane, converted into an estimate of the extent of damage to the reef. A group policy will cover the pilot reef sites, with an appropriate payment structure reflecting the cost of responding to each site at different levels of damage.


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