The government of Indonesia, UndP and Swiss Re has teamed up to set up a marine biodiversity trust in order to create insurance solutions for the protection and restoration of coral reefs in Indonesia.
According to a press release from UNP, the foundation for the Trust was determined in November 2024 when the Indonesian Ministry of Marine Matters and Fishing issued a new regulation to finance sustainable marine and fishing programs.
UNDP supported the preparation of the ministerial regulation No. 27 for the implementation of financial resources for sustainable programs in the marine and fishing sector. The Marine Biodiversity Trust is managed via the Indonesian Environmental Fund Management Agency (BPDLH) – the country's official mechanism for monitoring environmental and climate fund.
The trust will serve as a critical governance mechanism for the financing of the insurance of coral reefs for the Gili Islands. This also enables the development of a long-term insurance solution for the protection and restoration of coral reefs on the Indonesian Gili Matra Islands (Gili Meno, Gili Air and Gili Trawangan).
The local government and communities are consulted to ensure that the approaches used react appropriately and to their needs. Swiss Re has now completed its data acquisition from the Gili Islands, and the design of the parametric Korall-Re insurance product is underway.
Coral ecosystems across Indonesia include the world's richest variety of coral species with 72%. These reef systems support the livelihood of millions of people in the country through tourism, agriculture, algae cultivation, fishing and aquaculture.
The coral reefs in Indonesia contribute over $ 3 billion to business every year, but are increasingly deteriorated by fishing and tourism activities. Indonesia is also the world's second highest natural nation for natural hazards, whereby the coastal regions accommodate many municipalities with low incomes that have the effects of disasters. However, healthy coral reefs are natural buffers against waves, storms and floods that help prevent the loss of life, property damage and erosion.