Yesterday, the United Nations Development Programme (UNDP) in the Maldives and the Maldives Monetary Authority (MMA) signed the financing agreement to begin collaboration on the Maldives Insurance Development Project.
The agreement outlines a partnership between UNDP and MMA to develop the capacity of the insurance industry in Maldives focusing on two key pillars: insurance regulation and insurance operations. The project is formulated based on the findings of the Insurance Sector Diagnostic Study completed in January 2023, with the support of UNDP’s corporate offer on insurance; the Insurance and Risk Financing Facility (IRFF), and in alignment with the Integrated National Financing Framework (INFF) of the Maldives.
The objectives of this project are to develop the actuarial and operations capacity of the insurance industry in Maldives, to ascertain the feasibility of nature-based insurance products in the Maldives and to develop key regulations.
“Through this strategic partnership, we envision a transformative journey for the insurance industry in the Maldives. By strengthening the regulatory framework and enhancing operational capabilities, we are not only fortifying stability in our financial landscape but also fostering resilience against the unique challenges inherent in our environment. This collaboration between MMA and UNDP marks a significant step towards sustainable development and economic safeguarding for our nation,” Governor of MMA, Ali Hashim said.
Maldives identified 9 practical actions specifically related to the development of the insurance sector in its INFF. This project will serve as a necessary precursor to achieving these commitments. These commitments include accelerating the introduction of services that are becoming increasingly essential for the country, such as green, blue and climate insurance products.
UNDP Resident Representative in the Maldives, Enrico Gaveglia said, “With the effects of climate change intensifying around the world and with Maldives being in a position of vulnerability to the damage this poses, the ability to protect the country’s natural and physical assets has become of vital importance. The economic cost of climate change is increasing alarmingly and unpredictably. Insurance is an effective adaptation measure that can be leveraged as a new financing tool to protect vulnerable communities and investments. This with MMA is a partnership that breaks ground on our joint work on insurance in the Maldives and enables future collaboration in the insurance sector for a broader vision of sustainable development.”