Coral reef to get its own insurance policy
A 60km stretch of coral reef off the coast of Mexico is set to become the first in the world to have its own insurance policy. The government and local organisations, including those dependent on tourism, will pay into a pot - amounting to between $1-million and $7.5-million - for the premiums.
If a storm should strike and damage the reef or its beach, the Zurich-based insurance company Swiss Re will fund repairs. Coral reefs act as a natural barrier, guarding coastal lands against wave damage.
They also provide nurseries for fish, and the rich sea life they support is a big draw for tourists - making their preservation good business for local communities and governments.However, their condition worldwide has deteriorated in recent years, due to factors such as pollution, climate change and human exploitation.
Insurance payouts - which the Guardian says could be between $25-million to $70-million in any given year - would be spent on projects to restore the reef, such as building artificial structures that can increase its height.
Live coral can also be removed and rested elsewhere for weeks or months to support regrowth, before it is safely reattached.Hotels and private companies are currently signing up to the scheme and full coverage is expected to begin in January.
The plan was pioneered by The Nature Conservancy (TNC), a US-based environmental charity.
It says this particular reef - in Cancun - is a good candidate as it is still in good health. The goal, then, is to emphasise protection rather than repair and to set up a system where everybody - including the environment - wins.As TNC's Kathy Baughman McLeod tells GreenBiz, the goal is to change "the way people see these natural assets and [to find] ways to protect them."
From the insurers' perspective, she said such agreements could "become a mainstream product for communities that are dependent on natural resources".
As for the local communities, she added, "Because you're assigning a value to the reef, you know the various scenarios in which that reef can fail, and now you have a whole cast of stakeholders contributing to its future."
Ultimately, the hope is that it will spark a new system for protecting fragile environments across the globe...