InsuResilience Solutions Fund (ISF) Request For Proposals

Grant Overview

Donor: KfW Development Bank on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ)

About: The InsuResilience Solutions Fund (ISF) is dedicated to enhancing the resilience of poor and vulnerable households in developing and emerging countries against the impacts of climate change. Its mission focuses on developing innovative climate risk insurance products that provide financial protection against extreme weather events and natural disasters. The ISF aims to leverage the expertise of the insurance industry to create needs-based solutions that are financially sustainable. The fund is implemented by the Frankfurt School of Finance & Management and operates through comprehensive climate risk analyses, product development, co-funding for innovative insurance products, and targeted financing of premiums.

The InsuResilience Solutions Fund (ISF) plays a crucial role in the broader field of climate risk insurance by addressing the financial vulnerabilities faced by communities in developing countries. The fund's mission aligns with global efforts to combat climate change and its impacts, particularly for those most at risk.

Eligible Cost Categories
The ISF outlines specific eligible cost categories to ensure that funding is directed towards effective and sustainable initiatives. These categories include:

1. Investments in Infrastructure: This includes establishing light weather stations, developing technological infrastructure, and acquiring project-specific hardware and software.
2. Project Management: Costs associated with staff coordination, travel, and office supplies necessary for project implementation.
3. Product Development: Funding for the development of new risk models, technical product design, and insurance policy frameworks.
4. Product Distribution & Implementation: Costs related to developing distribution channels, training local partners, and conducting marketing campaigns.
5. Reporting, Auditing, Monitoring, and Evaluation: Expenses for sound reporting, monitoring, verification, and financial auditing to ensure accountability.
6. Professional Services: Legal and consultancy services necessary for regulatory compliance and insurance policy development.

Context within Climate Risk Insurance
The ISF is part of a growing recognition of the importance of climate risk insurance as a tool for managing the financial impacts of climate change. With increasing climate-related disasters, the demand for effective insurance products is rising. However, challenges such as rising premiums and coverage gaps persist, particularly in vulnerable communities. The ISF aims to bridge these gaps by providing targeted funding and support for innovative insurance solutions that can enhance resilience and provide financial security.

Focus: Climate risk insurance, resilience building, financial protection against climate change impacts

Region: Asia and the Pacific, Europe, Africa, and Latin America

Eligibility: Nonprofits, institutions, companies, faculty, postdoctoral researchers, working professionals, and research scientists with a completed PhD; organizations must be legally registered and aligned with ISF purposes; projects must focus on vulnerable populations living on less than USD 15 PPP per day.

Benefits: Funding for eligible cost categories including infrastructure investments, project management, product development, distribution, monitoring, and professional services. Premium financing is available but limited to 30% of total project costs.

Terms: The ISF has strict guidelines regarding eligible costs, which must occur during the project implementation phase and be approved by ISF Committees. Ineligible costs include taxes (except non-refundable VAT), indirect costs exceeding 25% of total project costs, and salaries for government officials. Funding requests must not exceed EUR 2.5 million, and project timelines are capped at 24 to 36 months depending on the project level.