Madagascar: diagnostic of inclusive insurance & risk finance

Madagascar remains one of the world’s most climate-vulnerable nations, consistently facing severe cyclones, recurrent droughts, and localized floods. These shocks threaten the livelihoods of over 80% of the population who live in extreme poverty. The country’s exposure to climate and disaster risks ranks it 17th out of 193 countries in the 2022 World Risk Index, with a striking lack of adaptive capacity and financial preparedness. Yet, inclusive insurance coverage remains negligible, while disaster risk finance (DRF) mechanisms are fragmented, underfunded, and lack systemic coordination. Despite the growing need for proactive financing solutions, Madagascar’s insurance penetration is shallow, with limited products, weak enabling legislation, and inadequate infrastructure to support market development. The Government of Madagascar (GoM), in partnership with UNDP and its Insurance and Risk Finance Facility (IRFF), recognized the need for a comprehensive, evidence-based review to guide future interventions and policy direction. To this end, a detailed Country Diagnostic on Inclusive Insurance and Risk Finance was developed in 2023 by local experts. This critical document required international validation and expert scrutiny before final adoption and to ensure consistency between various country's reporting.

To ensure the diagnostic met international standards, Russell LEITH of GG International was commissioned by UNDP to conduct an independent review and validation of the draft report. As Risk team leader and global expert on inclusive insurance and sovereign risk finance Mr Leith reviewed each of the country diagnostic reports to ensure consistency of reporting and therefore ability to benchmark between countries reported on. He was supported by Shaan Stevens, an international legal and regulatory expert from GG International, who provided analysis of Madagascar’s legal and institutional frameworks. Their mandate included:

The final review: