By: Staff Writer
August 4, 2026
Insurance giant, Lloyd’s of London, commissioned a report on insurance coverage in three Caribbean countries, Barbados, Grenada and Jamaica and found that Caribbean Small Island Developing States face repeated extreme weather events alongside widening protection gaps linked to inaccessible or unsuitable insurance products.
The report, ‘Addressing Climate-Related Insurance Protection Gaps in the Caribbean’, found that “the majority of their livelihoods and professional assets, including boats, engines, crops, livestock, and equipment … remain uninsured”.
Insurance product design and quality alone are insufficient however, but trust, delivery, and affordability also determine the value for policyholders. A clear value translates into increased demand and uptake.
The research was carried out by the Munich Climate Insurance Initiative, hosted at the United Nations University Institute for Environment and Human Security, drawing on 99 interviews and a 58-respondent survey conducted last year. Lloyd’s Inclusive Futures programme commissioned the research to examine climate-related insurance protection gaps and identify potential solutions for communities that remain largely excluded from insurance markets.
The report also said: “Climate related insurance protection gaps persist across micro, meso, and macro levels. Initial solutions exist across these levels, creating a layered response in the Caribbean, but one that is weakly connected across the financial protection system.
“At the macro level, sovereign risk pooling mechanisms provide valuable post disaster liquidity to governments but benefits often do not fully reach affected households or small businesses in a timely or sufficient manner, and public relief is frequently delayed and limited.
“At the meso level, cooperatives, associations, and community organisations rarely hold or have access to collective climate insurance, despite their potential to pool risks and reduce costs for members.
“Micro level protection gaps are the most pronounced, with communities bearing the majority of climate related losses themselves. Hurricanes, flooding, and droughts have a detrimental impact on the livelihoods of individuals, households, and entrepreneurs, yet the majority of their livelihoods and professional assets, including boats, engines, crops, livestock, and equipment, as well as financial risks, remain uninsured.”
For Jamaica, the report noted that Jamaica’s insurance protection gap is shaped by frequent climate hazards interacting with poverty and informality, leading to repeated livelihood losses. Smallholder farmers, fishers, tourism workers, women, and rural communities are especially vulnerable. While Jamaica received rapid financial support through sovereign risk financing mechanisms and agricultural insurance payouts for some insured farmers, coverage remained limited relative to the scale of impacts
The report also said that Barbados faces a significant climate insurance protection gap driven by high coastal exposure and dependence on fisheries, agriculture, tourism, and informal work. While the country benefits from sovereign level parametric coverage, access to financial protection at the household and livelihood level remains limited.
Grenada on the other hand experiences a pronounced insurance protection gap despite strong sovereign disaster risk financing systems. Farmers, fishers, tourism workers, women, and persons with disabilities are particularly vulnerable to repeated shocks. Access to financial protection at the household level remains constrained by affordability, low financial literacy, and limited trust in insurers. Available products are often poorly aligned with informal livelihoods, and delivery channels do not reach vulnerable groups effectively.