Hanover losses spotlighted in Lloyd’s study on Caribbean insurance gaps

A study commissioned by Lloyd’s, the London-based insurance and reinsurance marketplace, found that farmers, fishers and tourism workers in three hurricane-exposed Caribbean countries — Jamaica, Barbados and Grenada — are left to replace lost boats, crops, livestock and equipment themselves because they lack insurance.

They should get faster intervention from the government, while co-operatives they trust, like credit unions, should start offering insurance-related 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”.

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 maps the gap across three levels – government disaster financing, co-operative and community-level pooling, and individual household coverage – and finds weaknesses at each stage. Sovereign aid arrives but often does not reach households or small businesses quickly enough or in sufficient amounts. The study also found that organisations such as co-operatives, associations and credit unions often enjoy higher levels of trust than insurers and banks, yet rarely hold or have access to collective climate insurance products. Among its recommendations, the report urges insurers to partner with community-level organisations for outreach, distribution and trust-building efforts. And at the micro level, most livelihood assets remain uninsured altogether.

The report states that “trust, delivery, and affordability also determine the value for policyholders”. It frames those issues as barriers to wider insurance uptake and identifies opportunities for insurers to close climate-risk insurance protection gaps through product redesign, improved delivery channels, and partnerships with community organisations.

Jamaica’s section of the report singles out the parish of Hanover. It cites severe crop and poultry losses following Hurricane Melissa in October 2025, along with widespread property damage, including destroyed homes, broken fences and damaged water tanks. The report notes that 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”, with many affected households reporting that available assistance was insufficient.

In Hanover, among the interventions announced were a J$100-million government yam recovery programme, an $80-million voucher programme, and a J$4.4-million GraceKennedy Foundation initiative targeting affected communities.

Barbados and Grenada showed similar gaps. In Barbados, the report linked the protection gap to Hurricane Beryl’s storm surge in July 2024, which damaged more than 200 fishing boats in Bridgetown and exposed how little financial protection was available to many small-scale coastal livelihoods.

In Grenada, Hurricane Beryl caused widespread destruction of homes, crops, boats and critical infrastructure, particularly on Carriacou and Petite Martinique. Despite existing sovereign disaster-risk financing mechanisms, the report found that many households still lacked access to timely and affordable financial protection and remained dependent on external assistance after the storm.

Beyond the insurance sector, the findings raise broader economic questions about how climate risk is financed across the Caribbean. The report argues that repeated uninsured losses can leave households and small businesses dependent on savings, remittances, public support and other informal coping mechanisms, slowing recovery and widening financial vulnerability after major weather events.

carolyn.guniss@rjrgleaner.com