Jakarta, 7 May 2026 — Indonesia is taking an innovative step to safeguard its coasts, communities, and blue economy by launching new guidance on coral reef insurance, an emerging solution that can help nature recover faster from climate shocks while protecting the livelihoods that depend on it.

The United Nations Development Programme (UNDP), in partnership with the Ministry of Marine Affairs and Fisheries (MMAF) of Indonesia, today launched a Lessons Learned Report and a Practical Toolkit on Coral Reef Insurance under the “Improving resilience of coral reefs and dependent communities in Gili Matra” project. Supported by the Ocean Risk and Resilience Action Alliance (ORRAA) through the United Kingdom’s Blue Planet Fund, the initiative demonstrates how Indonesia is leading efforts to embed new financing solutions into broader coastal resilience strategies to protect both people and the planet, while strengthening its blue economy.

Indonesia is home to around 16% of the world’s coral reefs, ecosystems that sustain fisheries, tourism, and natural coastal protection. Yet rising sea temperatures and increasing human pressures are accelerating coral bleaching, putting both ecosystems and livelihoods at risk. In Gili Matra, North Lombok, reef-based tourism alone generates over IDR 9.5 trillion annually, equivalent to more than USD 550 million, highlighting how much is at stake.

The “Improving resilience of coral reefs and dependent communities in Gili Matra” project explores how coral reef insurance can help address a critical financing gap by ensuring rapid funding is available when climate shocks occur. Rather than insuring the reef itself, the approach covers the cost of emergency response and restoration, enabling faster action when damage happens.

The Lessons Learned report documents Indonesia’s first experience in developing a coral reef insurance model, covering risk assessment, stakeholder engagement, and institutional arrangements. The accompanying toolkit translates these insights into a practical decision-making and implementation guide for governments and practitioners exploring similar approaches.

A prototype parametric insurance model has been developed using satellite data from the NOAA Coral Reef Watch system – a global monitoring platform that tracks sea surface temperatures and heat stress on coral reefs in near real time. Using indicators such as Degree Heating Weeks, the model is designed to trigger payouts when predefined sea surface temperature thresholds are reached, supporting early response and recovery efforts.

Indonesia has also strengthened the enabling environment through Ministerial Regulation No. 27/2024, which supports sustainable marine financing and opens pathways for blended funding, including public, private, and tourism-based contributions, for premium payments.

When reefs are damaged, the impacts extend far beyond the environment. Tourism and fisheries livelihoods are disrupted, food security is affected, and natural coastal protection against storms is weakened. Coral reef insurance is emerging as an innovative risk-transfer mechanism that can help communities respond more quickly to climate shocks by enabling timely funding for emergency response and restoration.

While the model has already been designed and tested, the next critical step is securing sustainable financing for premium payments, advancing regulatory processes, and strengthening governance arrangements. Indonesia’s leadership in piloting this innovation demonstrates how marine conservation can be linked with financial resilience, offering a practical pathway to protect biodiversity while supporting communities and economies that rely on healthy marine ecosystems.

As climate risks intensify, coral reef insurance offers a promising way to reduce delays in funding, strengthen resilience, and support faster recovery for both ecosystems and communities, contributing to broader efforts to invest in nature as a foundation for sustainable development.

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Contact Information: 
Nabilla Rahmani, Head of Communications, UNDP Indonesia
nabilla.rahmani@undp.org