The SEADRIF Insurance Company made a payout of $2 million to the Ministry of Finance of Lao PDR on 1st September 2025, under a first-of-its-kind policy that uses official government data on the number of people affected as the sole payout trigger, after 305,196 people were impacted by multiple disaster events.
Between 2nd May to 4th August 2025, Tropical Cyclones Wutip and Wipha, together with seasonal monsoon rains and flooding, severely affected Lao PDR.
The events caused widespread damage to farmland, disrupted the power grid, and damaged critical infrastructure including schools, roads, bridges, irrigation systems, and sanitation facilities.
As the number of affected people surpassed the policy’s second payout tier threshold (300,000–449,999 people), the terms were met, triggering the $2 million payout.
Data on the number of people impacted was reported by the Lao PDR National Disaster Management Office (NDMO). The payout was initiated on 1st September 2025, just six business days after SEADRIF received the latest data from the government’s NDMO. It was confirmed after Gallagher Re, the calculation agent, verified the disaster impact against policy thresholds.
The payout supports the Government’s emergency response and recovery activities in line with a pre-agreed contingency plan developed by the Ministry of Finance of Lao PDR in partnership with the World Bank and SEADRIF. The plan ensures targeted use of funds to support emergency response and recovery, while meeting fiduciary standards and following the World Bank’s Environmental and Social Framework (ESF).
Phaitoun Thienglamay, Director General, Department of State-Owned Enterprises and Insurance Supervision, Ministry of Finance, Lao PDR, said, “Typhoon Wutip and Wipha have had severe impacts on our communities, and our government agencies are implementing much needed response measures. This payout will help us to respond quickly, especially in the most affected areas. The policy’s structure—triggering payouts based on the number of people impacted—has proven effective and well-suited to Lao PDR’s disaster management system. We appreciate SEADRIF’s swift support during this critical time.”
Benedikt Signer, Executive Director of SEADRIF Insurance Company, added, “This payout provides timely financial support to help the Government of Lao PDR respond to immediate recovery efforts.
“We commend the government’s rapid reporting, which enabled this mechanism to function as intended. Multiple medium-sized disaster events can cumulatively unlock substantial support, not just single large disasters. SEADRIF will continue to work closely with the Government to monitor the evolving situation resulting from the recent Tropical Storms Kajiki and Nongfa. Our thoughts are with the people of Lao PDR, and we stand ready to process further payouts should additional thresholds be reached within the current coverage year.”
The sovereign parametric insurance policy was issued to Lao PDR in May 2025. It was launched in collaboration with the Government of Lao PDR, the World Bank, and insurance industry partners. The policy represents a major milestone in disaster risk financing as it ensures alignment with national systems while enabling faster response based on real-time conditions on the ground.
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