Restoration Insurance Service Company for Coastal Risk Reduction (RISCO)


Coastal mangrove habitats have a critical role in storing carbon and increasing resilience to flooding, and yet we’ve lost half of the world’s mangroves in the last 50 years. Mangroves’ risk reduction and carbon benefits are not currently sufficiently valued, leading to their conversion to other uses such as shrimp ponds. Estimates show that continued loss of mangroves would put an additional 18 million people at risk from flooding, with flood damages increasing by US$ 82 billion a year. Recent research values the flood reduction benefits of restoring the Philippines’ mangroves, for example, at US$ 453 million per year. Annual mangrove deforestation also contributes 10% of all greenhouse gas emissions from tropical deforestation.

Mangrove conservation and restoration has typically been financed by governments and local communities, limiting its scale. RISCO seeks to create new revenue streams for mangrove conservation and restoration by a) incorporating mangroves’ risk reduction value into insurance product pricing and b) monetizing the climate mitigation value of mangroves through blue carbon credits.

The Solution

RISCO is a social enterprise that will invest in mangrove conservation and restoration in areas with high-value coastal assets, enabling property damage risk reduction and protecting blue carbon.

RISCO would be the first enterprise to assess and monetize the coastal asset risk reduction value and carbon storage benefits of mangroves. Specifically, RISCO would enable deployment of mangrove conservation and restoration projects, which would reduce the impacts of storms and typhoons on coastal populations, as well as store an average of 850 tonnes of carbon per hectare. Working with insurance companies, RISCO would embed mangrove risk reduction values into insurance models for coastal properties and allow for reduced premium prices. A portion of the premium savings, or other insurance-related revenue, would be paid by coastal asset owners to finance the upfront cost of the conservation and restoration projects. RISCO would also generate and sell blue carbon credits to organizations seeking to meet voluntary or regulatory climate targets, using forthcoming Verra methodologies for carbon credits.

Implementation and Impact

The proponent of RISCO, Conservation International, plans to pilot RISCO in the Philippines, where it has worked with the government and local communities to value and protect healthy ecosystems since 1995. Every hectare of restored or protected mangroves in the Philippines provides on average $3,200/year in direct flood reduction benefits.

Specifically, RISCO will target sites in Palawan, an area with significant but threatened mangrove cover and high vulnerability to climate change. Eventually, RISCO aims to replicate the approach in other areas of the Philippines and beyond. By combining insurance-related and blue carbon revenue streams, RISCO should become financially self-sustaining once sufficient scale is reached.


Barriers to mangrove conservation and restoration include a reliance on scarce government and philanthropic financing and a failure to prioritize these interventions. RISCO would overcome these by creating a social enterprise which connects the adaptation and mitigation values of these ecosystems to beneficiaries who benefit from intact mangroves and are able to pay for these benefits, but do not have the knowledge, skills or necessary relationships to protect them – including high value coastal asset owners, and insurance companies.

RISCO would identify new sites and coastal asset owners, facilitate deals including by coordinating with insurance partners, and (directly or via a third-party) provide the mangrove conservation and restoration interventions, including valuation of the mangrove benefits.

The owners of coastal assets (e.g. homes, tourism infrastructure, fisheries, ports, and other infrastructure) would receive a discount on their insurance premium payments and/or other benefits based on a quantification of property damage risk reduction. The insurance companies would benefit from lower risk exposure and payouts in the event of storms, typhoons, and flooding.

In the short-term, RISCO would rely on blended finance from concessional and/or commercial finance providers to implement pilots and test and refine the business model. Longer term, RISCO will become self-financing with two main revenue streams: (1) it will receive a percentage of the premium payment savings that the coastal asset owners accrue over time or some other insurance-related revenue depending on the contract structures; and (2) it will sell blue carbon credits to buyers in the voluntary and/or relevant compliance markets.