In view of the country?s high exposure to natural hazards and lessons learned from past events, the Government has begun to take a proactive approach to disaster risk management as opposed to focusing mainly on post-disaster response by approving the Disaster Risk Reduction and Management (DRRM) Act in May 2010 (Republic Act No. 10121). One of the priority areas identified by the DRRM Act is the establishment of appropriate risk finance policies and instruments that will reduce the fiscal burden of the Philippine Government to natural disaster impacts. This project support to prepare a hazard module for typhoon and seismic hazards that would inform the design of an ensuing catastrophe liquidity facility that would address higher layers of risks.

The assignment consists of the following four components: 1. Hazard data and loss data collection and management; - To build a database of major historical hazard events (e.g., earthquakes, floods and tropical cyclones) for the Philippines.
- To build a database of economic and financial losses caused by selected hazards.
- To collect ancillary data sets required for further hazard modeling activities.


2. Exposure data collection and management and vulnerability function development; - To build a GIS exposure database of government assets and contingent liabilities such as schools, hospitals, public buildings, large scale infrastructure, and roads (quantified value in peso/dollar terms for input into potential damage calculations) at risk for the Philippines that could inform a risk finance transaction as well as the government?s Fiscal Risk Statement prepared every June.
- To build a GIS exposure database of population including where possible socio economic disaggregate data for gender and vulnerable populations.
- To characterize the vulnerability of physical assets and exposed population.

3. Catastrophe risk assessment;

Using state-of-the art catastrophe risk modeling methodology, develop national and local (e.g., provincial, city, and municipal) specific risk profiles for major natural perils in the Philippines.

4. Design of triggers for financial transactions; - To design parametric indices to be used for financial transactions.
- To design prototype risk transfer instruments based on the parametric indices.

The outputs, especially under Components (1) , (2), and (3) above, that would be produced under this Assignment will be shared with the Philippine Government which will become the principal institution to own and maintain the data for its own purposes.

- To build a consolidated database/catalogue of historical events associated with major natural disasters in the Philippines.

- To collect ancillary data sets including elevation, topography, bathymetry, surface soil, geological, and microzonation maps.

- To collect information and data on the economic, financial and human losses caused by natural disasters in the Philippines, from damage assessment reports, insurance reports and other sources.

- To identify and review ongoing projects on exposure data collection in the Philippines.

- To compile an inventory of geo-referenced government assets and contingent liabilities and population exposed to natural disasters, key attributes that are used in assessing their vulnerability to selected hazards, and their replacement value.

- To identity and review existing sources of information on vulnerability for the asset classes included in the exposure database.

- To develop catastrophe risk models for major perils for the Philippines that will allow for an assessment of national and local (e.g., provincial, city, and municipal) catastrophic risk losses.

- To develop a hazard module of major perils that takes into account the correlation of catastrophic risks in the Philippines;

- To develop loss estimates (direct losses, emergency losses, population losses) for the Philippines (national, and local) analyzing the potential impact of major perils for each class of government assets and contingent liabilities.

- To produce dissemination material that will inform participating areas/regions on their exposure to major perils.

-To design parametric indices to be used for financial transactions.

- To design prototype parametric risk transfer products for the Philippines based on the risks covered and the level of coverage (e.g., attachment points, limits), and to provide estimated pure premium rates.

1. A geo-referenced catalogue of historical major events.
2. Database of historical economic and financial losses caused by past natural disasters.
3. A technical report describing the data collected and their limitations.
4. Maps of historical event footprints and damage with estimated or observed values, as available.
5. Ancillary hazard data including: Surface soil and geology maps, microzonation studies, digital elevation data (topographical maps); land cover/land use.
6. Set of exposure maps, figures and tables describing the country-specific asset and population exposure to natural disasters.
7. A GIS database of government assets and contingent liabilities at risk.
8. A Database of population distribution for the Philippines.
9. Brochures on catastrophe risk profiles for the Philippines.
10. GIS data files for the key Hazard maps (probabilistic, key historical and simulated scenarios) and Risk Maps including return period hazard and average annual loss for the modeled hazards.
11. Tabular data with risk profile outputs.
12. A simple, flexible and fast-running Excel tool to generate the risk profile of the prototype (first generation and second generation) parametric risk transfer products.
13. A report analyzing the risk profiles of a set a pre-agreed parametric risk transfer products.
14. A simple, flexible and fast-running excel tool to allow for the analysis of the risk profile of a portfolio of parametric risk transfer tools.
15. Note of the protocol to access the real time data and use them for the calculation of the index.
16. A simple, flexible and fast running tool to calculate the parametric index value in real time.
17. Dissemination material summarizing the prototype insurance policies and the portfolio analysis. (e.g., PowerPoint presentation).