SEADRIF Insurance Company has disbursed US$2 million to the Ministry of Finance of Lao PDR after official data confirmed that over 305,000 individuals were affected by a series of disaster events between May and August 2025.
The payout, processed on Sept. 1, was made under a new sovereign parametric insurance policy that was introduced in May of this year.
The trigger for the payout was the official impact data submitted by the Lao PDR National Disaster Management Office (NDMO), which surpassed the policy’s second payout threshold.
During the covered period, Lao PDR experienced multiple natural disasters, including Tropical Cyclones Wutip and Wipha, as well as seasonal flooding.
These events resulted in significant damage to agricultural land, power infrastructure, and essential public facilities such as schools, roads, and sanitation systems.
The cumulative number of people affected exceeded the 300,000 mark, which under the policy’s terms, activated the US$2 million payment.
Gallagher Re, acting as the calculation agent, verified the data and confirmed that the policy’s requirements were met.
The payout was delivered within six business days after SEADRIF received the latest impact figures from the NDMO.
The funds are intended to support the government’s emergency response and recovery operations, following a contingency plan developed in collaboration with the World Bank and SEADRIF.
This plan is designed to ensure that resources are directed to priority needs and that all disbursements comply with the World Bank’s Environmental and Social Framework.
Phaitoun Thienglamay – director general of the Department of State-Owned Enterprises and Insurance Supervision at the Ministry of Finance, Lao PDR – said the recent typhoons, Wutip and Wipha, have significantly affected communities across the country, prompting government agencies to take necessary response actions.
“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,” he said.
Benedikt Signer, executive director of SEADRIF Insurance Company, said the payout offers the government of Lao PDR prompt access to funds for immediate recovery activities.
“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,” he said.
He added that SEADRIF will maintain close coordination with Lao PDR authorities to track the ongoing impacts of recent storms such as Kajiki and Nongfa, and confirmed that the company is prepared to issue additional payouts if further policy thresholds are met during the current coverage period.
The policy represents a shift in disaster risk insurance for the region, as it bases payouts solely on government-reported numbers of people affected, rather than on hazard models or loss estimates.
This approach is intended to align insurance mechanisms more closely with national disaster management systems and to accelerate the release of funds following major events.
Lao PDR’s agreement with SEADRIF, signed in July 2025, provides up to $16 million in coverage over two years for a range of perils, including floods, cyclones, earthquakes, and landslides.
Since joining SEADRIF in 2021, Lao PDR has received a total of $4.5 million in payouts under similar fast-disbursing arrangements.
The policy stipulates that payouts are to be made within 10 business days once the number of affected people crosses predetermined thresholds, embedding financial protection directly into the government’s disaster response framework.
