Hurricane Lala triggers Hawaii’s parametric coral reef insurance

The Nature Conservancy’s (TNC) Hawaiʻi parametric coral reef insurance policy will pay for damage assessment and reef repairs for the first time since it purchased the United States’ first such policy four years ago, following recent impacts from Hurricane Lala which brought dangerous flooding, strong winds and major power outages across the state.

In 2022, WTW, alongside TNC, launched the parametric coral reef insurance concept, with global reinsurer Munich Re underwriting the risk for the Hawaiian coral reef parametric insurance arrangement.

In 2024, the policy was renewed, offering expanded coverage and greater potential payouts, thereby enhancing the funding allocated for reef recovery and the communities reliant on these ecosystems. Munich Re was again chosen as the coverage provider from a pool of seven competitive bids.

The parametric policy was renewed again in 2025, with Munich Re continuing to play a key role in the programme.

Moreover, the parametric policy is designed to provide rapid funding for assessing and repairing coral reef damage caused by hurricanes and severe tropical storms across the Hawaiian Islands

According to The Nature Conservancy, Hurricane Lala is the first storm—with sustained winds of 65 knots within the covered area—to trigger the insurance policy. The minimum payout is $200,000

While The Nature Conservancy (TNC) is the policy holder, it has been confirmed that disbursement of the payout will be determined collaboratively with the Hawaiʻi Emergency Reef Restoration (HERR) Network.

As a result, these funds will enable the HERR Network, a unified statewide coalition comprising government agencies, scientists, nonprofits, and community organisations, to evaluate the reefs across the state following the storm and identify subsequent actions to rescue, reattach, and restore any damaged corals.

As per the announcement, the HERR team will evaluate the damage within the coming weeks and determine the best course of action to catalyze reef recovery.

“This is how it’s intended to work. Through the HERR Network we have a coalition of trained emergency reef responders who can respond rapidly in times of crisis,” commented Julia Rose, TNC’s Coral Restoration Program manager in Hawaiʻi and Palmyra.

“Our reefs face many threats that are beyond our ability to address locally, but physical storm damage is an impact we can do something about. By acting quickly to assess and repair damaged reefs, we can give corals a better chance to recover and continue supporting Hawaiʻi’s communities,” Rose added.

In addition, the HERR Network has already demonstrated its rapid response capabilities this year following back-to-back Kona Low storms, which caused significant coral breakage and sedimentation across multiple islands, which saw responders conduct rapid assessments, cleared debris, and stabilise reef structures on Maui and Oʻahu.

The Howden Foundation, also commented: “Hawaii’s first-ever coral reef insurance policy has been triggered following hurricane-force winds and heavy rainfall across the islands.

“While no one wants to see a reef damaged by a storm, this payout demonstrates the value of having funding ready when nature and communities need it most. Supported by Howden Foundation, this policy provides funding for the rescue, reattachment and repair of damaged corals when pre-agreed thresholds are met.”

The firm continued: “Since launching in 2022, the policy has also helped strengthen preparedness efforts and build new partnerships across Hawaii. In the coming weeks, the Hawaiʻi Emergency Reef Restoration (HERR) Network will assess the damage and determine the actions needed to support reef recovery.

“This is the power of insurance: helping to build resilience before disaster strikes and supporting recovery when it does.”

Generous support from the Howden Foundation and TNC enabled the purchase of the 2026 policy.