On October 7, 2020, the sky over the sultry Mexican fishing town of Puerto Morelos began to darken. Hurricane Delta’s winds amassed like a riotous mob and smashed directly into the diminutive Caribbean pueblo. 

“Everyone was hiding at home with their families, nervously praying for as little damage as possible,” recalls Jacob Rubio, a local marine biologist and scuba instructor.

They didn’t get their wish. The storm’s 100-mile-per-hour winds claimed several of the town’s structures, including its pier. Less noticeable, but perhaps even more consequential, was the damage sustained by the vibrant coral reef just offshore.  

reef repair
The town of Puerto Morelos. Its damaged fishing pier can be seen in the foreground. Credit: Oliver Gordon

Hidden beyond Puerto’s ivory beaches lies the Mesoamerican Reef, the second largest barrier reef system in the world.  Rubio is part of the local brigade of volunteer conservationists who care for it. A week after the hurricane, when the sea had settled, he was among roughly 30 ‘Guardians of the Reef’ who set about clearing debris and re-rooting and re-attaching damaged coral colonies.“We worked 12 hours every day for a month and a half,” says Rubio. “It was exhausting.”  

Normally after a natural disaster, when the need for help is widespread and urgent, the rapid restoration of a coral reef might not rank high on the list of priorities. But the Guardians’ work was enabled by a pioneering collaboration aimed at saving the reef and the economy it supports: this 100-mile stretch of the Mesoamerican Reef is the world’s first natural asset protected by an insurance policy. Successfully tested by Hurricane Delta, the policy provides a fast injection of cash for reef repair after a storm. Time is of the essence — without quick restoration, coral colonies can die within a few weeks.

Insuring the Mesoamerican Reef as if it were any other valuable asset represents an innovative approach to leveraging the economic value of nature to pay for its own conservation. The model is the product of a collaboration between the local government, hotel owners, an international NGO and an insurance behemoth — all of whom believe it can be exported to protect not only the world’s reefs, but also other ecosystems such as mangroves, wetlands and forests.

“What is attractive about this model is that it allows an insurance company to add a practical solution to its client portfolio, and one that recognizes the economic value of nature’s services — that’s really transformational.”

“This model can be scaled up and applied to protect many different natural assets and the eco-services they provide, with insurance payouts enabling fast response and restoration activities,” says Philippe Brahin, head of Americas Public Sector Solutions at insurer Swiss Re. “We are actively trying to replicate the program in other parts of the world where we identified natural assets playing an important part in climate adaptation.”

The Mesoamerican Reef program

The idyllic Riviera Maya on Mexico’s Caribbean coast is the country’s chief tourist attraction, contributing around $10 billion in annual tourism revenues. Spanning 700 miles of that coastline, the Mesoamerican Reef plays a fundamental role in both the local ecosystem and the local economy. But its future, and those that rely on it, are under threat. Since 1980, 80 percent of the reef’s living coral has been lost or degraded by pollution, overfishing and storms.

This isn’t just a loss for snorkelers. A healthy coral reef can reduce up to 97 percent of a wave’s energy before it hits shore, limiting the effects of storm surge and coastline erosion. Unhealthy reefs, however, are themselves vulnerable to storm damage, losing 15 to 55 percent of their coral cover after a strong hurricane, decreasing their protective qualities. In the Riviera Maya, research has shown that a one-meter loss in the height of the reef crest could double the damage to local homes and hotels. To make matters worse, climate change is resulting in more hurricanes: last year, the Atlantic saw the most named storms on record