Tourism is a key contributor to Sri Lanka’s economy, employment, and regional development, but the sector is increasingly affected by climate-related risks. Rising temperatures, erratic rainfall, storms, and coastal impacts disrupt operations, damage infrastructure, and create uncertainty for businesses and communities that rely on tourism. These challenges highlight the need to strengthen resilience through both physical adaptation and financial instruments that can help enterprises and workers recover from shocks and plan for long-term sustainability.

Climate risk transfer and insurance offer important tools in this process, yet current coverage remains limited in scope, affordability, and accessibility. This discussion paper draws on insights from a multi-stakeholder consultation convened by SLYCAN Trust and the Sustainable Development Council to assess existing insurance frameworks in Sri Lanka’s tourism sector, identify key gaps and barriers, and explore opportunities for innovative solutions. It aims to provide a basis for enhancing access to climate-relevant insurance and integrating risk transfer mechanisms into wider adaptation and resilience-building efforts.

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