Thursday 29 October, 2020

Caribbean & Central American states renew their disaster insurance

Photo:iStock/Mike Mareen

Photo:iStock/Mike Mareen

Twenty-two Governments from the Caribbean and Central America have renewed their parametric insurance coverage with the Caribbean Catastrophe Risk Insurance Facility Segregated Portfolio Company (CCRIF) ahead of the 2020 Atlantic Hurricane Season.

CCRIF said the overall risk package amounts to over US$1billion, which is an eight per cent increase from last year.

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The insurance covers tropical cyclones, excess rainfall, earthquake and fisheries.

 The European Union (EU) has donated €10 million (US$11 million) to CCRIF for premium support/ increased coverage for its Caribbean members, whose social and economic sectors have been significantly disrupted by coronavirus (COVID-19) pandemic.

This is the first time that that support will be provided to all members simultaneously.

This financial assistance to CCRIF is channelled through the EU Regional Resilience Building Facility managed by the Global Facility for Disaster Reduction and Recovery (GFDRR) and The World Bank. 

The GFDRR, the World Bank and CCRIF will continue efforts to secure further potential discounts to CCRIF member countries.

The EU funds will provide at least a 26 percent discount on a country’s total gross premium or an increase in policy coverage under their CCRIF parametric insurance policies.

CCRIF is also providing a five percent discount on gross premiums for Tropical Cyclone coverage, and a further discount of 15 percent on additional coverage purchased by members for increased Tropical Cyclone and/or Earthquake coverage for the 2020/21 policy year.

CCRIF said: “The renewal of countries’ catastrophe risk insurance policies at this time signals the strategic importance they are placing on disaster risk financing as key to advancing their sustainable development prospects and they welcome this additional support provided to them by the EU in the context of shrinking fiscal space.”

Daniela Tramacere, EU Ambassador to Barbados, the Eastern Caribbean States, OECS and CARICOM/CARIFORUM, has reaffirmed the strong partnership with the Caribbean in these difficult times: “Mitigation of COVID-19 impacts ahead of the hurricane season that already started in the region requires extraordinary and coordinated measures. EU is strongly committed to stand together with its partners in the Caribbean, providing emergency support and participating in the social/economic recovery process. The €10 million support has been provided to CCRIF SPC to ease payment of member countries’ premiums and improve their risk coverage against natural hazards.”

CCRIF CEO, Isaac Anthony commented:

“I must use this medium to openly thank the European Union for its rapid response in support of our member countries at a time when they are grappling with significantly diminished financial resources due to the economic crisis posed by COVID-19. I also take the opportunity to thank the GFDRR and the World Bank for facilitating this timely assistance to Caribbean countries as part of their wider response to the COVID-19 crisis in the region”.

Since its inception in 2007, CCRIF has made 41 pay-outs, totalling US$152 million, to 13 of its 22 member governments on their tropical cyclone, earthquake and/or excess rainfall policies, all within 14 days of the event.

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