In the News
Caribbean Cat Fund Covers Over $1 Billion in 2020 Risk
The European Union supports fund with grant of $11.2 million.
- David Pilla
- July 2020
Caribbean catastrophe fund CCRIF said its member governments in the Caribbean region all renewed their parametric insurance coverage for tropical cyclone, excess rainfall, earthquake and fisheries ahead of the 2020 Atlantic hurricane season, ceding more than $1 billion in risk to CCRIF and increasing overall coverage by 8%.
The European Union through its global COVID-19 response also provided a grant of €10 million ($11.2 million) to CCRIF for premium support or for increasing coverage for its Caribbean members to support Caribbean governments whose social and economic sectors have been significantly disrupted by COVID-19, CCRIF said in statement.
The €10 million support has been provided to CCRIF to ease payment of member countries' premiums and improve their risk coverage against natural hazards.
EU Ambassador to Barbados and the Eastern Caribbean
“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,” CCRIF said.
According to CCRIF, the EU-funded support available for each member country would provide at least a 26% discount on total gross premium or an increase in policy coverage under their CCRIF parametric insurance policies. “This is in addition to the discounts that CCRIF also is providing—5% discount on gross premium for tropical cyclone coverage and a further discount of 15% on additional coverage purchased by members for increased tropical cyclone and/or earthquake coverage for the 2020-2021 policy year,” CCRIF said.
“Mitigation of COVID-19 impacts ahead of the hurricane season that already started in the region requires extraordinary and coordinated measures,” Daniela Tramacere, EU ambassador to Barbados and the Eastern Caribbean, said in a statement. “The €10 million support has been provided to CCRIF to ease payment of member countries' premiums and improve their risk coverage against natural hazards.”
CCRIF said member countries have the option of using the EU-funded discount during the 2020-2021 and 2021-2022 policy years. “The decision to allow for use of the funding in 2021-2022 is based on projections of low or negative growth in Caribbean countries next year, which undoubtedly will have an impact on their fiscal space,” the company said.
As the 2020 Atlantic hurricane season continues, CCRIF said Caribbean countries are covered for another year against tropical cyclones and excess rainfall events that occur throughout the year as well as earthquakes.