ORIGINAL PUBLICATION HERE
A US$30 million catastrophe bond issued by the World Bank under its Capital-at-Risk Notes Program helps the Caribbean Catastrophe Risk Insurance Facility (CCRIF) transfer the natural disaster risk of 16 member countries to the capital markets efficiently and at highly competitive prices.
The Caribbean Catastrophe Risk Insurance Facility (CCRIF) was established in 2007 with the support of the World Bank, the Government of Japan and other donors. CCRIF provides insurance coverage against earthquake, hurricanes and excessive rainfall to sixteen Caribbean countries (Anguilla, Antigua & Barbuda, Bahamas, Barbados, Belize, Bermuda, Cayman Islands, Dominica, Grenada, Haiti, Jamaica, St. Kitts & Nevis, St. Lucia, St. Vincent & the Grenadines, Trinidad & Tobago and the Turks & Caicos Islands) by pooling the risks of the countries and transferring a portion of the pooled risks to the re-insurance market. CCRIF’s portfolio has grown since 2007 to about US$135 million in 2013. As of August 2014, eight payments were made to affected countries. CCRIF was designed as a parametric facility, which provides a fast and transparent payment when triggered. As a reference, the payout from CCRIF was the first to reach Haiti in the aftermath of the 2010 earthquake.