SVG among three to receive CCRIF first post-Elsa payout
ST VINCENT and the Grenadines is one of three countries in the region which have received insurance payouts from the Caribbean Catastrophe Risk Insurance Facility (CCRIF) in the wake of the passage of hurricane Elsa.
The insurance facility said in a release that following passage of the hurricane it made two payouts to the Government of Barbados under the country’s tropical cyclone and excess rainfall parametric insurance policies, totalling US$2.5 million.
And payments totalling US$528,512 were made to three other member governments – Haiti, St Lucia, and St. Vincent and the Grenadines – under the Aggregate Deductible Cover (ADC) feature of CCRIF’s tropical cyclone policies. Hurricane Elsa was the fifth tropical cyclone in the 2021 Atlantic Hurricane Season.
Since the inception of CCRIF in 2007, the Facility has made 52 payouts totalling US$202.5 million to 16 of its 23 members, with the Government of Haiti receiving 4 payouts totalling US$38.3 million and the Government of Barbados receiving 7 payouts totalling US$21.8 million. These two countries have received about 30 per cent of CCRIF’s total payouts.
Parametric insurance that is offered by CCRIF is very different from traditional indemnity insurance. CCRIF’s parametric insurance products make payments based on the intensity of a natural hazard event (for example, hurricane wind speed, earthquake intensity, and volume of rainfall) and the exposure or assets affected by the event, and the amount of loss calculated in a pre-agreed model caused by the event. Thus, CCRIF does not need to wait for on-theground assessments of loss and damage – unlike with indemnity insurance – to make payouts, enabling the Facility to disburse funds to governments within 14 days of an event.
CCRIF was developed under the technical leadership of the World Bank and with a grant from the Government of Japan. It was capitalised through contributions to a Multi-Donor Trust Fund (MDTF) by the Government of Canada, the European Union, the World Bank, the governments of the UK and France, the Caribbean Development Bank and the governments of Ireland and Bermuda, as well as through membership fees paid by participating governments.