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New Risk Insurance Facility for region

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02.MAR.07

The UK Government on Monday announced a new US $7.5 million contribution to the World Bank’s pilot Catastrophic Risk Insurance Facility (CRIF) in the Caribbean, a Facility which provides insurance cover for hurricanes and earthquakes. The announcement was made at a donor pledging conference jointly chaired by the World Bank President, Paul Wolfowitz and Jamaican Minister of Finance, Omar Davies in Washington DC.{{more}}

This UK contribution will help establish the Facility which will be self-financing and provide participating Caribbean Governments with fast payouts to cover immediate needs for recovery and reconstruction aid following natural disaster. By purchasing insurance from the Facility, Caribbean Governments can contribute to their own protection proportionate to their risk of exposure to natural disasters and help safeguard their services. This in turn will help protect the poor who suffer disproportionately from such disasters, and raise investor confidence in any participating country’s ability to recover from a disaster. At US$890 million, economic damage caused by Hurricane Ivan was twice Grenada’s annual GDP. Ninety percent of the population was affected and the island’s tourism and agriculture industries were virtually devastated.

For those Caribbean countries which chose to take part in the insurance facility, the CRIF will become an integral component of their broader strategy to reduce the devastating consequences of natural disasters which are becoming increasingly frequent due to the effects of climate change. The UK continues to assist Caribbean countries invest in a range of disaster mitigation and planning activities.

The insurance will be in place for the 2007 Hurricane season and so far 17 countries have signed up to participate. Other donors that will join the UK in contributing to the start-up capital for this Facility include France, Canada and the World Bank.

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