CCRIF Caribbean members renew Disaster Risk Insurance Policies

CCRIF is pleased to announce that its member governments in the Caribbean have all renewed their parametric insurance coverage for tropical cyclone, excess rainfall, earthquake and fisheries ahead of the upcoming 2020 Atlantic Hurricane Season, ceding over US$1 billion in risk to CCRIF and increasing overall coverage by 8 per cent. Also, in response to the challenges being faced by Caribbean governments, the European Union (EU) under its Global COVID-19 Response, has proactively stepped forward and provided a grant of €10 million (US$11 million) to CCRIF for premium support or for increasing coverage for its Caribbean members whose social and economic sectors have been significantly disrupted.

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 welcomes this additional support provided to them by the EU in the context of shrinking fiscal space.

The EU-funded support that is available for each member country would provide at least a 26 per cent (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 per cent discount on gross premium for Tropical Cyclone coverage, and a further discount of 15 per cent on additional coverage purchased by members for increased Tropical Cyclone and/or Earthquake coverage for the 2020/21 policy year.

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.”

This financial assistance to CCRIF is channeled 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.

Member countries have the option of utilizing the EU-funded discount during the 2020/21 and 2021/22 policy years. The decision to allow for use of the funding in 2021/22 is based on projections of low or negative growth in Caribbean countries next year, which undoubtedly will have an impact on their fiscal space.