From nbamericas

Multi-national risk fund CCRIF SPC said that all of its 19 Caribbean members had re-upped on their coverage for the 2019/20 period, starting June 1, with nine governments increasing their level of coverage and one adding protection for tropical cyclone.

“CCRIF is pleased that some member governments have increased their coverage,” said the fund in a statement.

Formerly known as the Caribbean Catastrophic Risk Insurance Facility, CCRIF is the world’s first multi-country risk pool offering parametric insurance products for hurricanes, earthquakes and excess rainfall in the Caribbean and Central America.

CCRIF has provided coverage for hurricanes and earthquakes since 2007 and for excess rainfall in the Caribbean since 2013, extending it into Central America in 2015.

The facility now includes 21 members, 19 in the Caribbean and two in Central America (most recently Panama in January). It has stated plans to further expand parametric coverage for drought, fisheries and aquaculture, as well as crop and utility coverage, poising it for significant growth in the coming years.

CCRIF added that it is providing members with two new policy features – the aggregate deductible cover (ADC) and reinstatement of sum insured cover (RSIC) – at no cost for 2019/20.

First offered in 2017, the ADC can provide a minimum payment for events that are objectively not sufficient to trigger a CCRIF policy if the modeled loss is below the attachment point (or deductible). The RSIC provides access to coverage during a policy year even after the maximum coverage limit is reached.

The tropical cyclone and earthquake policies for 2019/20 have also adopted a new risk model called SPHERA (System for Probabilistic Hazard Evaluation and Risk Assessment), replacing the former MPRES model in use since 2011. Among SPHERA’s new features are improved ground motion, wind and storm surge models, as well as an enhanced exposure database integrating infrastructure and facilities.

CCRIF has also updated its excess rainfall risk model for 2019/20 with new features that reduce basis risk and improve modeled results.

“Increasing the level of coverage is a key component of CCRIF’s scaling-up strategy, which also includes increasing membership in both the Caribbean and Central America, as well as offering new parametric products as a means of helping governments reduce post-disaster resource deficits and budget volatility as well as closing the protection gap,” the fund said.

CCRIF began its scaling-up strategy in the wake of the devastating 2017 hurricane season.

Climate outlook

US weather service NOAA has predicted a “near-normal” hurricane season this year, which means that there is a likelihood of 9-15 named storms, of which 4-8 could become hurricanes, including 2-4 major hurricanes (category 3, 4 or 5) occurring in the Atlantic this year, said CCRIF.

Since the inception, the facility has made 38 payouts to 13 member governments on their tropical cyclone, earthquake and excess rainfall policies totaling approximately US$139mn, including a hefty US$55mn to nine member governments due to Hurricanes Irma and Maria in 2017.

CCRIF has also made seven payments totaling almost US$700,000 under member governments’ ADC.

For more on this story go to; https://www.bnamericas.com/en/news/ccrifs-caribbean-members-renew-coverage