The World Bank presented the results of the Caribbean Catastrophe Risk Insurance Facility (CCRIF) project, a programme that designed an insurance facility to allow countries to receive rapid access to emergency financing based on the occurrence of severe weather events, rather than on measuring damages.
8 May 2012: The World Bank has presented the results of the Caribbean Catastrophe Risk Insurance Facility (CCRIF), a programme designed to promote rapid access to emergency financing in cases of severe weather-based disasters in the Caribbean.
CCRIF provides Caribbean countries with hurricane and earthquake insurance for a cost that is 45-50% lower than that provided by insurance markets. This price difference results from the CCRIF agenda of aggregating individual country risk, and then making rapid payouts based on initial indication of severe weather. According to the World Bank, payment of the claims follows the occurrence of a pre-defined event (e.g. wind speed or ground motion of a certain magnitude) rather than an assessment of actual losses after the fact.
The level of participation in the project is successful because funding from the World Bank’s International Development Association (IDA) has provided beneficiary countries with access to the financial means to purchase catastrophe risk insurance. Specific success can be seen in practice through various payouts. Following a November 2007 earthquake, Dominica received US$528,000, and St. Lucia received US$419,000. After a severe earthquake in 2010, Haiti received US$7.8 million. Furthermore, after Hurricane Tomas in 2010, St. Lucia and St. Vincent and the Grenadines received payouts of US$3.2 million and US$1.1 million, respectively. The first years of the initiative (2007-2011) were also supported by the Governments of Bermuda, Canada, France, Ireland, and the UK, as well as from the EU and the Caribbean Development Bank. [World Bank Press Release]