Atlantic Hurricane Season

Tropical Storm Risk (TSR) has issued its extended range forecast for the 2026 Atlantic hurricane season, saying it currently anticipates activity levels around the 30-year norm, projecting 14 named storms, 7 hurricanes and 4 major hurricanes.

Reflecting on the impacts of Hurricane Melissa, Jamaica’s Prime Minister Dr. Andrew Holness has stressed the importance and effectiveness of responsive disaster risk financing instruments in reducing the country’s debt burden in the aftermath of the hurricane.

Reflecting on Hurricane Melissa’s impacts on Jamaica, Hon. Andre Ebanks, MP, Premier & Minister for Financial Services and Commerce, of the Cayman Islands, said that the British Overseas Territory should also look to financial instruments such as catastrophe bonds for future protection.

The World Bank has announced today that following the events of Hurricane Melissa, the Government of Jamaica will receive a full 100% payout of its $150 million IBRD CAR Jamaica 2024 parametric catastrophe bond.

Moody’s RMS Event Response has provided a best estimate for the insurance and reinsurance industry losses from recent hurricane Melissa of $3.5 billion, with a range of between $3 billion and $5 billion anticipated.

Having already seen its parametric tropical cyclone insurance triggered by major hurricane Melissa’s winds, Jamaica is now set to also benefit from a payout under its CCRIF SPC parametric excess rainfall policy, taking the total it will receive to $91.9 million.

Catastrophe modelling firm Karen Clark & Company (KCC) is the latest to issue an estimate for the insurance industry loss from recent major hurricane Melissa, pegging the total at US $2.4 billion.

Hurricane Melissa is only estimated to have caused insured losses in a range from US $1 billion to US $2.5 billion in Jamaica, according to catastrophe modeller Cotality, with the total expected pegged at US $1.5 billion, while the economic impacts are far higher demonstrating the protection gap.

Verisk’s Extreme Event Solutions division estimates that insured industry losses to onshore property in Jamaica from Hurricane Melissa will likely range between $2.2 billion and $4.2 billion.

As Jamaica awaits an official determination on a potential $150 million payout from its IBRD CAR Jamaica 2024 parametric catastrophe bond from Hurricane Melissa, ratings agency Fitch has said that it does not expect to see any adverse reaction from the insurance-linked securities (ILS) market as a result of the payout.