The Mexican government has decided to triple their investment in disaster insurance coverage for 2012, over the amount the country spent in 2011 according to reports. 3.15 billion pesos, which is nearly $250m has been set aside for investment in disaster insurance to protect the country from climate, weather and catastrophe events.
$205m has been committed by the federal government while $44m has been provided by the States with the aim of purchasing around $1.89 billion of coverage. They expect an investment of this size to allow them to cover an area of up to 12 million hectares of farm land.
Much of the investment in disaster insurance is to be aimed at the agricultural sector but we have heard from sources that Mexico has been discussed in connection with a pipeline catastrophe bond this year. There is no information about whether that deal will come to market but we are told that enquiries were made in recent weeks. Could we see some of these funds diverted to support another MultiCat cat bond deal? The current MultiCat Mexico 2009 cat bond matures in October.