The Micro Insurance Catastrophe Risk Organisation (MiCRO) has signed a grant agreement supporting their parametric catastrophe micro-insurance programme for Haiti with the Caribbean Development Bank (CDB). The CDB will be administering the multi-donor trust fund that supports the operations of MiCRO.
MiCRO provides parametric insurance products which aim to protect microfinance institutions and therefore their borrowers by offering predictable, parametric covers which help borrowers to keep to their repayments even after disasters. This helps the microfinance organisations ensure that their borrowers can recover from disaster and hopes to prevent their businesses from failing.
MiCRO is a Barbados registered segregated cell company licensed to carry out insurance activities. At the moment they only provide coverage in Haiti, but according to the CDB’s press release they plan to expand to cover the Caribbean region. Given the proliferation of microfinance in the Caribbean region an expansion of MiCRO could be extremely beneficial to micro-credit companies working there. The parametric nature of the triggers mean that the cover can be matched to actual natural disaster and weather conditions, thus providing coverage when it is most needed in a predictable manner.
CDB President, Dr. Warren Smith, said that the bank “Is very happy to be associated with this venture, since it represents a very good example of innovation in arriving at solutions to the challenges which confront micro-business and solutions to risk.” Dr. Smith added that it was particularly significant that the focus of the exercise is Haiti where there is a proliferation of micro-enterprises which he regards as “a dynamic force for the future of the country.”
Recently it was announced that MiCRO would be expanding the range of parametric insurance covers it offers to include a product specifically designed to protect Haitian women struck by cholera.