disaster risk financing

The World Bank supported Pacific Catastrophe Risk Insurance Company (PCRIC), a parametric disaster and catastrophe insurance captive insurer for the Pacific Island Countries (PIC’s), has renewed its reinsurance protection, growing the risk pool by 18% to $45 million, with the backing of four major reinsurers.

The Dominican Republic has secured the first catastrophe contingent line of credit in the Caribbean, with a $150 million Catastrophe Deferred Drawdown Option (Cat DDO) supported by the World Bank, that provides immediate financing in the event of natural disasters or public health emergencies.

The World Bank hopes to sign on new member countries for its parametric insurance facility, the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI), as the latest phase of the initiative has already encouraged two new enquiries.

A new, regional disaster risk financing project that supports and builds on the experience of the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI) has been launched in Fiji, significantly expanding regional collaboration and financial resilience.

The Philippines has long been the focus of disaster risk financing and insurance discussions, given its exposure to typhoons, earthquakes, fires, rainfall, floods and drought, and now the Asian Development Bank (ADB) is examining options for disaster insurance facilities.

The World Bank has announced that the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI) has renewed for its fifth season and transitioned into phase II, with the establishment of its own captive insurer.

The World Bank has been helping countries to access the capital markets for catastrophe insurance and disaster risk transfer for over a decade, but now the organisation is looking to the catastrophe bond structure as a way to help mitigate other kinds of risks.

The World Bank has again stressed the importance of innovative products from, and engagement with, the risk transfer industry, the World Bank’s message brings to mind the benefits of insurance-linked securities (ILS) structures.

The World Bank has launched the Pacific Resilience Program (PREP), a group of projects aiming to strengthen Pacific Island countries’ resilience to natural disasters and climate change, including through the use of parametric insurance coverage.

The World Bank Group aims to expand the use of sovereign disaster risk transfer instruments by the year 2020, hoping to add five more countries to those covered by instruments such as insurance, risk pools and contingent finance.