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World Bank Provides US$23.2 million for Caribbean Countries to Participate in Regional Catastrophe Risk Insurance Facility

Available in: Français
Press Release No:2007/265/LAC
Contacts: 
Stevan Jackson (202) 458-5054
Sjackson@worldbank.org

WASHINGTON , March 8, 2007 – The World Bank’s Board of Directors today

approved a US$14.2 million zero-interest credit from the International Development Association (IDA) to four country members of the Organization of Eastern Caribbean States (Dominica, Grenada, St. Lucia, and St. Vincent and the Grenadines), and an IDA grant of US$9.0 million to Haiti to support their participation in the Caribbean Catastrophe Risk Insurance Facility (CCRIF).

 

Caribbean states are highly susceptible to natural disasters – on average, one major hurricane affects a country in the region every two years – and have only limited options available to respond. With small economies and high debt levels, they often depend on donors to finance post-disaster needs, but donor resources often take time to materialize. The CCRIF will enable governments to purchase catastrophe coverage akin to business interruption insurance that will provide them with an early cash payment after a major hurricane or earthquake.

 

Pooling their risk will save the participating countries some 40 percent in individual premium payments. 

 

The Facility, the first of its kind in the world, represents an important shift from reacting to disasters after they hit, to being much more proactive about disaster management and mitigation,” said Caroline Anstey, World Bank Country Director for the Caribbean. “These projects will allow Haiti and the OECS beneficiary countries to pay their contribution to the CCRIF, giving them immediate access to funds if hit by an earthquake or hurricane.”

 

The IDA credit will provide Dominica, Grenada, St. Vincent and the Grenadines and St. Lucia with resources to meet their payments of annual insurance premiums over the next 3 years. The funds will be disbursed in four installments to the CCRIF at the request of each country’s Ministry of Finance.

 

On February 26, 2007, the World Bank hosted a donor pledging conference where Bermuda, Canada, France the United Kingdom, the Caribbean Development Bank and the World Bank pledged US$47 million for the CCRIF’s reserve fund. A total of 18 Caribbean countries are participating in the CCRIF, which is expected to become operational before the 2007 hurricane season which begins in June.

 


For more information, please visit the Projects website.



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