Close eye on Irma’s potential damage

He was speaking at the signing of a Memorandum of Understanding with the Association of Caribbean States (ACS) at the ACS Secretariat, Sweet Briar Road, St.

Clair, during the formal opening of the 25th meeting of the ACS’ Special Committee for Disaster Risk Reduction. He said, over the years the facility has entered into MOUs with eight organisations, including the Caribbean Disaster Emergency Management Agency; the Organisation of Eastern Caribbean States; The University of the West Indies (The UWI); the United Nations Economic Commission for Latin America and the Caribbean and the UWI Seismic Research Centre.

Signing for the ACS was its secretary general Dr. June Soomer who welcomed the initiative, saying the ACS works closely with all its partners.

Anthony said the facility was established in 2007 and seven years later it was restructured to facilitate its expansion into new products and geographic areas. He said it is the world’s first regional fund using parametric insurance, a type of insurance in which payout is triggered when specific conditions, or parameters, are met. Because the parameters are already specified, experts say no loss adjusters are needed, allowing for speedy payments and Anthony said the CCRIF has consistently provided payments within 14 days of an event. He said the parametric nature of the policies allows for rapid payouts against losses and keeping operational expenses to a minimum.

He said that since 2007, CCRIF has made 22 payouts to ten member governments totalling U.S. $70 million.

After the passage of hurricane Matthew last year, he said CCRIF paid U.S. $29.2 million to four member countries affected by that hurricane: Haiti; Barbados; St. Lucia and St. Vincent and the Grenadines; and all the payments were made within 14 days.

He said the majority of the payment - U.S.

$23.4 million - went to Haiti under its Tropical Cyclone policy which covered wind and storm surge and its excess rainfall policy.

He said immediate access to liquidity is critical for governments after a disaster and while the international community provides relief, those funds are often slow to be released taking as much as six to 12 months.

Government borrowing and reallocation of funds in their budgets also takes time and smaller governments such as those in the Caribbean and most of the Small Island Developing States, with their high debt burdens, can no longer afford to self-finance disaster risk.