The Caribbean Catastrophe Risk Insurance Facility (CCRIF) will, this week, make payouts to the Government of Grenada totalling about US$44 million (EC$118 million) following the passage of Hurricane Beryl.
The hurricane devastated 90 per cent of all buildings – the airport, marinas, gas stations, the hospital and homes – on the islands of Carriacou and Petite Martinique – two of the sister islands that comprise the State of Grenada.
There was also significant damage to the agriculture sector as well as the natural environment, including mangrove ecosystems. Electric utilities, mainly the transmission and distribution systems on both islands, also were significantly damaged. The north of mainland Grenada was also not spared the wrath of Hurricane Beryl, with damage to homes, the agriculture and forestry sectors, and electric utility transmission and distribution and water distribution systems.
CCRIF’s parametric insurance policies make payments based on the intensity of an event and the amount of loss calculated in a pre-agreed model caused by these events. The payout to Grenada on its tropical cyclone (TC) policy is the single largest payout by CCRIF. Until now, it was Haiti, which received just under US$40 million following the 2021 earthquake.
“These payouts represent Grenada’s first payouts from CCRIF. I commend the Government of Grenada, which has always maintained that despite not receiving a payout, it understood the importance of financially protecting the economy in case a disaster strikes, as it would never want to see a repeat of Hurricane Ivan,” said CEO Isaac Anthony.
Anthony, in reflecting on Beryl, further stated that, “countries ought to treat parametric insurance for natural hazards like they treat health insurance. We buy health insurance because it is important to help safeguard our lives. However, we hope we do not need it but when we do, we have the peace of mind that it could help us deal with a more serious illness than a common cold.
“Similarly, we do not want to be negatively impacted by natural hazards and be faced with natural disasters. However, in the case of CCRIF’s parametric insurance, the moment we really need it, it is available within 14 days of a triggering event. CCRIF’s parametric insurance must be seen as a key component in helping countries to build back better and stronger to withstand future natural hazards, especially within the context of climate change”.
CCRIF currently offers six parametric insurance products – for tropical cyclones, excess rainfall, earthquakes, and the fisheries, electric utilities and water utilities sectors.
Since its inception in 2007 and prior to Beryl, CCRIF made 65 payouts totalling US$274 million to 17 members. CCRIF is expected to make ten payouts under Beryl totalling over US$75 million in the next few days thereby taking payouts to approximately US$350 million. (PR/SAT)
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