The country is due to be awarded some $16.3 million from the Caribbean Catastrophe Risk Insurance Facility after the passing of Hurricane Beryl. According to Minister of Finance Dr Nigel Clarke, it was in that context very important that the country secured a multi-layered disaster risk financing arrangement to support recovery.

The Caribbean Catastrophe Risk Insurance Facility will provide an approximate payout of $16.3 million to Jamaica. This is based on the fact that Hurricane Beryl has fulfilled all conditions of their parametric tropical cyclone insurance policy.

This was affirmed by uien Clarke, Minister of Finance of Jamaica, who explained, “I have received the Preliminary Modelled Loss and Policy Payment Report from CCRIF for Tropical Cyclone Beryl.” As far as Jamaica is concerned, the report stated that the country’s insurance policy with CCRIF had been breached by the hurricane with parameters to trigger the payout sum of about $16.3 million or approximately J$2.5 billion.

To this, Dr. Clarke added that the insurance policy with CCRIF is part of a multilayered framework for disaster risk financing in place for Jamaica. It has many benefits in the management and response to natural disasters within the country. In fact, the policy purchased from CCRIF reflects the fourth layer in such a system.

Some utilisation of the CCRIF SPC parametric capacity was expected in the wake of Hurricane Beryl, which made landfall last week. This would be especially so for the Windward Islands in the Caribbean, which report severe impacts from the storm. Jamaica has also been among the entities expected to receive payouts.

As readers may recall, there is a $150 million cat bond with IBRD. But it is understood this was not triggered following Hurricane Beryl’s close passage to the island. Jamaica has a number of disaster risk contingent financing arrangements, some of which, as Dr. Clarke explained previously, were expected to release funds.

Dr. Clarke himself has been very explicit in describing the country’s disaster risk financing arrangements in the aftermath of Hurricane Beryl, especially referring to a layered approach where he has recognized at the topmost level that the catastrophe bond caters to extreme events, and the second layer represented by CCRIF SPC parametric insurance provides further protection.

Yet another payout is to be made, clearly realizing the benefits that CCRIF SPC can bring forth with its parametric insurance coverage. It will help restore Jamaica from damages induced by Hurricane Beryl and act as a very good example of why countries need to have a fully packaged disaster risk financing system.

The case of Jamaica serves as a very good example of how to manage disaster risk among countries prone to natural disasters. A number of insurance and financing options stacked together help take better care of the financial impacts caused by such events in Jamaica. This would ensure that, compared to others, its recovery would be quicker and with less economic disruption.