Haitian Quake Could Mean “Significant Payout” From CCRIF
Jan/12/2010 07:04 PM Filed in: Catastrophe
Bonds
The
Caribbean-based catastrophe fund will face a major
test.
Haiti will likely
have a significant claim against the
Caribbean
Catastrophic Risk Insurance Facility
(CCRIF) following the
recent earthquake, according to Simon
Young, PhD,
CEO of CaribRM.
CaribRM is a risk consulting firm that focuses on the Caribbean region and also acts as facility supervisor for the CCRIF.
“We’ve already done a preliminary calculation and Haiti could see a significant payout,” says Young. “Haiti did not have as much earthquake cover as hurricane, but that is typical of the region.”
Earlier today, the United States Geological Survey reported that a magnitude 7.0 quake struck about 10 miles southwest of the Haitian capital Port-au-Prince.
The CCRIF was created in 2007 as a parametric catastrophe pool by 17 regional governments and the World Bank.
Young described today’s earthquake as a fifty to one hundred year event for the northern section of the Caribbean Arc, a geological boundary within the region.
Given that the quake occurred in a developing region, Young said he expects a majority of recovery and rebuilding funds to come from the public sector.
However, he adds that today’s event will also cause a reconsideration of earthquake risk in the Caribbean.
“There will be a lot of rethinking about the role of insurance and risk transfer and quake risks, especially given it was a very quiet hurricane season,” Young says.
CaribRM is a risk consulting firm that focuses on the Caribbean region and also acts as facility supervisor for the CCRIF.
“We’ve already done a preliminary calculation and Haiti could see a significant payout,” says Young. “Haiti did not have as much earthquake cover as hurricane, but that is typical of the region.”
Earlier today, the United States Geological Survey reported that a magnitude 7.0 quake struck about 10 miles southwest of the Haitian capital Port-au-Prince.
The CCRIF was created in 2007 as a parametric catastrophe pool by 17 regional governments and the World Bank.
Young described today’s earthquake as a fifty to one hundred year event for the northern section of the Caribbean Arc, a geological boundary within the region.
Given that the quake occurred in a developing region, Young said he expects a majority of recovery and rebuilding funds to come from the public sector.
However, he adds that today’s event will also cause a reconsideration of earthquake risk in the Caribbean.
“There will be a lot of rethinking about the role of insurance and risk transfer and quake risks, especially given it was a very quiet hurricane season,” Young says.