Caribbean governments buy excess rainfall insurance

A little disclosure--I used to work at Swiss Re. From the Jamaica Observer: The Caribbean Catastrophe Risk Insurance Facility (CCRIF) announced on Monday that eight of its members have purchased excess rainfall insurance coverage for the 2014/2015 policy year. The countires — Anguilla, Haiti, Barbados, Dominica, Grenada, St Kitts & Nevis, St Vincent & the Grenadines and Saint Lucia — are the first of the 16-member group to have made the step. All members have had CCRIF hurricane and/or earthquake policies since 2007.

"The excess rainfall product," CCRIF said in a statement to the media, "is aimed primarily at extreme high rainfall events of short duration (a few hours to a few days), whether they happen during a tropical cyclone or not."

"Like CCRIF's tropical cyclone and earthquake insurance, the excess rainfall product is parametric and estimates the impacts of heavy rain using satellite rainfall data from the Tropical Rainfall Measurement Mission (TRMM) and exposure from
CCRIF's risk estimation database. Because the product is parametric, a payout can be made quickly (within 14 days) after a rain event that triggers a country's policy, without waiting for time-consuming damage and loss assessments on the ground," the insurers said.

The excess rainfall product was developed by CCRIF and global reinsurer Swiss Re. " We commend our eight members for taking the initiative and purchasing this ground-breaking product and hope that other countries in the region will follow," said CCRIF CEO Isaac Anthony, who added that Caribbean governments have eagerly awaited the new product as rainfall and flooding cause considerable damage in the region every year....