CCRIF SPV Parametric Coverage Pays Out to Panama for Rainfall Event

CCRIF SPV has made $26.7 million in parametric insurance payments to the government of Panama to cover losses associated with a rainfall event that affected the country from October 31 to November 4.

According to reports, the rainfall event caused landslides, flooding, fallen trees, the collapse of some bridges, and crop losses in some areas. Some 1,500 people were affected, with 11 people losing their lives due to the heavy rains.

Panama has two CCRIF policies for excess rainfall and one policy for earthquakes. The parametric insurance through CCRIF is part of Panama's national strategy to protect the country against natural disasters. That strategy also includes contingent credit lines from the World Bank and the Inter-American Development Bank.

Previously known as the Caribbean Catastrophe Risk Insurance Facility Segregated Portfolio Company, CCRIF SPC is a segregated portfolio (SP) company that is owned, operated, and registered in the Caribbean. It limits the financial impact of such disasters as catastrophic hurricanes, earthquakes, and excess rainfall events on Caribbean and Central American governments by quickly providing short-term liquidity when a parametric insurance policy is triggered.

CCRIF's parametric insurance was specifically designed to cover high-intensity, low-frequency events and provide quick liquidity within 14 days of an event if a policy is triggered.

In the last 5 years, CCRIF members have been routinely ceding more than $1 billion in insurance coverage to CCRIF. For the 2024–2025 policy year, the total amount of coverage purchased by CCRIF members increased by 10 percent over the previous policy year, a CCRIF statement said.

CCRIF has made 13 payouts in the current policy year, which began June 1. Since its formation in 2007, CCRIF has made 77 payouts totaling $385.2 million. CCRIF currently has 30 members including 19 Caribbean governments, 4 Central American governments, 3 electric utility companies, 3 water utility companies, and a tourist attraction.

CCRIF SPC was developed under the technical leadership of the World Bank and with a grant from the government of Japan. It was capitalized through contributions to a multidonor trust fund by the government of Canada, the European Union, the World Bank, the governments of the United Kingdom and France, the Caribbean Development Bank, and the governments of Ireland and Bermuda, as well as through membership fees paid by participating governments.