Finance Minister Dr. Nigel Clarke says the facility will provide US$150 million in coverage, in the event Jamaica is impacted by named storms.
By Javaughn Keyes
Jamaica has secured its second catastrophe bond, with assistance from the World Bank.
Finance Minister Dr. Nigel Clarke says the facility will provide more than US$100 million in coverage, in the event of damage from named storm events.
"The catastrophe bond is a risk transfer instrument that allows Jamaica to transfer the fiscal risk of a direct hit by a hurricane to international capital market. International investors put up the principal amount of the bond in the amount of US$150 million or just under $24 billion and those funds are held in trust by the World Bank. Jamaica pays an annual premium and in the event of a direct hit by a hurricane, the World Bank pays out to Jamaica according to the severity of the hurricane and the location," he explained.
Jamaica will benefit from this coverage for the hurricane seasons up to 2027.
The Facility will trade on the Hong Kong Exchange.
In 2021, Jamaica became the first developing country in the world to independently sponsor a Catastrophe Bond.
comments powered by Disqus
All feeds
