Munich Re will lead a syndicate – the “Caribbean Catastrophe Risk Insurance Facility” (CCRIF), set up to offer 16 countries in the Caribbean insurance cover against hurricanes and earthquakes.
The syndicate officially opens for business today, June 1.
Munich Re said it “has been working for some time with the World Bank and London broker Benfield and has been closely involved in the CCRIF coverage concept from the outset.”
The bulletin explained that the CCRIF will carry losses up to $10 million, and will obtain additional capacity up to $110 million on the international reinsurance and capital markets. Munich Re is leading the reinsurers’ role
The announcement described an additional feature, created in cooperation with the World Bank, involving “a natural catastrophe swap allowing risks amounting to $20 million assumed by the World Bank to be passed on to Munich Re.” According to Munich Re it will be the first time that emerging countries will have access to the use the capital market “to cover natural catastrophe risks using derivative products.”
Georg Daschner, Munich Re Board member responsible for Europe and Latin America, at the launch of the CCRIF commented: “We are proud to have been able to support the development of the concept from the outset with our extensive risk-assessment and risk-management expertise.”
He added that the program was a role model that “can be exported to other countries. For us, this means new and profitable business opportunities.”
Daschner also noted that the idea behind CCRIF formed an integral part of the reinsurer’s “Changing Gear Program,” in the sense that Munich Re is seeking to “achieve profitable growth through new concepts.”
At the same time, such new coverage concepts can provide protection against the risk of natural hazards also in heavily exposed regions. “This was previously not possible on such a scale. This way we can help the people in the regions concerned,” Daschner explained .
So far, the following states have subscribed to the CCRIF: Anguilla, Antigua & Barbuda, Bahamas, Barbados, Belize, Bermuda, the Cayman Islands, Dominica, Grenada, Haiti, Jamaica, St. Kitts & Nevis, St. Lucia, St. Vincent and the Grenadines, Trinidad & Tobago, the Turks & Caicos Islands.