Caribbean Risk Managers Ltd. (CaribRM), in partnership with the Development Bank of Jamaica (DBJ), has been selected as one of 20 finalists at the Marketplace on Innovative Financial Solutions for Development competition to be held in Paris from 4 to 5 March 2010.
The Marketplace (www.fininnov.org) is co-hosted by the Agence Française de Développement (AFD), the Bill & Melinda Gates Foundation and the World Bank. Its aim is to garner and highlight fresh ideas on financial solutions for development.
CaribRM’s CEO, Dr Simon Young, explained: “Our concept is to utilize index-based insurance, which estimates catastrophe loss using models, to address the issue of loan portfolio stability. We are seeking support to develop a product that will enable cost-effective transfer of a key portion of the catastrophe risk of the DBJ’s agricultural and small business loan portfolio.”
Matthew Pragnell CEO, CGM Gallagher Group, parent company of CaribRM, added: “Utilizing insurance to smooth volatility in loan default rate due to catastrophe events will enable DBJ to provide a more stable flow of funds to its clients, while attracting further investment from International Financial Institutions and the wider donor community.”
CaribRM’s bulletin noted that the “initiative would also enhance conditions for the development of micro-finance across the Caribbean region and beyond, thereby allowing greater access to critically needed finance by the rural poor.”
Dorothea Simpson, DBJ Director of Finance, stated: “The Development Bank of Jamaica is committed to national development through agriculture. We are excited at the prospect of introducing an index-based insurance to protect our farmers who come under threat from natural catastrophe risk,”
CaribRM said its “proposal was selected as one of the most innovative ideas out of a pool of over 800 applicants who responded to the open call for proposals during the autumn of 2009. 110 specialists in innovative finance, together with development experts from inside and outside of the organizing institutions, selected the most promising as finalists. Finalists covered more than 15 developing countries across five continents from a variety of organizations ranging from small local NGOs to large multinational corporations to international development agencies.
“As one of the 20 finalists, CaribRM will participate in the final grant competition in which up to 5 grants of up to US$100,000 each will be awarded. CaribRM’s proposal is entitled “Natural Catastrophe Protection for the Development Bank of Jamaica’s Agricultural and Microfinance Loan Portfolio”.
CaribRM was formed following a merger between GeoSY Limited and what is now the CGM Gallagher Group. It is the only Caribbean-based risk management company to offer cat modeling, analytical and risk surveying solutions. The company’s client base comprises a wide variety of regional and global re/insurance brokers as well as individual private and public sector clients including the World Bank and many Caribbean Governments. Caribbean Risk Managers Ltd is the Facility Supervisor of the Caribbean Catastrophe Risk Insurance Facility (CCRIF).
Source: CGM Gallagher Group – www.cgmgallagher.com
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