A Super-Nerdy Insurance Plan Could Save Poor Countries from Damage Caused by Climate Change

Quartz: “CCRIF was, according to its CEO Isaac Anthony, the world’s first ‘multinational parametric insurance company.’ In layman’s terms: it’s insurance for acts of God, designed to help countries rebound quickly after disaster.”

“Parametric insurance makes payments not based on assessed loss, but on the intensity of an event. With a hurricane like Tomas, for instance, CCRIF measures the volume of rainfall and wind speeds. They then compare these factors to models of how much damage the disaster was likely to inflict, taking into account the regions and cities affected. Member countries take out policies with different levels of protection, and within two weeks of a disaster, CCRIF determines what, if any, payment they will make.”

“Parametric insurance makes payments not based on assessed loss, but on the intensity of an event. With a hurricane like Tomas, for instance, CCRIF measures the volume of rainfall and wind speeds. They then compare these factors to models of how much damage the disaster was likely to inflict, taking into account the regions and cities affected. Member countries take out policies with different levels of protection, and within two weeks of a disaster, CCRIF determines what, if any, payment they will make.”

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