CCRIF SPC makes full payout to Guatemala under excess rainfall policy

CCRIF SPC reportedly made a payout on July 1st of $6,376,184 to the Government of Guatemala following heavy rains from June 13th to 19th.

According to CCRIF, this payout represents the Government of Guatemala’s full payout under its excess rainfall (XSR) policy, meaning that the policy has reached its coverage limit.

The firm trusts that the payout “will provide a measure of financial support to assist the Government in its most urgent relief efforts.”

CCRIF also expressed sympathy with the Government and people of Guatemala for the loss of life and the impacts on communities and infrastructure caused by this event.

CCRIF continued, “Due to the increasing frequency, intensity, and unpredictability of climate-related hazards, CCRIF has been developing policy features (or endorsements) to enhance its main parametric insurance policies.

“One such feature is the Reinstatement of Sum Insured Cover (RSIC), which was introduced by CCRIF for tropical cyclone and earthquake policies as far back as 2017 when the Facility celebrated its 10th anniversary.”

CCRIF reportedly made the RSIC available for XSR policies for the first time for the 2024/25 policy year.

“The RSIC allows a member government’s policy to be reinstated if it reaches the coverage limit before the end of the policy year,” the firm explained.

CCRIF went on, “Guatemala purchased the RSIC under its XSR policy – ​​at a cost that is a small fraction of the main policy premium. This means that, following the triggering of the policy to its limit, the XSR policy was immediately reinstated to the full coverage limit of US$6.38 million.

“Therefore, Guatemala will continue to be financially protected against excess rainfall events until the end of the policy year on May 31, 2025, or until the coverage limit of the policy is reached again as a result of one or more rainfall events prior to that date.”

In related news, CCRIF members also recently renewed their insurance policies for the 2024/25 policy year, which began on June 1st.

CCRIF CEO, Isaac Anthony, stated, “For 2024/25, total coverage has increased by 10 per cent compared with last year. This demonstrates our members’ commitment to investing in financial protection against natural hazards.”