GILLINGS
A CONTRACT in the amount of US$495,000 to develop the financial risk strategy component of the Caribbean Catastrophe Risk Insurance Facility (CCRIF) was signed yesterday between the Jamaica Social Investment Fund (JSIF) and CGM Group, a Caribbean and United States-based consortium.
The CGM Group was selected based on an international competitive process, which involved the submission of proposals by interested consultants. The JSIF's managing director, Scarlette Gillings signed the contract at the JSIF offices located in New Kingston.
CGM Group chief executive officer Matthew Pragnell in his remarks made reference to the devastation caused by Hurricane Ivan in the Caribbean, Hurricane Katrina in the United States as well as the negative impact of the el Niño effect which highlight the timeliness of the Caribbean Catastrophe Risk Insurance Facility for CARICOM states.
The CCRIF is a facility through which CARICOM states will be able to purchase insurance policies against adverse natural events like earthquakes and hurricanes of specific return periods with claim payments depending on specific parametric triggers.
MAIN BENEFITS
The main benefits of this regional insurance facility include the provisions of an efficient risk transfer mechanism through parametric instrument, risk pooling and economies of scale that would enable optimal pricing from re-insurers. The sharing of administrative and operational costs is another advantage.
In October of 2005, the Minister of Finance and Planning, Dr. Omar Davies and counsellor of political science and general public affairs at the Japanese Embassy, Katsumi Maruoka, signed the grant agreement through which funding is provided to procure the consultant services for the relevant studies and preparation of the facility.
This is the second contract signed under the CCRIF as EQECAT Inc of the U.S.A. signed a contract with JSIF in February of this year to develop a risk model for the Facility.
The results of these studies will be presented to and discussed with the donor community and CARICOM governments during a workshop scheduled for the middle of 2006.
