Government of Jamaica issues Historic Catastrophe Bond

• The GOJ created history, on July 23, 2021, with the successful completion of a catastrophe bond (CAT bond) issuance through the World Bank (International Bank for Reconstruction and Development (IBRD)) that secured US$185.0Mn in financial protection against major hurricanes. 
• The Jamaican government is the first in the Caribbean and the first island state in the world to independently access the CAT bond market. The bond was issued under the World Bank’s “capital at risk” notes program and will provide the GOJ with critical disaster insurance protection against losses from named storms across three Atlantic hurricane seasons up to December 2023. 
• This historic transaction transfers financial risk associated with tropical cyclones and hurricanes to the international capital market. Along with the other layers of disaster risk financing that have been put in place, the CAT bond strengthens Jamaica’s ability to finance the emergency costs of hurricanes and tropical cyclone, which improves the country’s economic resilience against these economic shocks.

(Source: Ministry of Finance)