Index
In risk finance, an index is an indicator or measure that is chosen to be a good proxy for a type of shock, and used to determine payouts. For example, tropical cyclone categories used as an index for property damage or area average yield as a measure of lost agricultural production. Modelled estimates of damage costs are also used as indices (Centre for Disaster Protection).
Risk layering
Using different financial instruments for different disaster frequencies.
Attachment point
The loss level above which a reinsurer begins paying under a reinsurance agreement.
Total crisis financing
Development funding focused mainly on crisis prevention, preparedness and response activities.
Shock-responsive social protection
Social protection systems adapted to scale quickly when large shocks affect many people.
Pre-arranged financing
Financing approved before crises that is released automatically when agreed triggers are met.
Contingent loan (or credit) and grants
A pre approved loan released automatically when agreed crisis conditions or triggers are met.
