Parametric insurance
A type of insurance that does not indemnify the pure loss but agrees before the event to make a payment dependent on an index. Also known as index insurance. (Clarke and Dercon, 2016).
Crisis protection gap
The difference between expected crisis costs and funding already arranged to cover them.
Attachment point
The loss level above which a reinsurer begins paying under a reinsurance agreement.
Contingent loan (or credit) and grants
A pre approved loan or grant released automatically when agreed crisis conditions or triggers are met.
Sovereign insurance
Sovereign insurance is insurance coverage purchased by a national government to protect its budget against the financial impacts of disasters.
Hazard
A natural or human process that can cause injury, damage or disruption.
Cost multiple
The cost multiple measures the average amount a government pays to receive USD 1 of payout from a financing instrument over its lifetime.
