Glossary

Risk profile

Underlying risks that an organisation or country is exposed to, the amount of financial protection needed and that is expected to be covered by pre-arranged financing instrument(s), and where there are funding gaps.

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This guidance note has been developed to help the increasing number of countries and organisations that are considering or using pre-arranged financing instruments.

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other key terms

Social protection

Policies and programmes designed to reduce and prevent poverty and vulnerability throughout the life cycle.

Indemnity insurance

Insurance that pays based on assessed losses after damage to a specific asset.

Adaptive social protection

Social protection systems that adjust to shocks, helping vulnerable people prepare, cope and recover over time.

Index

A measurable indicator used to estimate losses and trigger financial payouts.

Contingent loan (or credit) and grants

A pre approved loan or grant released automatically when agreed crisis conditions or triggers are met.

Risk transfer

When disaster risk is shifted to insurers or capital markets.