Glossary

Risk retention

When governments retain and finance disaster costs themselves.

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This report offers an in-depth assessment of pre-arranged financing tools using seven key criteria for ensuring pre-arranged financing reduces the human and financial costs of disasters

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other key terms

Total crisis financing

Development funding focused mainly on crisis prevention, preparedness and response activities.

Disaster

A severe event causing widespread harm that exceeds a community’s ability to cope alone.

Covariate shocks

Shocks affecting many households at once where losses are shared across the same community.

Accountability

Being responsible for decisions and resources, listening to affected people, and accepting consequences for actions taken.

Contingent liabilities

Possible financial obligations that only become real if specific future events occur.

Attachment point

The loss level above which a reinsurer begins paying under a reinsurance agreement.