Glossary

Risk transfer

When disaster risk is shifted to insurers or capital markets.

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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

Hazard

A natural or human process that can cause injury, damage or disruption.

Crisis protection gap

The difference between expected crisis costs and funding already arranged to cover them.

Disaster risk financing

Financial arrangements made in advance to pay for disaster prevention, response and recovery.

Basis risk

The gap between measured indicators and real losses causing payouts to differ from actual damage.

Development bank

A public financial institution providing loans, grants and expertise to support development goals.

Ex ante

Actions, decisions or financial arrangements made before a disaster or crisis occurs.