Sovereign insurance
Sovereign insurance is insurance coverage purchased by a national government to protect its budget against the financial impacts of disasters. Under these arrangements, the government pays a premium and receives a payout when a predefined disaster trigger is met
This working paper presents a framework that compares contingent loans, grants from multilateral development banks, catastrophe bonds, and insurance provided through regional risk pools.
Read moreAdaptive social protection
Social protection systems that adjust to shocks, helping vulnerable people prepare, cope and recover over time.
Risk transfer
When disaster risk is shifted to insurers or capital markets.
Basis risk
The gap between measured indicators and real losses causing payouts to differ from actual damage.
Early warning system
Systems that monitor hazards and share information early, so people can act in time.
Ex ante
Actions, decisions or financial arrangements made before a disaster or crisis occurs.
Risk layering
Using different financial instruments for different disaster frequencies.
