THE catastrophic risk insurance shared by the countries of the Caribbean could serve as a model for collective strategies for dealing with natural disasters resulting from climate change, says the World Bank’s lead economist for Latin America and the Caribbean John Nash.

Nash said the Caribbean Catastrophe Risk Insurance Facility (CCRIF), which will provide participating governments from the region with immediate access to cash if hit by a hurricane or earthquake would save countries significantly.

“Pooling their risk will save the 18 participating countries approximately 40 per cent in individual premium payments,” he said.

He said exploratory work is underway for a similar facility for the Central American countries.

“We have also been working with countries of the region to establish or improve their agricultural weather insurance systems, and to develop the capacity to lay off some of the risk in international reinsurance markets, which will be helpful in mitigating the impact of changing weather patterns on agricultural production,” Nash said.

“Unfortunately, in a number of countries, the infrastructure for monitoring weather has actually deteriorated over the years. This will need to be rectified, which will require investments, and the local insurance markets will need to be deepened.”

Nash’s comments came in response to questions posed by Tierramérica, a specialised news service produced by IPS, for its “First Regional Report on Climate Change: Latin America and the Irreversible Effects of a Warmer Planet”.