Jamaica Can Access Up to US$820 Million in Disaster-Risk Financing After Hurricane Melissa
In the wake of Hurricane Melissa, which tore through Jamaica in late October 2025, the country now has access to as much as US$820 million in disaster-risk financing through a combination of insurance payouts, catastrophe bonds, and credit lines. The funding forms part of the government’s multi-layered disaster-risk financing strategy, designed to strengthen the nation’s capacity to respond swiftly to natural disasters.
The most substantial component comes from a US$150 million catastrophe bond issued in April 2024 with the support of the World Bank. The bond provides coverage for extreme hurricane events, and its triggers are expected to be fully met by the severity of Hurricane Melissa’s impact. Investors who purchased the bond will likely forfeit their principal, enabling Jamaica to receive the payout instead (World Bank, 2024).
Jamaica also maintains US$210 million in parametric insurance coverage through the Caribbean Catastrophe Risk Insurance Facility (CCRIF). These policies ensure rapid access to funds following specific disaster events — such as tropical cyclones or excess rainfall — with payouts determined by the event’s physical intensity rather than damage assessments (CCRIF SPC, n.d.).
The remainder of available resources includes the government’s contingent reserves and pre-arranged credit lines, which add further liquidity to support recovery and relief operations (Ministry of Finance and the Public Service, n.d.).
Hurricane Melissa marks the second major storm in two years to test Jamaica’s disaster-financing system. In July 2024, the country received multiple payments from CCRIF following Hurricane Beryl, when both tropical cyclone and excess rainfall coverage were triggered (CCRIF SPC, 2024).
Together, these mechanisms underscore Jamaica’s commitment to financial resilience in an era when climate-related disasters are becoming more frequent and severe (World Bank DRFIP, n.d.).
References
- Caribbean Catastrophe Risk Insurance Facility (CCRIF SPC). (n.d.). About CCRIF SPC. Retrieved from https://www.ccrif.org/
- Caribbean Catastrophe Risk Insurance Facility (CCRIF SPC). (2024). Hurricane Beryl Payouts to Jamaica. Retrieved from https://www.ccrif.org/news/
- Ministry of Finance and the Public Service. (n.d.). Disaster Risk Financing Strategy. Government of Jamaica. Retrieved from https://mof.gov.jm/
- World Bank. (2024, April 4). Jamaica Catastrophe Bond for Hurricanes Provides US$150 Million in Coverage. Retrieved from https://www.worldbank.org/en/news/press-release/2024/04/04/jamaica-catastrophe-bond-for-hurricanes
- World Bank Disaster Risk Financing and Insurance Program (DRFIP). (n.d.). Disaster Risk Financing Overview. Retrieved from https://www.worldbank.org/en/programs/disaster-risk-financing-and-insurance-program
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