How Jamaica’s Smart $150M “Cat Bond” Move Is Turning The Disaster Into Much Needed Fast Cash
When Hurricane Melissa came barreling through, Jamaica didn’t just have sandbags and a prayer — it had a financial snorkel. Last year the island issued a $150 million catastrophe (“cat”) bond , and because the deal pays out when certain storm parameters are met, Jamaica stands to get money in hand within days to fix roads, power and phone lines. It’s the sort of tidy civic planning that makes accountants weep tears of joy while meteorologists continue to look guilty. Why This Feels Like Clever Planning (and not just luck) Jamaica’s risk team designed the bond to trigger on objective meteorological thresholds — namely the storm’s central air pressure when it made landfall over pre-defined geographic “boxes” around the island. Florian Steiger , CEO of Icosa Investments , put it plainly: “They are linked to the central pressure of the hurricane when it makes landfall.” That third-party verification is what turns subjective damage assessments into a fast, for...