Grenada Invests Millions in Disaster Protection

• Grenada will spend over US$2Mn this year to insure itself against hurricanes and other natural disasters, as the country strengthens its financial defences in a region where a single storm can erase years of economic gains. The payment renews coverage under the Caribbean Catastrophe Risk Insurance Facility (CCRIF), a regional risk pool designed to provide rapid payouts when hurricanes, earthquakes or extreme rainfall events cross predefined thresholds. The approach reflects a wider Caribbean shift toward “risk layering”, combining insurance, contingency credit and reserve funds to reduce fiscal shock after disasters.
• Permanent Secretary in the Ministry of Finance Mike Sylvester said the premium has risen from about US$1.8Mn last year, reflecting recent disaster activity in the Caribbean. “You will see that that premium has increased, and of course, that in itself is expected,” he said. “Years before we had (Hurricane) Beryl in Grenada in 2024, and we also had Melissa in Jamaica in 2025, so once there are events and claims and so on, the insurance usually goes up.” He said the cost is significant but unavoidable in a region repeatedly exposed to climate shocks.
• CCRIF is a parametric insurance mechanism that provides payouts when specific hazard conditions are met, allowing governments to access liquidity quickly after disasters. CCRIF currently provides coverage for tropical cyclones, earthquakes, excess rainfall, fisheries and selected utility risks.
• The value of that system is underscored in recent regional events. Following Hurricane Beryl, Grenada received a total of US$44.04Mn from CCRIF across 3 parametric insurance policies within 14 days. Jamaica also received about US$91.9Mn in CCRIF payouts following Hurricane Melissa in 2025, with funds released within 15 days. Together, the figures highlight both the speed and the limits of parametric insurance in small island economies, where liquidity can support recovery but cannot fully absorb the cost of major disasters.
• Forecasts point to a less active 2026 Atlantic hurricane season, Sylvester noted, but he cautioned that even a quieter outlook offers little comfort since “all you need is one major event to create serious problems for us.” Officials are also exploring whether disaster protection can extend further into the wider economy, particularly tourism and small businesses, which remain highly exposed to storm damage.

(Source: Now Grenada)