WASHINGTON, Aug. 16, CMC – The Inter-American Development Bank (IDB) says Belize will have faster access to emergency financing following major hurricanes under a new “catastrophe swap” designed to strengthen the Caribbean country’s financial resilience to natural disasters.
The Washington-based financial institution said it has arranged for a portion of Belize’s hurricane risk to be transferred to international reinsurance markets through Swiss Re, which is providing the underlying parametric insurance coverage.
The protection, which runs from August 1, 2026 to May 31, 2028, will provide rapid financing when predetermined hurricane triggers are met.
The IDB said the transaction provides coverage of up to US$20 million, with a maximum payout of US$10 million in each policy year.
It is the first transaction of its kind undertaken by the IDB and forms part of efforts to expand innovative disaster-risk financing through the Ready and Resilient Americas financial instruments (FIRRe).
“The operation creates a blueprint for strengthening resilience across Latin America and the Caribbean by showcasing how countries can transfer disaster risks to international markets and access rapid liquidity following extreme events,” the bank said.
The IDB said the catastrophe swap forms part of its wider support for Belize in implementing its financial risk-management strategy and strengthening its ability to withstand the economic impact of natural disasters.
The new protection complements US$25 million in contingent financing already available to Belize through the IDB’s Contingent Credit Facility for Natural Disaster Emergencies.
Belize also has US$118 million in approved loans protected by Climate Resilient Debt Clauses, which allow the government to postpone principal payments for two years following an eligible natural disaster.
The catastrophe swap is supported by technical cooperation resources from the Ready and Resilient Americas Initiative, donor contributions from the French Climate Fund and a contribution from the Belize government towards the premium.
The IDB said the arrangement demonstrates the importance of partnerships in expanding innovative financial solutions for disaster resilience and reflects Belize’s commitment to strengthening its financial preparedness for extreme weather events.
CMC/nk/kb/2026