Belize secures $20 million hurricane protection via IDB catastrophe swap

Belize has secured $20 million in hurricane disaster protection through a sovereign parametric catastrophe swap arranged by the Inter-American Development Bank (IDB). The transaction, underwritten by Swiss Re, marks the first time the IDB has facilitated this specific type of disaster risk transfer for a member country.

The coverage is active from August 1, 2024, through May 31, 2028, specifically protecting Belize during the 2026 and 2027 hurricane seasons. Under the terms of the agreement, Belize is eligible for a maximum payout of $10 million per policy year if pre-agreed parametric triggers, such as specific storm strength or location, are met.

Unlike traditional insurance that requires damage assessments before payouts, parametric coverage provides rapid access to funds once storm conditions are verified. The initiative was supported by the IDB’s Ready and Resilient Americas program and contributions from the French Climate Fund. This arrangement complements Belize’s existing disaster-financing tools, including emergency credit and climate-related loan clauses.