Nicaragua Catastrophe Risk Insurance Project

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The Honduras and Nicaragua Catastrophe Risk Insurance Project for Central America objective is to enable the access of Honduras and Nicaragua to efficient sovereign risk insurance associated with tropical cyclones, earthquakes, and or excess rainfall. This will be achieved by financing the entrance fee and insurance premium for Honduras for seven years and Nicaragua for four years in a regional initiative linking current Caribbean Community (CARICOM) members of the Caribbean Catastrophe Risk Insurance Facility (CCRIF) together with Council of Ministers of Finance of Central America and the Dominican Republic (COSEFIN) countries. To extend the timeline of the proposed Project, individual countries may choose to pay a portion of the annual premium, thereby allowing remaining project finance to be used towards additional years of insurance premium payments. The project consists of two components: (1) payment of the entrance fee to the CCRIF for Honduras and Nicaragua, this component is to assist Honduras and Nicaragua to join the CCRIF by financing their entrance fees; and (2) payment of annual insurance premium to the CCRIF for Honduras and Nicaragua, this component is to assist Honduras and Nicaragua to purchase the catastrophe insurance coverage offered by the CCRIF for seven years for Honduras and four years for Nicaragua.