Evaluating Sovereign Disaster Risk Finance Strategies : A Framework
This paper proposes a framework for ex ante evaluation of sovereign disaster risk finance instruments available to governments for funding disaster losses. The framework can be used by governments to help choose between different financial instrume...
| Main Authors: | , , , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2016/06/26510520/evaluating-sovereign-disaster-risk-finance-strategies-framework http://hdl.handle.net/10986/24637 |
| Summary: | This paper proposes a framework for ex
ante evaluation of sovereign disaster risk finance
instruments available to governments for funding disaster
losses. The framework can be used by governments to help
choose between different financial instruments, or between
different combinations of instruments, to achieve
appropriate and financially efficient strategies to fund
disaster losses, taking into account the risk of disasters,
economic conditions, and political constraints. The paper
discusses the framework in the context of a hypothetical
country, with parameters selected to represent a
disaster-prone small island state. The paper shows how a mix
of instruments can be chosen to minimize the economic
opportunity cost given the underlying disaster risk faced
and prevailing economic and financial conditions. |
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