The Insurance Authority (IA) of Hong Kong has recognised the successful issue and listing of a catastrophe bond by the International Bank for Reconstruction and Development, part of the World Bank Group.
The bond, amounting to US$150 million, aims to shield Jamaica from storm-related losses through the next four hurricane seasons.
IA CEO Clement Cheung highlighted the role of insurance-linked securities (ILS) in disaster risk reduction.
“The citizens in Hong Kong are no stranger to the devastating impact of tropical cyclones. This issuance of insurance-linked securities (ILS) shows clearly that we care for and are willing to support economies in mitigating the risks arising from natural disasters,” he said. “Going forward, we will dedicate efforts to forging an ecosystem that nourishes institutional investors, data modelling capabilities, and professional talents.”
Jorge Familiar, vice president and treasurer of the World Bank, also commented on the initiative, noting its benefits to the Jamaican government in preparing financially for future hurricanes.
“We are pleased to support the government of Jamaica in their financial preparation for responding to future hurricane events. This catastrophe bond serves as another example of how developing countries can mitigate disruptive economic impacts brought by natural disasters,” he said. “We are proud to have partnered with the IA on this transaction and in further developing the ILS market for our clients.”
The issuance is part of a broader trend in Hong Kong, which, since 2021, has introduced a bespoke regulatory regime and a pilot grant scheme, leading to five ILS issuances totalling roughly US$713 million.
In other news from the IA, a notice has been issued about a deceptive website that falsely presented itself as an official platform for a legitimate insurance provider in Hong Kong.
