CCRIF introduced multi-layered policies for the first time for 2026/27. Technical Brief #1 2026, Multi-Layered Policies: How They Work and How They Support CCRIF Members’ Disaster Risk Financing Strategies, explains these new multi-layered policies and how they compare with the traditional policies.
A multi-layered parametric insurance policy enables members to select different coverage limits for different layers of risk. This gives members greater flexibility to tailor coverage to their unique risk profiles. Multi-layered policies effectively stack two policy layers on top of one another, each with its own attachment point, exhaustion point and ceding percentage. This means a member can set different coverage limits for different layers of risk within a single policy, prioritizing payouts for frequent, lower-severity events, concentrating protection against rare, catastrophic events, or maintaining a balanced structure across both.
Importantly, the same premium can be distributed in different ways to achieve very different outcomes: a lower-layer priority structure maximizes payouts for moderate, more frequent shocks to protect annual budgets, while a higher-layer priority structure channels more of the premium into the upper layer to safeguard debt and macro-fiscal stability against high-impact disasters.
Multi-layered policies are best viewed not merely as technical instruments but as essential fiscal-strategy tools, shaping how CCRIF coverage complements reserves, contingent credit and other disaster risk financing instruments.
CCRIF will continue working closely with members to help each select the structure that best supports its national disaster risk financing strategy.
