Catastrophe bond

{
  "id": "MLC-T-INS-000706",
  "term": "Catastrophe bond",
  "field": "Insurance and risk management",
  "definition": "A type of insurance-linked security that transfers specific catastrophic risks, such as hurricanes or earthquakes, from an insurer or reinsurer to investors in the capital markets. Investors receive interest payments and a return of principal if no covered catastrophe occurs. If a defined catastrophic event triggers the bond, investors may lose some or all of their principal, which is then used to pay claims.",
  "url": "https://mlchart.com/terminology/insurance/catastrophe-bond/"
}