On July 17, 2026, a potent 7.3 magnitude earthquake struck off the southern coast of Mexico near Puerto Madero, shaking the regions of southern Mexico, Guatemala, and El Salvador. While initial assessments raised concerns about a potential tsunami, the highest wave recorded was only 0.3 meters, with local authorities reporting no significant damage or casualties. This earthquake, however, narrowly missed triggering a payout from Mexico’s World Bank-funded catastrophe bond, which had provisions for disaster insurance but required a stronger quake. The incident highlights the intricate design needed in parametric triggers for such bonds. Additionally, Mexico’s government has increased its catastrophe insurance coverage to $575 million for the upcoming year.
