Q. What are public catastrophe funds?

A.
A public catastrophe fund is a pre-disaster measure where the government implicitly self-insures by setting aside money to finance some of the recovery needs following a disaster. Alternatively, the government can mobilize its own financing sources by such policy instruments as imposing taxes, borrowing domestically or internationally, or diverting from the public budget.

For more information, please refer to "Risk sharing in flood management"