Under the terms of non indemnity-based catastrophe bonds, for the sponsoring insurance company to collect part or the investors entire principal when the catastrophe occurs, an independent third party must confirm that the objective catastrophic event was met such as reaching i.e. 7.0 in local magnitude as reported by the National Geological Survey Moreover, the Bond Market Association(B.M.A, 2002) commented that there are often compelling reasons for sponsors of the risk-linked securities to use non indemnity based strutures