Parametric Solutions and Disaster Risk Management
Our solutions for Latin America, the Caribbean and Iberia
Acting fast in the face of severe catastrophes requires a customised solution. Parametric products bring a simplistic and transparent coverage concept for insurers, companies and the public sector alike. When being confronted with risks such as natural disasters or extreme weather events, industries ranging from tourism and trade to renewable energies and agriculture to government agencies can all avoid liquidity shortages by integrating parametric solutions into their coverage ecosystem. Pre-defined conditions guarantee automatic pay-out when triggered by a major loss event, resulting in a seamless and fast claims settlement process. Parametric solutions are the perfect complement to traditional insurance for policy holders aiming to reduce their risk exposure and bridge the gap between insurable and, so far, uninsurable risks.
You accept the challenge – We take the risk
Key advantages of Parametric Solutions
Innovative solutions and beyond
The building insurance is based on the residual value of mortgages, accompanied by deductibles.
When a major loss event such as an earthquake occurs, financial resources are needed by mortgage holders for additional expenses (e.g. living expenses), not just mortgage and insurance payments.
Financial constraints increase tremendously for mortgage holders accompanied by an increased mortgage default rate for the financial institution.
A parametric coverage for natural disasters will enable the financial institution to provide immediate financial relief to its clients while at the same time minimizing the risk of having to account for defaulted clients.
Tourism Sector in the Caribbean
The hospitality industry often finds it difficult to obtain traditional coverage for an increase in cancelations due to the results of an approaching major event.
When a major loss event such as a hurricane occurs, hotel chains also want to insure themselves against the lack of guests who cancel their trips. A loss of attraction may arise due to severe weather that limits the ability for potential guests to take advantage of the hotel offerings.
A parametric cover can be an adequate solution by covering usually hard to insure exposures. By designing a parametric coverage that automatically pays out once a hurricane with pre-determined wind speeds tracks into the covered region, previously uninsured risks are made insurable. The protection gap can then be closed, and the client will have more financial protection in the case of adverse events.