Search
 
Commentary

Closing the protection gap with parametric hurricane insurance in the U.S.

What insurance agents, brokers and property owners need to know about U.S. parametric hurricane insurance.

By Alok Jha, Tony Manzitto | Updated on June 19, 2017
Parametric insurance may help property owners repair damage more quickly after a natural disaster. (Photo: Shutterstock)

Although we tend to think of emerging markets as underinsured, it may surprise you to know the United States also has a sizeable protection gap in the difference between total economic losses and insured losses. The problem is magnified by natural catastrophes. Windstorms and earthquakes can cause damage to a wide range of assets that aren’t insured, forcing people to pay for losses that aren’t covered.

In developing nations, parametric insurance is helping close the gap by providing rapid payouts with minimal claims intervention. One such example is a business interruption coverage offered by MiCRO and Swiss Re in Guatemala. That model can be adapted in developed nations and is already showing tremendous potential in places where extreme weather events are a statistical certainty.

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.

INCLUDED IN A DIGITAL MEMBERSHIP:

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

PropertyCasualty360

Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join PropertyCasualty360.com now!

  • Unlimited access to PropertyCasualty360.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including BenefitsPRO.com, ThinkAdvisor.com and Law.com
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2024 ALM Global, LLC. All Rights Reserved.