Hawaii insurer launches parametric insurance for hurricane damage
The program from First Insurance Company of Hawaii offers coverage for damage below the deductible of most hurricane policies.
Just days after Hurricane Douglas narrowly missed the Hawaii islands, First Insurance Company of Hawaii (FICOH) launched an affordable and flexible parametric insurance product for Hawaii homeowners and renters. The program is designed to close the gaps left by other insurance programs while simplifying claims and speeding up recovery for insureds.
The program, called FirstTrack, provides coverage for hurricane damage expenses that fall below the deductible on most hurricane policies. FirstTrack is the first admitted parametric insurance product in the United States and is the first parametric insurance product in the Hawaii market.
The policy covers emergency supplies, debris removal, food spoilage resulting from blackouts, and lost wages, and the policy can be used to offset deductibles for a renter or homeowner insurance policy.
To prevent the delay of payments after a lengthy and potentially arduous claim process, the program bases payments on the storm wind speed and the proximity of the storm to the insured home and gives insureds a predetermined payment amount based upon the above parameters. After the parameters are met, the policyholders are paid within days after a covered event. So, the closer the storm is to the home, the higher the payment would be.
Learn more about the FirstTrack program here.
Editor’s Note: Had Hurricane Douglas made landfall, it would have been only the third hurricane in modern history to hit Hawaii. Although an actual hurricane eye crossing the islands is very rare, the number and severity of hurricanes annually have been increasing across the globe. For Hawaii, parametric hurricane insurance seems a little premature; however, parametric hurricane insurance in areas often affected by the storms will likely increase in popularity in the coming years.
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