Parametric insurance is insurance
in which the payment is triggered by reference to a pre-determined
parameter or 'index' that stands as a proxy for loss. For
example, a policy designed to provide funding to a policyholder in
flood or drought conditions could be triggered by excess or
insufficient rainfall measured by a local weather station.
Parametric insurance has wide-ranging applications, from renewable
energy to flight cancellation to agriculture.
This article was originally posted on Commercial Risk
Online here: https://www.commercialriskonline.com/bridging-protection-gap-novel-forms-risk-transfer/
Parametric insurance is insurance in which the payment is
triggered by reference to a pre-determined parameter or
'index' that stands as a proxy for loss. For example, a
policy designed to provide funding to a policyholder in flood or
drought conditions could be triggered by excess or insufficient
rainfall measured by a local weather station. Parametric
