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Parametric ‘No Longer a Niche Product’
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Parametric insurance is expanding in usage, particularly when paired with traditional policies, according to Dr. Megan Linkin, who heads the parametric natural catastrophe team in the Americas for Swiss Re Corporate Solutions. On this installment, Megan outlines the benefits of parametric, which settles claims based on the intensity of the event itself versus estimated property loss. (Example: amount of rain or level of wind speed.) Parametric is transparent in what is covered, the claims settlement is quick, and the funds can be used immediately for a wide range of uses, Megan says. “It covers things your insurance policy does not. You can use it to jumpstart your recovery efforts.” While public entities were early adopters of parametric, it also is resonating with hospitality, retailers, construction project owners and manufacturers. “It’s no longer a niche product; it’s an accepted insurance product,” she says. Megan grew up fascinated with meteorology, and recalls being glued to Weather Channel’s coverage of Hurricane Andrew in 1992. “We can observe storms, but there’s nothing we can do about them,” she says. “We have to prepare for them and live with them.” We also dive into a favorite topic for we two Jersey natives: food!
