Key Challenges for the Region
Hurricanes can cause severe infrastructure damage, disrupting regional supply chains and causing delays in deliveries and operational inefficiencies.
Mandatory evacuations can lead to prolonged business closures, contributing to widespread non-damage business interruption (NDBI).
Utility outages (power, water, internet) can force businesses to suspend operations, compounding economic losses despite limited physical damage.
Key benefits of parametric insurance
In 2024, Hurricane Milton was one of the most devastating natural disasters to impact both the U.S. and Mexico. In Florida, many businesses suffered not only extensive property damage but also non-damage business interruption (NDBI).
Descartes’ Parametric Hurricane Insurance: Comprehensive Coverage for Those at Risk
Descartes’ Cat-in-a-Circle parametric solution offers a cost-effective way for businesses to enhance their risk coverage, ensuring swift payouts and comprehensive protection.
case study example
Parametric Hurricane Solution for Florida
A corporation based in Tampa, Florida was severely impacted by Hurricane Milton, facing multiple operational risks.
Problem
Mandatory evacuations, widespread power outages, and other logistical disruptions led to significant financial losses. However, the company’s traditional insurance policy did not cover these non-damage business interruption (NDBI) effects, leaving them financially vulnerable.
Solution
To mitigate similar risks in the future, the company could complement their traditional insurance policy with Descartes’ parametric solution. This approach ensures both direct and indirect financial losses are covered, providing fully transparent terms and effectively closing the coverage gap.
Our Cat-in-a-Circle product is designed to trigger payouts based on objective parameters: it monitors both the cyclone’s proximity to the insured location and its maximum sustained wind speed.
Result
If a Category 3 hurricane were to pass within 10 miles of the location with wind speeds reaching 115 mph, the policy would trigger a rapid payout of 15% of the location limit.


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