Key Challenges for the Region
High Exposure to Typhoons: Taiwan faces recurring natural disasters driven by severe windstorms, torrential rains, and flooding, placing major stress on local insurers.
Industrial Concentration in High-Risk Zones: Critical manufacturing hubs such as Tainan, Taichung, and Hsinchu lie directly in typhoon-prone areas and high-risk corridors, increasing the probability of catastrophic damage to facilities and supply chains.
Rising Claims Pressure: When SMEs suffer partial flood damage or wind losses, cumulative claims rapidly strain insurers’ liquidity—especially when traditional insurance policies require lengthy claim assessments.
Transparent Terms
Policies are built on measurable triggers—like rainfall or temperature—so clients and their brokers know exactly when payouts occur. No fine print, no ambiguity.
Customized Coverage
We work closely with brokers to build each policy around the client’s specific risk and budget profile, providing protection where traditional insurance often cannot.
Fast, Predictable Payouts
Once a triggering event occurs, payment is issued quickly and automatically—no need for on-site assessments or lengthy claims processes.
Flexible Use of Funds
Payouts are based on the severity of natural events occurring, not solely on proven losses, giving clients immediate access to funds and empowering them to cover any type of financial loss, not just for physical damage.
Typhoons are among the most devastating natural disasters in Taiwan, causing structural damage, flooding, disruptions to infrastructure, and major financial losses. For insurers and reinsurers, these events highlight the growing need for fast, transparent cash flow protection.
Descartes’ Parametric Typhoon Reinsurance: Rapid Liquidity for Catastrophic Wind Events
Descartes’ Cat-in-a-Circle parametric product delivers fast, transparent payouts based on verified wind and track data—no need for adjusters, on-site assessments, or lengthy claims. This solution provides insurers with immediate capital to handle surges in claims following a natural disaster.
case study example
Parametric Typhoon Solution for Taiwan’s Insurance Market
In July 2025, Typhoon Danas crossed Taiwan’s western industrial belt, impacting densely populated economic zones and generating substantial insured losses.
Problem
A Taiwanese cedent with a diversified commercial and SME portfolio faced mounting claims following Typhoon Danas. Although many policyholders reported only partial damage, cumulative losses and business interruption stretched the cedent’s liquidity and operational capacity. Traditional reinsurance recoveries required extensive damage verification and months of adjustment, delaying the release of capital needed to manage new claims and restore client operations. With most exposure concentrated along the island’s western corridor, the cedent recognized the need for a more responsive, data-anchored reinsurance tool that could complement its traditional treaties and provide immediate cash flow once severe wind conditions were independently confirmed.
Solution
With Descartes’ parametric typhoon reinsurance, the cedent would gain rapid, transparent protection against severe wind events impacting Taiwan’s western industrial corridor. The structure provides immediate liquidity based on verified wind and track data, eliminating delays tied to on-site assessments.
Result
Under our Cat-in-a-Circle structure, Typhoon Danas would have triggered 10% payouts at each of the three insured locations—Tainan, Taichung, and Hsinchu—releasing a total of USD 3 million within days to support swift recovery and business continuity.
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