Key Challenges for the Region
Severe monsoonal rainfall can lead to record-breaking flooding that causes catastrophic damage to local infrastructure and business assets.
Extreme weather events disrupt local economies, leaving businesses to face costly property damage and significant supply chain interruptions.
Traditional insurance often leaves critical gaps for outdoor businesses, failing to cover fairways, bunkers, or indirect income losses during closures.
Key benefits of parametric insurance
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.
Fast, Predictable Payouts
Once a triggering event occurs, payment is issued quickly and automatically—no need for on-site assessments or lengthy claims processes.
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.
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.
In February 2019, record-breaking monsoonal rainfall struck North Queensland, causing devastating flooding that disrupted local economies and challenged the financial survival of area businesses.
Descartes’ Parametric Excess Precipitation Insurance: Closing the Coverage Gap with Speed and Transparency
Descartes’ Parametric Excess Precipitation product covers both direct and indirect financial losses, utilizing predefined triggers and fast payouts that do not require on-site loss assessments. By monitoring verified third-party data, Descartes ensures a transparent process where clients know exactly how much they will receive when a triggering event occurs.
case study example
Parametric Excess Precipitation Solution for a Golf Club in Australia
After the February 2019 flood, a local golf club in Townsville faced significant delays in recovery.
Problem
Their traditional insurance program only covered the clubhouse, leaving fairways, bunkers, and general play areas unprotected—along with the sheds that housed critical maintenance equipment essential for operations. It also excluded indirect financial losses resulting from the delayed reopening. With these exposed coverage gaps, the club began exploring alternative risk transfer solutions.
Solution
Descartes' parametric product for excess precipitation offers an affordable solution that covers both direct and indirect financial losses, effectively closing the coverage gaps exposed by the 2019 Townsville flood. With predefined triggers and fast, transparent payouts, the club would know exactly when and how much they would receive in a similar event.
Result
If a similar event were to occur and the accumulated rainfall over seven days was more than 500mm, the club would receive a full payout. For example, under an A$1,000,000 insured limit, once rainfall exceeds the established threshold, the client would receive 100% of the insured limit.
Contact Us
Whether you're quoting a complex risk, looking to break into new markets, or just curious about parametric insurance, our team is here to help you win. Reach out and we will get back to you within 48 hours.
