Excess Precipitation — Descartes
Group 8

Parametric Insurance Case Study: Construction delay due to excess precipitation

Client Need: A contractor in San Antonio, Texas experienced major project delays due to the excess rainfall in May 2021. The adverse weather conditions caused significant delays on their project and impacted their employee budget, as it forced work suspension. 

Pain Point: With no option for insurance coverage from the traditional market, the heavy rainfall caused delays beyond what the contractor had anticipated in their contract. 

Our Solution: With increased awareness of their ongoing exposure to adverse weather, the client & their broker opted for a parametric policy to cover their next project. It was the only policy on offer that could provide cover for weather delays that exceeded the initial contract.

The Result: The total project budget remains the same, but with the insurance coverage in place the company is financially protected up to their maximum rainfall exposure. With the policy in place, if the May 2021 event was repeated, they would receive the total daily limit for additional adverse weather days that exceeded their initial contract budget of 20 days. The fully-customized parametric cover fills the gap left in the traditional market and ensures efficient financial recovery and return to normal operations.