Corporate Flood Insurance: A Parametric Response to Flood Risk in the United Kingdom
A look at flood exposure in the UK and how parametric solutions can help fill the gap left by traditional…
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When compared to other Nat Cat perils, Flood remains significantly under-insured in both emerging and mature markets. As public budgets contract and capacity continues to shrink in the world’s most flood exposed regions, many corporates are left unprotected.
Descartes uses a new generation of data sources to build advanced hydrologic models and better understand client’s flood risks. Our parametric products provide brokers and corporates precise, customized flood protection.
Our parametric approach to flood risk
Our parametric flood covers combine river monitoring data, satellite rainfall data, and IoT to precisely assess and measure flood risk in near-real-time on clients’ premises.
Payouts are based on water level triggers, predefined in partnership with each client, and adjusted to each insured location’s settings and existing flood prevention measures.
Descartes’ flood products are uniquely designed to address key strategic exposed locations for both domestic and international exposures across the globe.
Parametric Insurance Case Study: Corporate Flood Risk
Client Need: A hospitality client in Europe with high value outdoor assets faces capacity restrictions in the market due to its river-front location in a flood-prone area.
Pain Point: While the client had invested heavily in protecting its assets from flood – installing flood protection barriers and using flood resistant building materials in a recent renovation – traditional insurers were failing to provide the business with a flood cover due to the region’s flood rating
Our Solution: A parametric flood cover that uses proprietary models to assess the client’s specific flood risk and is structured to pay out when water levels surpass a predefined threshold on site, measured in real-time by a connected sensor. The thresholds are set to reflect the clients’ view of the risk and their ongoing investments in flood prevention.
The Result: The client was able to transfer its flood risk to a tailored flood protection, filling the gap left in traditional market capacity. Descartes then monitors their exposure in real-time through a combination of public river gauge data and IoT devices installed on-site, notifying the client and providing indemnification within days if the policy triggers.
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