Public entities represent a massive asset base and manage critical infrastructure exposed to both property damage and operational interruption. Aging infrastructures and highly correlated asset bases make public properties particularly vulnerable to climate disruption and notably exposed to hurricanes, severe convective storms, floods and earthquakes.
In the US, public entities are facing a rising need for quicker access to liquidity, as they are highly relying on federal aids for disaster recovery, while FEMA reimbursements can face long delays, taking several months or even years before being delivered.
As the market continues to soften, public entities are looking to do more than just lower their premiums: they are looking to fix the structural gaps that traditional insurance leaves behind, such as high catastrophe deductibles and restrictive sub-limits.
Parametric insurance unlocks significant value for public entities, often operating on fixed budget with limited flexibility, as it provides rapid, predefined liquidity immediately after a qualifying event to reduce insureds’ financial stress and allow them to face first-response emergencies.
Risk Landscape
Perils Relevant To The Sector
Financial Pain Points
- High catastrophe deductibles: In disaster-prone regions, hail & wind deductibles often range from 2% to 5% of total insured value, leaving public entities with multi-million-dollar gaps to cover out-of-pocket before traditional insurance kicks in.
- Uncovered first-response costs: Standard policies often include restrictive sub-limits or exclusions, especially for outdoor assets and debris removal, and typically do not cover first-responder temporary staffing or overtime pay, nor fund emergency services such as aid tents and food pantries.
- Shared limits in risk pools: Public entities can be insured by a risk pool, where multiple participants draw from the same coverage limit. In the event of a large-scale catastrophe affecting many members, each insured may receive only a portion of the available funds for recovery, as the total limit must be distributed among all affected participants.
- Delayed recovery timeline: Traditional insurance claims for major catastrophes can take months or even years to settle, creating severe cash flow pressure for public entities which are often operating on fixed budgets with no meaningful liquidity.
Customer Profile
- Local governments (e.g., States, cities, counties, municipalities)
- Educational institutions (e.g., universities, colleges, school districts) → Learn more
- Port & airport authorities → Learn more
- Public risk pools
- Special districts (e.g., water/fire/waste utilities)
- Tribal governments
- Non-profit organizations (e.g., faith-based institutions) → Learn more
Parametric Coverage in 3 Steps
Define the Trigger
Together with the public entity and its broker, we structure a parametric trigger based on independent, objective data, such as wind speed, rainfall intensity, or ground shaking, tailored to the entity's specific perils and risk profile (e.g., hurricane, SCS, flood, earthquake).
Monitor the Event
When a qualifying event occurs, we use independent third-party data sources, including satellite imagery, weather stations, and public datasets, to measure the event's intensity against the predefined trigger. No on-site loss adjustment is required.
Receive Rapid Payout
Once the trigger is confirmed, payout is issued automatically, within days of confirmation and weeks of the event, giving the public entity immediate liquidity to fund emergency response, debris removal, and operational recovery, before traditional insurance claims are even settled.
Our case studies are all over the world
Utilizing Machine Learning and real-time monitoring from satellite imagery & IoT, our state-of-the-art technology helps businesses bounce back faster against climate, cyber and other emerging risks.
Why Parametric Works
- Rapid liquidity: Payouts are confirmed in days and paid in weeks, providing critical liquidity during the post-event recovery period.
- Flexible capital: Payouts are not tied to specific loss assessments and can be used to offset revenue losses or support operational recovery.
- No claims adjustments: Coverage is triggered by predefined parameters, eliminating lengthy loss adjustments processes.
- Complements traditional insurance in risk pools: Parametric coverage is triggered independently of shared limits, absorbing deductibles for smaller events and protecting against limit exhaustion in major catastrophes, ensuring full recovery rather than prorated payouts.
The Solutions We Provide
Deductible buydownOffset large catastrophe deductibles, notably hail & wind deductibles for educational institutions, through rapid parametric payouts following qualifying events | Emergency Liquidity CoverSecure immediate capital following a catastrophe to fund debris removal, temporary repairs, and operational recovery before traditional insurance claims are settled |
Non Damage Business InterruptionCover revenue losses from operational disruption (e.g., campus closures, flight cancellations) independent from on-site damage | Additional Capacity for Risk PoolsAvoid claim proration in the event of a large-scale catastrophe event affecting several pool participants and reduces the potential need to reinstate the policy limit |
Global Parametric Insurance Specialist
10 countries with offices around the world
150+ scientific experts: risk modelers, data scientists, and software engineers
20+ perils covered with best-in-class (re)insurers, written on A+ paper
USD 140M capacity per policy even in highly exposed regions & for clients with a history of NatCat losses
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.
