Addressing the tornado risk
Severe convective storms (SCS), encompassing tornadoes, hail, and straight-line winds, are among the most common and damaging natural catastrophes in the United States. Last year marked a historic milestone for SCS, as it recorded insured losses of nearly $58 billion, making it the most financially burdensome year on record.
While tornadoes occur worldwide, the United States consistently leads the curve in frequency, experiencing an average of 1,200 tornadoes annually. Tornadoes develop very quickly and cause devastation within confined areas, propelled by their formidable winds and the debris they hurl. In the most extreme cases, tornado wind speeds can reach 300 mph, propelling vehicles airborne and causing the collapse of even perfectly sturdy structures.
Among the most vulnerable to the impacts of tornadoes are businesses with warehouse and manufacturing facilities, as well as sites with utility-scale solar assets. As industrial and renewable infrastructure expand into regions of heightened tornado occurrence, Descartes emerges with innovative insurance solutions, offering fresh capacity where our clients require it most. Leveraging the latest in satellite and climate modeling technology, our parametric insurance provides crucial financial support in the aftermath of a tornado.
Assess
We assess and evaluate the client’s tornado exposure, leveraging our proprietary risk model.
Customize
Design a customized cover, fit to the client’s needs, in which payout structures are indexed according to tornado intensity.
Monitor
Upon policy inception, we monitor the insured's location for tornadoes to determine whether a qualifying storm has occurred.
Payout
Insured client receives a payout within days of reporting a loss, accelerating financial recovery and return to normal operations.
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.
Our parametric approach to tornado exposure
Our parametric tornado product relies on an in-house “tornado-risk model” supported by highly granular tornado event data. This method allows us to accurately gauge the likelihood of a tornado occurring for potential policyholders. By employing this innovative approach, we can deliver highly precise risk assessments and offer coverage in vulnerable areas that align closely with each customer's unique risk profile and financial requirements.
In full collaboration with the broker and client, our team is able to design a customized cover that is structured to indemnify based on tornado intensity and percentage of insured area impacted. This parametric approach ensures swift compensation in the aftermath of a tornado, eliminating the need for a lengthy indemnity claims process. These funds can be directed toward repairing physical damage to assets, mitigating revenue loss or operational disruptions during repairs, or to supplement retention in traditional property policies.
Interested in a solution ?
