Typhoons—also called tropical cyclones and hurricanes—are among the most destructive and unpredictable natural perils on the planet, capable of devastating assets, halting operations, and generating financial losses that linger long after the storm has passed. The Asia-Pacific region remains the world's most typhoon-prone area, and the financial stakes are rising. In 2025, tropical cyclones have accumulated more than $2.4 trillion in economic losses globally since 2000—the costliest peril of the 21st century. The APAC region alone recorded $76 billion in economic losses from natural disasters in 2025, with tropical cyclones and flooding among the primary drivers. Yet despite the scale of the threat, insurance penetration across Southeast Asia remains critically low — with only 4% of flood and tropical cyclone losses in South Asia covered by insurance since 2000, and 12% in Southeast Asia — leaving businesses dangerously exposed when storms strike.
Descartes’ parametric wind-at-location typhoon insurance solution provides fast and transparent financial protection based on sustained wind speeds measured directly at insured locations. Powered by advanced wind field modeling and third-party data providers leveraging public agency data and scientific modeling, the product delivers rapid payouts when predefined wind thresholds are exceeded—without requiring on-site loss adjustment or proof of physical damage. Designed to be highly customizable, the solution helps businesses secure liquidity quickly to accelerate recovery and operational continuity following a typhoon event.
How it Works
- Insured Location Definition: At policy inception, insured locations are defined using addresses or GPS coordinates to establish the precise coverage area for the policy.
- Wind-at-Location Monitoring: A specialized third-party data provider continuously models and monitors one-minute sustained wind speeds at the insured location(s) during a typhoon event.
- Trigger Verification: If the sustained wind speed exceeds the predefined threshold agreed upon in the payout structure, the policy is triggered.
- Independent Event Assessment: Following the event, certified data and final wind footprint analysis are collected and validated to determine the exact wind intensity experienced at the insured location.
- Transparent Payout Calculation: The payout amount is determined based on the predefined payout structure linked to wind speed intensity. For example, a wind speed of 201 km/h may correspond to an 80% payout of the insured limit.
Rapid Claims Settlement: Once the event report and declaration of loss are completed, funds are paid rapidly according to the policy terms, enabling businesses to accelerate recovery and continuity efforts.
Example of Typhoon Yolanda (2013) passing over an insured location (source Reask)
Why Choose Descartes’ Parametric wind-at-location typhoon insurance solution?
✔️ Rapid Liquidity After a Typhoon Event
Parametric payouts eliminate lengthy traditional claims adjustment processes. Businesses receive funds quickly after trigger verification, helping them manage recovery costs, operational disruptions, and financial obligations without delay.
✔️ Advanced Wind Field Modeling Technology
The solution leverages high-resolution wind footprint modeling from specialized third-party providers, delivering a granular and accurate assessment of wind intensity at specific insured locations rather than relying solely on public storm track data.
✔️ Coverage Beyond Physical Damage
Unlike traditional indemnity insurance, the product can cover a broad range of economic losses resulting from a typhoon event, including business interruption, extra expenses, and operational disruption—even without direct physical damage on site.
✔️ Flexible and Tailored Structure
Each payout structure is customized according to the client’s operational exposure, engineering resilience, and financial requirements. Coverage can be designed for single or multiple locations with limits of up to $80 million per contract.
Want to Learn More?
Download our product sheet (PDF) to:
- Learn more about our parametric wind-at-location typhoon solution, covered industries, quote requirements, and more.
- View an example payout structure based on sustained wind speed intensity.
- Discover additional details about the product in our Frequently Asked Questions section.
Interested in a solution?
Contact our commercial team.
FAQ
Who is the data provider?
We utilize a private third-party data provider that leverages wind field modeling and data from public agencies to estimate a high-resolution wind footprint.
How does the third-party data provider differ from public agencies?
Although it may leverage the data published by a public agency (such as JTWC), the wind footprint provided by the data provider adds an additional layer of modeling, which provides a more granular vision of the actual wind speeds experienced at a specific location.
Why is the index based
Our preference for sustained wind speed rather than gustn wind speed stems from the data’s one-minute liability, as it,tends to show better correlation with resulting damage. We use one-minute sustained wind speed, which is determined by averaging observed values over a one-minute period.
How is a policy triggered?
A policy is triggered when the one-minute sustained wind speed at the insured location(s), as reported by the data provider, exceeds the predefined threshold in the payout structure, as agreed upon in the policy.
How is the payout structure determined?
Our payout structure, which will determine the minimum wind speed needed to trigger coverage, will be co-designed during the quoting process in collaboration with the broker and client.
What types of damages are covered?
A parametric policy covers any economic loss sustained from a triggering event including but not limited to property damage, business interruption, and extra expense. We do not require direct physical damages on site to trigger coverage.
How does the claims process work?
1) The client notifies their broker, Descartes and/or risk carrier of the loss.
2) After the event, we collect the final data from the certification agent, ensuring the most accurate level of information to assess if the intensity of the event has triggered the policy and to what payout threshold.
3) Using the collected data, we then create an event report stating the maximum monetary amount to be recovered based on the structure outlined in the client’s policy.
4) After receipt of the event report, the client will issue a Declaration of Loss Statement to Descartes and/or the risk carrier.
5) As defined within the policy, after receipt of the Declaration of Loss Statement, the client will receive the payout in agreement with the policy terms, allowing them to accelerate continuity of operations.
