Big Picture

Floods present a plain challenge to insurers

Bulleen, Australia

An aerial view of recent flooding in Victoria,

Australia. Climate change means freak weather events like these are becoming commonplace. Increasingly, insurtechs are utilising open-source data and IoT-enabled devices to measure flood levels or other weather-related parameters, allowing almost instant payout when a pre-agreed condition is met.

It’s a well-known practice called ‘parametric insurance’, and it’s often considered a type of ‘bounce back’ insurance because it prioritises speed of payment over full indemnification of incurred losses. Find out how the insurance sector is using parametrics in our article on ‘Managing a Climate in Crisis’.