Policy snapshot
Parametric Insurance pays out a fixed amount when a pre-defined event threshold (like rainfall, temperature, or earthquake magnitude) is met — no physical loss assessment required.
What is Parametric Insurance?
Parametric Insurance pays quickly when a defined event (like drought or earthquake) crosses set thresholds. It offers transparency and fast liquidity for businesses.
What can it cover?
- Rather than indemnifying actual loss, the policy pays when predefined indexes (e.g., less than 20 mm rainfall in 10 days) are triggered. This offers simplified, quick compensation to manage income volatility due to weather or natural events.
Who should consider it?
- Farmers, solar/wind farms, mining companies, Event organizers, renewable energy producers, Governments for disaster relief planning.
Key features to understand
- Fast claim settlement based on satellite or weather data
- Index-based: rainfall, temperature, earthquake, wind speed
- Widely used in agriculture, mining, and energy sectors
- Custom-built triggers for corporate clients
What deserves attention before you buy?
Coverage, exclusions, sub-limits, deductibles, waiting periods, warranties and underwriting can vary between insurers and policy versions. The policy wording and schedule remain the definitive contract. Novo can help you review the relevant terms for your requirement.
Read the wording, not just the brochure
The schedule and policy wording determine the actual contract.
Compare meaningful differences
Look at exclusions, limits, deductibles, conditions and claim requirements—not premium alone.
Think beyond purchase
Servicing and claims-related support can matter as much as placement.