MUMBAI: Parametric insurance, which pays out claims on the happening of a specific event, usually weather-related, can be a force for good in helping the underprivileged. It can be a high-growth commercial insurance according to the chief of Howden, the largest non-US insurance broker.
According to David Howden, CEO of insurance broking firm Howden, this is a major form of insurance of the future, offering protection from risks that are uninsurable by conventional insurance.According to him, if people are uninsurable, they are uninvestable. “Most of the global South cannot buy insurance if we provide insurance that will bring investment,” said Howden.
Howden has arranged for parametric climate risk cover in Rwanda for subsistence level farmers. This cover helps farmers to plant all their seeds and increase productivity by 25%, while also providing protection against drought. The broker works with govts and NGOs to design covers for vulnerable populations. The premium gaps are filled in by the NGOs or govts or in the case of Rwanda, by Howden as a CSR activity.
“An area where parametric insurance will take up heavily is energy transition, where covers are becoming very relevant because of the growth of renewable energy sources,” said Howden. This includes areas like solar and wind energy where weather also plays a crucial role.
In India, Howden has helped arrange insurance for 26,000 families in Gujarat who will receive Rs 2,000 each if the maximum temperature breaches the danger mark of 43.7 degrees. The cover was arranged by Mahila Housing Trust to cover livelihoods.
According to David Howden, CEO of insurance broking firm Howden, this is a major form of insurance of the future, offering protection from risks that are uninsurable by conventional insurance.According to him, if people are uninsurable, they are uninvestable. “Most of the global South cannot buy insurance if we provide insurance that will bring investment,” said Howden.
Howden has arranged for parametric climate risk cover in Rwanda for subsistence level farmers. This cover helps farmers to plant all their seeds and increase productivity by 25%, while also providing protection against drought. The broker works with govts and NGOs to design covers for vulnerable populations. The premium gaps are filled in by the NGOs or govts or in the case of Rwanda, by Howden as a CSR activity.
“An area where parametric insurance will take up heavily is energy transition, where covers are becoming very relevant because of the growth of renewable energy sources,” said Howden. This includes areas like solar and wind energy where weather also plays a crucial role.
In India, Howden has helped arrange insurance for 26,000 families in Gujarat who will receive Rs 2,000 each if the maximum temperature breaches the danger mark of 43.7 degrees. The cover was arranged by Mahila Housing Trust to cover livelihoods.
