How will embedded insurance transform parametrics ?
How will embedded insurance transform parametrics ?
As embedded insurance expands into different industries , we take a look at how it could transform parametric insurance . For Mark Hara , US CEO of FloodFlash , embedded insurance could help revolutionise parametrics coverage in the mortgages and loan space .
“ If you ’ re a lender and want to support businesses in coastal communities but cannot reconcile the flood risk , it makes sense to embed a parametric insurance product that pays for the loan repayments while the business recovers from a flood . We ’ re at the beginning of the journey for this kind of thinking – but the potential is massive .”
The potential of embedded insurance in parametrics could be fully unlocked as parametrics becomes universally understood , according to the Head of Commercial at Floodbase , Peter Lacovara , who says embedded solutions are already “ the only way to sell parametrics with any meaningful scale ”.
He adds : “ The growth of the broader parametric market was stunted by the difficulty of explaining parametrics . Simple programmes , more akin to ‘ warranties ’ than insurance , might see the greatest takeup in the near-term in the embedded space . As parametrics become more universally known and understood , we may see the vast majority of parametric capacity committed on an embedded basis .”
“ In the future , we will see more industries adopting embedded insurance models as consumers become increasingly accustomed to personalised and on-demand services ”
MEERI SAVOLAINEN CEO AND CO-FOUNDER , INZMO
56 July 2023