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PARAMETRIC INSURANCE TO BUILD FINANCIAL RESILIENCEIn partnership with 1United Nations Development Programme (UNDP) UNDP is the leading United Nations organization in fighting to end the injustice of poverty, inequality and climate change. Working with our broad network of experts and partners in 170 countries, we help nations build integrated, lasting solutions for people and the planet.Learn more at: www.undp.orgUNDPs Insurance & Risk Finance Facility The Insurance and Risk Finance Facility
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How to fill out parametric insurance

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How to fill out parametric insurance

01
Identify the specific risks you want to cover with parametric insurance.
02
Determine the parameters or triggers that will activate the payout (e.g., rainfall amounts, wind speed).
03
Gather historical data to assess the likelihood of the risk occurring based on the chosen parameters.
04
Collaborate with an insurer or broker to design a policy that accurately reflects the risks and triggers.
05
Request a quote based on the defined parameters and coverage amounts.
06
Review the terms of the policy to ensure coverage meets your needs.
07
Complete any necessary application forms and submit payment to finalize the policy.

Who needs parametric insurance?

01
Farmers and agricultural businesses facing risks from weather-related events.
02
Property owners and businesses in regions prone to natural disasters.
03
Event organizers who need coverage against weather disruptions.
04
Corporations looking to hedge against specific risks impacting revenue or operations.
05
Governments and NGOs seeking to manage risk in development projects.
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Parametric insurance is a type of insurance that pays out a predetermined amount based on specific parameters or triggers, such as a weather event, rather than indemnifying the actual loss incurred.
Typically, parametric insurance is utilized by businesses, agricultural entities, or individuals who are exposed to specific risks that can be quantified with measurable parameters. While filing depends on regulations, those seeking coverage against certain risks may need to file.
To fill out parametric insurance, individuals or businesses must complete an application that includes details such as the type of risk, relevant parameters, coverage amount desired, and any necessary documentation to support the application.
The purpose of parametric insurance is to provide quick financial relief after specific adverse events, minimizing the time and complexity involved in traditional claims processing, and helping to manage risk more effectively.
Information that must be reported on parametric insurance includes applicant details, the specific risk being insured, the trigger conditions, the payout structure, and any pre-agreed parameters that will activate the payout.
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