Aon plc has launched a parametric insurance product to mitigate hurricane-related storm surge losses. Developed with Floodbase and Swiss Re, this innovative solution helps fill existing gaps in traditional insurance, providing faster and more flexible coverage based on meteorological data. It aims to assist businesses affected by significant prior losses, particularly from hurricanes like Helene.
Aon plc has introduced a new parametric insurance solution aimed at mitigating commercial losses caused by hurricane-related storm surges along the U.S. coast. This innovative product, developed in collaboration with Floodbase and Swiss Re Corporate Solutions, addresses gaps in traditional insurance policies that often have significant exclusions and high deductibles related to storm surge risks.
The necessity for enhanced insurance solutions arises from the significant economic losses incurred due to hurricanes, such as the estimated $75 billion loss from Hurricane Helene in 2024. Insurance claims stemming from hurricanes Helene and Milton reached roughly $37.5 billion, emphasizing the need for robust coverage against storm surge damages, which can comprise over a third of total loss costs in many incidents.
The collaboration between Aon, Floodbase, and Swiss Re represents a proactive step in addressing the financial risks associated with storm surges. By leveraging parametric insurance, businesses can access customizable protections that facilitate quicker payouts while complementing existing insurance coverage. Through this solution, stakeholders can better align their risk management strategies with the growing impacts of climate-related disasters.
Original Source: www.insurancejournal.com
