Insurtech Floodbase has entered into a partnership with Ag Guard to develop and distribute parametric flood insurance programs across both Australia and New Zealand.
Both companies are teaming up together to help close the ANZ flood insurance gap through jointly-developed parametric flood insurance programs that are designed to cover ag risk.
The programs, which are set to launch in 2024, will offer region-specific pricing with payouts that are prompted automatically when the magnitude of flooding exceeds predetermined thresholds.
As a result, this solution will empower reliable, large-area cover, which will provide both farmers and governments protection against agricultural risk and flood-induced economic loss.
Moreover, the combination of both Ag Guard.’s region-specific specialization and distribution network, along with Floodbase’s flood data and expertise will significantly mitigate the impact of flooding.
The collaboration will also help to insure previously uninsurable flood risk, and foster resilience across the ANZ region.
If you recall, New Zealand has weathered multiple catastrophic flood events over the last decade, including their worst storm this century – 2023’s Cyclone Gabrielle. PERILS AG, a Zurich-based catastrophe insurance data provider, recently released its third insured loss estimate for the cyclone, pegging the total at NZ $2.018 billion.
However, looking back in 2021, flooding that took place on both the North and South Islands resulted in evacuations, states of emergency, and agricultural instability, which required the Ministry of Agriculture to provide debt relief to devastated farmers.
Floodbase stated that this increased frequency and magnitude of flooding is said to be driving record P&C loss ratios, as well as the need for innovative insurance solutions.
Alex Cohn, Co-owner and Managing Director of Ag Guard, commented: “Floodbase provided us the flood data and expertise we needed to design the country-wide parametric programs launching early next year. Our offering will enable New Zealand farmers to purchase flood covers that were previously unavailable, drastically reducing the risk of insolvency and agricultural instability. We couldn’t be more excited about the opportunity to complement indemnity insurance, help close the flood insurance gap, and bring comparable programs to Australia.”
