Independent insurance broker Lockton has unveiled its new Global Parametric Insurance Practice, created to help businesses adopt cost-effective alternative risk solutions, and address the widening gap between insured and uninsured losses.
The initiative brings together a team of experts, including data scientists and modelers, that are dedicated to creating efficient, customised parametric solutions to help protect clients from risks often overlooked by traditional insurance.
“Over the past three years, Lockton has invested significantly in parametric expertise and resources across the U.S., Latin America, Europe, and Singapore,” said Diego Monsalve, Latin America and Caribbean Head of Risk Practices and International Head of Parametric Solutions.
Monsalve continued: “This global team is uniquely positioned to address our clients’ risk management challenges through innovation, delivering the high-calibre solutions they’ve come to expect from Lockton. We are excited to support our clients as we move forward with this initiative.”
As natural disasters and new risks like cyber threats increase, the need for supplementary insurance grows. The parametric insurance market is expected to reach $39.3 billion by 2032, highlighting the demand for alternatives to traditional commercial property insurance.
“Parametric insurance solutions offer significant benefits that can help meet the needs of businesses seeking a more efficient and cost-effective approach to uncertainty,” Peter Rapciewicz, Executive Vice President and Practice Leader of Alternative Risk Solutions and U.S. Head of Parametric Solutions, stated.
Rapciewicz added: “Lockton’s investment in a Global Parametric Insurance Practice underscores our commitment to delivering resilient solutions that not only provide financial protection but also empower businesses to continue operations seamlessly despite challenges.”
Unlike traditional policies that require detailed loss assessments, parametric insurance provides payouts based on specific event triggers, such as the intensity of a storm or earthquake.
These policies offer clear transparency and quick payouts, often processed within days of an event, helping businesses to resume operations faster.
Lockton’s specialized Parametric Insurance Practice offers expert guidance and a data-driven approach to help businesses identify the most relevant triggers for their specific needs.
Its tailored approach, the broker explained, ensures that coverage gaps are addressed effectively and cost-efficiently, complementing traditional insurance.
