Insights on the Parametric Insurance Global Market to 2028 - Featuring Allianz, AXA, Zurich Insurance and Berkshire Hathaway Among Others - ResearchAndMarkets.com

The "Global Parametric Insurance Market Size, Share & Industry Trends Analysis Report By Type, By Vertical (Agriculture, Construction, Aerospace & Defense, Mining, Manufacturing, Energy & Utilities), By Regional Outlook and Forecast, 2022 - 2028" report has been added to ResearchAndMarkets.com's offering.

The Global Parametric Insurance Market size is expected to reach $21.4 billion by 2028, rising at a market growth of 9.6% CAGR during the forecast period.

Parametric insurance is a type of insurance solution, which covers the likelihood that a preset event will occur rather than compensating for actual losses. Secondly, the definition of parametric insurance is an agreement to pay an amount in the case of a triggering event; as such, it is not connected to any actual physical asset or component of the infrastructure.

If pre-defined event parameters measured by an objective variable or index linked to a specific exposure of an insured are met or exceeded, the insurance coverage is activated.

The purpose of parametric coverage is to speed up recovery rather than to replace traditional insurance. They can be created to cover both individual massive losses and frequency losses, such as the effects of reduced snowfall or economic interruptions brought on by hurricanes. To get the greatest outcomes, it is crucial to think about how standard indemnity plans might be combined with parametric alternatives.

In order to help businesses finance or manage risks in a non-traditional manner, reinsurance and insurance companies offer parametric covers, which are alternative risk solutions.

The solutions are based on specified triggers or payment systems and revolve around a quantifiable index; no actual physical harm needs to be done for them to work. The demand for such cutting-edge parametric insurance systems has been rising as climate-related meteorological risks become more complicated and unpredictable.

Market Growth Factors

Budget-Friendly Policy Costs and Expansive Policies for Clients

Due to the lower prices, parametric insurance is growing in popularity. Customers are drawn to parametric insurance because of its affordable premiums since they want to protect their property from unanticipated financial losses or damage. Additionally, it is tailored to a customer's budget or bundled with indemnity insurance to close any gaps in coverage.

Actual post-event costs are substantial and infrequently expected or budgeted, particularly for governmental institutions tasked with rebuilding a region after a tragedy. The insured may have more financial freedom with parametric insurance.

Ensured Insurance Payments at A Faster Pace

Policies with parametric insurance allow for speedy payouts. For firms to recuperate from a disastrous catastrophe, this may be essential. The insured also understands that this payment is guaranteed because it is based on specific, predetermined conditions. One more implication is that the compensation specified in the insurance will happen even if the insured suffers no harm at all or very little damage.

Market Restraining Factors

Uncertainty of Events and Loss Determination for Basis Risk

The basis risk is higher with parametric insurance because it bases risk determination on pre-established parameters. In insurance, the idea of risk premium is essential. Basis risk is the situation when an insurance policy does not cover a loss occurrence. Additionally, parametric insurance payments are frequently outlined using indices. As a result, there is a chance that someone covered by it could sustain a loss yet not be compensated since some requirements weren't completed. It is plausible that the policyholder will not receive any compensation at all.

Scope of the Study

Market Segments Covered in the Report:

By Type

• Natural Catastrophes Insurance
• Specialty Insurance
• Others

By Vertical

• Agriculture
• Construction
• Aerospace & Defense
• Mining
• Manufacturing
• Energy & Utilities
• Others

By Geography

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• UK
• France
• Russia
• Spain
• Italy
• Rest of Europe
• Asia Pacific
• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Rest of Asia Pacific
• LAMEA
• Brazil
• Argentina
• UAE
• Saudi Arabia
• South Africa
• Nigeria
• Rest of LAMEA

Key Market Players

List of Companies Profiled in the Report:

• Allianz Group
• AXA SA
• Zurich Insurance Group Ltd.
• Berkshire Hathaway, Inc.
• Chubb Limited
• Munich Re Group
• FloodFlash Limited
• Neptune Flood Incorporated
• Global Parametrics Limited
• Swiss Re

For more information about this report visit https://www.researchandmarkets.com/r/mfazmc-parametric?w=4

View source version on businesswire.com: https://www.businesswire.com/news/home/20230130005390/en/