In the increasingly volatile world of catastrophe risk, the primary hurdle for third-party capital has rarely been the risk itself, but rather the tail; the years-long process of loss adjustment and trapped capital that follows a major event. However, CelsiusPro is making the case that parametric insurance offers a cleaner alternative for institutional investors, according to CEO Mark Rueegg.
Unlike traditional insurance, which relies on manual damage assessments, parametric triggers pay out based on objective data points, such as wind speed or rainfall levels.
During a recent interview with Artemis, Rueegg explained that the structural advantage for investors lies in the speed of the settlement cycle. Because payouts are triggered by data rather than physical inspections, the uncertainty regarding “claims leakage”, where loss estimates grow over time, is effectively removed.
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