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Lockton's Innovative Approach to Parametric Insurance

Lockton, the largest independent insurance broker and human capital consulting group worldwide, has recently unveiled its global parametric insurance practice. This innovative initiative is designed to help businesses tackle the increasing gap between insured and uninsured losses by offering more efficient risk management solutions. The practice brings together a talented team of experts, including data scientists and modelers, dedicated to creating customized parametric solutions meant to cover risks often overlooked by traditional insurance.

Growing Demand for Parametric Insurance

In recent times, the frequency and intensity of natural disasters like hurricanes and wildfires have surged, exacerbating the need for alternatives in insurance coverage. Moreover, evolving risks such as cyber threats and supply chain disruptions have brought parametric insurance into the spotlight. According to research by Global Market Insights, the parametric insurance market is projected to reach an impressive $39.3 billion by 2032.

Diego Monsalve, head of risk practices for Latin America and the Caribbean and international leader of parametric solutions, emphasized Lockton's commitment to innovation over the past three years. During this period, the company has significantly invested in parametric expertise across the United States, Latin America, Europe, and Singapore, positioning its global team to effectively address clients' risk management challenges.

Financial Protection and Rapid Claims

Parametric insurance policies provide payments based on defined triggers, such as the magnitude of a storm or the level of rainfall, rather than on actual physical damage. This feature allows for greater transparency and swift payment—often within days—following an event, helping businesses minimize disruption and resume operations more smoothly.

Peter Rapciewicz, executive vice president and head of alternative risk solutions, highlighted the substantial advantages parametric insurance offers for companies seeking cost-effective approaches to uncertainty. With Lockton's new practice, clients will benefit from resilient solutions that not only provide financial protection but also facilitate business continuity.

Customized Risk Assessments

Catering to the specific needs of businesses, Lockton's parametric insurance practice will conduct thorough risk assessments using advanced data science and analytics. By identifying the most relevant triggers for potential losses, businesses can find tailored coverage that fills significant gaps in their traditional insurance policies.

The introduction of this global parametric insurance practice underscores Lockton's dedication to offering innovative risk management products that enhance business resilience. By bridging the ever-widening gap in coverage, Lockton is positioning itself as a leader in helping businesses navigate the complexities of modern risks.

About Lockton

What sets Lockton apart is its independence. The company’s private ownership empowers its over 12,600 associates operating in over 140 countries to focus solely on clients' needs in risk management, insurance, and personnel solutions. Their global expertise allows for a deep understanding necessary for achieving exceptional results. For further information, visit Lockton's official website.