By Ola Jacob Raji, NGIN Champion and Broker Success Manager at FloodFlash.
Winter claims for catastrophe insurtech show how fast parametric payouts can be.
FloodFlash, an insurtech startup offering rapid-payout insurance for businesses in areas at high risk of flooding, has paid claims related to storm Ciara in record time. In a world first, the parametric insurer that focusses on commercial clients paid claims the day after floods that accompanied winter storm Ciara over the weekend of 8 and 9 February.
Dubbed, the “storm of the decade”, storm Ciara caused chaos as 100mph winds, heavy rain and snow battered the UK. According to the Environment Agency, nearly three quarters of February’s rain fell in just 24 hours in Cumbria. Some business owners were relieved to find that their insurance claims were already underway before the waters had started to recede.
FloodFlash uses parametric cover to provide payouts. This new approach doesn’t rely on claims adjustment. Instead, the client selects a depth of flooding and a payout, FloodFlash install an internet-connected sensor which provides data on flood depths at the insured property. When flood depths reach the pre-agreed amount, FloodFlash organise the payment.
After several FloodFlash sensors began reporting flooding on Sunday afternoon, the team started the claims process. By the end of the following day, the clients had received their payments in full.
The fastest claim was paid in 26 hours and 15 minutes – something FloodFlash regards as an unofficial record for a flood claim payout made possible by their parametric approach.
FloodFlash co-founder Ian Bartholomew comments: “Getting claims paid fast has a huge impact on a flooded business. They can start recovering quicker and long-term property damage from factors like mould are more limited. Fast payouts also have a massive impact on the emotional trauma caused by floods. We have proven that parametric cover can provide financial security within days of the event, so our clients aren’t left in the dark waiting for a payout to come through.”
Co-founder Adam Rimmer added: “we want to set the standard for rapid, transparent payouts within the catastrophe market. Paying out within a day is only beginning. One day we hope to pay clients within minutes of confirming a flood”.
About FloodFlash
FloodFlash is a new type of rapid-payout flood insurance. They use the latest in data modelling and connected technology to provide fast, easy and flexible cover. FloodFlash is a registered coverholder at Lloyd’s of London and is authorised and regulated by the Financial Conduct Authority
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