HDI Global SE and Descartes Underwriting approved to offer parametric earthquake insurance in Japan
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HDI Global SE’s Japan branch, part of Germany-based insurer Talanx AG, has been approved by the Japanese Financial Services Agency to introduce a parametric earthquake insurance product to the Japanese market.
To create this product, HDI Global worked with Descartes Underwriting SA (headquartered in Paris, France), a provider of parametric insurance solutions for natural catastrophe risks. The development also involved HDI Enablers, HDI Global’s unit focused on Risk Finance solutions.
The insurance is designed to address gaps in coverage for Japanese businesses affected by earthquakes. It offers protection for various types of losses linked to seismic events, including property damage, business interruption (direct and contingent), and non-physical impacts. The product does not require a deductible or minimum loss amount.
The insurance, developed in collaboration with Descartes, operates on predefined criteria. Claim eligibility is determined by seismic intensity readings based on the Shindo scale used by the Japan Meteorological Agency.
Once the set thresholds are reached, a fixed payment is issued based on a straightforward declaration. This approach enables faster processing compared to conventional insurance models and can also account for non-physical losses. Policy terms, including triggers and payout conditions, are stated in a clear and accessible format.
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