Beazley harnesses data solution for tornado crisis cover

Specialist insurer Beazley has partnered with Sola Technologies and Spinnaker Insurance Company to provide a parametric tornado disaster benefit insurance for homeowners. The tornado crisis product uses National Weather Service data to automatically initiate the claims process.

The new product offers early payments to help policyholders deal with the immediate impact following a tornado. The NWS will confirm the path and severity along the path, based on the ‘Enhanced Fujita’ scale of a tornado, which then acts as a trigger for payments to be generated. Sola aims to pay the disaster benefit shortly after the event, compared to the extended time it often takes for traditional policies to pay out.

The policy limits of up to US$15,000, are intended to cover the deductible and immediate expenses. The coverage can supplement a comprehensive homeowners or renters policy and is currently available in 15 US states in the Midwest and Southeast, with more expected to come online soon.

Neil Kempston, head of incubation underwriting at Beazley, said: “Beazley is well known for its focus on ensuring clients have a seamless and stress-free claims process. By applying data and technology, we believe the new tornado crisis insurance product will further improve the situation for policyholders who need a fast claims payment in the aftermath of a tornado. We are pleased to be supporting this innovative new solution which can help policyholders with the immediate challenges following a tornado.”

Costero Brokers, a Lloyd’s broker and specialist in innovative placements, served as the sole placing broker and was responsible for securing fronting and reinsurance capacity.

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