Redicova is an innovative, parametric insurance cover which may provide eligible Northern Australians with fast disaster recovery cash in the immediate aftermath of a severe tropical cyclone (Category 3 or above).
Parametric insurance is not new, however, it has been limited in application and availability. Retail parametric insurance products are becoming popular and increasingly available to individuals, small to medium business or agricultural enterprises.
It’s based on agreed criteria called parameters. When these parameters are met, the policy pays you the agreed sum insured without the need for lengthy claims assessment or delays.
It’s designed to cover a specific risk event only, offering standalone protection and it may also provide additional cover to your existing insurance arrangements. You should consider maintaining your existing home, business, strata, rural property or other insurances based on your particular objectives, financial situation or needs.
What does parametric insurance do?
The main difference to traditional insurance is that parametric insurance pays out an agreed amount when a pre-defined event occurs, not just the cost to repair property damage suffered. It's similar to life insurance - which pays a lump sum amount if you die (pre-defined event).
|Example of Parametric Trigger||Pre-Defined Event|
|Life||Diagnosis: Melanoma Grade 3|
|Prize/Promotion||Golf tournament – “Hole in one”
Australian Open 2019 – any player that hits a hole-in-one off tee #17 at the Royal Melbourne Golf Club during the last day of the event will be paid $50,000 AUD.
|Crop||Hail occurring at a cotton farm causing damage to insured crop and reduction in yield of greater than 30% of estimated gross yield based on standard industry data.|