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Parametric cyclone insurance in Northern Australia

The Disaster Risk Facility supported the development of a retail parametric cyclone insurance produce in Northern Australia, called ‘Redicova’ (pronounced ‘ready cover’).

Redicova is a parametric product which provides pay-outs in relation to windspeeds from a severe tropical cyclone. Parametric products make pay-outs based on indices rather than indemnifying the actual loss incurred. Redicova is an autonomous product which will quickly pay claims that are triggered without the need for physical assessment.

The innovative retail solution provides fast financial relief to impacted communities to assist their recovery after natural disasters. Developed around the risks faced by customers in Northern Australia, the severe tropical cyclone product brings the protection gap between economic and insured losses closer together. This will help all citizens in the region including individuals, small to medium businesses and agricultural enterprises.