Table of Contents
Historical Data, Premium Insights, Market Dynamic, Analysis and Projection, By Product, Analysis and Projection, By Application, Analysis and Projection, By End-Use, Analysis and Projection, By Regional Analysis, Competitive Landscape, Company Profiles, Market Revenue, Sale & Price Analysis
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According to a research report published by Spherical Insights & Consulting, the Global Parametric Insurance Market Size is Expected to Grow from USD 18.20 Billion in 2023 to USD 34.10 Billion by 2033, at a CAGR 6.48% during the forecast period 2023-2033.
Browse key industry insights spread across 210 pages with 110 Market data tables and figures & charts from the report on the Global Parametric Insurance Market Size, Share, and COVID-19 Impact Analysis, By Insurance Type (Index-Based Insurance, Weather-Based Insurance, Catastrophe Bonds, and Other), By Application (Agriculture, Property and Casualty, Energy, and Other), and By Region (North America, Europe, Asia-Pacific, Latin America, Middle East, and Africa), Analysis and Forecast 2023 – 2033.
The parametric insurance market refers to a type of insurance that pays out a predetermined amount based on a specific trigger event, rather than the actual losses incurred. This non-traditional insurance product disburses a pre-agreed sum when a defined event occurs. Moreover, the parametric insurance market is experiencing growth due to several factors. Firstly, the increasing frequency and severity of natural disasters, driven by climate change, has created a demand for quicker and more efficient claims processes. Also, advancements in data analytics and the widespread use of IoT devices have fueled interest in parametric insurance models. Moreover, the growing availability and accuracy of Earth Observation data significantly enhance both risk assessment and trigger verification. Government initiatives and regulations that promote climate risk management are also expected to further boost growth in this sector. However, there are some factors that may restrain the growth of the parametric insurance market. One significant concern is basis risk, which arises when an insurance policy does not adequately cover a loss, potentially resulting in overpayment or underpayment. Furthermore, many potential clients remain unfamiliar with parametric insurance, which can lead to skepticism and reluctance to adopt this type of coverage. Limited access to real-time data, insufficient data infrastructure, and communication challenges can also hinder market expansion.
The index-based insurance segment is predicted to hold the largest market share through the forecast period.
Based on the insurance type, the parametric insurance market is classified into index-based insurance, weather-based insurance, catastrophe Bonds, and other. Among these, the index-based insurance segment is predicted to hold the largest market share through the forecast period. The segmental growth due to its innovative approach of linking payouts to specific indices such as weather patterns or crop yields rather than individual losses, index-based insurance enhances efficiency and streamlines traditional claims processes. This model reduces the time and costs associated with claims, making it especially appealing to both farmers and insurers. As climate variability increases and the need for rapid recovery from adverse events becomes more pressing, index-based insurance offers a viable solution that promotes financial stability and resilience in the agricultural sector.
The agriculture segment is anticipated to hold the highest market share during the projected timeframe.
Based on the application, the parametric insurance market is divided into agriculture, property and casualty, energy, and other. Among these, the agriculture segment is anticipated to hold the highest market share during the projected timeframe. The demand for food security and sustainable farming practices drives this trend. As climate change impacts agricultural productivity, farmers seek innovative risk management solutions to protect their yields and investments. The adoption of parametric insurance products specifically designed for agriculture allows farmers to mitigate risks associated with unpredictable weather events, ensuring their livelihoods and contributing to overall food supply stability. This growing recognition of the importance of agricultural insurance is expected to significantly boost its market share.
North America is estimated to hold the largest share of the parametric insurance market over the forecast period.
North America is estimated to hold the largest share of the parametric insurance market over the forecast period. The growth of parametric insurance is largely attributed to the region's advanced financial infrastructure and high levels of awareness regarding risk management solutions. The presence of numerous insurance providers and a diverse array of parametric products tailored to various sectors, including agriculture and natural disasters, enhance market penetration. Additionally, regulatory support and technological advancements such as the use of satellite data for real-time risk assessment are propelling the growth of parametric insurance in North America, positioning it as a leader in this emerging market.
Europe is expected to grow the fastest during the forecast period. The growth of parametric insurance is driven by increasing climate-related risks and a strong push towards innovative insurance solutions. The European Union's initiatives to enhance climate resilience and promote sustainable practices are encouraging the adoption of parametric insurance across various sectors. Furthermore, growing awareness among businesses and farmers about the benefits of rapid payouts and simplified claims processes is driving demand. As European insurers adapt to evolving market needs and regulatory frameworks, the region is poised for significant growth in the parametric insurance market.
Competitive Analysis
Major key players in the parametric insurance market includes SCOR SE, Lloyds Banking Group, Sompo Japan Nipponkoa Holdings, Inc., Swiss Reinsurance Company, Tokio Marine Holdings, Inc., Zurich Insurance Group Ltd., Munich Reinsurance Company, Allianz SE, Chubb Limited, Everest Re Group, Ltd., AXA SA, PartnerRe Ltd., Aon plc, QBE Insurance Group Limited, Hannover Re, and Others.
Key Target Audience
Recent Development
Market Segment
This study forecasts revenue at global, regional, and country levels from 2023 to 2033. Spherical Insights has segmented the parametric insurance market based on the below-mentioned segments:
Global Parametric Insurance Market, By Insurance Type
Global Parametric Insurance Market, By Application
Global Parametric Insurance Market, By Regional Analysis
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