“The term ‘parametric’ might seem new, but the concept of index-based insurance has been around for a while. For many insurance buyers, some loss scenarios might not warrant a traditional insurance policy and parametric insurance has been a hot topic as businesses seek new, more specialized ways of transferring risk.
Advisen
Rather than settling on an amount after a sometimes lengthy claims process, parametric insurance offers a speedy, pre-determined payout upon occurrence of a specific, measurable event.”
July 5, 2019
“(Parametric reputation insurance) is becoming known as an efficient way to protect balance sheets and transfer risk.”
Parametric reputation insurance: indemnification affirming trust and reducing economic losses.
For a broader view of reputation risk, discover additional articles by Steel City Re here, mentions of Steel City Re here, and comments on newsworthy topics by Steel City Re here. To read an abstracted summary of reputation risk, see below.
Reputations are valuable strategic intangible assets. Threats to these assets⏤ enterprise reputation risks, often mislabeled “brand risks” ⏤ need to be managed, and management needs to be overseen through reputation risk governance lest reputational damage or reputational harm result in long-tailed go-forward losses in economic value and/or political power. Because these intangible risks arise from the interplay of stakeholder expectation, experiences, and media amplification, parametric insurances for intangible asset risks, for reputational value, for reputational harm, and for reputation assurance help mitigate risk by telling a simple, convincing and completely credible story of quality reputation governance to stakeholders. This story telling effect is the expressive power of insurance complementing insurance’s better known instrumental power of indemnification.
Risk management, risk financing in insurance captives, and risk transfer through reputation insurances comprise the constituent elements of a comprehensive solution.
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