Parametric Index Insurance

Innovative parametric index-based coverage for climate risk financing

Insurtech solution
dark clouds

What is parametric index insurance

Parametric index insurance is like a safety net that pays out money quickly if certain bad weather conditions happen, like a big storm or not enough rain for crops.

Unlike regular insurance that checks the damage after it happens and then pays you, this insurance has set rules saying if event X happens, you get $Y immediately. This helps farmers or shop owners get back on their feet right away without a lengthy process.


Long waiting period while claims are assessed manually before payouts

Complicated underwriting to cover potential loopholes that policyholders might try to exploit

High costs and high premiums, making it inaccessible to developing countries

Parametric index value propositions

Transparent transactions, driven by indices

Automatic coverage where sum insured is based on loan amount of hectares of land

Simpler product compared to outcome-based payouts (for eg. destroyed crops that require physical verification), making it less prone to abuse, fabrication and fraud

Weather index insurance

Insurance coverage for SME businesses and farmers against climate risks where claims are automatically triggered by indices such as rainfall and temperature.

Automatically triggered claims based on agreed upon thresholds, removing the need for field investigation.

Event-based triggers instead of outcome-based incentivises agriculture businesses and farmers to put preventative measures in place and employ recovery tactics to minimise crop failure and maximise yields.

Reduced administration and operational costs by leveraging trusted data sources and technology to automate claims approval, thereby allowing for lower premiums.

Real-time dashboard for index and claims monitoring.

Real-world application #1

Why weather index insurance

Our Weather Index Insurance resolves a number of fundamental problems that make traditional crop insurance inefficient or ineffective in rural areas of Vietnam.

Unlike traditional crop insurance, we do not need to physically visit a farmer’s field to assess damages to the crop; if the rainfall amount is below a pre-specified threshold, payout is automatically triggered.

Since the payout is not linked to the farmer’s crop survival or failure, the farmer always has an incentive to make the best decisions for crop survival. This improves the overall social efficiency of farmers as they do not have any incentive to let the crop die and claim from the insurer.

With Weather Index Insurance, we significantly lower the insurance company’s operation costs to hire a claim officer to go to the fields and inspect the degree of damage. The biased and fraudulent claim assessment is also removed with the design of automatically triggered claims from indexes.

Product details


Farmers for any crop

Geographical location



Rainfall index

Data source

International Satellite Data / Weather Station Data


Excess rainfall cover & Deficit rainfall cover

Payout trigger

Excess: total rainfall for a week more than the defined thresholds
Deficit: total rainfall for a quarter less than the defined thresholds

Non-damage business interruption

Loan protection embedded in business and individual loans for the MSME segment, particularly the industries that are affected by climate risks, for eg. food delivery drivers, street vendors and other brick-and-mortar businesses that will typically be interrupted by bad weather. This product doesn’t cover natural disasters such as typhoons and earthquakes, since those are usually covered by disaster insurance products.

Real-world application #2

Product details


MSMEs segment

Geographical location



Rainfall index

Data source

International Satellite Data / Weather Station Data


Excess rainfall cover

Payout trigger

Excess: total rainfall for a week more than the defined thresholds

Igloo’s end-to-end solution for distribution partners

End-to-end solution that includes the system, indices, data, reinsurance, distribution and claims processing

  • Core

    Start distributing our parametric index-based products that are tested and proven to help individuals and businesses whose livelihoods are affected by climate risks, all within weeks, not months or years.

  • Indices

    We conduct extensive research with SCOR and our local project partners, selecting indices with wide coverage and high data accuracy so it’s win-win for you, Igloo, and your customers.

  • Data

    Get access to real-time data of sales performance on our dashboard, and we work with you to optimise for mutually beneficial partnership.

  • Reinsurance

    Our parametric index solution is jointly developed with a regional reinsurer SCOR, giving us coverage across markets while localising it so it’s relevant for your customers in your country.

  • Distribution

    Igloo helps you with the distribution of parametric index insurance products, so you just manage the sales processes while we handle the policy issuance and everything after.

  • Claims

    Don’t worry about post-sales as it’s all handled by automatic triggers. We take care of your customers’ claims and payouts, saving you operational hassle and overheads.

How we can help

Distribution partners of parametric index solutions

mobifone with strapline


Partner profile

Major Vietnamese mobile network operator headquartered in Trung Hoa Nhan Chinh, Hanoi. Founded on 16 April 1993, as a Global System for Mobile Communications launcher, MobiFone is the first and currently third largest telecommunications provider in Vietnam.

Distribution overview

Bundled with mobile phone plan

Standalone insurance product on MobiAgri app

farm angel

Farm Angel

Partner profile

Singapore based tech-enabled food and agri-products company with operations in Asia and Africa. Farm Angel provides a full-stack solution to smallholder farmers, businesses and agripreneurs across the entire agriculture value chain.

Distribution overview

Bundled with crop inputs and agri equipment

Our partners

Discuss how parametric index insurance can help your business

Interested in finding out more? Fill out the form below and our commercial team will contact you within 2 business days.

Insurtech solutions lead form

Join Ignite now!

Interested to find out more about Ignite? Get in touch with us with this form.

Ignite form