Zurich North America has announced the launch of a weather parametric insurance product. The insurance will cover weather-related construction delays not covered by traditional builders’ risk insurance policies.
Traditional builders risk policies offer protection for financial loss related to weather events, but only when those events cause physical loss or damage to a product. Zurich’s construction weather parametric policy does not require physical loss or damage for a claim to be paid.
Rather, payment is based on predetermined weather events occurring in the project’s location, such as extreme rain, wind, or temperatures – any of which can cause project delays that result in financial loss, even when the project is not physically damaged.
The coverage is customizable for the buyer – contractor or owner – since customers face varying risks if a project is delayed. An owner could see sizeable revenue losses from operating profits that aren’t being realized. A contractor could suffer penalties or incur additional expenses due to project delays.
“We are proud to offer this solution as a complement to our newly enhanced suite of master builders’ risk and project builders risk policy forms, which include flexible reporting options, as well as several new coverage enhancements attuned to today’s evolving marketplace,” said Kelly Kinzer, head of construction property for Zurich North America. “These innovative products demonstrate why Zurich has been a trusted leader in the construction space for 25 years. The Zurich construction team is committed to putting our extensive knowledge, experience and financial strength to work for contractors and owners.”
The perils, thresholds, limit, deductible, and coverage duration for the policy can be individually tailored to meet the needs of the buyer. The threshold options for each peril are based on historical weather data at the location of the project. Parametric coverage for one or more weather perils, and coverage duration can be tailored to the peak season for the weather risk, Zurich said.