Swiss Re Corporate Solutions has released an insurance policy in Hong Kong that will automatically pay out if typhoon signal number 8 is officially declared. Signal number 8 is the third-strongest storm category in Hong Kong.
The new policy is aimed at businesses that are likely to suffer losses during a T8 signal, either through property damage or business interruption. According to Swiss Re, the new policy would fill a gap in the protection offered by traditional insurance policies.
With traditional insurance, insurers have to dispatch personnel to the claimant’s premises to inspect the damage caused by the typhoon. But in the new policy, named Insur8, the insured will receive a payout once the Hong Kong observatory declares typhoon signal 8.
“We have seen a shift in insurance policies, from mainly covering physical damage to focus more on the revenue losses clients suffer due to natural factors such as a typhoon,” Jacky Chan, head of casualty and sales for North Asia at Swiss Re Corporate Solutions, told the South China Morning Post.
Storm signal 8 means winds averaging 63 kilometres per hour are to be expected, with wind gusts that could exceed 180 kilometres per hour. Classes and work for most companies would be suspended, and economic activity stops, causing losses for many businesses.
Related stories:
Swiss Re and Ping An launch parametric insurance for typhoons
Hong Kong still has room for insurance newcomers
Hong Kong’s insurance sector grew ninefold in the past 20 years
