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Parametric insurance to become mainstream for travel insurers
Parametric insurance has played a big part in the recovery of the travel sector post-pandemic, says Blink Parametric CEO.
In a post-COVID-19 pandemic world, the travel insurance sector is not just bouncing back; it’s evolving. Instant payouts are becoming the gold standard, and parametric insurance is at the forefront of this transformation.
Sid Mouncey, chief executive officer of Blink Parametric, a company specialising in parametric solutions for a range of travel disruptions, spoke to Monte Carlo Today about this paradigm shift.
“The travel insurance sector has seen an explosion in recent years,” Mouncey said. However, this resurgence has come with its own set of challenges, particularly in the areas of operational infrastructure and claims processing.
“There has been a flurry of activity within the travel sector with people coming out of COVID-19, and recovering from a lack of operational infrastructure, which has had knock-on impacts on claims capability,” he said.
“The biggest challenge has been the ability to handle the level of disruption,” he noted. “Insurers have been looking for solutions to help them deal with the increasing volume of customer queries they’ve been receiving with a lower staff level post-pandemic.
“It has put considerable pressure on key service lines.”
This is where parametric insurance has proved invaluable. Mouncey explained that parametric solutions allow insurers to reallocate resources from handling low-value, high-frequency disruptions—such as minor travel delays—to focusing on more significant events. They align with regulators’ increasing focus on consumer-friendly, high-value insurance solutions, eliminating the barriers of extensive form-filling, and making the claims process more streamlined and transparent.
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“We’ve launched partnerships with large insurers.”
Sid Mouncey, Blink Parametric
“Parametric has played a big part in the recovery of the travel industry, benefiting consumers and insurers as its adoption grows significantly,” said Mouncey.
“It has enabled insurers to reduce cost, increase operational efficiency, and deliver better value through to consumers, making the whole insurance process more transparent.”
Partnerships
For Blink, this industry shift has led to substantial growth. The company has seen an 8 percent increase in the number of clients using its services globally.
“We’ve launched partnerships with large insurers in the US and other markets. A year ago, we were operating in just five markets; now we have seen a significant growth in our geographic spread,” Mouncey revealed.
Blink is particularly focused on consumer parametric, an area Mouncey believes is currently “underserved”. With some “big launches” in the pipeline, the insurtech is gearing up to launch in “two to three new markets with large global insurers” and planning to double its workforce by 2025.
As for the future, Mouncey expects parametric solutions to become mainstream within the next two to five years, driven by adoption from major players in the insurance industry and a growing consumer expectation for this level of efficiency.
“We see an enormous opportunity within parametric insurance, with the growth in the internet of things and the increase in connected devices.
“As the volume of data from consumers using devices and other means grows, parametric solutions will become more widespread across multiple insurance lines,” he concluded.
Main image: Shutterstock / Hananeko_Studio
