Floodflash and Yokahu join Vitesse in Fintech for Good collaboration
Climate risk insurance platform Yokahu, alongside flood parametric insurtech FloodFlash, is delighted to announce today a collaboration with global fintech Vitesse, to significantly accelerate payments from insurers to policyholders to prevent small and medium-sized business (SMEs) from failing after extreme weather events.
Climate change is impacting the frequency and severity of weather events around the world. Natural disasters through to the end of the third quarter of 2022, for example, are estimated to have caused total economic losses of approximately US$227 billion – of which an estimated US$99 billion was covered by public and private insurers, meaning that insured losses are likely to exceed US$100 billion for the third year in a row according to Aon’s Global Catastrophe Recap report. This represents a significant insurance protection gap of over 50%.
SMEs and vulnerable communities in particular are disproportionately impacted by natural catastrophes with 90% of smaller companies failing within a year unless operations resume within five days of a flood, for instance. However, traditional claims payments from insurers can take weeks or sometimes months in the case of complex claims requiring loss adjusters – time that SMEs and the individuals who work for them do not have.
To address this challenge, fintech Vitesse – which has digital banking distribution in over 170 countries globally – has developed a platform that allows cross border payments for insurers to pay a claim in real-time, and has partnered with FloodFlash and Yokahu to enable this through parametric insurance.
Harnessing Vitesse’s worldwide digital banking channels combined with parametric insurance products reduces claims payment times from months to minutes and ensures that cash goes straight into the hands of those individuals and SMEs worst affected.
Reactions to Fintech for Good
Adam Rimmer, CEO of FloodFlash, said:
“One of the themes that has emerged from COP27 is that developed countries are putting forward financial tools (most notably the loss and damage fund) to support the poorer nations that will fall victim to climate catastrophes. In parametric insurance we have a powerful financial tool that can help everyone, from governments down to individual citizens.”“Parametric cover is the best way to help more people recover from catastrophe. As the world changes faster and recovery demands become more intense, the speed at which funds are made available will only become more important. This partnership signals a great step towards fast, sustainable financial resilience.”
Daniel Andrews, Insurance Director of Vitesse, said:
“Our collaborative approach with FloodFlash and Yokahu demonstrates our desire to positively impact change and deliver quicker outcomes for consumers and businesses at a time when they need it most. Whether that be to repair a residential property or to get a business back up and trading. The partnership is a match made in heaven, where third parties can come together to deliver a compelling insured experience from end-to-end.”
Tim McCosh, CEO and Founder of Yokahu, said:
“The climate change emergency is accelerating, and this year’s COP27 focused minds once again on the urgent need for action on the ground where it will have the most impact. No one person or company can solve the challenges that climate change presents – only through truly collaborative efforts can innovation reach the scale that is required to have the most impact and bring the biggest cost savings to society.
The partnership with Vitesse means that when a parametric climate risk policy is triggered, we are now able to pay each individual or business covered by the policy, so that they wake up the day after an event happens and the money is there to support them in rebuilding. That’s the power of technology.
The potential for scaling is vastly improved by collaborating with Vitesse, which is present in over 170 countries globally. This brings us a step closer to protecting businesses and individuals who can’t otherwise access affordable insurance in face of natural hazards, and expedite support to victims of disasters around the world.”
Are you a parametric insurer looking to pay claims to your customers in real-time, when they need it most? Talk to us today