New Delhi: State-owned New India Assurance will this month launch a parametric insurance product, which will provide a financial safety net to its retail and business customers against climate risks, said chairman and managing director Girija Subramanian on Tuesday.
Parametric insurance refers to losses arising out of calamities including heavy rainfall, high speed wind and flood/drought. Unlike traditional insurance policies, the payout in case of parametric insurance products depends upon triggering of pre-defined parameters, thus allowing for quicker claim settlement.
“Parametric insurance is a use and file product, which is allowed by the regulator IRDAI. We have got it already registered on IRDAI so the product is ready and can be used across both retail and business groups. We are ready with that in a big way,” Subramanian told PTI.
Asked about the timeline for launch of the product, she said: “We will be launching it by the end of this month.” Subramanian said the parametric insurance product would mostly cover climate-related uncertainties, which affects daily livelihood, employment generation, and so on.
“Climate change affects so many things. So normally, this kind of parametric covers are based on thresholds. Once the threshold is breached, the claim is paid,” she said.
The threshold, she said, is measured by publicly available data, like IMD declarations and the claim settlement in such policies is climate driven.
On Monday, New India Assurance, India’s largest general insurer by market share, had reported about 2 per cent drop in net profit at Rs 347 crore for the fourth quarter ended March 2025.
The public sector general insurance company had a net profit of Rs 354 crore in the March quarter of 2023-24 fiscal, according to a regulatory filing.
Total income, however, rose to Rs 10,966 crore in the latest fourth quarter, up from Rs 10,849 crore in Q4FY24.
For the full 2024-25 fiscal year, New India Assurance reported a 12.49 per cent drop in net profit at Rs 988 crore. In FY24, the net profit was Rs 1,129 crore.
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