Parametric start-up Adaptive Insurance has been launched to aid businesses in protecting themselves against climate risk.
As an AI-powered insurance platform, the company has introduced its first product, GridProtect, to protect insureds from the impact of power outages due to climate risks.
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This technology-driven solution promises to offer financial relief following grid disruptions, filling a gap left by traditional insurance policies.
Adaptive Insurance noted that power outages in the US pose a significant challenge, affecting an estimated 15 million businesses each month and leading to considerable economic losses.
The US Department of Energy reports that such outages cost businesses around $150bn annually.
GridProtect aims to mitigate these losses by providing parametric coverage that activates without the standard 24-hour delay found in traditional insurance.
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By GlobalDataAccording to the Federal Emergency Management Agency, businesses that are shut down for just five days due to significant power outages face a 90% likelihood of not being able to reopen.
GridProtect’s swift capital infusion is expected to allow businesses to quickly recover and manage both immediate and long-term outage effects.
Adaptive Insurance is one of the initial ventures from Montauk Climate, a climate technology incubator.
Adaptive Insurance CEO and co-founder Mike Gulla said: “We have seen it all across the US – climate change is accelerating faster than the insurance industry can adapt, and businesses are paying the price.
“We designed GridProtect to fill a critical void in the market. With our AI-powered platform, businesses can now insulate themselves from the financial shock of power outages the moment they occur – less waiting, less uncertainty.
“We are not just offering insurance; we are offering resilience, enabling businesses to weather the storms – literally and figuratively – that threaten their survival.”
Montauk Climate founder and partner Philip Krim said: “Climate and weather events cause $1bn in damage every three weeks in the US. We launched Adaptive to address this immense and growing problem with a novel approach that is both effective and scalable.
“Adaptive’s co-founders, Mike Gulla and Arik Yelovitch, have the vision and expertise needed to steer this innovative company, making them the ideal leaders for this mission.”
Insurance broker Howden recently introduced the Howden Resilience Laboratory, a platform that utilises Microsoft technology to help clients navigate climate challenges.
The Howden Resilience Laboratory, developed in collaboration with Microsoft, utilises cloud services such as Azure, Microsoft 365 and Dynamics 365 to transform complex environmental, societal and financial data into practical insights.
