Liberty Mutual Reinsurance (LM Re), a unit of Liberty Mutual Insurance Group, and Safehub, a provider of seismic sensor and risk management solutions, have collaborated with UC.
This partnership aims to mitigate the risk of earthquake damage across UC campuses, marking the first purchase of sensor-triggered parametric earthquake coverage in the US.
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It builds upon the deployment of bespoke sensor-triggered policies by LM Re and Safehub in Mexico and the Caribbean.
Munich Re provided additional reinsurance capacity, with Alliant brokering the deal. Howden was involved in the placement.
The policy’s claims are activated and settled based on data from 180 Safehub sensors deployed at various UC sites.
These sensors measure peak spectral acceleration values to trigger and finalise claims.
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By GlobalDataThe number of sensors being installed at UC exceeds the total number of earthquake sensors installed in all buildings across California.
LM Re said this sensor-based solution distinguishes itself from other parametric products that rely on general estimates from public agencies, offering a more precise assessment of earthquake impacts directly at the building site.
This precision is said to reduce the basis risk typically associated with determining payouts and accelerates the claims process, providing UC with faster access to funds in the aftermath of an earthquake.
Additionally, the near-real-time damage information from the sensors is expected to support UC’s emergency response efforts.
LM Re head of agriculture and parametrics Jean-Christophe Garaix said: “We are delighted to partner with Safehub to provide the University of California with sensor-based parametric earthquake coverage, offering unparalleled protection to earthquake damages.”
Safehub CEO Andy Thompson said: “Together with Liberty Mutual Re, we are excited to work with the University of California and its individual campuses to support the earthquake recovery of these prestigious academic institutions.”
Meanwhile, this August, LM Re, in partnership with Sprout and Britam, launched a parametric insurance product to protect Kenyan coffee farmers from climate-related risks.
This product, which emerged from the Lloyd’s Lab Launchpad Pitch, is designed to offer immediate financial relief with quick payouts following specific weather events.
