The use of parametric insurance as an alternative to traditional indemnity-based insurance has increased over the last twenty years, particularly as a mechanism for insuring against extreme weather risks.
Following said increasement, parametric insurances in Latin America have not received a standardized legal treatment.
Every country has developed its applicable normative, at its sole discretion, depending on the requirements of the local insurance markets.
Notwithstanding, the following are the main regulatory trends for parametric insurances in the region which will be explained herein: (i) countries where the local regulation does not provide nor mention any applicable law for parametric insurances and, therefore, as it is not explicitly forbidden, it is deemed permitted; (ii) countries where the local regulation accepts parametric insurance, and (iii) countries where the local regulation and the parametric insurance commercialization are only for agriculture and livestock practices.
This report updates the report published in 2020, considering the new regulations on the subject issued in the last two years and the fact that new exclusive members from the region joined insuralex during the same period (Guatemala and the Dominican Republic).
Follow the link and donwload the report: https://insuralex.com/2022-parametric-insurance-in-latin-america-update/