Nagaland processes first claim under Parametric Disaster Insurance

Nagaland has successfully processed its first claim under the Disaster Risk Transfer Parametric Insurance Solution (DRTPS), marking a significant step towards improving the state’s disaster management efforts.

In 2024, the Nagaland State Disaster Management Authority (NSDMA), in collaboration with SBI General Insurance, introduced this innovative multi-tier DRTPS agreement to strengthen disaster resilience in the state.

According to a press release from the NSDMA, the claim under “Cover 1” totals Rs 1 Crore 6 Lakh 50 Thousand, which will be distributed to beneficiaries impacted by the 2024 monsoon season.

The payment will be made through the Decentralized Relief Payment System (DRTPS), a digital gateway developed by NSDMA to ensure quick and direct transfers into the accounts of those affected. This efficient system enables faster relief, enhancing transparency and reducing delays in aid distribution.

“Today, NSDMA marked a significant milestone with the settlement of the Cover 1 Claim (Monsoon Period) under the DRTPS for 2024-2025. This parametric disaster insurance system stands as a testament to the collective strength of commitment to disaster preparedness and resilience,” stated the NSDMA.

The ceremony was honoured by the presence of Shri Z. Nyusietho Nyuthe, Advisor to NSDMA and NRE, who attended as the special guest.

Also present were the Commissioner & Secretary, along with NSDMA officers and staff, and representatives from SBI General Insurance, including Piyush Kumar, Sandeep Mukherjee, Subhankar Mazumder, and Luntsuba. During the event, a formal declaration of the claim settlement was made.

In his keynote address, the Advisor thanked the Chief Minister and Chairman of NSDMA for his “par excellence leadership” and his visionary approach in implementing this forward-thinking project.

He also emphasised that, in the face of increasing climate variability, a Parametric Disaster Risk Insurance Solution is a crucial component in achieving sustainable development.

“The story of Nagaland venturing into Disaster Risk Transfer Parametric Insurance Solution (DRTPS) is the spark in the history of Parametric Disaster risk transfer insurance in the country and around the globe. This solution is being studied by many insurance industries in the development of risk financing,” mentioned the press release.

Nagaland’s DRTPS has made a positive contribution to India’s risk financing mechanisms, with a special provision set to be included in the 16th Finance Commission.

“The claim settlement of Cover 1 under the DRTPS is a golden letter day in the Parametric Insurance history. This innovative Nagaland Disaster Risk Transfer Parametric Insurance Solution will be referred to by many scholars in the field of insurance in the days to come,” added the NSDMA.

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