Amwins offers parametric cover for ‘atmospheric river’ losses

Amwins Group Inc. and flood technology company Floodbase on Tuesday launched a parametric municipal flood insurance program covering “atmospheric river” flooding in California.

Atmospheric rivers are long, narrow regions of water vapor that form in the atmosphere and can lead to significant precipitation.

The program offers average limits of up to $10 million. Tailored pricing and coverage options are available, and the minimum premium is $65,000, an Amwins spokeswoman said. The program is supported by an “A+” rated insurer, Amwins said.

Policy payouts are triggered by the magnitude of atmospheric river flooding. Amwins said municipalities can use the payments for various uses, including emergency response, to offset lost tax revenue, establish residential rebuilding programs, or to repair public infrastructure.

Damage caused by atmospheric rivers is largely uncovered by traditional insurance policies, and federal support has covered less than 1% of the state’s estimated economic losses from these events in the last two years, Amwins said.

Last year’s atmospheric river season cost California an estimated $5 billion to $7 billion in damages, according to Moody’s data.