Embedded or parametric insurance works on the paradigm of probability of the event occurring.
- Embedded insurance has been in vogue in last couple of years.
- The arrival of smart device has made embedded insurance a possibility.
- If the mobile phone falls down and the mobile screens crack or develop a crack on fall, depending on the impact, the IOT sensors which are fitted will trigger an alert and corresponding insurance claim can be generated.
- The same can be extended to cars as well, suppose there is collision between 2 wheelers or 4 wheelers, depending upon the severity of collision the IOT sensors which are retrofitted in car bumper fender should be able to judge the damage
- Zhong An and Xiaomi have partnered to provide parametric cover for phones. After a fall, the sensor in the phone automatically triggers a claim for broken screen.
- In our case, appropriate sensors may be place externally.