New India Assurance, a state-owned insurance company, is set to launch a parametric insurance product this month to provide financial protection to its retail and business customers against climate-related risks. The product, which has been registered with the Insurance Regulatory and Development Authority of India (IRDAI), will offer a safety net against losses arising from calamities such as heavy rainfall, high-speed winds, and floods or droughts.
According to Girija Subramanian, Chairman and Managing Director of New India Assurance, the parametric insurance product is a “use and file” product, which allows for quicker claim settlement based on pre-defined parameters. The payout will be triggered when certain thresholds are breached, which will be measured using publicly available data such as declarations from the India Meteorological Department (IMD). This climate-driven approach will enable faster claim settlement, providing relief to policyholders affected by climate-related uncertainties.
The product will cover climate-related risks that affect daily livelihoods, employment generation, and other aspects of life. Subramanian noted that climate change has a wide-ranging impact, and this product is designed to provide financial protection against such uncertainties. The launch of the parametric insurance product is expected to take place by the end of this month.
In a separate development, New India Assurance reported a 2% drop in net profit to Rs 347 crore for the fourth quarter ended March 2025, compared to Rs 354 crore in the same quarter of the previous fiscal year. The company’s total income, however, rose to Rs 10,966 crore in the latest quarter, up from Rs 10,849 crore in Q4FY24. For the full fiscal year 2024-25, the company reported a 12.49% drop in net profit to Rs 988 crore, compared to Rs 1,129 crore in FY24.
The introduction of the parametric insurance product is a significant move by New India Assurance, as it seeks to provide innovative solutions to mitigate the impact of climate-related risks on its customers. With the product set to launch soon, the company is well-positioned to cater to the growing demand for climate-resilient insurance solutions in the country.