Parametric Wind Protection is a contract to financially protect physical wind power generation against natural fluctuations. After having adjusted for non-generation due to outages and grid congestions, the cover provides a financial floor on an agreed level of power produced by a wind generator.
Parametric insurance is a type of insurance that does not indemnify the pure loss, but ex ante agrees to make a payment upon the occurrence of a triggering event. The triggering event is often a catastrophic natural event which may ordinarily precipitate a loss or a series of losses. But parametric insurance principles are also applied to Agricultural crop insurance and other normal risks not of the nature of disaster, if the outcome of the risk is correlated to a parameter or an index of parameters.
Parametric Energy Insurance Coverages: Lack of Wind / Wind Volatility, Lack of Sun, Lack of Water