CelsiusPro doubling down on technology and innovation to put parametrics centre stage

CelsiusPro has put technology and innovation at the forefront to capitalise on the parametric insurance revolution. The firm’s CEO and founder Mark Rueegg talks to Parametric Insurer to discuss the firm’s achievements to date and future strategy.

Since its inception in 2008, CelsiusPro has sought to highlight the importance of innovative climate and nat cat risk transfer products and its story since has involved significant achievement and global recognition.

The Switzerland-based technology firm gained even more prominence in September 2023 with its acquisition of London-based Global Parametrics, aimed at strengthening its parametric insurance offering, especially in deploying risk capacity to bolster natural disaster resilience across the Global South.

On an individual company level, CelsiusPro has advocated technology and innovation, particularly through its white-label platform. The platform enables insurers to enter the parametric market without requiring significant investment in internal IT solutions. It also provides digitalised, end-to-end policy administration, allowing insurers to focus on serving clients via several distribution channels.

“Technology is at the very core of what we do, and it’s at the very core of enabling the parametric market to grow and to become centre stage in risk transfer for climate and natural catastrophe insurance,” Rueegg says.

“Without technology, you can’t do anything really.”

Parametric toolkit

Another key aspect of CelsiusPro’s offering is ParameterPro, a toolkit that enables brokers to quickly visualise, structure and model parametric climate and nat cat insurance solutions.

ParameterPro 2.0 launched last month, while several more releases are set to follow. The company claims that the platform helps brokers meet the demand for solutions to the increasing unpredictability of climate risks. The platform’s initial release focuses on parametric hurricane and earthquake events while providing global access to comprehensive climate and nat cat datasets.

Features of the toolkit include product structuring and modelling capabilities, which together allow brokers to model historical losses and expected premiums.

At the same time, the ability to download climate datasets (including temperature, wind speed, precipitation and more) helps brokers analyse the climate risk of their clients and design relevant parametric insurance covers.

Rueegg notes the importance of simplicity, adding that the firm had a desire to create “tools that are easily understood”.

“That’s why we purposefully call it a toolkit, because it’s easy [to use] but not simplistic,” he says.

“So the visualisation and the features of the tool, it’s something that really helps brokers present to their clients parametric insurance solutions that really align with the clients' intent of making their business more climate-resilient.”

Innovation for individuals and communities

In October 2024, Land Bank Insurance Company partnered with the firm to pilot index insurance in South Africa to provide affordable drought-risk insurance for both crop and livestock farmers.

As part of the partnership, CelsiusPro’s technology is used to automate product distribution and policy administration for the insurer.

In its “quest is to bring parametric solutions to the centre stage”, Rueegg notes technology should “demystify” parametric offerings to make them “transparent and accessible to all the players in the market”.

He also explains that insurance firms, in particular, need to understand parametric solutions, as existing offerings revolve around indemnity-based solutions that have been around for decades.

Another notable partnership went live in September 2024 when CelsiusPro’s technology enabled New Zealand and Pacific insurer Tower to upgrade the distribution of its parametric Cyclone Response Cover to micro and small enterprises, independent farmers, mariners, rural communities and retail customers across Pacific island states.

Again using CelsiusPro’s white-label platform, Tower customers are able to get quotes, purchase policies and receive payouts via their mobile phone.

Rueegg explains that Tower can now offer its clients cover for natural catastrophes including tropical cyclones, earthquakes and flooding “very easily” using the platform and it basically takes an “enormous section of the insurance value chain and digitalises it”.

The firm’s approach to innovation has also been recognised globally, with its work insuring vulnerable women in India against extreme heat having been profiled by the UN Development Programme and discussed at the 2024 International Conference on Inclusive Insurance in Nepal.

Parametric insurance progress

The continuing desire from the insurance industry to evolve has led to more progress on parametric offerings, ultimately driving CelsiusPro’s advances. Unlike traditional indemnity-based insurance, parametric solutions pay out based on the occurrence of a predefined triggering event such as an extreme weather event or a natural catastrophe.

Such covers are expected to play a more prominent role in future (re)insurance transactions.

Rueegg says parametric offerings had been in the industry for some time but are only now starting to gain widespread acceptance.

“You needed to have more players coming into the market and realising there is room for these insurance policies,” he explains.

“This is not a substitute for traditional insurance, but it’s basically an add-on.

“It’s a simple supplementary cover that has its own benefits in areas where you can’t easily get to when we talk about natural catastrophes, where a whole region is affected and the typical claims mechanism would take a long time to be assessed and settled.”

He explains that increased education and practical use cases for the concept have prompted wider acceptance.

“A lot of people talk about parametric insurance and then think, ‘Okay, I think I get the concept’, but with the education, [and] visualisations and technology, we’re making it truly accessible.”

He adds that CelsiusPro’s technology demonstrates how the process behind parametrics has become accepted by combining climate data, visualisation, pricing, execution and settlement with an intuitive interface.

Future

Addressing the future, Rueegg says that while the firm is looking at new developments, “mainstreaming what’s already there” is just as important.

“Innovation is also ensuring everyone has access to what’s already there,” he says.

“So many products have been already structured, but if it’s [established] in one structure that a broker used in one part of the world, well, why don’t we just put it on a platform so everybody can use this very efficiently?”