UK’s Lloyd’s marketplace has launched the first retail parametric cyclone insurance cover for customers in Northern Australia.

The new offering, called ‘Redicova’, is supported by Lloyd’s Disaster Risk Facility (DRF) and led by Beazley.

AXA XL, Hiscox and RenaissanceRe, members of DRF at Lloyd’s, will offer initial reinsurance support for the new offering.

Parametric policies offer pay-out claim amount based on the local parameters such as the wind speed of the cyclone.

Redicova is an autonomous offering, which will pay out claims to insureds without the need for physical assessment.

Lloyd’s regional head of Australia & New Zealand Chris Mackinnon said: “Redicova will provide fast support for local communities and businesses in Northern Australia who are impacted by severe tropical cyclones.”

Redicova uses track maps to follow cyclones and plot their journey. It also uses data from the Australian Bureau of Meteorology.

Beazley head of property covers Alex Hardy said: “Our support for this new parametric cyclone product in Australia demonstrates Beazley’s commitment to providing new and responsive solutions to customers who could be adversely impacted by climate change.

“The application of data and insurance insight to create an insurance solution that responds quickly and efficiently at the point of a loss is a great example of taking an innovative and client-centric approach to risk mitigation to help support clients at the time when they need us most.”

Last week, K2 Insurance launched a new managing general agent to offer parametric insurance coverage in the US.