Sompo Japan Nipponkoa Insurance plans to introduce, by the end of March 2020 at the earliest, a flood insurance policy for businesses that pays out the same day that sensors detect a specified degree of flooding. This move is the first by a major Japanese insurer to promise payouts on the day of a disaster.
The insurance policy will offer fixed premiums and payouts.
The Japanese insurer worked with disaster-prevention researchers at Kyoto University to develop a sensor system that uses Internet of Things (IoT) technology, reported Nikkei Asian Review. The low-cost sensors are designed specifically for insurance purposes and cost about JPY100,000 ($920) each, about one-tenth that of existing devices.
Sompo Japan believes there is a market in the country for such quick-response policies. Japan has suffered many floods in recent years, such as that caused by Typhoon Hagibis last month.