Mitsui Sumitomo Insurance Co. said Monday it will offer “typhoon derivatives” contracts to protect client companies from typhoon-related losses this year.
The contract is designed for hotels, transporters, restaurants, leisure facility operators and other businesses exposed to risks from typhoons, the property and casualty insurance company said.
The derivatives scheme sets the minimum amount of premiums at 500,000 yen and pays insurance money when the center of a typhoon passes to within a specific distance from a predetermined point in the 47 prefectural capitals on at least three occasions.
Under a scheme for Chiyoda Ward, Tokyo, up to 5 million yen will be paid for an insurance premium of 500,000 yen.
Mitsui Sumitomo will offer two indemnity periods — July 1 to Oct. 31 and Aug. 1 to Oct. 31 — from which clients can choose.
The insurer will accept orders from the typhoon derivatives product until June 16.