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Digit Insurance and KMD Launch India’s First AQI-based Parametric Insurance.

Banking & Finance | Dated: 27 Feb 2025

In February 2025, Go Digit General Insurance Limited (Digit Insurance), in collaboration with K.M. Dastur Reinsurance Brokers (KMD), introduced one of India’s first Air Quality Index (AQI)-based parametric insurance policies for migrant labourers impacted by construction bans during high pollution levels in the Delhi National Capital Region (NCR).

🎯 Key Highlights:

  • - The policy is designed to mitigate salary losses for construction workers during periods of construction bans due to air pollution.
  • - When the AQI in Delhi exceeds 400 for more than two occasions, the parametric insurance will provide payouts of up to Rs 6,000 for 6,200 migrant workers.
  • - The policy stipulates that a "strike" is defined when the AQI remains above 400 for at least three of the five preceding days, with a minimum 25-day gap between strikes.

💡 Other Important Facts:

  • (i) Construction bans are often enforced through government and court orders to address severe pollution levels in the region.
  • (ii) Parametric insurance offers a straightforward, transparent, and effective solution to address the financial challenges faced by workers due to environmental factors in the area.

📚 Test Your Knowledge:

Which company launched India’s first AQI-based parametric insurance policy?

Correct Answer: Digit Insurance

🚀 Quick Recap: