Data-Based Insurance With Rapid Payouts

• Sponsored by: Vortex Weather Insurance
• July 14, 2025

The rise of big data is giving independent agents new insurance products to sell to business owners in coastal areas and to operators of outdoor events nationwide. With parametric weather insurance, business owners can skip the cumbersome claims process following a weather-related financial loss and get the help they need quickly, according to Andrew Klaus, vice president of business development at Vortex Weather Insurance.

“For business owners, there are protection gaps within the traditional insurance marketplace, and parametric insurance can help to fill those gaps,” Klaus says. “Most agents don’t know that this type of coverage exists, so we’re working to change that.”

Based in Overland Park, Kansas, Vortex offers parametric rain insurance for outdoor events, such as golf tournaments, concerts, fairs and carnivals. Using historical weather data, Vortex creates policy options specific to clients’ coverage needs and weather risks. If the policy conditions are met, the policyholder automatically receives payment, with no additional documentation needed.

Policyholders choose the specific date, time window and location for which they want coverage, and if the amount of rainfall defined in the policy occurs during that period, the policy automatically pays out. The rainfall data just has to be recorded by a verifiable, independent and localized source.

Prior to big data, it was difficult or impossible to verify weather data for the specific locations of outdoor events, so parametric policies were either unavailable or were based on data from the nearest airport or weather station. But now that verifiable third-party data is available for just about any location, parametric insurance is rapidly gaining a foothold in the insurance marketplace, Klaus said.

When rainfall keeps crowds at home but the event still goes on, rain insurance can help business owners recoup that lost revenue. “Claim payments typically are mailed in less than two weeks, providing immediate financial relief,” Klaus says.

Similarly, Vortex provides supplemental hurricane and hail insurance to protect businesses from coverage gaps and high deductibles in their traditional insurance policies. Policyholders choose their desired level of coverage, and Vortex uses historical weather data to create affordable policy options.

Vortex’s hurricane policies pay out if any category of storm tracks within 30 miles of a covered property or if a Category 3 or stronger hurricane tracks within 60 miles of a business. Policies automatically pay out according to verifiable weather data, so policyholders don’t have to incur losses, prove damages or see a claims adjuster. Payments also increase based on the intensity of the storm and how close it tracks to a covered business.

“Hail insurance is especially popular among solar-energy installations and auto dealers with outdoor parking lots,” Klaus says. “Business owners in hail-prone areas also seek out supplemental coverage for damage to their roofs and windows.”

“Vortex’s policies are structured to automatically issue payouts when predefined conditions are met, providing customers with greater confidence in the product and assurance that the claims process is objective and free from arbitrary interpretation,” Klaus says. “Parametric insurance is “another tool in the toolkit” for insurance agents, a previously untapped source of revenue and an opportunity to build relationships with new commercial clients,” he adds.

“Parametric insurance really is changing the industry because the terms are so transparent,” Klaus says. “Everything within a parametric insurance policy is specified prior to the insured signing on the dotted line, so they know exactly what they’re getting before they make the purchase. This is data-based insurance, which makes the payment process much more streamlined.”

To learn more about Vortex’s parametric insurance policies, visit Vortex Weather Insurance.

Nick Fortuna is a freelance writer and editor.