Parametrics offer a way to address risk that is simpler than regular insurance.

Let us say you run a ski resort. Clearly, your economic well-being depends on how much snow falls in a given season since otherwise, you’ll need to use snow-making machines, skiers may not arrive, etc. You might be interested in an offering along the lines of  “You pay $10,000. If the region gets less than 3 inches of snowfall, you’re paid $1 million”.

The general statement of a parametric offering is

``If you pay me X and if bad thing Y happens, then I will pay you Z.``

Y is viewable/measurable by all parties.
Thus there is no argument about whether Y did or did not occur.
Z is determined in advance
Hence, there is no claim process to determine your loss.
The price and payout of a parametric may be fixed, or the buyer may select them via an online slider.
Parametrics may be offered per event or per month or per quarter etc., not just annually.
Parametrics may be billed via credit card and may auto-renew.

If an earthquake of intensity more than X strikes within Y miles of your house, we will pay you $Z. 

If the ship holding your container fails to dock/unload within N hours, we will pay you $X

If your website home page fails or your e-commerce confirmation page fails or your SLA is in breach, we will pay you $X.

If your flight is delayed by more than N hours, we will pay for your ticket.

If sensors embedded in your wind turbines indicate impending failure past some threshold, we will pay you $X.

If you get a notice-of-audit with respect to some regulation, we will pay you $X. 

If the train takes more than N minutes to arrive during your morning commute, we will pay you $X.

If a sensor in your automobile indicates impending failure, we will pay you $X


In order to provide any parametrics, it is necessary to have two pieces of technology. They are:


The technology to scan (if needed) any set of IP-addressable devices (websites, servers, IoT sensors…) in push as well as pull mode, combination of the gathered data with other databases and analysis of the results via the appropriate machine-learning algorithm. 

This serves two purposes: 

  • Estimating the probability of out-of-band behavior and hence the price structure of the relevant parametric.
  • Determining whether/when a given parametric offering has actually triggered.


A platform to enable the selling and servicing of any parametric offering. There are many sales+service scenarios, including but not limited to:

  • Insurance carriers and MGAs selling parametrics as ‘bolt-ons’ to base insurance offerings
  • Insurance brokers selling parametrics as part of larger multi-risk packages
  • Non-insurance companies selling parametrics as ‘warranties’ atop what they sell anyway.

Machine Cover's entire technology stack is accessible via secure, access-controlled ReST APIs. This allows our partners to integrate the Machine Cover offerings directly into their websites and mobile apps.


Parametrics can be created for personal lines, commercial lines and outside insurance altogether. In fact carriers and reinsurers can expand revenue beyond insurance channels using parametrics.

To begin with, Machine Cover has created parametric offerings for the three cases below.


There are roughly 31 million US-facing websites. All websites get ‘impaired’ at some point. By impaired, we mean either down or very sluggish.

Websites may become impaired for a whole host of reasons but the business owner is really concerned with only one thing –their website is not running. We monitor all 31 million websites for impairment every 30 minutes.

Our offering is

“If your website normally runs fine, and it is impaired for over 24 hours, we will pay you $X provided you paid our fee of $Y per month per $1000 payout”.

Contact us to obtain the documentation to our API.


The global air travel market is $568 billion annually. The US market is roughly 25% of this.

If your flight is more than (say) 2 hours late, you’re annoyed because of missed meetings & connections, wasted time, lost sleep, etc.

Analyzing all 200 million US flights since 1989 shows that the probability of delay by more than 2 hours is around 2%. A mashup with weather data and a few other things, leads to an estimation of delay per flight.

Our offering is

“If you pay us $X per $100 of ticket cost and your flight is more than 2 hours late, we’ll immediately refund your ticket.”

Contact us to obtain the documentation to our API.


The US Govt. has roughly 1600 locations that collect weather-related information every few minutes, mainly for aviation purposes. Wind-speed is part of that. A mashup of that with satellite feeds, Google Maps and a few other things, leads to our offer below.

Crudely speaking, wind-speeds exceeding 100 mph are able to damage property, uproot trees, etc. If there is a wind-storm near a house, it may of course damage the house, but it may also knock down trees, force evacuations, damage schools and daycare centers, swamp roofers with business, etc. –many of which are not covered by homeowner policies.

Our offering is

“If wind speeds recorded by a US weather station within 20 miles of your house exceed 100 mph, we will immediately send you $10,000.”

Contact us to obtain the documentation to our API.


Machine Cover, Inc. is a Boston-based company.

We jointly explore parametric offerings with our clients.

We use artificial intelligence and machine-learning to analyze
vast amounts of data pertinent to parametrics.
We help our clients establish the price structure for
any parametric they offer.
We provide our clients with all the tools and support
they need to sell and service parametric offerings.



Former Chairman & CEO of CNA Insurance. Serves on the Board of the Chicago Mercantile Exchange


Chairman at Ascendant Group & previously President at Renaissance Reinsurance Services


Board of directors at the Zurich Insurance Group. Previously CEO, Global Consumer Insurance at AIG and President of International Operations at the Starr Companies


Former Chief Marketing Officer of MetLife


President of the Brokerage Division of CRC Insurance, a leading US MGA


former Founder/CEO of Equity Risk Partners, a leading insurance broker


CEO of MetLife Asia


CEO of Allianz France (the former Assurances Generales de France, the national French insurance company) & Chairman of Allianz Worldwide Partners



He has supervised or been involved with operations, technology, and product development at WebMD, which was recently sold for $2.8 billion. He has founded and run several companies and before that he worked as a consultant at Bain & Co., mainly involved in M&A activity. 

He holds an MBA from Stanford University. He also holds degrees in Solid State Physics from the Indian Institute of Technology, New Delhi and an MS in Computer Science/Mathematics from the Rensselaer Polytechnic Institute in Troy, NY. He has done graduate work in Byzantine & Ottoman History at Harvard & is a licensed helicopter pilot.


Please email us at info@machinecover.com

Machine Cover