Tower has announced the launch of its Cyclone Response Cover pilot ahead of the upcoming cyclone season, offering peace of mind and extra financial security to the people of Tonga.
Cyclone Response Cover provides a rapid cash pay-out when a customer is impacted by a high wind speed cyclone event, regardless of damage and without the need for an insurance assessor’s signoff.
Tower Head of Pacific Retail Distribution Joanne Rasmussen says, Cyclone Response Cover will help dramatically increase insurance accessibility, particularly as climate change impacts increase over time.
“Tonga was ranked as the third most at-risk country for natural hazards in the 2021 World Risk Report, but like much of the Pacific, less than 10% of families have insurance.
“Cyclone Response Cover will lessen the burden on local communities and their support networks, enabling them to recover from cyclone damage quickly. We’re doing what’s right by our customers and communities.”
For the pilot, Tower customers have a choice of three product options, ranging from TOP$1,000 to TOP$10,000, based on the amount of cover they feel they need to fast-track their recovery after a cyclone event.
“You are guaranteed to be paid out, if a Cyclone meets certain criteria in your area, no questions asked and no insurance assessment needed. We aim to process payments within seven days,” says Ms Rasmussen.
Tonga is heavily exposed to weather events, including cyclones. At times, locals are left to rely on their savings, borrow money or seek cash elsewhere to start their recovery during a cyclone crisis.
In 2018, Tropical Cyclone Gita made landfall in Tonga, the impact on the country was significant with approximately TOP$10.3m in claims paid out by Tower alone, known as National Pacific Insurance (NPI) at that time. In 2020, Tower paid out more than
TOP$2.1m in claims to customers after Tropical Cyclone Harold. “When we began officially rebranding from National Pacific Insurance to Tower last year, we promised the people of Tonga that the Tower name would come with new and improved offerings,” says Ms Rasmussen.
“We are so proud to be delivering on that promise so strongly already, with the launch of My Tower Tonga in February and now, with our Cyclone Response Cover pilot.”
Cyclone Response Cover was first trialled in Fiji for the 2022/2023 cyclone season in collaboration with the United Nations Capital Development Fund (UNCDF), under its flagship Pacific Insurance and Climate Adaptation Programme. Following the success of the pilot, Cyclone Response Cover is now available to all Fijians.
For Tonga’s Cyclone Response Cover trial, Tower has also partnered with the Tonga Development Bank and the Pacific Disability Forum. The product is available to bank customers and forum members for the 2023/2024 cyclone season, with the goal of launching the product to the wider Tongan market next year.
Tonga Development Bank Manager Silia Tupou says, Cyclone Response Cover’s streamlined claims and settlements process will benefit bank customers.
“Parametric insurance can provide some peace of mind at either a more affordable price point or in situations where more traditional policies are simply unavailable. The claims process is also simpler and the payouts are faster.”
Delegations from the UNCDF, Tonga Development Bank and Tower met last week, to officially launch the pilot programme in Tonga.
Bank customers and forum members interested in the pilot can talk to their respective organisations or visit the Tower Tonga branch.
