Council authorizes staff to add parametric earthquake insurance option after presentation on quick liquidity
Loading...
Summary
Council voted unanimously to authorize staff to add a base-level parametric earthquake insurance option, citing the product's ability to provide quick discretionary funds after an event; staff noted an annual premium estimate and a response deadline from the risk pool.
The Rio Veil City Council voted 5-0 to authorize staff to add a base-level parametric earthquake insurance option after staff described how the product could provide quick liquidity after seismic events.
City staff relayed a proposal presented to the joint risk pool (SCORE) by K2 Parametric Insurance Services. The staff summary gave a sample annual cost of $13,730 for a coverage cap of $500,000 and noted SCORE requested member jurisdictions indicate interest by Dec. 19, 2025. “For Bridal Del, the proposal would be an annual cost of 13,730 for a maximum coverage of, $500,000,” staff said.
Staff described how parametric insurance differs from traditional coverage: payouts are triggered by measurable ground-shake metrics rather than loss-adjusted claims, and proceeds can arrive quickly. As an example, staff said parametric coverage would have produced roughly $450,000 in discretionary funds within 30 days for the December 2022 event, which could have helped with immediate cash-flow needs while federal or state reimbursement processes proceeded.
Supporters said the policy adds a tool for the city to respond to events when federal or state aid is uncertain. Council members asked about payout levels and a lower-cost "light" option; staff said payout tables and alternative levels were included in the packet.
The council authorized staff to proceed with the base-level parametric insurance option; staff will respond to SCORE by the requested deadline and return any necessary contract paperwork to council as required.
