The policy, which uses parametric triggers, is the first of its kind in India and was issued to The Phoenix Mills Ltd, a company operating malls, hotels, and office assets across the country.
This insurance product provides coverage for business interruption losses caused by epidemic or pandemic events, including loss of revenue and additional expenses.
The aim is to help businesses maintain financial stability and operational continuity during future public health emergencies.
The COVID-19 pandemic exposed vulnerabilities in business continuity planning, particularly for sectors dependent on physical locations.
According to The Tribune’s report, The Phoenix Mills Ltd experienced prolonged closures and significant revenue loss during the last pandemic, prompting a search for more robust risk management solutions.
Kailash B Gupta of The Phoenix Mills Ltd said the company directly felt the effects of the previous pandemic, with retail locations shuttered for five to eight months and no revenue coming in while fixed costs persisted.
“That experience has left a lasting impact on the financials of many corporates, including ours. This new insurance solution provides us with the assurance that we are now better equipped and more resilient to face such events in the future,” he said, as reported by The Tribune.
Gallagher structured the policy to meet local needs while leveraging international reinsurance capacity. The product covers non-damage business interruption (NDBI) losses and is designed to provide a degree of financial certainty in the event of future outbreaks.
Puneet Gehani, chief broking officer at Gallagher Insurance Brokers Pvt Ltd, India, said developing this pandemic insurance product demonstrates the company’s focus on evolving risk solutions for the Indian market.
“At Gallagher, we don’t just place policies – we unlock global capacity, local relevance, and rapid response. In moments of crisis, clients deserve more than coverage; they deserve clarity, speed, and certainty. This solution delivers all three,” he said.
The policy is reinsured by Munich Re’s Epidemic Risk Solutions team, which specialises in pandemic risk management.
The parametric model allows for payouts based on predefined triggers, such as the declaration of an epidemic, rather than waiting for traditional claims assessments. This approach is intended to facilitate faster recovery for affected businesses.
Prashant Khandelwal, head – banking and treasury at The Phoenix Mills Ltd, noted the importance of collaboration in developing the policy.
“Poonam and I conducted an in-depth review of the various aspects of the policy and articulated the nuances of our business to the team of experts at Gallagher. This collaborative exchange played a pivotal role in shaping the overall structure of the policy,” he said.
Surbhi Goel, CEO of Munich Re India, said the launch of India’s first Epidemic Risk Solution policy, developed in collaboration with New India Assurance, Gallagher, and Phoenix Mills, marks an important move toward strengthening pandemic preparedness.
“This product combines the power of parametric with innovation to provide swift financial protection when outbreaks disrupt business operations,” she said.
Ajay Sadana, head of origination for Asia at Munich Re’s Epidemic Risk Solutions, added that insuring pandemic risk requires broader financial mechanisms, including involvement from capital markets, to distribute risk and strengthen the insurance ecosystem.
New India Assurance, the country’s largest non-life insurance provider, issued the policy as part of an NDBI package for Phoenix Mills Ltd.
Girija Subramanian, CMD of New India Assurance, highlighted the company’s long-standing presence in the Indian insurance sector, noting its track record of launching new products to address evolving risks over the past 106 years.
“The company takes pride in its milestone contributions, especially in providing insurance solutions during the pandemic, reinforcing its commitment to safeguarding businesses and society,” she said.
In a separate development, Indian authorities are in the early stages of considering a nationwide insurance program to address losses from climate-related disasters.
The proposed scheme would use a parametric model, providing predetermined payouts when weather indicators such as rainfall, temperature, or wind speed cross set thresholds.
This approach is intended to accelerate compensation for policyholders affected by events like floods and heatwaves, reducing the time required for claims processing compared to traditional insurance.
Discussions are underway between the National Disaster Management Authority, the Ministry of Finance, GIC Re, and other major insurers to determine how the scheme could be structured and funded. A senior government official, who declined to be named, confirmed the ongoing talks.
