Global Parametrics, a financial risk management company specialising in parametric solutions for natural disaster and climate-related risks, has reported that USD 400,000 in payouts has been triggered through the Natural Disaster Fund (NDF) to support communities affected by drought in Pakistan and Ethiopia.
The payouts form part of a multi-country drought protection programme operated by international charity Tearfund through the NDF.
Global Parametrics said the arrangement is intended to make financing available ahead of a crisis, with funds released when predefined conditions are met. This allows resources to be directed towards anticipatory measures ahead of expected impacts, including losses associated with poor agricultural seasons.
The drought cover was developed by Global Parametrics, with part of the premium costs supported through a subsidy provided by Humanity Insured. The company said the cover generated a USD $100,000 payout in Pakistan and a further USD $300,000 payout in Ethiopia after drought conditions met the relevant parameters during the agricultural seasons.
According to Global Parametrics, the financing is connected to anticipatory action plans established through a project supported by the NDF Technical Assistance Fund (TAF). The company said these plans are intended to help communities prepare for and manage the effects of drought before conditions develop into a wider humanitarian crisis.
The programme has also involved discussions between Tearfund’s Ethiopia country team and KfW Country Director Jonas Dylla. Global Parametrics said the discussions examined how anticipatory approaches could be incorporated into disaster risk management and how trigger-based financing could contribute to broader efforts to manage exposure to natural hazards.
Global Parametrics described the role of parametric insurance in supporting earlier intervention, stating: “Parametric insurance is designed exactly for this: to help build resilience before disaster becomes a crisis and ensure finance is there when it can have the greatest impact.”
The company noted that the underlying product was established with support from a catalytic grant from the NDF Technical Assistance Facility. Global Parametrics explained that the NDF receives funding from the UK government’s Foreign, Commonwealth and Development Office and Germany’s development bank KfW, acting on behalf of the German Ministry for Economic Cooperation and Development (BMZ).
The NDF’s public funding is combined with matching risk capacity from Hannover Re. Global Parametrics also noted that the NDF announced in June 2026 that global re/insurer MS Amlin had become an additional risk capacity partner.
The latest payouts illustrate how parametric risk financing can be structured to provide funding when predefined environmental conditions are reached, rather than relying solely on assessments of losses after a disaster has occurred. In this programme, Global Parametrics said the financing is connected to pre-established plans for anticipatory action in drought-exposed communities.
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