When parametric insurance became a lifeline in Morocco’s 2023 earthquake
2 min
"Insurance, when used in partnership with public organisations, can make a huge difference."— Hamza Ouazzani
A Story by Hamza Ouazzani, Head of Actuary, Formerly Head of Reinsurance, AXA Morocco
I live in Casablanca – more than 200 kilometres from the Marrakesh region, where the earthquake hit. I had just put my children to bed and gone to bed myself. We were sleeping but were woken up by the shock of the earthquake. I grabbed the children and went outside, where others were gathering.
"Even if we only have an indirect role, we know that we are able to help people. That’s what makes our work meaningful. We have a social role to play."
After a while it calmed down and we were able to go back into our homes. In the morning, we started to get more information about what had happened. It had been a huge earthquake – 6.8 on the Richter scale – and had primarily struck mountainous areas, where there are lots of villages with fragile family houses that are not built to resist this kind of shock.
I worked on parametric coverage of the earthquake. This is something that I am really proud of and makes so much sense in a situation like this. It means that people will be entitled to automatic compensation as soon as an event hits certain parameters; they do not need to file a claim.
This was very useful, because there were so many uninsured people living in rural villages. They were covered by a solidarity fund set up by the Moroccan government, which is supported by AXA Climate. That meant that when the earthquake struck, we could measure the intensity of it and quickly send money to victims. We did not need to wait for people to declare that they had been impacted or to analyse how much they were entitled to. It is so important to be ultra-fast in such critical times. I think it was very clever to set up parametric insurance for the solidarity fund.
It is an undeniable proof that insurance, when used in partnership with public organisations, can make a huge difference, even to people who aren’t insured. It was hard to see the images coming out of the affected zones, and lots of us knew someone impacted. But we knew that we could do something to help, that what we were doing was important and there was meaning to it.
